Securian Financial Network by npu97223

VIEWS: 9 PAGES: 26

More Info
									Reagan
   Consulting




2003 ABIA Study of Leading
    Banks in Insurance
                October 2003


                                     Presented by:
                                     Jim Campbell
                                 Reagan Consulting, Inc.
                               jim@reaganconsulting.com
                                     404.233.5545
2003 Study Sponsors
 AIG American General
 Balboa Life & Casualty Company
 Securian Financial Network
        A Minnesota Mutual Company
   Transamerica Financial Institutions, Inc.
        A Member of the AEGON Group
 Century-National Insurance Company
 Assurant Group
 Progeny Marketing Innovations
Survey Responses by Region
                            ’98 – ’02
                     2003   Average
 Midwest
                     130      119
 Northeast
                     104       78
 Southeast
                      71       74
 Southwest
                      52       48
 West
                      49       50

             TOTAL   406      369
Survey Responses by Assets
                                    ’98 – ’02
                             2003   Average


 > $10 Bil                    24       29



     $1 to $10 Bil            70       69



         < $ 1 Bil           312      271


                     TOTAL   406      369
Bank Produced Premiums
Grew 26%
                                           26.0
                             23.4   22.9

         20%          17.8

Growth
               11.6
         10%




               1998   1999   2000   2001   2002
Premiums Growth by Line
                  Total                 26.0%

     Commercial Lines                       29.5%

              Annuities                     28.6%

         Personal Lines             22.4%

Individual Life & Health            21.7%

            -10.7%         Credit
Bank-Insurance Premiums
Composition
                     Credit
   Individual Life   3.6%
     & Health
        4.0%


  Personal Lines
      7.2%                    Annuities
                               68.6%



      Commercial
        Lines
        16.6%
Commercial lines premiums
    have grown . . .

       from 10.1% in 1997 . . .

             to 16.6% in 2002.
Excluding annuities . . .

  Commercial lines premiums
      have grown . . .

         from 31.5% in 1997 . . .

                   to 52.8% in 2002.
General Lines Participation
2002 vs. 1998
                      2002   1998

> $10 Bil             91%     89%


$1 to $10
   Bil
                      66%     49%



 < $1 Bil             33%     35%
Products Sold 2002 vs. 1998
                     2002     1998    Change
Term Life           37.6%    27.8%     +35%
Whole Life          32.3%    23.1%     +39%
Second to Die       25.6%    17.4%     +47%
Accident & Health   26.1%    22.4%     +16%
Disability          25.9%    18.7%     +39%
Long-term Care      26.6%    17.0%     +57%
Commercial P&C      25.8%    16.7%     +55%
Benefits            20.6%    13.8%     +49%
Personal P&C        27.4%    18.7%     +46%
Title               11.4%     7.1%     +61%
                            Average    +44%
    % Began Selling in 2002

+ % Planning to Sell by 2005

   = Momentum Index Score
Momentum Index – Top Five
                                       Momentum
                                       Index Score

1.   Commercial P&C (small business)     10.7
2.   Long-term Care                      10.1
3.   Commercial P&C (middle market)       9.7
4.   Disability                           9.7
5.   Term Life                            9.4
Momentum Index – Bottom Five
                                            Momentum
                                            Index Score

22.   Credit (MOB on RE loans)                 5.7
23.   Credit Unemployment                      5.7
24.   Credit Disability                        5.4
25.   Credit (single premium on RE loans)      5.2
26.   Private Mortgage Insurance               3.8
Debt Cancellation/Suspension
                           All    > $10 Bil

   Currently Selling      4.1%    24.8%

   Planning to Sell       6.8%    26.2%

   Momentum Index Score   7.8%    34.8%
Primary Customer Targets –
Personal Lines
   Property & Casualty   Life & Health



                                 71%
                         59%
     48%     50%



      All   > $10 Bil    All    > $10 Bil



            Affluent      Mass Market
Primary Customer Targets –
Commercial Lines
   Property & Casualty           Benefits



     70%                      64%


             29%                       25%

      All   > $10 Bil           All   > $10 Bil



    Small Business       Middle Market and Larger
EBITDA Multiples Paid
                 % > 7.0x

        Total               48%


With Earnout                      65%


   > $5.0 Mil                           75%


     '02 - '03                    67%
Will You Acquire Again?

       Total        88%



With Earnout              100%



  > $5.0 Mil        88%



    '02 - '03         97%
Profile of the Leading Banks
 48

 20   with > $10 billion in assets
    have > 3 years general insurance
 All
 experience
 Allreported > $1.0 million 2002 general
 insurance revenue
Revenue per $1 million in
Assets - General Insurance
          Total          $978


      > $10 Bil   $450


      < $10 Bil                 $2,280


   Top Quartile                     $2,518


Bottom Quartile   $404
Examples
    Assets       Median Revenue

   $50 Billion       $22,500,000

    $5 Billion       $11,400,000

   $.5 Billion        $1,140,000
Three-Year CAGR –
General Insurance
          Total                   33.3%


        Benefits                      35.3%


Commercial P&C                29.5%


  Personal P&C        19.1%


 Individual L&H    15.6%
Contribution to Revenue -
General Insurance
          Total           2.1%


      > $10 Bil    1.0%


      < $10 Bil                  4.0%


   Top Quartile                         4.8%


Bottom Quartile   0.8%
Contribution to Non-Interest
Income - General Insurance
         Total         9.6%


      > $10 Bil 1.8%


      < $10 Bil               15.8%


  Top Quartile                        18.9%


Bottom Quartile 1.9%
A Final Observation. . .
 Top performingbanks are emphasizing a
 “team approach” to sell to “targeted
 customers”

								
To top