Insurance companies suffer under cost extensive regulation, low interest rates and demographic changes. Due to increasing cost pressure, insurers want to expand their asset management to boost group profits.
Just as many banks do, insurance companies want to increase the fees generated with their asset management for external parties to improve the performance of the whole organisation. An analysis of the Citibank shows that insurer’s asset management is currently generating less than ten percent of total profits of insurance companies. “It is surprising that the third-party asset management businesses of the large listed insurers still account for a relatively small part of their overall earnings,” says Farooq Hanif, a Citi analyst, on dpn.
Some big insurance companies are thus making their asset management expand a strategic priority. Allianz Global Investors has expanded their fixed income boutique with the purchase of Rogge Global Partners in February. Generali Investments has just recently been allowed to expand its operations to the UK, Sweden, Denmark and Norway. To do so, a new strategy has been introduced and a 16 men and women strong team has been set up taking care of external client’s money.