Boris SCHNEIDER, General Manager, ASIROM-VIENNA Insurance Group
The VIENNA Insurance Group has a vast experience in operating by a multi-brand strategy. We believe there is still enough room on the Romanian insurance market for all VIG member companies. Also, competition can only lead to excellent results; thus, given that we have a very good communication across the group, we can even learn from our "sisters".
XPRIMM: What plans for development does the company you run have,
considering that the "family" relation with the other companies from
Romania, members of the VIENNA Insurance Group, raises a lot of questions?
Boris SCHNEIDER: The VIENNA Insurance Group has a vast experience
in operating by a multi-brand strategy. We believe there is still enough
room on the Romanian insurance market for all VIG member companies. Also,
competition can only lead to excellent results; thus, given that we have
a very good communication across the group, we can even learn from our "sisters".
For instance, OMNIASIG has some very good parts to it, and the same applies
to ASIROM, so we can only learn from each other. In the end, may the
best one win!
Looking from a different perspective, we must admit that we discuss about
totally different companies, with different market approaches. As a group,
however, we build synergies that can be achieved in departments like
back-office, IT etc. But these are plans on very long term, which means
that, for the time being, there won't be any major changes.
XPRIMM: Is there any initiative of collaboration between VIG member companies
in Romania, such as setting common policies and strategies for market
B. S.: We don't discuss about our commercial strategies; as I said,
the competition is free. But if one of the VIG companies in Romania sells
a product at half the price of another group company that provides a
similar product - I imagine that someone, in Vienna, will start asking
questions and investigate the case.
XPRIMM: What do you think is the main threat for the Romanian insurance
B. S.: The price should no longer be the main criterion that differentiates
between insurance companies in Romania. I believe this is the only thing
we need to make sure it happens on the market as a whole. In fact, this
was a stupid mistake we made the previous years and even last year, on
the motor third party liability insurance market, when at least one company
sold MTPL policies almost for free. This company, just like the other
ones adopting this strategy, only managed to achieve a planned loss.
In case ASIROM would start selling MTPL at extremely low prices, no one
would be left on the market but us, because we have the strongest sales
When the Romanian insurance market convenes on official occasions, discussing
the problems of the relevant market, everybody agrees that franchise
on Motor Hull must be introduced and that MTPL prices are still low.
Immediately after these meetings we can see the same companies displaying
a behavior that is totally the opposite of what they defended in the
official statements made during those meetings. And prices do anything
but increase, although the increase would only be normal and healthy
for the market.
Moreover, the market is really faced with a problem related to claim
rate, especially on the motor segment. At ASIROM we have taken many measures
in this respect, the most important one being the introduction, beginning
with November last year, of a mandatory franchise for Motor Hull policies.
We planned to maintain the portfolio of ASIROM traditional clients and
avoid those clients who, every year, shift from an insurer to another.
Eventually, Motor Hull doesn't have to pay for damage amounting to EUR
100 or less... the fixed costs are already too high.
Nevertheless, I do hope it won't be long until the Romanian insurance
market is truly strengthened. I am fully confident that better times
are yet to come. Clients will understand that they shall get only best
quality services, as they pay for it.
Things cannot change in just one year, but I am sure we are on the right
XPRIMM: What objectives did ASIROM set for this year and what has been
achieved so far in this respect?
B. S.: We've already introduced a dual management system, which shall
be put in place through a Supervisory Board and a Board of Directors.
The decision was already made at the General Shareholders Assembly, organized
at the end of February. All VIG companies implemented this system and
it works, based on this solution. Practically, the main advantage is
that the company management becomes 100% responsible for development
- thus making ASIROM more flexible for the client.
Moreover, at the beginning of May, we shall start a major rebranding
process to mark the affiliation to the Austrian VIENNA Insurance group.
Also, we plan to improve the positioning of ASIROM as retail insurer.
We also intend to expand the brand's awareness to the small and medium-sized
enterprises, which actually represent one of our main targets for 2008.
The total investments shall be considerable, and they are still to be
XPRIMM: What is the strategy of ASIROM this year, market share or profits?
B. S.: We are not interested in reaching a significantly higher market
share. It would only help if we wanted to impress some financial analysts,
but the clients are not at all interested in our market share; the shareholders
either, they want profit. For us, the main objective for 2008 is gaining
profit, especially since 2007 was a difficult year because of the increasing
claim rates we had. At the same time, we intend to complete the ASIROM
restructuring process in 2008 and reach a modest increase in the company's
underwriting, similar to last year, of about 6-7%.
Another measure concerns the savings at administrative level, in a context
where, last year, we had a major increase in costs for workforce remuneration,
due to the fact that we offered the employees numerous seniority bonuses.
When added to the losses caused by flooding throughout the country, our
profitability was clearly affected, hence the need for a capital increase.
The investments for the company's development will, obviously, continue,
as in October-November this year we' shall implement the new IT solution
XPRIMM: Why was this capital increase necessary?
B. S.: In my opinion, ASIROM experienced some difficult times with
the restructuring, shifting from the old organization system to the VIENNA
Insurance group, while maintaining the market share, which was one of
the aspects of the strategy adopted at the time. We had to support the
development and the restructuring with the appropriate capital. We also
took this measure to compensate for the losses of the previous period,
and not because we did not have the solvency limit.
ASIROM must become strong again. The capital increase is also a sign
for all our employees - showing that we appreciate them and we are a
resilient company, part of a strong international group -, and for our
XPRIMM: Can we expect a change in the ASIROM values and brand orientations
in the future?
B. S.: We are the strongest insurer in terms of sales network and
we intend to stay that way. We also plan to jump on the SME sector's
development train. Moreover, we have already achieved results by winning
several tenders, so we are encouraged to continue in this direction as
well. We shall equally get involved in insuring Austrian investments
in Romania. Vienna will not intervene in this, whoever offers better
conditions and services shall win those accounts. Everything will happen
in the spirit of the free competition I was mentioning earlier.
XPRIMM: Thank you!
Editor: Alexandru CIUNCAN
| Published on 27.03.2008