What are your priorities for the 2023-2025 strategic plan?
We are targeting three priority topics. In the field of insurance activities where AG2R La Mondiale is present – in addition to supplementary pensions -, we must ensure control over financial balances, especially with regard to independent insurance. The second priority is changing gear in terms of information and digital systems to ensure our operational efficiency. Finally, customer satisfaction should be at the heart of all our thoughts and all our actions.
What do you plan to do to fix the pension?
Important work needs to be done on the economic performance of AG2R Prévoyance. On June 9, we will present a recovery plan that aims to earn 130 million euros per year by 2025. Provident institutions must consolidate their financial costs to ensure the sustainability of their activities. We will fix the pricing first. The termination of the assignment clauses according to the branch agreement has led to new commercial costs for our teams. We need to consider this and evaluate the loads. We will also strive to improve technical results by agreeing to terminate certain contracts. With insurance more elsewhere perhaps, growth should be profitable, due to Solvency 2, which requires the inclusion of expected future profits in equity calculations. We must be careful not to lower our solvency margin. We also hope to improve a lot of equipment. This lever has not been adequately exploited, especially by digital technology, in compliance, of course, with the GDPR (General Data Protection Regulation, Editor’s note).
How will digital be developed in the group?
The group caught on digital, no doubt because it was built through successive fusion. André Renaudin (his predecessor, editor’s note) has done significant work to bring together entities and teams. We should do the same for information systems. Customer knowledge remains very fragmented today, information systems present a risk of obsolescence, partnerships and synergies take a long time to deploy. We need to swap equipment and set up an open and shared organization that will benefit policy holders but also employees. In this context Pascal Martinez joins the group’s management committee, where he oversees information and digital systems. He will lead the change for several years.
You announced a new direction in early May. What is the purpose?
The new management organization chart aims to encourage teamwork between businesses and functions and thus reduce loopholes. In addition to Pascal Martinez, François Rubichon also joined the group as general secretary. We are also setting up a young executive committee called “Comme1Comex”, consisting of 8 women and 8 men under 40 years old. They will work on several topics and will have a role to be prod, specifically on topics related to new technologies.
Do you still have ambitions for a rapprochement with another player on property damage?
We did not give up on opening up property and casualty insurance despite abandoning the merger with Matmut. This will help in terms of multi-equipment and solvency gains through business diversification. The idea of starting from scratch in P&C is discarded. We put three options on the table: either a merger with a player comparable to Matmut, a P&C specialist, or a partnership agreement to distribute damage products from another player, or the acquisition of a insurtech. We will wait for the right opportunity before acting.
Can a fintech be integrated into a large group like yours?
The question arose for a insurtech as for a traditional insurer. It all depends on cultural harmony and leaders. We have also just finished our work on a reference system for joining the group for all our entities and any new participants such as mutual Intériale, where discussions with the goal of a merger continue. The group has grown to the size we need to be clear to all parties on a set of rules business planstrategy, human resources, finance, management cash and assets, risk, information, marketing and communication systems.
What are your points of attention on the evolution of markets and the next major reforms?
The economic environment is strongly marked by uncertainty and geopolitics. We now need to analyze certain economic scenarios in our internal risk assessment process (Orsa). The recovery in interest rates promises good news overall, though we prefer to rely on our plan to change.
We will also be helpful in the next pension reform. The increase in the legal retirement age has had the side effect of creating an additional, unexpected burden for provident institutions responsible for paying more disability pensions. This question seems to be getting more government attention. Finally, a possible dependency reform will worry us. Beyond considering its financing, we will take care to raise the topic of training and human resources in this sector.
Interview with Alexandre Garabedian and Thibaud Vadjoux