A strong commercial performance in Asia in a challenging economic cycle

2024 was a year in which Asia, especially China, felt the full impact of macroeconomic and geopolitical developments that challenged the region. With interest rates in China at historic lows, the region came under scrutiny with investors. Against this backdrop however the underlying insurance needs of consumers remain high, even after more than 20 years of significant growth.

Despite macroeconomic challenges, the region, especially China, saw strong commercial performance over the past year, with premium inflows reaching a record high. This demonstrates the resilience of the insurance sector amid the broader economic slowdown.

Empowering local teams to reshape Asia’s leadership

Far from being one homogenous economic entity, Asia comprises a mix of emerging and more mature markets; each one at distinct stages of maturity and socio-economic development. Low insurance penetration rates are still a common characteristic of all markets, however, which also points to new opportunities in the future. Recognising the distinct regional differences, we chose to restructure our Asian leadership team in 2024 by appointing three Regional Executive Directors, for China, South-East Asia and India, ensuring the right organisation and know-how is in place to best support our JV partners on the ground. These JVs are longstanding in nature, with Thailand this year joining China and Malaysia in a 20+ year club of which we are immensely proud. Our long-term commitment to Asia is also of course a long-term commitment to the end customer. As an insurer we have a strong purpose and an equally strong duty of care to be there for our customers throughout their lifespan and indeed throughout macro-economic cycles.

Leveraging Technology for Growth and Efficiency

2024 also brought a close to the Impact24 strategic cycle. This allowed us to reflect on how Impact24 had driven so many of our priorities. Over this period, we have significantly strengthened the resilience of our core channels, first and foremost by continued support to our Bancassurance partners, our dominant distribution channel, working collaboratively on a successful transition in the digital era.

But we also recognise that many customers continue to value the agency channel while open and willing to embrace a fully digital experience. Consequently, we have continued to grow the agency channel, including new agency channels in India and in the Philippines, with a focus on quality and productivity supported by the gold star of professionalism, the MDRT (Million Dollar Round Table).

But beyond this, we have been proactively exploring new engines of growth embracing the digital revolution and leveraging digital platforms that allow us to extend our reach and create scale. Having successfully experimented with digital platforms in India, we concluded in 2024 eight new partnerships delivering 10% of new business inflows in India. And we are expanding the model to other markets.

So, the continued development of an omni-channel approach to distribution, to offer our customers their channel of choice, is and will remain a top priority for us in the region.

Asia shows strong momentum in putting sustainability at the heart of business

Impact24 also increased our focus on the importance of ESG, and putting sustainability at the heart of everything we do. Across Asia, but particularly in Malaysia, Thailand and China, we saw significant traction with our partners which we have managed to reinforce by Ageas acting as a knowledge broker of best practices both intra-region but also Group-wide. Across the region we also made improvements in both Employee and customer NPS, testimony that our commitment to “Creating a Great place to Grow” and our focus on customer excellence is being recognised.

Looking to the future, China will continue to remain a top priority for Ageas in Asia. And as the business navigates its way through this difficult economic cycle, we remain resolute to its long-term growth and sustainability. In Europe, Ageas has acquired considerable experience in adapting its products and pricing strategies to counter the low interest environment particularly to address customer needs for long-term guarantees and returns often difficult to find. Ageas can now tap on its valuable experience and expertise while sharing and inspiring potential solutions to these significant, yet similar challenges in Asia. It further demonstrates one of the many tangible benefits of being present in both Europe and Asia.

Another priority in a post-Covid world, is the attention being paid to health, where the demand supply side has very much shifted to health providers. Pressure on public health systems is a global phenomenon and private health insurance is one of the most important yet emerging needs in the region. In Europe Ageas has already built a leadership position in both Portugal and Belgium and this has allowed the Group to share its best practices in this field with our partners in Asia. Significant investments are currently being made across the region to address specific challenges, while identifying and devising tailored solutions for each market. We have deconstructed the building blocks of the various value chains in the health segment and are working with partners in redesigning them for improved efficiency and customer service.

Anticipating the needs of an ageing population and a fast-changing society

We will embrace the challenge of an ageing society particularly in the fast-ageing markets of Thailand and China. And while we will take a holistic approach to the ageing challenge, we see particular opportunities especially in the development of the fast-growing pensions market which is also what drove our investment in Taiping Pension in 2024.

And finally, we cannot underplay the increasing importance of operational efficiencies and technical performance particularly during these times. Data combined with (Gen) AI allows us to explore hyper-personalisation on an industrial scale, enabling at the same time a significantly enhanced customer experience. While markets are at various stages of development, the more mature markets of China, Thailand and Malaysia are at the forefront of embedding technology with rapid adoption. This technological revolution requires us to take our people on this same journey, ensuring they are equipped and educated in what the power of technology can do to elevate our performance to the next level, supplementing the power of human intervention.

Asia is ready to focus on delivering Elevate27. To summarise, the distribution diversification will remain a top priority with a focus on quality and efficiency, and our digital journey will move to the next phase. Powered by Data and AI, operational productivity and technical excellence will become paramount, and the focus will drift further towards expanding margins and free capital generation when markets become more mature and growth slows down. This is both a mental shift as well as a technological transition, which will require a different mindset by all.

Asia embraces digital innovations and expansion of embedded insurance 

From a strong starting point in 2023, the Group’s progress in leveraging Digital Platforms in Asia hit new heights in 2024, from the perspective of both partnerships but also results. A key driver for this success is the substantial increase in the number of active embedded insurance partnerships and the successful implementation of several Minimum Viable Products (MVP). Embedded insurance is a model where insurance coverage is integrated into digital journeys such as the purchase of a product or service at point of sale rather than being sold as a separate product.  And within that, MVPs are commonly used to validate customer needs and demands prior to developing a more fully featured product. 

Embedded insurance is on a strong growth trajectory and is ripe for further development in the highly digital-savvy markets of Asia. The embedded insurance market is projected to reach $ 170 billion by 2030.  

Ageas has played a crucial role in driving several new initiatives in 2024, working in close collaboration with its JV partners, leveraging its expertise and resources to support the implementation and scaling up of digital platforms.  

In India AFLI doubled the number of partnerships in just one quarter from 12 to 25, helping to compensate for a slowdown in micro-lending in the Indian market. And in collaboration with MunichRe, AFLI forged an important new partnership with PhonePe, launching a Group Term Life product on their extensive platform. In Vietnam, MB Ageas Life expanded its reach and impact by launching Term Life embedded in MB journeys through digital platforms leading to an increase of EUR 620,000 in inflows in just three months.  

And extending our scope from embedded insurance, our first omnichannel MVP was launched in Singapore in collaboration with Singtel and Etiqa. This MVP included 15 new initiatives targeting various building blocks of the sales model, advanced needs-based propensity modelling, digital marketing campaigns, and other value-added innovations. While the project is still in progress with continuous fine tuning of the customer journeys and sales flow, with positive initial results, the level of customer engagement increased alongside sales, cementing Etiqa's role as the partner of choice for digital platforms. The learnings of the project are currently being applied to customer journeys in the Bancassurance channel at MBAL. 

You are reading an article that is part of our Annual Report 2024.