Old Mutual Plc, Africa’s largest insurer, said it’s making changes to the way it sells products in China, moving away from targeting the most affluent individuals to expand its reach among the country’s workforce.
Old Mutual reaches customers in China through banks including Industrial & Commercial Bank of China Ltd., the world’s largest lender, and Bank of China Ltd. It intends to broaden that to online and direct-sales channels, Ralph Mupita, chief executive officer of the insurer’s emerging markets business, said in an interview. “Going digital will mean using the Internet and building up our telesales base.”
Old Mutual targets high net-worth customers in China, giving it just 100,000 clients, Mupita said, in a country that the World Bank estimates has a labor force of about 800 million people. The London-based insurer has had a joint venture in China with Guodian Capital Holdings Co. for about nine years.
“We’re operating at the very top end of the market, we want to diversify and move to the middle market,” Mupita said Thursday in Johannesburg. “Right now, customers come to us through the private banking divisions of their banks. Some of the Chinese customers are government officials.”
The push in China is part of Old Mutual’s efforts to broaden the number of channels it uses to win customers in emerging markets in Latin America and Asia to boost revenues from faster-growing regions.
Profit from Asia and Latin America grew 39 percent in 2014 because of improved results in China, “strong performance” by Colombia, and growth in AIVA, its Uruguay-based distributor, Old Mutual said in its year-end statement.
While the insurer courts affluent consumers in Colombia, in Mexico it’s more true to its South African roots, focusing on building a mass-market business targeting lower- to middle-income clients. AIVA distributes Old Mutual products across both countries.
“In Colombia, we’re diversifying our product range from pensions to life, and we’re diversifying distribution by using financial advisers,” Mupita said. “In Mexico, we’re building an advisory force, and in both regions we’re looking for bank partnerships.”