presentation: global mobile operator strategies in insurance and assistance

© Finaccord Ltd., 2014 Web: www.finaccord.com, E-mail: [email protected]

Global Mobile Operator Strategies in Insurance and Assistance

1

Global mobile operator strategies

in insurance and assistance

Latin America’s 5th Annual

Microinsurance Summit

10 March 2014



2

What topics does Finaccord cover?

Affinity and partnership marketing

Automotive financial services

Bancassurance: life, non-life and creditor insurance

Commercial non-life insurance brokers

Consumer intelligence

Extended warranties and insurance for white, brown and grey goods

Insurance and assistance linked to payment cards and bank accounts

Mobile gadget and phone insurance

Professional indemnity insurance

Retailer payments, banking, insurance and assistance

Road assistance

Small business insurance

Trade credit insurance

Travel insurance and assistance

For some topics, our coverage is already global (i.e. 40+ countries)



Global Mobile Operators: Strategies in Payments, Banking,

Insurance and Assistance

• 2012 survey of global mobile network operators, conducted by Finaccord;

• 255 network brands, across 70 countries

• coverage of over 20 separate payment, banking, insurance and assistance

product categories

• aim: how do / can mobile operators generate revenues from financial

services?

3



Product categories investigated

• payments: contactless merchant payments; payments via bank

card / account; payments via mobile phone bill; payments via

network account; talktime / call credit transfer;

• banking: mobile banking (bank current accounts); credit cards (non-

virtual); prepaid cards (non-virtual); personal loans / micro-credits;

• insurance: mobile phone, mobile gadget, bill payment protection,

identity protection, motor, household, travel, accident, health, life;

• assistance: home, legal, medical, road.

4



5

Source: Finaccord Global Mobile Operators reports

Geographical segmentation of

mobile operator brands researched

E&S-E Europe, 33

N&C Europe, 35

S&W Europe, 28

Africa & Middle East, 50

Asia-Pacific, 69

Latin America, 27

North America, 13



6


Multinational telecoms groups with five or

more wholly- or partially-owned subsidiary

brands covered by the research

Number of

subsidiaries

Vodafone

Telefónica

France Télécom

Deutsche Telekom

América Móvil

Hutchison Whampoa

Telenor

TeliaSonera

Etisalat

Qtel

Bharti Airtel

Singapore Telecommunications

Telekom Austria

VimpelCom

23

14

12

10

8

8

8

7

6

6

5

5

5

5



7

Mobile operator brands surveyed in Latin America


Country Brand Subscribers

(millions) Country Brand

Subscribers

(millions)

Uruguay Ancel Peru Movistar

Argentina Claro Uruguay Movistar

Brazil Claro Brazil NEXTEL

Chile Claro Mexico NEXTEL

Ecuador Claro Peru NEXTEL

Peru Claro Brazil Oi

Colombia Comcel Argentina Personal

Chile Entel Paraguay Personal

Mexico Iusacell Mexico Telcel

Argentina Movistar Colombia Tigo

Chile Movistar Paraguay Tigo

Colombia Movistar Brazil TIM

Ecuador Movistar Brazil Vivo

Mexico Movistar

1.8

14.1

61.0

3.2

8.0

9.0

29.0

5.6

3.8

16.8

9.5

11.4

4.5

21.0

14.0

1.8

4.0

3.8

0.7

39.4

18.0

1.8

66.9

5.1

3.6

61.4

71.6



8

13.7%

22.4%

22.7%

22.4%

61.6%

27.1%

23.5%

5.9%

5.9%

1.6%

37.9%

28.9%

38.5%

43.2%

67.7%

36.5%

42.4%

19.6%

4.7%

1.2%

0% 20% 40% 60% 80% 100%

Contactless merchant payments

Payments via bank card / account

Payments via phone bill

Payments via network account

Talktime / call credit transfer

Mobile banking (bank current accounts)

Credit card (non-virtual)

Prepaid card (non-virtual)

Consumer f inance / micro-credits

Miscellaneous payments / banking

Provision rates for payment and banking products:

all mobile operators surveyed worldwide


Unweighted provision rate

Weighted provision rate



9

0.0%

25.9%

14.8%

11.1%

70.4%

33.3%

59.3%

0.0%

22.2%

0.0%

0.0%

19.4%

2.8%

14.6%

72.7%

31.3%

76.1%

0.0%

9.8%

0.0%

0% 20% 40% 60% 80% 100%











Provision rates for payment and banking products:

mobile operators surveyed in Latin America






Comments about provision rates

for payment and banking products

• Talktime transfer remains the most popular form of mobile payment

– Usable with any handset since @1996

– Perfect product for under-served communities (works with

prepaid phones, works without mobile data connection)

10



11

36.1%

13.3%

4.3%

0.8%

0.8%

2.0%

9.4%

27.2%

13.4%

2.8%

0.8%

0.3%

15.3%

22.3%

0% 20% 40% 60% 80% 100%

Mobile phone insurance

Mobile gadget insurance

Bill payment protection insurance

Identity protection insurance / assistance

Motor insurance

Household insurance

Travel insurance / assistance




Provision rates for insurance and assistance products:

all mobile operators surveyed worldwide (1)



12

8.6%

3.1%

6.3%

5.9%

5.5%

10.2%

7.5%

6.7%

23.1%

4.4%

17.8%

4.0%

4.2%

18.2%

6.9%

7.5%

0% 20% 40% 60% 80% 100%

Accident insurance

Health insurance

Life insurance

Home assistance

Legal assistance

Medical assistance

Road assistance

Miscellaneous insurance / assistance





all mobile operators surveyed worldwide (2)



13

63.0%

25.9%

7.4%

0.0%

3.7%

3.7%

37.0%

63.6%

38.4%

13.4%

0.0%

0.7%

14.6%

31.6%

0% 20% 40% 60% 80% 100%





Motor insurance

Household insurance






mobile operators surveyed in Latin America (1)



14

18.5%

7.4%

11.1%

48.1%

40.7%

48.1%

55.6%

40.7%

30.6%

16.5%

17.4%

31.4%

31.6%

47.2%

37.4%

33.6%

0% 20% 40% 60% 80% 100%

Accident insurance

Health insurance

Life insurance

Home assistance

Legal assistance

Medical assistance

Road assistance







mobile operators surveyed in Latin America (2)



15

• Mobile phone insurance (handset protection) is most popular

• Assistance packages are also widespread in Latin America

• Assistance products are becoming potentially significant for mobile

providers (especially where strong interaction with mobiles is

possible, such as with medical, road and travel assistance)

Comments about provision rates for

insurance and assistance products



16

Overview of provision rates for all payment, banking,

insurance and assistance products by region


0% 20% 40% 60% 80% 100%

E&S - E Europe

N&C Europe

S&W Europe

Africa & Middle East

Asia Pacific

Latin America

North America

All countries

Payment / banking alone

Insurance / assistance alone

None

T

Payment / banking and

insurance / assistance



17

Overview of provision rates for all payment and banking

products plus all insurance and assistance products apart

from mobile phone (handset) and gadget insurance by region


0% 20% 40% 60% 80% 100%

E&S - E Europe

N&C Europe

S&W Europe

Africa & Middle East

Asia Pacific

Latin America

North America

All countries

Payment / banking alone

Insurance / assistance alone

None

Payment / banking and

insurance / assistance



• Development of mobile payment and banking products is primary

activity for mobile operators

• Apart from mobile phone (handset) and gadget insurance, initiatives

in insurance and assistance tend to be secondary

18

Comments about overall provision rates



19

0% 20% 40% 60% 80% 100%











External partner

Multiple external partners

Captive partner

Joint venture partner

Internal

Other

Undisclosed

.

Operating models used for payment and banking

products: mobile operators surveyed worldwide




20

Comments about operating models


• Operating models vary by payment and banking product

• Apart from talktime / call credit transfer, external or non-internal

entities are often involved for other services

• Examples include Gemalto, MasterCard, Visa, Western Union etc.



21

Operating models used for insurance and assistance

products: mobile operators surveyed worldwide (1)


0% 20% 40% 60% 80% 100%





Motor insurance

Household insurance


External partner


Captive partner


Internal

Other

Undisclosed

[legend tricker]



22

Operating models used for insurance and assistance

products: mobile operators surveyed worldwide (2)

0% 20% 40% 60% 80% 100%

Accident insurance

Health insurance

Life insurance

Home assistance

Legal assistance

Medical assistance

Road assistance


Total

External partner


Captive partner


Internal

Other

Undisclosed

Series9





23

• External partnerships dominate, as few mobile operators maintain

captive insurance arms

• The few found tend to specialise in mobile phone (handset)

insurance

• Even mobile operators with captives (e.g. Telefónica, Vodafone)

maintain strong ties with external partners (e.g. ACE, Assurant)

Comments about operating models




24

The European experience: distribution

interfaces used for motor insurance

Source: Finaccord Aggregation Metrics report

0%

20%

40%

60%

80%

100%

Buyers in years prior to 2012

Switchers and new buyers,

2008

Switchers and new buyers,

2012

T

Post

Outbound telephone

Inbound telephone

Online

Face-to-face



25

0% 20% 40% 60% 80% 100%

France

Germany

Italy

Poland

Spain

UK

Average

Laptop or desktop computer Tablet computer Mobile phone T

The European experience: devices

used to buy motor insurance online

Source: Finaccord Aggregation Metrics report



26

• The online channel has seen significant growth and use of mobile

devices to buy insurance online is likely to grow in future

• People are coming to the online channel through mobile devices,

not just ‘switching’ online interfaces

• Tablet costs are dropping and purchases are often viable among

lowest income bands

• Tablets (and smartphones) in many areas represent ‘device +

broadband’ (especially where fixed broadband access is limited)

Comments about the European

experience in motor insurance



27

Finaccord is a leading market research, publishing and consulting company specialising in financial

services. We provide our clients with insight with a particular focus on marketing and distribution

strategies, including affinity and partnership marketing.

Our areas of expertise include: affinity and partnership marketing; automotive financial services;

bancassurance; commercial non-life insurance brokers; consumer intelligence; extended warranties

and insurance for white, brown and grey goods; insurance and assistance linked to payment cards and

bank accounts; mobile gadget and phone insurance; professional indemnity insurance; retailer

payments, banking, insurance and assistance; road assistance; small business insurance; trade credit

insurance; and travel insurance and assistance.

Our international network of consultants is able to deliver information quickly and accurately across a

range of countries worldwide, basing research projects on robust data and knowledge.

Contact us

The Office Farringdon

24 Greville Street

London,

EC1N 8SS

Phone: +44 20 3178 2556

Fax: +44 20 7198 7902

Email: [email protected]

www.finaccord.com

http://twitter.com/

http://www.linkedin.com/company/finaccord

mailto:[email protected]



http://www.finaccord.com/





presentation: global mobile operator strategies in insurance and assistance

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