Finaccord presentation car dealers and manufacturers as distribution channels_vienna_october 2013

Car dealers and manufacturers as distribution channels

Bancassurance Models
Car dealers and manufacturers as
distribution World
Around thechannels

Presentation at the 5th Annual Insurance Distribution
Strategies Forum

Vienna, October 17th – 18th 2013

© Finaccord Ltd., 2013

Web: www.finaccord.com. E-mail: info@finaccord.com

1


Agenda
 How important is the automotive channel for motor
insurance?
 How large are the markets for creditor and GAP
insurance and extended warranties in comparison?
 Should you distribute through manufacturer brands or
dealers?

 What is the outlook for distributing insurance through
the automotive channel?



2


Questions for you
Q1) Is the automotive trade in decline as a channel for
distributing motor insurance in your market? [Yes / no]
Q2) If yes, which other channels have gained share? [Select
all that apply]
 online aggregators
 cashback websites
 automotive associations
 direct sales by insurers
 banks
 other channels (e.g. retailers)



3


Automotive financial services research, 2013

 25 European countries
 1,350 dealers interviewed across Europe
 30 to 40 manufacturer brands covering 99% of new car
registrations per country

 Market size estimates
 Distribution analysis



4


EUR 7.55 billion of motor insurance GWP
originally sold through the automotive channel
Personal motor insurance premiums originally sold through manufacturer
brands and car dealerships (new plus in-force business), Europe, 2012

Automotive trade,
EUR 7.55 billion,
7.5%

Other channels,
EUR 93.42 billion,
92.5%

Source: Finaccord Automotive Financial Services Model


5


This channel accounts for 20% or more
of premiums in some countries
Personal motor insurance premiums originally sold through manufacturer brands
and car dealerships (new plus in-force business), selected countries, 2012

Russia

23.0%

Norway

20.1%

Germany

10.2%

Italy

5.6%

UK

2.6%

France
Ireland

2.1%
0.0%

0%

5%

10%

15%

20%

25%



6


Dealers nearly always offer
comprehensive motor insurance
Maximum level of motor insurance coverage
sold by dealers in Europe, 2013

100%

Liability only
Non-liability only

80%

60%
Comprehensive

Non-liability only

40%
20%

Comprehensive

0%
Average (excl. Italy)

Italy

Source: Finaccord Automotive Financial Services Survey


7


Creditor insurance, GAP insurance and
extended warranty terms and definitions
 Creditor insurance: pays the balance or instalments of a loan or lease in
case of death, disability or unemployment
 Restschuldversicherung oder Ratenschutzversicherung
 assurance décès, incapcité, invalidité, perte d'emploi
 GAP insurance: covers the difference between an insurance payout in
case of complete loss and the outstanding balance on a loan or lease or
price of a new car
 GAP-Deckung
 garantie perte financière
 Extended warranty: covers the cost of repair in case of mechanical failure
after the factory warranty has expired
 erweiterte Garantie
 extension de garantie


8


Creditor, GAP and extended warranties together are
worth three quarters of the motor insurance market
Value of four products sold through the automotive trade, in GWP
and similar revenues (new and in-force business), 2012

EUR billion

10
8
6

GAP

4

Creditor

2

Extended
warranties

0
Motor insurance

Others



9


New business for these four products can exceed 2% of
the value of all cars sold by dealers to private customers
GWP and similar revenues (new business only) for motor, creditor, GAP insurance and extended
warranties as % of value of new and used cars sold by dealers to private customers, 2012

Sweden

2.3%

Germany

2.0%

Italy

1.9%

Spain

1.7%

UK

1.4%

France

0.9%

Ireland

0.2%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%



10


But there are major country differences again

 Negligible creditor insurance in Finland and Romania, and no new
business in Ireland and the UK in 2013

 No GAP insurance in six countries and negligible GAP insurance in
another six
 Manufacturer brands provide extended warranties internally or
through captives half of the time, restricting the market for external
providers



11


The largest market also uses
external underwriters the most
Operating models used by car manufacturer brands for extended
warranties, selected countries and European average (unweighted), 2013

External underwriter

Internal / captive

Other

Germany

Average

France

Denmark
0%

20%

40%

60%

80%

100%



12


Should you sell motor insurance via
dealers or manufacturer brands?
Product sources used by car dealers for motor insurance,
selected countries and European average (unweighted), 2013

Manufacturer / importer

Dealer (non-tied)

Both

Belgium
Germany
Italy
Average
Russia
0%

20%

40%

60%

80%

100%



13


Should you sell extended warranties
via dealers or manufacturer brands?
Product sources used by car dealers for extended warranties,
selected countries and European average (unweighted), 2013

Manufacturer / importer

Dealer (non-tied)

Both

Turkey
Germany
Average
France
Norway
0%

20%

40%

60%

80%

100%



14


Distribution through independent finance houses
 A number of finance houses also distribute motor and GAP
insurance plus extended warranties, as well as creditor
insurance
 Germany: BDK and Santander Consumer Bank both have
partners for GAP and motor insurance plus extended warranties
 France: Cetelem, CGI, Financo, GE Money Bank and Viaxel all
have partners for GAP insurance and extended warranties
 Hungary: Erste Bank with Union for motor insurance
 Portugal: BBVA with MAPFRE for motor insurance
 Russia: Rusfinance Bank with Société Générale Strakhovanie
for GAP insurance
 UK: Black Horse with Car Care Plan for extended warranties


15


What is the outlook for distributing
insurance through the automotive trade?
 RESULTS OF Q1) AND Q2) DISPLAYED HERE



16


The competition from online aggregators
Percentage of consumers taking out or renewing motor insurance through online
aggregators, average of France, Germany, Italy, Spain and the UK, 2012 (unweighted)

50%
40%
30%

22.4%
20%
10%

6.9%

0%

Renewals

New buyers and switchers

Source: Finaccord Aggregation Metrics


17


Additional products in Europe
 Driver or passenger accident insurance
 Legal protection insurance

 Minor damage insurance
 Tyre insurance

 Vehicle contents
 Vehicle running costs insurance

 Window insurance (in addition to windscreens)



18


Additional products in North America
 Wheel and tyre insurance
 Multiple levels of extended warranty

 major items only, e.g. powertrain
 minor items only, e.g. brake pads, headlamps, belts and hoses

 Excess wear and tear cover for lease contracts



19


Questions for you
Q3) Which type of product do you think has potential for
growth? [Select all that apply]
 Cover packaged with motor insurance policies

 Cover packaged with finance and leasing
 Separate niche insurance products



20


Any questions?

Sources and related Finaccord publications:
Consumer Automotive Financial Services in Europe
Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Greece,
Hungary, Ireland, Italy, Luxembourg, the Netherlands, Norway, Poland, Portugal,
Romania, Russia, Slovakia, Spain, Sweden, Switzerland, Turkey, Ukraine and the UK

Consumer Automotive Financial Services in Major Global Markets
Argentina, Australia, Brazil, Canada, China, India, Indonesia, Japan, Mexico, South
Africa; South Korea, Taiwan and Thailand and the US

Fleet Insurance and Assistance in Europe
Road Assistance in Europe


21

Finaccord presentation car dealers and manufacturers as distribution channels_vienna_october 2013

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (19)

Andere mochten auch

Andere mochten auch (7)

Ähnlich wie Finaccord presentation car dealers and manufacturers as distribution channels_vienna_october 2013

Ähnlich wie Finaccord presentation car dealers and manufacturers as distribution channels_vienna_october 2013 (20)

Mehr von Intelligo Consulting

Mehr von Intelligo Consulting (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Finaccord presentation car dealers and manufacturers as distribution channels_vienna_october 2013