My first question
will be regarding the truly historical development
of Generali in the Czech Republic. The company has
set its foot here since the 19th century and after
a break after the Second World War, you started
picking up again. Could you provide us with a short
historical background?
Indeed, the history of Generali in the Czech
Republic started in 1832 and last year we celebrated
the 170th anniversary of our activities on Czech
territory. Until and before 1945 Generali had
already played an important role on the Czech
insurance market. After the Second World War we
were forced to leave the country and could only
come back after the Velvet revolution. A truly
new era started for us in 1993 and it gives us
another reason to celebrate, this time the ten
years of our new existence in the Czech Republic.
It was a very interesting history for me personally
also, since I have been here from the beginning
of our "new" history. I started working
for Generali a year before its arrival to the
Czech Republic, in 1992 in Vienna as a member
of the Czech Project that makes me the oldest
employee of Generali here in this new era.
How have you been developing your clientele,
portfolio within this new environment?
Within those ten years we became the seventh
biggest company in terms of the market share,
that means we hold almost 4 % of the entire market.
Our total annual premium income for 2002 will
be 2.720 billion of CZK. Out of that we have approximately
30% of life insurance products and 70% non-life
premiums. We have now more than 400 thousand customers
and now I hope that after we merge with the company
Zürich Financial Services we will improve
our position on the market of corporate clients
and also increase the number of our customers.
Talking about the merger, could you tell us
more in details? You are also in talks with another
insurance company to join your forces, is that
right?
Concerning the merger with Zürich Financial
Services, that was an agreement between Generali
Holding Vienna AG and Zürich Financial Services
and according to it we are joining our forces
in four countries - Poland, the Czech Republic,
Hungary and Slovakia. The most significant change
was in Poland, where thanks to this deal Generali
could improve its position radically. Also we
should not underestimate the importance of that
transaction for us here in the Czech market. By
taking over, Generali´s premium income will
increase by 40 % and therefore we will significantly
increase our market share.
Apart from the improvement in your market
position, what other benefits will it bring you?
Generali on the first place is a retail insurance
company. On the other side Zürich Financial
Services specializes on the industry and individual
risk. Therefore, we will have a very good position,
because these two different activities will merge
together. With regards to the deadline, we started
on the 1st of January, after three weeks we still
do not know exactly how much time it will take
us. However, I suppose it is possible to stabilise
the situation till the end of June and till the
end of December the whole integration process
should be finished so we can be ready again for
other possible mergers.
According to a study, the floods in the Czech
Republic have shown that there is a gap on the
insurance market in the Czech Republic. What has
been your experience?
I see it completely differently. The total damage
in the Czech Republic is between 70 and 100 billion
of Czech Crowns. From this total amount 35 billion
will be covered by insurance companies, that is
between 30% to 50%, which is significantly higher
than in Germany or Austria. So I do not see many
new possibilities for additional activities, only
on the individual side of risk acceptance, and
that there will be an increase of premiums from
this kind of dangers or risks. The only change
that I expect is in the deeper and better selection
of the risks and in the awareness of possible
future water risk.
Would you say that it is one of the important
things for insurance companies to consider in
the Czech market?
The most important thing is the readiness of the
government to find a new solution for the situation
with the pensions. We are still running the old
pension system and because of the possible development
in the future, this is what we should target. It
is one of the latest issues. We have the chance
to change the system. One of the possible steps
would be to include life insurance into the pension
system. |
Do you expect a kind of a second boom?
I think we have a great space for development.
When I take the global figures for Generali, the
life premiums comprises 60-65% of the portfolio,
in the Czech Republic it is only a half of it.
We can also see it on the figures of the Czech
market. During the last year, the non-life premium
market grew by 10% and the life premium market
grew by 20%. Therefore I think in order to increase
the market share it is necessary to be very strong
on the life insurance side of the business and
of course to improve sales.
With the new and more complex company comes
a new communication strategy?
Regarding our position on the market we are in
a very good position, because we are the fourth
best-known company on the insurance market. Therefore
we do not want to make special changes after the
merge, but we want to continue with the previous
communication strategy, which proved to be very
successful.
The fact that you will be also focusing on
corporate clients will not affect your communication?
Only because of not having sufficient know-how,
we were not deeply interested in this part of
the business. Now, by taking over these, experts
with knowledge will concentrate on this clientele,
however the "old" clientele of Generali
are still small and medium size companies and
families and we want to continue this way. I don't
want to set priorities; both of these will be
an important part of the business.
The Prague branch is one of the oldest offices
of the company in Eastern Europe. What will be
your expectations regarding the future development,
not only in the Czech Republic, but also within
the region?
In Austria, Generali is the third biggest player
on the market, in Hungary, Generali Providencia
is the second biggest on the market. I think that
for us the challenge is to become among the three
biggest.
Generali has recently opened a bank in Vienna,
do you see it as a possibility for the Czech Republic
also?
It all started in Italy with Banca Generali and
because of the great success we had there, Generali
decided to develop it further in Spain and Austria.
Concerning the Czech Republic, I do not see it
necessary for the time being. Having a share 4%
of the insurance market, it is not sufficient
to start such a project. Therefore we are interested
to co-operate with existing banks but we are not
ready to start our own activity.
Who are your main partners on the market?
I will try to divide it into groups. One is the
sales co-operation. The whole Generali Group in
Central and Eastern Europe is co-operating with
MBI, the biggest Austrian sales structure. In
the car insurance, we have a very successful co-operation
with all the three biggest leasing companies on
the Czech market - CSOB Leasing, CAC Leasing and
Škofin. Regarding banks, since September
2002 we started to cooperate with GE Capital Bank.
Concerning corporate clients, we are providing
services to all Generali customers from Italy
and Austria and after the take-over of Zürich
Financial Services, also to their clients.
We always like to talk about the people that
are behind the business. Could you tell us about
your professional background, especially since
you are the oldest employee here?
It is an interesting story. I started to work
in machinery; my first activity was in chemical
engineering and projection of chemical plants.
Then I changed my career to IT area. I came to
Generali in 1992 as an IT development manager.
You can imagine the situation; you can find IT
in almost any company. Since 1993 I was responsible
for IT, but soon I moved into insurance. My IT
background helped me to understand all the primary
and secondary processes in the insurance industry.
In 1992 I started to work in Vienna on the international
project implementing Generali on the Czech market.
in 1998 I became a member of the board and since
2001 I am the Chairman of the Board. For a period
of three years I was also a member of the board
of the Slovak sister-company, because we helped
to establish Generali in Slovakia and Poland from
Prague as well.
As you know, our readers are mainly investors
on the look out for opportunities. What would
you say to the ones that will be reading the report
on the Czech Republic?
I am personally, as a former Peugeot owner, very
happy that now a new plant in the co-operation of
Peugeot, Citroen and Toyota near Kolín, is
built. I think that it was a very significant step
from the side of the French investors towards the
Czech Republic, and I am very interested to see
what will be the second, third, fourth and fifth
one. |
