Transcript Customers - AFIRC Conference 2013

Creating Opportunities in a Challenging
Environment
Julio G. Villalon
Head of Middle East Region
MetLife
Objectives
Overview of today’s environment
What we can expect in the future
- Some Challenges
- .. but also great Opportunities
How is MetLife dealing with these
challenges
The World Economy is Changing…
GDP DEVELOPED COUNTRIES
GDP EMERGING COUNTRIES
Source: International Monetary Fund, World Economic Outlook Database, September 2011
Our Environment: Post – Financial Crisis
Customers
• Loss of trust in financial sector
• More sensitive to price
• Higher risk aversion
Governments and Regulators
• Sovereign debt crisis
• New Regulation (Solvency II, Customer protection rules)
Insurance Industry
• Consolidation
• Shortage of capital
- Some deleveraging geographically
- Others deleveraging lines of business
Low Interest Rates
Lowest Interest Rates in Last 25 Years
Source: WSJ LIBOR: Historical Data
Our Environment: Future
Customers
• Value more capital
strength and solvency
• Products with guarantees
• Products more transparent
Governments and Regulators
• More regulation and supervision
Insurance Industry: 2 Winning Strategies
• Large companies that can leverage their size
• Specialists who focus in specific risks or
niche markets
What are the opportunities?
Life Industry Myths
Life insurance is sold,
not bought
Personal interaction is
essential
It’s hard to cross-sell to
existing customers
Providers can’t materially
influence retention
Based on Research
•
Customers want to make better-informed decisions when
purchasing, rather than relying on the industry to know
what’s right for them
•
Customers expect to do far more research in the future
using online sources, even though they may continue to
use an advisor to complete the purchase
•
Customers want to be rewarded for loyalty and repeat
sales
•
Providers could influence retention if they were better at
meeting customers‘ changing needs and were prepared
to offer better deals to stay
Responding to the New Customer Needs
Source: Ernst & Young global insurance customer survey, 2012; 24,000 customers in 23 countries covering Americas, EMEA and Asia
Where are the opportunities?
Additional Trends
Emerging Markets will represent
most of the growth
• More than 60% of Life Premium growth
will come from Emerging markets
Corporations are becoming more
Global
• 65% of Global 1000 have Employees
outside the U.S.
Source: McKinsey Global Insurance Pool
Dun & Bradstreet Research
MetLife - A leader in the International Life Market
Total Revenues1 $ M
Market capitalization
$68,150
$53.31B
2
# of countries present4
Leading market positions
Over 45
5
Over 20 Markets
 MetLife has a strong
foundation
 Will need to adapt to this
changing and challenging
Total customers (M)4
Assets Total3 $M
1
90
environment
836,781
Total Revenues are from MetLife’s audited Consolidated Financial Statements for the years Ended December 31, 2012. This financial data should be read in
conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the audited consolidated financial statements
and related notes included in the Metlife’s 2012 Annual report. .
2
th
Market capitalization as of Oct 28 , 2013. Data from Yahoo Finance
3
st
Assets Total: Consolidated Balance Sheet as of December 31 , 2012.
4
From MetLife Corporate profile. Customer and country information represent combined numbers for both life and non-life businesses.
5 AXCO Insurance Information Services, March 7, 2013
MetLife Positioning in Middle East
 Over 1350
Turkey
Lebanon
Since 1988
Since 1953
Jordan & PNA
Since 1958
Employees
 Operating
Since 1953
 Leading
Position in
Region
Oman
Since 1971
Egypt
Since 1997
UAE
Saudi Arabia
Since 1954
Kuwait
Bahrain
Qatar
Since 1954
Since 1960
Since 1962
Since 1962
MetLife Strategy
Refocus the U.S.
Business
ONE
Build Global
Employee Benefits
Business
GLOBAL * WORLD-CLASS * SCALE
Grow
Emerging Markets
Drive Toward
Customer Centricity
and a Global Brand
MetLife Strategy
Grow Emerging Markets
• GDP Growth driving Insurance penetration
• Growing middle class needs for Life
Insurance
Build Global Employee Benefits
• Corporations increasing Global presence
• Employee Benefits as a lever to retain talents
Customer Centricity & Global Brand
• Listen to Customers to derive better
experiences
• Global Brand to differentiate ourselves
MetLife Strategy Key Enablers
 Talent/Collaboration/Communication
 Scale & Efficiency
 Regulatory Engagement:
- Creating long term relationship
- Share Global expertise
- Support strong regulation appropriate to
marketplace
In Summary
Challenging Environment
• Economic and Financial
crisis
- Clients’ loss of trust
- Higher Risk Aversion
• Changing Regulatory
environment
• Persistent low interest
rates
• Diverse Competition
Strategic Response
• Leverage size and scale
vs. specialist approach
• Responding to the
“new consumer”
• Need for global
partnerships (Clients,
Distributors, Partners,
Brokers)
Significant Opportunities
• Clients want to do
business in different
ways.
• Insurance penetration is
increasing in emerging
markets
• Corporations are
becoming more Global