TO position its Asia business as "the growth engine for Allianz globally", Europe's largest insurer by market capitalisation has partnered Standard Chartered Bank in a 15-year bancassurance deal to distribute its general insurance products through the lender in five markets in Asia.
This is in line with the German insurer's ambitious target to double the size of its business in Asia by 2020.
Even though the low interest rate environment and uncertain economic conditions remain concerns for insurers around the world, Allianz had laid out a plan in 2015 to grow its global earnings by 5 per cent between 2015 and 2018.
George Sartorel, regional chief executive of Allianz's Asia-Pacific operations, told The Business Times on Thursday that the insurer relies on three strategic pillars - its agency force, bank partnerships and non-organic growth. "So we're doing more and more partnerships and it's not just a StanChart partnership, we did the Maybank partnership in 2016, we've acquired a business in the Philippines with a 15-year banca partnership with PNB Life Insurance Inc."
Bancassurance accounts for about 35 per cent of the region's life and non-life business, Mr Sartorel said, adding that "well above 50 per cent" comes from the agency channel, while the rest is from direct sales, brokers and other tie-ups.
Under the new arrangement - the value of which is not disclosed - the insurer's full suite of plans such as travel, personal accident, fire, health and motor will be sold through StanChart's retail banking clients in Hong Kong, Singapore, Malaysia, Indonesia and China.
Besides the bank's 800 branches in Asia, the products will also be available for distribution via a digital bancassurance platform developed and owned by Allianz, to broaden the reach to customers.
Last year, it was reported that StanChart was seeking about US$400 million to distribute the products.
Karen Fawcett, chief executive of retail banking at StanChart, noted that bancassurance is "a key focus" for the lender as it continues to innovate and expand its offerings to meet the needs of its clients in branches and online.
Currently, Allianz offers corporate and specialty solutions such as liability, energy and marine, as well as product recall. Other lines of business offered here are reinsurance, asset management and retail travel plans.
While it does not have a life insurance business here, Mr Sartorel says he is looking at it.
The tie-up comes as demand for non-life insurance in the region is projected to grow at 10.8 per cent per annum over the next four years to reach a total market size of about US$280 billion by 2020, driven by growth of emerging markets and Asia's insurance penetration gap.
For the nine months of 2016, the insurer's total net income was down 1.1 per cent year on year to 5.1 billion euros (S$7.7 billion). Total revenues fell by 3.2 per cent to 92.4 billion euros in the same period, while operating profit eased 1.7 per cent to eight billion euros, dragged down by the property and casualty segment and, to a lesser extent, asset management.