Swiss Re plans to broaden its offering by way of concluding more partnership agreements. Chief Executive Christian Mumenthaler in an interview also said the Zurich-based company considered making acquisitions.
Developing new products required more time and effort than people would think, said Christian Mumenthaler, CEO of Swiss Re, in an interview with Germany’s «Handelsblatt» newspaper. Agreements with industrial partners, therefore, provided a wide field of potential new business opportunities, he added.
The potential had increased as many firms had come under financial strain, requiring them to consider their options in terms of what products they aimed to sell. The insurance industry therefore was looking for new avenues of revenue with industrial partners, seeking the joint exploitation of new fields of business.
Deal With German Carmaker
Swiss Re in October announced a new joint venture with Daimler, the German carmaker, with an aim to develop the fully digital car and mobility insurance products, starting next year. Mumenthaler said his aim was to develop a platform to integrate the purchase of insurance into the car-buying process, generating a combined customer experience.
Mumenthaler told the newspaper that such a combination was unlikely to come about without a partner. Buying insurance intrinsically is associated with negative thoughts and the likelihood of accidents, theft, and damage, he said. Nobody liked brooding over the best insurance policy – which was why the cool and cut-price insurers had found it so hard to get a foot into the door of that business. Therefore the attempt to integrate insurance into a product that people enjoyed buying, such as cars or, in Switzerland, Swedish furniture store Ikea.
Iptiq Cooperation
Insurers and industrial clients didn’t always appreciate that Swiss Re was muscling into their fields of business, Mumenthaler conceded, adding that he used to answer that they should cooperate with Swiss Re instead.
One such example is the insurtech startup Iptiq. The data-driven product machine compiles tailor-made solutions for corporate clients, maintaining the interface with clients. UBS for instance announced earlier this year that it will launch a life insurance product for its clients next year.
Takeovers Remain an Option
Other insurers could make use of the platform provided by Iptiq to reach new markets or business segments, instead of investing hundreds of millions going it alone. The chief executive of Swiss Re also said that the company was open for takeovers if presented with interesting opportunities.
However, this didn’t apply to the core business of reinsurance, because Swiss Re had grown to be very large in all countries, rendering takeovers in this field not strategically viable.
