VIG aims for the top three markets in Central and Eastern Europe by 2025

SOFIA (Bulgaria), June 9 (SeeNews) – The Vienna Insurance Group (VIG) aims to be among the top three players in every Central and Eastern European (CEEC) market except Slovenia by 2025 with a focus on financial stability and profitability, proximity to customers, sustainability and market growth, CEO Elisabeth Stadler told SeeNews.

“We want to achieve this through organic growth, but we will also consider possible acquisitions. Like I said, we are aiming for this Top 3 goal, but of course the right opportunities have to present themselves. Because we stay true to our overarching premise that only profitable assets that match our strategy will be an option for us, ”Stadler said in a recent interview with SeeNews.

In the face of the challenges of the ongoing pandemic, the VIG Group has shown strong resilience to unpredictable events and implemented all projects that had been planned or underway before the crisis hit, noted Stadler.

“We have had a very strong performance, premiums and the combined ratio are at the same level as the previous year and earnings have increased significantly,” she added. “We had great success before the start of the pandemic, have so far gotten through this unique global situation very solidly and are already seeing a return to the levels reached in the first quarter of 2019.”

The VIG Group announced premiums of 3.11 billion euros and an annual increase of 5% of its profit before taxes to 128 million euros for the first quarter.

OPTIMISM takes hold

The return to pre-crisis levels gives VIG grounds for optimism about achieving its goals for 2021.

“Although the economic recovery in most countries in the EEC region is being delayed due to the increase in infection rates that we have seen since the fall of 2020, we are confident that we will meet our targets for 2021, this which means premium volume at 2020 level with 10.4 billion euros, profit before tax between 450 and 500 million euros. Vaccination rates will be essential to ensure tangible economic improvements, and we are currently seeing progress significant in this area in many of our markets.

Stadler attributed the group’s stable development in this exceptional global situation to its great diversity across countries, brands, distribution channels and products, and heavy investments in timely digitization. “It has also been shown that insurance policies that concern protection and security are very important, especially in times of crisis,” she added.

Regarding the financial parameters set in the program for the next four years, Stadler said VIG is aiming for a premium volume of around € 12.3 billion by the end of 2025.

“This represents an average annual increase in turnover of around 380 million euros, based on the 10.4 billion euros recorded in 2020. The objective is to achieve a combined ratio of less than 95% “, she noted.

Based on the new strategy and given the current operating environment, the solvency ratio target is between 150% and 200% because this range does not take into account the transitional measures that the group is currently using. A new indicator, the return on operational equity (RoE), which should be greater than the cost of equity and thus set an objective in terms of sustainable value creation, will be presented in external communications from the 2021 annual results.

MARKET-SPECIFIC APPROACH

The group also aims to create sustainable value by gaining the cost of equity and to achieve environmental, social and governance objectives with respect for society, customers and employees.

To achieve its goals, VIG has refined its country portfolio and differentiates between its main EEC market which includes 20 countries including Austria, and special markets such as Georgia, Germany, the Nordic countries and Turkey. with their own specific goals.

“We have defined portfolio groups with different objectives within the 20 CEE markets, in accordance with the respective market potential,” said Stadler.

The new strategic program also includes a reorganization of the country responsibilities of the members of the group’s management board along regional lines.

South East Europe (SEE) is defined as the Southern Region and will be under the responsibility of board member Peter Höfinger. The Southern region includes Croatia, Serbia, Romania, Bulgaria, Albania, Kosovo, North Macedonia, Bosnia and Herzegovina, Montenegro, Moldova and Slovenia.

“Our program is based on an analysis of key trends and their effects on the insurance industry. Low interest rates, increased regulatory pressure and the growing importance of environmental issues have shaped the market facing insurers for many years. Sales will become more and more hybrid – which is underlined in particular by our experience during the pandemic – with a mix of personal and digital contacts, ”explained the CEO.

“The frequency of customer contact is decreasing, which means visibility to customers is growing in importance, and we also want to deliver new customer experiences that go beyond risk coverage. Despite the ongoing digitalization, the people and expertise of our employees clearly count for a lot at VIG. And that will give us the opportunity to tap further growth potential by using new approaches to reach out to customers, ”she added.

CORE SOCIAL RESPONSIBILITY

To create sustainable value, the group will initiate various measures focused on the company, customers and employees, including an increase in green investments, as well as the newly defined goal of making office operations in all companies of the group climatically. neutral by 2030 at the latest.

“We have consciously included a strong emphasis on social responsibility in the objectives that we have defined for the group, alongside financial indicators, because it is a particular concern for us to anchor this subject more strongly in the markets of the ‘Central and Eastern Europe,’ Stadler said.

She highlighted the general low level of awareness and personal financial education in SEE as the main reason for the latent high demand for insurance.

“Our idea is to play an active role in improving financial awareness through initiatives to increase awareness and knowledge, create networks and provide individual risk solutions aimed at improving reputation. and brand awareness in the local market. “

The group plans to set up an awareness program on the importance of retirement savings and the benefits of insurance, which will be launched in three quarters of the EEC markets by 2025.

Digitization, which has gained particular momentum, especially due to the pandemic, will also remain a major topic for VIG over the next four years.

“Without a doubt, and I mentioned that in sales, for example, we’ll see a hybrid model of digital and face-to-face contacts and digital services will continue to increase,” Stadler said.

As an example, she cited ‘beesafe’, the group’s first purely digital insurer, which was established in Poland with auto insurance, with the intention of rolling out the model to other interested companies within the group. .


Source link

About Eleanor Blackburn

Check Also

Too early to say if lockdown will end on June 21, says UK minister

BERNE: How vaccines can be distributed equitably to the world’s population has upset world leaders …

Leave a Reply

Your email address will not be published. Required fields are marked *