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PRESS RELEASE
Europe: Affinity insurance
 18 May 2015
 By Jacqueline Legrand
Quality, simplicity and price are the ingredients for a successful
affinity space in Continental Europe, says Brokerslink's
Jacqueline Legrand
While the market is not as mature as the UK, affinity insurance
has considerable scope for future growth in Continental Europe.
As with the UK, the key to success is to provide creative and
simple products, good services and access to a leading edge
technology platform to manage policies and claims. European
consumer associations are, however, also looking closely at the
products offered to consumers to ensure quality and their
influence should not be ignored.
A growing market
The affinity insurance space is broad in scope in respect of both products and distribution
channels. It ranges from professional liability insurance offered to members of unions to the
insurance embedded in credit cards to the various insurance products developed by retailers and
telecom operators. There are tens of thousands of affinity programs already provided by the
Continental European insurance market with more products and more distributors being added
every day.
Consumers can buy insurance from agents, brokers, direct insurers, banks, telecom providers,
food and non-food retailers, travel operators and more. As a result they are exposed to
insurance offerings whenever they buy electronic equipment, shop for food in the supermarket,
go to their bank, buy or finance a car, buy a trip online or rent a pair of skis. By utilising
increasingly sophisticated databases, savvy European insurance sellers are also building smart
email campaigns and using well trained experts in their call centers for targeted cross-selling
and upselling activities.
In a recent paper, Accenture estimates this ‘small-ticket' insurance market in Europe will
continue growing at a compound annual rate of 6.2 % to reach USD $17.1 billion by 2017. As a
result this market is extremely attractive due to its growth opportunities and potential
profitability. It is also very competitive and therefore critical for the insurers, brokers and other
players in this space to invest in high performing and continually evolving technology platforms.
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PRESS RELEASE
Innovation in affinity
These platforms not only deliver productivity in the management of large numbers of small
premiums policies, but also provide an enjoyable consumer experience regardless of whether the
interaction is via a computer or mobile device. As well as executing targeted marketing
campaigns, emails and phone calls, a dynamic customer relationship management system will
provide the instant data analysis that is fundamental to tracking loss experience, consumer
trends and developing adequate pricing and wordings.
As affinity products address the mass markets they must also be simultaneously creative, simple
and inexpensive to appeal consumers. Most of these products are purchased on the spur of the
moment; for instance purchasing a three-year warranty extension with a laptop, or a theft and
damage policy with a mobile phone, or even cancellation insurance with a concert ticket. Some
innovative products are designed to trigger consumer feelings - such as pet insurance products,
which is a fast growing affinity sector in Continental Europe.
The numbers of products and players in the affinity insurance market is growing. This rapid
expansion has also triggered interest from consumer associations who are now looking
increasingly closely at the products available in the market to ensure quality. Insurance
regulations are also evolving to allow consumers to cancel policies with more ease.
Protecting consumers
Although consumer associations are taking an interest in the market, the insurance industry in
Continental Europe also believes in delivering quality products and services to clients. As a
result, FG2A, a federation of affinity insurance, was created in France in 2012 to bring together
insurers, brokers, distributors and service companies in this common endeavor.
The Federation also produces newsletters and stages events to keep members informed of new
regulations, new trends in the affinity world and new products. This sharing of knowledge is
certainly benefitting members and contributed to the harmonious development of the affinity
sector in France. In 2015, FG2A was also created in Iberia with the same approach.
The affinity insurance market in Continental Europe is evolving quickly and may well catch up
with the UK within a few years. In the meantime developing quality products focused on
delivering worthwhile protection to customers will help to drive both sales and profitability.
Jacqueline Legrand, CEO of MDS Portugal, part of Brokerslink
This article was first published in Post Magazine.
http://www.postonline.co.uk/post/analysis/2408098/europe-affinity-insurance#
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