Exclusive: Allianz will rebrand Ensure Insurance next year, retain Nigerian management

Allianz Nigeria

Germany’s insurance giant, Allianz said it will not tamper with the management of Ensure Insurance but it would rather retain the board and its local talents.

Allianz announced yesterday that it had acquired 98% equity stake in Nigeria’s Ensure Insurance, a deal that was awaiting regulatory approvals in Nigeria.

In an exclusive interview with Africa CEO of Allianz, Coenraad Vrolijk, he told PageOne.ng’s Samuel Odusami that it will not make any change to the team as its competence was part of its reasons to acquire the Nigerian insurer.

“Developing and retaining local talent is a key focus for Allianz in Africa. One of the main reasons we are happy to have Ensure on board is the strength of the management team who are doing an excellent job in growing the franchise across the country and who we plan to retain,” he said.

An insurance expert who craved anonymity said the plan to retain 100% local management team is a good morale booster not just for the board of Ensure but the Nigerian insurance industry board room as a community. He said the move would further expose local talents to international insurance best practices and knowledge transfer that will have a ripple effect on the insurance industry as a whole.

However, Coenraad said Allianz will not retain the company’s current brand identity and the name given its controlling stake in Ensure.

“With the integration of Ensure Insurance into the Allianz Group, the company will be rebranded to Allianz in line with our global unified brand policy. Since the Ensure brand name is being owned by the company there is no urgency, however, to carry out the rebranding, we will be working with the Ensure team to address this topic in due course in 2018,” he said.

Allianz already has a full-fledged regional office in Casablanca, Morocco’s capital with key managers in charge of regional coordination on site. The Casablanca will be its hub for the entire African operations, a continent many insurance majors look to latch on for growth.

Allianz SE is listed on the German Stock Exchange. The company said it is not looking at listing the local unit on the Nigerian Stock Exchange, NSE.

An equity analyst who spoke to PageOne.ng on the company’s plan to keep its Nigerian operations private said, the Ensure Insurance would likely be one of its smallest local units given that the 98% stake was acquired for NGN11.5 billion. “It is a small exposure, the company can easily absorb it in its portfolio of foreign operations,” he said.

There are indications that a local listing might happen in future, but Coenraad was very explicit “we have no plans to list the company on the Nigerian stock exchange”, he said.

As a comparison, after France’s AXA acquired 77% stake in Mansard Insurance, it did not take the company private as AXA Mansard is currently listed on the NSE. Allianz might in the nearest future look to deepen its operations and presence in Nigeria by going public.

To look at the scale of Allianz, Allianz is largest P&C (property and casualty) insurer in the world and the largest European insurer (life + non-life).

In its 2017 second quarter results, Allianz reported an 83.4% rise in its net income (also known as net profit) to EUR2.0 billion. Gross revenue rose by 2% to EUR30.0 billion. Allianz said it is looking at reporting EUR10.8 billion as operating profit for the full year.

Allianz said its asset under management (AuM) at the end of the period was EUR1.9 trillion.

The entrance of Allianz is expected to see AXA, Swiss Re and another foreign player, Prudential, double down on their strategies to take advantage of the growth potentials in Nigeria’s insurance market. Analysts have concluded that being the continent’s largest economy, Nigeria is not matching its expectations. The entire industry reported gross premium of USD1 billion as at 2015. This is a small dent when compared to the second largest economy in Africa, South Africa, which reported USD50 billion within the same period.

While South Africa’s insurance market is deep and advanced when compared to Nigeria, the market is also getting saturated with local players looking for growth in Nigeria, Kenya and emerging African economies. The decision of Allianz to enter Nigeria is therefore justified.

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