Reinsurance News

Generali to place German life operation into run-off as part of broader restructure

28th September 2017 - Author: Luke Gallin

Generali Deutschland, the German division of global insurer Generali, has announced a “One Company” approach, which includes placing its German life business, Generali Leben, into run-off, as it looks to improve efficiency and accelerate the implementation of its strategic plan.

As part of its announced growth strategy, Generali is to place Generali Leben into run-off, which it says will provide security for all existing life contracts and significantly lower the company’s exposure to interest rate risk.

Generali logo“Today’s announcement is in line with Generali Group’s key strategic objectives: to improve operating performance and to create long- term value. It accelerates Generali’s transformation in Germany, one of the Group’s core markets.

“These actions will simplify processes, consolidate our distribution network, increase our product range and strengthen the Generali brand. Further, the run-off of Generali Leben will free up resources that will allow us to capture new growth opportunities in the German market,” explained Generali Group Chief Executive Officer (CEO), Philippe Donnet.

The international insurance company explains that the “One Company” approach will see it concentrate ten product factories into a single product development engine, which will be applicable across all Generali entities and brands.

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Under the new platform, technical and product capabilities for P&C, Health and Life will be consolidated, which the firm says will create a simpler and more innovative product offering.

General Deutschland has also entered into an agreement with Germany-based financial advisory, DVAG, of which it holds a 40% stake in the joint venture, that sees Generali benefit from exclusive distribution, while AachenMünchener and Central will be merged into a combined Generali brand.

Furthermore, and subject to regulatory approvals, DVAG will absorb the agents’ network of Generali Versicherungen (EVG), which currently consists of roughly 2,800 agents.

The insurer has also announced plans to expand its investment in digital and direct insurer, CosmosDirekt, which is looking to become the first insurance company to offer a broad spectrum of solutions that are designed for the millennial generation.

CEO of Generali Deutschland, Giovanni Liverani, commented; “This is the next step towards excellence for Generali Deutschland. This next phase will accelerate our growth story, increase profitability, reduce capital absorption and strengthen our competitive position.

“The adoption of the “One Company” approach will reduce complexity, improve go-to market capability and reinforce our leading role in product innovation and smart insurance. Leveraging on our long-term partnership with the outstanding DVAG sales network and enhancing CosmosDirekt’s leadership in digital sales we will reinforce further our strong competitive advantage in distribution.”

It’s also noteworthy than German reinsurance giant Munich Re is also looking to offload some closed life books from its primary arm Ergo, as we reported yesterday.

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