IAGPresentation20030918

IAGPresentation20030918 - Snapshot of a Successful Life...

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Snapshot of a Successful Life Company Does Size Matter? Industrial Alliance Insurance and Financial Services CIBC World Markets Frontenac Institutional Investor Conference Quebec City, September 18, 2003 1 Snapshot of a Successful Life Company Does Size Matter? CIBC World Markets Frontenac Institutional Investor Conference Quebec City, September 18, 2003 2 Key Success Factors of a Life Company ± Sound business strategy ± Good financial strength ± Strong operational efficiency Which lead to strong growth and high and consistent profits
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Snapshot of a Successful Life Company Does Size Matter? Industrial Alliance Insurance and Financial Services CIBC World Markets Frontenac Institutional Investor Conference Quebec City, September 18, 2003 3 Excel in one functional skill Build dominant positions in chosen markets Stake out position less vulnerable to head-to-head competition Exploit industry changes Develop permanent competitive advantages Sound Business Strategy Impact of size ± ± ± - - 4 Good Financial Strength Strong asset quality Adequate actuarial reserves Proven risk management Capacity to raise long-term capital High ratings Impact of size ± ± - - -
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Snapshot of a Successful Life Company Does Size Matter? Industrial Alliance Insurance and Financial Services CIBC World Markets Frontenac Institutional Investor Conference Quebec City, September 18, 2003 5 Strong Operational Efficiency Cost-efficient Competitive and up-to-date technology Performance-driven environment Well-developed people system Impact of size - - ± ± 6 Industry Characteristics ± Products No differentiation ± Growth potential Moderate for insurance products High for wealth management ± Distribution Distributors have significant power in consumer purchasing decisions ± Fixed costs Represent a small proportion of the cost structure (beyond a certain critical mass, relatively few economies of scale) Conclusion: Distribution is the key
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Snapshot of a Successful Life Company Does Size Matter? Industrial Alliance Insurance and Financial Services CIBC World Markets Frontenac Institutional Investor Conference Quebec City, September 18, 2003 7 Industry Characteristics Claims 53% Compensation 19% Expenses 14% Profit and taxes (incl. IIT) 14% Distribution of the Price of an Individual Insurance Policy Example of a UL level cost of insurance policy Expenses are not a key differentiating factor 8 Sound Business Strategy
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Snapshot of a Successful Life Company Does Size Matter? Industrial Alliance Insurance and Financial Services CIBC World Markets Frontenac Institutional Investor Conference Quebec City, September 18, 2003 9 Sound Business Strategy Key Elements of IAG’s Business Strategy 1. Excel in one functional skill: Distribution (underpins strategy) 2. Build dominant positions in chosen markets 3. Stake out a position that is less vulnerable to head-to-head attacks from competitors 4. Exploit industry changes (forward-looking management)
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This note was uploaded on 12/05/2011 for the course RESEACH 503 taught by Professor Dr.lee during the Spring '11 term at Arkansas State Beebe.

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IAGPresentation20030918 - Snapshot of a Successful Life...

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