Middlesea to boost portfolio, flatten corporate structure
Middlesea Insurance plc is to continue to tap numerous opportunities in the local market, particularly by focusing on its existing client base and leveraging the experience and knowledge of the Mapfre Group, chief executive Alfredo Munoz told The Times Business this week.
Internally, the company is embracing a flatter structure and will not seek to replace the two vice-presidents who resigned in the last few weeks, he added.
“We are taking experiences from across the world,” Mr Munoz explained. “Some products are designed with UK input. Some of the more innovative products, like the extended warranty, GAP and wedding policies were modelled on those found in the portfolio of our companies in France and elsewhere. That is the advantage of a diversified group. There are many opportunities in the Maltese market – that is one of the reasons Mapfre decided to come here. There are classes of business that have been extended, and customer feedback has been very encouraging.”
Mr Munoz explained life protection products will continue to be enhanced and there is a collection of new ideas in the pipeline. With individual customers often opting for health insurance over life insurance, Middlesea will seek to offer more innovation where demand is strongest. Policies for SMEs and family businesses will become increasingly attractive.
Mapfre, the sixth largest non-life company in Europe, worked to high standards of achievement and was committed to delivering value to all stakeholders and upholding its social responsibilities. The Mapfre philosophy will become increasingly evident over the next few months, particulary as Middlesea is striving to raise the Mapfre brand’s profile locally, he said.
Asked whether former vice-presidents Chris Borg and Anne Marie Tabone will be replaced, Mr Munoz replied: “I have no plans to have vice-presidents. The structure Middlesea had until recently was designed last year. It was a transitional structure. Before that, there was a chief executive, chief officers and heads of department, all reporting to one person. Middlesea has returned to that formation.”
Mr Munoz described the team as experienced, qualified, autonomous, and boasting considerable talent.
Last week, Middlesea Insurance reported a pre-tax profit of €7.17 million for the six months to June 30, compared to €1.58 million in the first half of last year. Profits after tax quadrupled to €4.63 million – €2.79 million of which attributable to shareholders – compared to a profit after tax of €1.12 million in the same period last year.
General business gross premium written increased by 7.3 per cent from €17.1 million last year to €18.36 million to June. Long-term gross premium written reduced by 36 per cent to €45.50 million compared to €70.86 million in the comparative period in 2011.
“We are pleased with the results for the first half of the year and there were many factors which contributed to those figures,” Mr Munoz said of the results.
“Financial investment performance has improved, and that also buoyed MSV Life. The operational result is also up and non-life business has increased more than satisfactorily.
“The year ends on December 31, and I prefer to be prudent.”
Customer response to Middlesea’s new products also contributed to the positive first-half results. Mr Munoz explained the company now enjoys enhanced links with more distribution channels, has fostered more relationships with tied insurance intermediaries and agents, while direct business has also increased significantly. Policies directly written by Middlesea have risen by seven per cent.
Service levels, which are constantly under review, had a part to play in the first half’s performance. Mr Munoz said Middlesea was increasingly seeking to deliver higher quality, and company dynamism was having the desired effect on distribution channels.
Middlesea Assist, the 24x7 roadside assistance and home call out service launched in January, has succeeded in delivering added value to customers. New trucks are being branded to be added to the fleet and additional services will be announced shortly.
Asked about his outlook for the rest of the year, Mr Munoz said it would be realistic to maintain the same levels of growth achieved earlier this year.
“The market was frozen last year. The increase in premiums in non-life were only 0.2 per cent,” he explained. “All competitors are complaining about the rates not increasing, so we are not expecting huge increases for this year. The corporate market is very concerned about pricing of the most common classes of insurance as they try to keep costs low and assume a little more risk.”