Suduiraut - June 11, 2004

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Suduiraut - June 11, 2004

• AXA Belgium
• Financial Protection in Action
• Alfred Bouckaert, CEO AXA Belgium

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Contents

• 1 Evolution of the Belgian Market
• 2 AXA in Belgium
• 3 Results summary
• 4 Strategic priorities
• 5 Conclusion

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High savings rate has fueled a strong growth in
Life and Savings
CAGR 9,5
CAGR 7,6
CAGR 25,6
CAGR 4,1
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Belgian distribution landscape has changed (Life
PC turnover)
Clients
Brokers 37
Bank channel 35
Tied Agents 8
Mutual 13
Direct 7
Insurance GWP evolution 1994/2002 10.035/22.169
mio (121)
Source UPEA
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The Belgian insurance market has undergone
considerable concentration
x 1.000.000
1996
2002
Top10 74 of the market
Top10 85 of the market
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Furthermore, Belgium has become a bank insurance
market

• Fortis (AG, Générale, CGER)
• ING (BBL, La Patriotique, ING)
• KBC (KB, ABB, CERA)
• Dexia (Dexia, Artesia, BACOB, DVV, Corona)
• AXA (AXA Belgium, Anhyp, IPPA, Royale Belge)
• AXA distribution through self employed brokers
  and bank agents
• Retail banking only

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Contents

• 1 Evolution of the Belgian Market
• 2 AXA in Belgium
• 3 Results Summary
• 4 Strategic Priorities
• 5 Conclusion

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Our mission Financial Protection
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1999 - 2001 merger of AXA in Belgium
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AXA Belgium distribution channels

• Specialized Brokers for large and medium-sized
  Companies (300)
• General Brokers for individuals and
  self-employed (12,000 - 2,700 professionals)
• Bank agents (950)
• La Poste
• Viaxis social finance
• Partnerships car manufacturers, banking
  partners, ...

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2002 integration into a financial protection
group

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A client facing organization
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A new retail organization became operational on
January 1, 2004

• Two main channels bank agents brokers
• One sales management
• broken down per product at the sales level
• integrated at area level
• with efforts and staff focusing on the best
  producer

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Contents

• 1 Evolution of the Belgian market
• 2 Organisation of AXA in Belgium
• 3 Results Summary
• 4 Strategic Priorities
• 5 Conclusion

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AXA is a leader of the Belgian market

• Market Market Share 2002 Volume 2002
• 1 PC 18.0 7 873 M
• 1 in Motor 20.2 2 735 M
• 2 in Property 16.4 1 656 M
• 1 in Worker comp 23.5 1 011 M
• 1 in Liability 19.4 614 M
• 5 LIFE 11.8 14 432 M
• 4 Individual Life 11.5 11 089 M
• 3 Group Life 12.8 3 342 M
• 2 PC LIFE 13.9 22 305 M

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We have stabilized our market share in PC ...
Global growth of the Belgian market 2000 - 2002
10,9
Growth
Written premiums
2002 size of the market 7 873 M
Source UPEA
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significantly improving our combined ratio and
our underlying earnings

• Combined ratio has improved with 10 points
  between 1999 and 2003.
• Underlying earnings doubled between 2002 and
  2003, to 118 mio adjusted earnings.

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In Life we generated growth and improved earnings
to 94 mio in 2003
Global growth of the Belgian market 2000 - 2002
12,1
Growth
Written premiums
2002 market size 14 432 M
Source UPEA
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In Life, premiums growth is significant and
outperforming traditional insurers and
bank-insurers
Belgian market
CAGR 16
AXA Belgium
CAGR 24
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We renewed growth in bank savings accounts and ...
In Mio
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doubled our market share in mortgage loans (12
in 2003 vs. 5 in 2001)
Mio
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Expenses are being reduced ...
Economic expenses (in Mio )
- 10 over 3 years
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... while strictly controlling FTE evolution
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Top of mind and spontaneous awareness (april
2004)
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Perceived activities AXA vs competition
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Contents

• 1 Evolution of the Belgian Market
• 2 AXA in Belgium
• 3 Results Summary
• 4 Strategic Priorities
• 5 Conclusion

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Priorities in AXA Belgiums Strategic Plan
Increase growth
Maintain profitability
Improve efficiency
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Increase growth in Life and Savings

• Double the banks size
• Increase loyalty
• Develop cross-selling with bank and PC database

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Maintain profitability in P/C

• Retention of existing base
• Focus on best risks (seniors, geographical
  focus)
• Further improve claims management
• Further streamline processes

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Improve efficiency

• A continuous process
• Further cut cost base
• Complete systems upgrading

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An integrated customer policy for growth and
loyalty

• Our growth strategy is mainly based on
• customer loyalty
• growth through cross-selling

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Significant potential of our customer base

• AXA Belgium owns 50 of Belgian households

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Our potential

• Cross-selling rate is only 1,5 contracts.

Cross-selling rate number of AXA products hold
by household
1 product group
2 product groups
3 product groups
4 product groups
5 product groups
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As you sow, so you reap
1st step Customer loyalty
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Motor Wildcard (November 2003)

• Target
• Bonus Malus 0 (best level) for two years by AXA
• Goal
• A 30 reduction in lapse rates
• on good risks
• Action
• The next claim is free

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Home Wildcard (March 2004)

• Target
• AXA customers with no claim in
• the past two years
• Goal
• Cut lapse rate by 20 on
•  good risks 
• Action
• 200 cash, if claim gt 1.500

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Mass Affluent

• Target
• AXA customers with more than
• 50.000 assets under management
• Goal
• Increase level of Mass Affluent
• AUM of 5
• Action
• Free banking account free banking cards
• Yearly financial check-up
• Services relationship advantages

65,177 Mass Affluent (AUM gt ?50,000)
702,283 L I customer base
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As you sow, so you reap
2nd step Cross-selling
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From Motor to Home

• Target
• Motor Wildcard without Home
• Goal
• 10 cross-selling
• Action
• 2 months free on purchasing Home
• insurance
• Home Wildcard if no claim in 2 years

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 Good risks  targets on which cross-selling
actions will be implemented
Cross-selling targets
691,000 Home customer families
763,632 Motor customer families
65,177 Mass Affluents (exp. gt ?50,000)
2 nd step LI customer families who over 45
years
702,283 L I customer families
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HIP concept for our VIP customers

HIP
HAPPYIMPORTANTPEOPLE
Happy Drive
Happy Home
Happy Life
Happy You

• Differentiation
• MA programme AUM gt 50,000 products, services
  relationship advantages

• Differentiation
• Wildcard
• Confidence guarantee

• Differentiation
• Pension build-up management programme

• Differentiation
• Wildcard
• VIP product (in co-operation with AXA Art)

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Contents

• 1 Evolution of the Belgian Market
• 2 AXA in Belgium
• 3 Results Summary
• 4 Strategic Priorities
• 5 Conclusion

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Conclusion AXA Belgium, a clear example of
Financial Protection

• A fully integrated retail model
• Maximizes distribution reach
• Customer-centric and not based on products as in
  the past
• Allows significant economies of scale
• Growing underlying earnings, stable market share
  in P/C, growth in Life and Savings
• Brand awareness increases and is essential in
  what is customer driven

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