How would you describe Zurich Insurance in the Middle East?
We have had a licence in the UAE since 1989. Zurich offers commercial insurance products to large corporations and life insurance solutions to retail and corporate customers.
After closing the retail general insurance arm, the Zurich life business is our largest element, which offers retail products to customers via IFAs and banks. We also offer corporate solutions to multinational companies that are based in the region.
Our product distribution is fairly evenly split between IFAs and banks, and we work with all the key IFAs in the Middle East.
One of the really big things we have been focusing on is the need for protection as insurance penetration is very low in the UAE.
Many of our customers are expats. They are here with their families and if something were to happen to the main breadwinner or to the person that is sponsoring the family, they would have to relocate back to their home country. That is a significant financial burden that must be protected.
How do you determine which IFAs you offer terms of business to?
Governance and abiding by the local rules and regulations is crucially important to us. We are a branch of the Isle of Man business Zurich International Life, and as such, we are wholly regulated by the Insurance Authority (IA) here in the UAE.
We only distribute our products through financial advisers regulated by the IA and only deal with banks authorised to sell insurance via the central bank. We also only offer products to customers who are resident in the UAE. What that all means is that end customers have recourse to go to the regulator if they have any issues with their policies. In our case, they can go to the IA. If they’re not happy with that, they can go to the Isle of Man ombudsman or regulator.
Do you think the domination of banks in Middle East financial services has driven Zurich’s recent bancassurance agreement with Standard Chartered?
Zurich has been working globally to develop more relationships with the banks. We’ve already got very successful relationships in Latin America with Santander, in Germany with Deutsche Bank and in Spain with Banco Sabadell. At a group level, bancassurance is a key distribution channel for Zurich.
In the Middle East it is a valuable way of getting insurance products into customers’ hands. We have long-term relationships and preferred distribution partnerships with CitiBank, HSBC and, more recently, Standard Chartered, which was signed in May.
Many of our customers choose to go to an IFA but there are also many people that are more comfortable dealing with their banks.
There was a circular from the central bank in May about banning new approvals for banks and finance companies on savings, investments and insurance products. What has your response been to that?
As we are regulated by the IA, Zurich is working with them to ensure we get clarity and understanding of what that circular will mean for us. The banks we work with are awaiting clarification from the central bank.