Journal - Allianz

+ CHART ?Eingriff ins BudgetMEINUNGENAROUNDTHE WORLDShutterstockAllianz Group Journal 1/2013AWARDSIntervention innational budgetsIn Allianz’s view, more decision-making powers should betransferred to the EU level to be able to intervene in thenational budgetary sovereignty of member states in emergencies.Allianz board member Jay Ralph and chief economistMichael Heise presented a seven-point plan in Frankfurt inDecember entitled Euro 2022. The plan outlines the mostimportant steps for Europe to preserve its unity, stimulatethe economy and regain investors’ confidence.The debt burden of EU countries must be significantlyreduced and far-reaching structural reforms introducedby 2022, the two managers contended. This must includeclear rules for countries that fail to meet their obligationsin the currency union and extended powers for Europeaninstitutions, particularly with regard to the European bankingsystem. Europe has lost clout as a global economic andpolitical force in recent years. “European unity is the onlyAllianz Austria has been awarded a goldmedal by AssCompact, the specialist magazinefor capital and risk management, for thebest company pension scheme and the besttechnical insurance in Austria.Allianz Group OPEX, the Allianz Group’sinternal consultancy unit, took second placein the consultancy award of the magazineWirtschaftswoche in the marketing and salescategory for a sales project in Rumania.Allianz Belgium was the recipient of the2012 Insurance Broker Award of the consultancyfirm Decavi. This is the fifth timethat the Allianz subsidiary has been awardedthis honor.Allianz Australia has been honored for thebest marketing campaign of 2012 in theAustralian Banking and Finance InsuranceAwards. The company was also selected asthe best property insurer of the year and forthe best life insurance product of the year.Bajaj Allianz emerged as the best privateproperty insurer in the country in the IndiaBest Bank and Financial Institution Awards.It’s the second time running that the IndianAllianz company has clinched this award.Genialloyd, the direct insurer of Allianz Italy,has been honored in the Insurance MarketingAwards for its product Genialdent, whichcovers the cost of dental treatment after anaccident. It’s the first online insurance of itskind in Italy.way forward if we want to preserve our influence on theinternational economy, safeguarding our living standardsfor the coming generations,” said Ralph.In an interview with the Frankfurter Allgemeine newspaperAllianz CEO Michael Diekmann also advocated stronger EUpowers. “We need an authority that spells out what happenswhen financial agreements are contravened,” Diekmannsaid. To this end, EU countries must be willing to relinquishcontrol of their budgets to a European institution. If Europewants to retain its influence in a world in which the balanceof power is shifting, more decisions will have to be made inBrussels. “At present,” said Diekmann, “people are no longertaking the EU seriously.”WWW.ALLIANZ.COM/EN/ECONOMIC_RESEARCH→ PUBLICATIONS → SPECIALSAllianz Italy was presented with the ProgrettoGenerAzione Award (generationsproject) by the National Committee for EqualOpportunities in recognition of its initiatives tostrengthen cultural diversity and equal rights.Andrew Torrance, CEO of Allianz UK, hasbeen named chief executive of the year bythe industry magazine Insurance Times. Thedistinction is based on votes by his fellowCEOs in the British insurance sector.Allianz has been selected as the best globalliability insurer by the financial magazineGlobal Finance. Euler Hermes was chosenas the best global credit insurer. In addition,Allianz was named best insurer in Europeand the Central and Eastern Europeanregion as well as the best liability insurerand best manager liability insurancecompany.Mood barometerwith mixed resultsLast year’s Allianz Employee Survey (AES)has shown a slight upward trend: over95,000 out of a possible 118,000 employees(81 percent) at 67 subsidiaries took part inthis year’s survey – three percent morethan in 2011. Since the first AES in 2010,when 69 percent of the workforce tookpart, there has been a steady improvementin terms of employees’ commitment,satisfaction and advocacy for Allianz. Thisyear, the average score at the EmployeeEngagement Index was 70 percent (2011:67 percent), ranging from 49 to 87 percentamong the Group companies. There wasa similar disparity in the results of theLeadership Culture Index, with an averagescore of 62 percent versus 58 percent lastyear. Among the participating subsidiariesthe scores varied from 42 to 86 percent.69%78% 81%2010 2011 2012Survey participation per yearLetters to the editorLow fliersReiner Meise of AMOS in Stuttgart was puzzled when he read the space debrisarticle in the last Journal. He writes:In the interesting article on the hazards of space debris you write that telecommunicationsatellites orbit the Earth at an altitude of 36 kilometers above the equator. Can that beright? There’s still atmosphere at that altitude. Don’t you mean 36,000 kilometers, whichis about the altitude of a geostationary orbit at which a satellite’s motion is synchronizedwith the Earth’s rotation?Raimund Beilicke at the Allianz branch office Würzburg-West has also donehis sums:If, as described in your article on page 15, telecommunication satellites really do orbit theEarth at an altitude of just 36 kilometers, I can take down my satellite dish and lay a cable.Editor’s note:Reiner Meise and Raimund Beilicke are right. The distance of telecommunication satellitesfrom the Earth is 36,000 kilometers.Not funnyAmos Nathan Koeller of Allianz in Stuttgart on the choice of the Dilbert comic stripin Journal 3/2012:I usually find Dilbert very funny. He was also amusing in the 3/2012 edition. But I think thesubject is rather inappropriate in a company magazine. What are you trying to achieve inpublishing a comic strip that intimates that career goals don’t matter, that you can strive fora better car but never for a more meaningful job or career advancement? I hope that bettertaste will prevail in the choice of comic strips in the future.Readers’ ForumIf you liked or even disliked any items in the Journal,we would like to hear from you. Your feedback will help usto improve our content, so all comments and suggestionsfor improvement are welcome. Please send to:journal@allianz.comAllianz Journal, Königinstr. 28, D-80802 MunichGroup Intranet (GIN) → Allianz Group News→ Allianz JournalDeadline for submissions for theAllianz Journal 2/2013 is April 19, 2013.Shutterstock67

OpinionsRothAllianz Group Journal 1/2013Ten years ago the Allianz Group introduced itsLeadership Values. How has corporate culture changedsince then? How open is the corporate climate, andwhat makes a good manager? We asked Allianz boardmembers Manuel Bauer and Dieter Wemmer.INTERVIEW: FRANK STERN“You’re confusingMr. Bauer, Mr. Wemmer, expertscomplain that there are still companiesaround that use a command and controlstyle of management from the pastcentury. Is that your experience?Bauer: You find everything at Allianz ofcourse. You find very modern managementstructures and you undoubtedly also findrelics from the past century. We havea smorgasbord of management methods.Wemmer: As a global corporation you needto discover how deeply the management cultureis embedded in the country concerned.As board members it is our job to set anexample and ensure that the culture we’restriving to achieve is promoted within Groupcompanies. I believe that you have to provideManuel Bauer and Dieter Wemmerfrankness with brutality”a modern management environment inorder to motivate employees and keep themon board. Otherwise they’ll go elsewhere.Loyalty, particularly in high-performingstaff, is actually the best evidence that themanagement culture at Allianz is workingand that it’s valued. But I think that there’sstill room for flexibility with regard to shallowhierarchies. Hierarchical thinking at Allianz isstill too pervasive in my view.What’s the secret of successfulmanagement?Bauer: I value a direct management style,an ongoing exchange of views and constructivecriticism. Direct and candid feedbackhelps enormously in developing one’s ownpersonality.Wemmer: I think authenticity is crucial, asis talking openly and honestly to your people.Direct communication and continuousdialog with colleagues and employees areimmensely important for achieving commongoals. And those goals must be clearly communicated.Another point is continuity: Ifyou keep changing direction, employees willbecome unsettled. On the other hand, I needemployees who analyze my ideas criticallyand correct them if necessary.Isn’t it extremely exhausting whenpeople talk so bluntly all the time?Sometimes silence is golden.Bauer: You’re confusing frankness withbrutality. That’s not what’s meant by directcommunication or a direct managementstyle. You can come out with things in anoffensive way, you can manage employeesby using negative criticism or you can applyconstructive criticism.Research has shown that intelligentand strategically minded sociopathsin the workplace often enjoy aboveaveragesuccess. Do you know any?Wemmer: I met someone like that earlyon in my career – at a very high level too –but I’m pleased to say that the person inquestion eventually got his just desserts. Butthis type of career model does exist and thepeople concerned are often astonishinglysuccessful.Do you think that your employees giveyou their honest opinion?Bauer: You have to cultivate the practice,promote it. On the other hand, that alsoapplies to managers themselves. They haveto learn to deal with the truth, even if it isn’talways pleasant. It’s a learning process, butthe more people who adopt this process,then the better the company functions.Wemmer: Blind obedience doesn’t help usat all today. We need confident people whoassess their work and their boss’s instructionsin a critical manner – not in the senseof being constantly obstructive, but by consideringwhether it really is the best solution.Such an approach is important in the financialworld because we’re dealing with incrediblycomplex issues. If you look at the big financialinstitutions that have collapsed in the past fewyears, they were all managed by highly intelligent,committed people. But maybe thosewho were having doubts didn’t put theirhand up early enough. An open managementculture is important precisely becauseit helps offset misguided developments.Isn’t it the case that only the peopleat the top can afford to be critical andopen? Or someone who’s about toretire?Bauer: One of the reasons I’ve been atAllianz this long is because there’s alwaysbeen an open culture. I’ve always said whatI thought was right – no matter when orwhere. In so doing I take care to strike theright tone and to not offend people. But I’venever kept my opinions to myself. I’ve beenable to express everything that I had to say,every day and every hour in my 23 years atAllianz, and I’ve taken full advantage of it.Wemmer: Of course it’s easier to be criticaland help bring about change when youenjoy greater responsibility.Have you ever had an argument withyour boss?Bauer: I don’t argue with my boss or mystaff. We believe in dialog to voice differentopinions. As a manager you have to acceptthat. But in the end you have to make it clearthat the line manager makes the final decisionand that it’s binding. There’s no other way. Wecan’t introduce democratic decision-makingprocesses at Allianz. It certainly wouldn’t bebeneficial to the company.Wemmer: It’s important to respect oneanother. Openness isn’t about telling someoneyou don’t like the color of their hair.Openness is first and foremost about sharinginformation and not creating an informationmonopoly. If you’re in open dialog withsomeone with whom you enjoy a goodrelationship, you can even broach difficultsubjects without causing offense.Mr. Bauer, your postings have includedDubai, Slovakia and Korea. How do differentvalue systems and cultures affectmanagement behavior and culture?Bauer: When I started my job in Korea in2004 it was extremely difficult, becausethere was virtually no communication withinthe company. In Slovakia it was very openand people communicated directly witheach other. This is something that must bedeveloped. Today, information is exchangedin Korea too. Eight or nine years ago it waslike Fort Knox. Corporate culture isn’t absolute.It’s something that progresses. It’s ina state of constant flux.In 2003 Allianz introduced its managementguidelines. But what is thecommon denominator in a globallyactive company? Can you prescribesuch guidelines for everyone whencultures are so disparate?Bauer: They set out the minimum requirementsfor guidance. Are they 100 percentapplicable in every country? No. There willalways be exceptions that have to be discussedin detail. Guidelines per se aren’t abad thing, but they have to be interpreted.It’s essential that you use your brain whenyou read them.Let’s take a specific example: women inmanagement positions. This issue quicklyreveals what kind of culture prevails withina company. How can female managersinfluence corporate culture?Wemmer: A greater percentage of femalemanagers would certainly change a company’sculture, and in my view in a verypositive way. I believe that diversity leads tobetter results, since issues and problems89

GLOBALAllianz Group Journal 1/2013Allianz on thegoUp-to-the-minute weather reports, travelreservations, skyping and instant messaging –nowadays, thanks to wifi, tablets and smartphonesit can all be done while on the go. The same shouldapply to the insurance world, says Arne Benzin.He and his team are getting Allianz into shape forthe mobile age. It’s a rocky road.FRANK STERNIt’s still essentially virgin territory, at least for the insurance industry.But there’s no doubt where things are heading. In the future no onewill be able to do without mobile devices and apps. According to thefinancial services firm Morgan Stanley, the number of mobile deviceusers is set to surpass the number of computer users this year.Internet companies such as Amazon, Google and Facebook are thebenchmark and determine users’ expectations. “Our customersexpect a similarly high technical standard, an equally modern designand the same quality service from us as from other digital suppliers,and that’s 24/7 and anywhere in the world,” says Arne Benzin, who ismanaging one of Allianz’s future projects, Allianz oneWeb, the digitalinteraction platform, which will form the basis of all mobile productsfor the entire Group.Digitalization@AllianzHowever, the project team won’t be starting from scratch. There arealready 70 apps in use in the Allianz world, some of which are still inthe experimental stage. Not all make the mobile users’ hearts beatfaster, but if you don’t enter the market with polished apps, you’llprobably miss the boat as far as new customers are concerned. “If atfirst glance an app doesn’t appear to offer any advantage for users orif they have to click endlessly on a webpage to find the informationthey want, we’ll have no chance of converting a customer to this newchannel”, says Georg Schepers, in charge of mobile apps at AllianzoneWeb.The mobile task force: (from left) Arne Benzin,Georg Schepers and Roland von KölichenMore and more people are using the internet, notonly as an information source but also as a platformfor business transactions and for social networking.In response to changes in customer behavior Allianzset up a digital project group in 2010. The program,called Digitalization@Allianz, includes Allianz oneWebas well as other projects (see also the article “Digitalbroadside” in Allianz Journal 1/2012).RothBut what do users expect? Which apps from the digital arsenal are successesand which are flops? For the most part, this is all new territoryfor the insurance industry. We’re still improvising and trying things out.But one thing is clear as far as Schepers is concerned: a mobile websitehas to be designed differently to a classical internet site. “The contentmust be relevant and concise. People on the go are short of time. Theydon’t need a corporate presentation. They’re looking for informationthat comes quickly to the point,” he says. “Mobile apps must offer aclear additional benefit. Otherwise they won’t even be downloaded orthey’ll be used just once and then deleted.”1617

GLOBALShutterstockAllianz Group Journal 1/2013The mobile world offers more than just new sales communicationchannels: for instance, an SMS text to remind travelers to take outtravel insurance as soon as they’re abroad. In addition to commercialuses, Roland von Kölichen of Market Management sees anotheradvantage that has opened up with the advent of smartphones andtablets: “We now have new opportunities to contact customers byoffering them services and apps that make their lives easier. In thisway we can strengthen our ties to them. The aim is to provide ourcustomers with added value through practical mobile services.”Some of those services have already been successfully introduced, forexample, the Weathersafe weather app in Switzerland and Ireland,the Crossroads road safety game in The Czech Republic, the premiumcalculator at Allianz Italy and the accounting app for private healthinsurance clients in Germany, which is able to scan the barcodes ofdoctors’ bills. However, there are few examples of how an entire added-valuechain can be set up to meet mobile requirements, exceptperhaps in the aviation sector. Nowadays everything pertaining to airtravel can be done on a smartphone: from buying tickets to checkingin online to obtaining boarding passes. The insurance industry has along way to go to achieve such a high level of automation.The construction set includes an app that the mobile Team has justdeveloped for Allianz Global Automotive in Germany to simplify theclaims settlement process. Until now car workshops have submittedtheir damage reports on paper for the most part. However, if the datais entered into the system from mobile devices, the processing timecan be significantly shortened while at the same time slashing theerror rate.The app platform is no replacement for creative in-house developments.But in the future they will be based on a uniform scheme andwill be technically compatible with those of other Allianz companies.“Subsidiaries will be able to adopt them easily, avoid duplicate workand save development costs,” says Arne Benzin.Now that the platform is ready, the mobile team is focusing onthe next stage of the project – linking the back office and businessprocesses. Only then can customers access their data, take out orcancel a policy at the press of a button or enquire about the status ofa claim – all while on the move. It would also set the stage for digitalinvoicing and mobile bank transfers. It’s still a vision of the future butone that is already taking shape.Fruitful investmentsAllianz intends to close this gap with its digitalization offensive. Incollaboration with Allianz experts from various countries, the oneWebteam has put together a kind of construction set, which all Allianz subsidiariescan use to set up their range of services. “This is a platformon the basis of which each Group company can develop its own modulesand supply them to others, a sort of development and exchangemart for mobile websites and apps,” explains Georg Schepers.Use of mobile services by various subsidiariesin the Allianz GroupARNE.BENZIN@ALLIANZ.COMGEORG.SCHEPERS@ALLIANZ.COMROLAND.KOELICHEN@ALLIANZ.COMUse of mobile apps currently availablein the Allianz Group by business segmentThe world’s population is growing, but so isglobal hunger. It is predicted that the earth willbe home to nine billion people by 2050. Hugeinvestments in agriculture will be needed tofeed them, and it is the job of fund managerslike Bryan Agbabian of Allianz Global Investorsto find companies that make these investments.But the sector is under fire.MICHAEL GRIMMIt is perhaps the most elementary challenge confrontinghumanity: food security. According to the UN Food andAgriculture Organization (FAO), an eighth of the world’spopulation is malnourished. To feed nine billion people in2050, the world needs to invest an additional USD 83 billionper annum in agriculture. In short, food production will haveto increase by 70 percent. At the same time, the number offarmers is shrinking: as of 2008, more people live in citiesthan in rural areas.Germany: 18%India: 14%Switzerland: 8%France: 8%Brazil: 6%Travel: 39%General: 29%Finance: 13%Car insurance: 13%Health insurance: 6%However, growing yields in the past few decades haveshown that this Herculean task is feasible. Today a farmerin Europe with one hectare of land can feed 140 people;in 1900 it was just four people. So why do hundreds of millionsstill go hungry? The answer is sobering: “We’re still notproducing enough,” says Bryan Agbabian of Allianz GlobalInvestors in San Francisco. Agbabian manages the firm’sGlobal Agricultural Trends Fund.1819

GLOBALAllianz Group Journal 1/2013RothMr. Bouts, you used to be an underwaterwelder. That’s quite a career change.I was indeed trained as an underwaterwelder in the Netherlands by a companycalled AGA Gas, although I never workedas one. After studying history and takingan MBA, I set up a company with a fellowstudent and we produced marketing, safetyand education programs for welders forbig companies, like Esso and Shell. Twoyears after I started running the operationsperformance department for an insurancecompany. They wanted to industrialize partof their business which was exactly wheremy interests lay.I’ve been in the insurance business eversince, 27 years in fact, working most recentlyas the chief operating officer of the lifebusiness for Zurich Insurance Group inSwitzerland before taking on my current rolelast February. Actually the two industriesaren’t so dissimilar: industrialization andglobalization, pretty common in the metalindustry years ago, are currently coming tothe forefront of the insurance business.What previous experience is helpingyou in your new role?It’s all about balance. One key balance is content,process and people. Most people starttheir career in the content area, say electricwelding or claims management, beforebecoming interested in the processes surroundingthat content. Then they realizethat they won’t achieve anything withoutcollaboration and they become interested inpeople. Ultimately, I believe that good leadersbalance content, processes and people:the better the leader, the more they focuson people.Another balance is confrontation consensus:you get the best out of people if you can discussthings in a passionate way, if people getexcited about some statement or other. Youknow you have to reach a conclusion and aconsensus later on. Then there’s the femalemale balance in your team. And also, there’sthe strategy content balance – you can talka lot about where you want to go but if youdon’t know how to execute it, it’s prettydifficult. And finally, there’s the balance youneed to reach between customers, shareholders,employees and other stakeholders.That’s the one I’ve been working on for thelast five years.What has surprised you most duringyour first few months?On the positive side, I’ve met a lot of excellent,knowledgeable people at Allianz. Thesenior management here is committed tochange and the company is mastering thefinancial crisis. There is room for improvement,however. We have a very elaboratealignment process and sometimes have toalign so much that it’s difficult to executereal business opportunities. Moreover, weare sometimes too slow to react to whatcustomers want. That also means, however,that we still have a huge amount of opportunityto tap.I would like to see customers driving ourbehavior more. It’s a question of mindset.For example, when I was board memberof AEGON in the Netherlands I used to bedriven around a lot by a corporate driver.Every time I saw an accident, I asked mydriver to stop and, if one of my insured wasinvolved, I told that person that she or hecould borrow my car and my driver to bebrought to wherever they wanted to go.I’ve never received better letters of customerfeedback or provided better advertising fora company. Ten years later, those customersare still talking about it. I believe every executivecan do something to bring customerscloser to the company.One year ago, you became head of theGlobal Life Unit at Allianz. How canthe life business tackle the problem oferoding margins?One way is to mitigate the risks by focusingon new products. Another way is to investcustomers’ money where you can ensurethat it generates an adequate return, workingwith the big asset companies within thegroup, like PIMCO.It’s also important to look at the quality of ouroperating profit. We focus on the technicalresult and the result on expenses in order tomake more sustainable profit in the future.That’s where the program, One Global Lifefocuses – it’s no longer primarily aboutrevenue and that’s a big change for the lifebusiness. We don’t necessarily want to bethe biggest insurer all over the globe in life –we want to be among the three most profitableones and within the next five years.What is Global Life doing to counterbalancethe effects of the financial crisis?We want to focus more on protection products,which protect your family or incomestream, because these represent good valuefor customers and are more sustainableprofit-wise – then customers aren’t relianton the insecurities of the stock market orfluctuating interest rates.We are also working on link products – youlink them to investments in some of thesafer investment categories. And of course,we also need to generate adequate cash sothat the life business can pay its dividendsover time. We can’t succeed, however, unlesswe get and keep the best people.Which markets are you looking at?It is important to distinguish between emergingand mature markets. North America,Western Europe, and some Asian countries,Korea and Taiwan for instance, are in themature market bracket. Eastern Europe,some African countries, Latin America andparts of Asia are emerging. Our focus will beon countries like Indonesia, Malaysia, Thailand,Turkey, Poland and the Ukraine, and forhealth also on Brazil, China, India and Russia.This is about profitable growth. Of course, allcountries will be managed so that we attainhigher operating profit. What we need ismore recurring premium, more protectionbusiness, more corporate pension businessand certain kinds of health products. OtherwiseI want to work with what we have andTheo Boutsnot to expand into a lot of new markets. Youcan still do a lot of good things in the maturemarkets; I foresee a lot of good business incorporate pensions and health, especially inthe mature markets.Which products are you using to drivegrowth?As I mentioned, we are steering in the directionof protection products. I also see opportunitiesto bundle protection units, namelyoffering protection for your house, your carand your life, to reach greater alignment forcustomers. There is a rapidly growing middleclass in some countries, such as Brazil, Russia,Indonesia, and India, which offers us furthergrowth opportunities with health; we are alreadyshowing double-digit growth in thesefour markets.Is bancassurance critical to success?As long as you are prepared to adhere to acouple of rules, then bancassurance can besuccessful. You need to watch the marginsand you need a sound partnership betweenthe distributor and the product supplier,»Every executive cando something to bringcustomers closer tothe company.«namely us, to come up with the right productsthat are sold easily and offer solid propositionsto the customer. You also need to get as closeto the banks’ point of sale activity as possible,as that is where all the customer interactionis. We already have countries that do wellwith bancassurance. New deals, like HSBC inAsia Pacific, can add more distribution power.What about the future of life insurance?I see greater concentration on longevity andmortality products; those are the productspeople will be really prepared to pay for inthe future.WWW.ALLIANZGLOBALLIFE.COM2223

EUROPETauber’s employees examine old aerial photos of bombrelease zones from World War II on the computerboth pictures: TauberPushingthe limitsWhen building sites are approved in Germany today,they are first checked to make sure that no explosivesurprises from the past are lurking below the ground.Tauber’s geophysicists try to isolate the areas at risk withthe help of old aerial photos that the Allies took of theirtarget regions. Topographic morphology and irregularvegetation around possible points of impact can providetelltale clues, but such hints are lacking in built-upareas. In Munich the bomb lay for years under the cultpub Schwabinger 7 and was only discovered when thebuilding was torn down. It is estimated that of the millionsof aerial bombs that were dropped over Germanyduring World War II, 10 to 15 percent failed to explode –an excavator operator’s worst nightmare. Occasionally,Tauber’s search teams even uncover poisonous gasgrenades from the First World War.Herbert Tauber is a walking dictionary as far as bombsand grenades are concerned. Models, calibers, casings,and fuses – the man from Würzburg knows them all.And after almost five decades on the job he knows exactlywhen disarming a dud bomb is feasible and when therisk is too great. He receives calls and recommendationson a regular basis from “teachers and experts” who wantto tell him how the job should be done, grumbles Tauber.His compact stature becomes suddenly reminiscent offormer Bavarian prime minister Franz Josef Strauss whenhe was angry.In Munich too there was a raft of well-intentioned suggestionsfrom outsiders. People didn’t agree that thebomb to be detonated should only be covered with sandbagsand bales of straw, which would then fly aroundthe neighborhood setting roofs on fire. The public wouldhave advocated everything but straw bales. Cover it withstones, was one of the counter suggestions. “They wouldhave shot through the air like bullets,” says Tauber duckinghis head. “Why on earth should I discuss defusingmethods with lay people?”There were good reasons to choose straw bales: Theground water was a meter below the bomb and no onewas able to calculate what would happen if the pressurewave spread outwards in an uncontrolled fashion. Therewas also a gas pipe three meters from the explosion siteand a subway train tunnel 30 meters away. To limit thedamage the experts’ only option was to direct the pressureupwards. “Straw was the best solution,” says Tauber,“because it is also ideal as a shrapnel trap.” The fire fighterson the site soon put out the flames.Allianz also reacted promptly, immediately assuring itsclients that it would assume the costs despite a war clausein the building insurance policies. “Good publicity forAllianz,” says Tauber. “I should have got a commission!”WWW.TAUBER-SYSTEM.DEOLIVER.KONRAD@ALLIANZ.DEbelow: Roth | above: ShutterstockSunday, September 2, 2012, the Belgian Grand Prix: Right at the start of therace, Lotus driver Romain Grosjean crashes into the McLaren car driven byLewis Hamilton, catapulting his car and narrowly missing Fernando Alonso’shead. Chaos on the racetrack, flying debris, Alonso ends up in the gravel trapin his Ferrari. Not really suitable for use as a road safety film you might think.FRANK STERNAllianz Auto Day proved very popular: Nico Rosberg of the Mercedes AMG Petronas team und ex-Formula 1 driver Christian Danner(left and right next to the racing car) discussed safety developments in Formula 1 racing2627

EUROPEAllianz Group Journal 1/2013AllianzWeak spot: the headThe partnership does seem unusual on the face of it:on the one hand Formula 1, whose main appeal is acombination of thoroughbred racing cars and breakneckspeed, and on the other hand the biggest car insurer inthe world, which wants its customers to discover the joyof defensive driving. The history of Allianz in Formula 1began over twelve years ago. In 2011, the company joinedforces with Mercedes AMG Petronas.Between the racetrack and the highwayThis alliance of convenience should generate plentyof money for the racing circus and worldwide publicityfor the insurance company. But from the outset it wasalso Allianz’s intention to raise public awareness of trafficsafety. Admittedly, an accident like the one in Spa mayprompt people to doubt the wisdom of using Formula1 as a platform for such a message. But this very crashhighlighted the huge advances the car industry hasmade in recent decades with regard to occupant safety.Not so long ago a crash like that would undoubtedlyhave resulted in casualties.Safety Cars are used after an accident or inextreme weather conditions. The Allianz namehas appeared on the hoods of the safety cars since2010. Above: Nico Rosberg at the Allianz Auto Dayboth pictures: RothThe first Allianz Auto Day in Ismaning near Munich,held nine days after the crash, was positive proof thatthe racetrack and the highway have something in common.In front of numerous motor-racing journalistsand experts at the Allianz Center for Technology (AZT),representatives of both worlds discussed the latestdevelopments in safety technology and the transferof technical innovations in racing to mass production.It was a good choice of venue as the AZT is one of Germany’sforemost research institutes in the field of vehicletechnology and safety. To the utter dismay of petrolheadseverywhere, car after car has been driven into awall on the AZT’s crash circuit in the name of research.For Allianz, the world’s biggest motor insurer with over50 million insured vehicles, safety is of paramount importance.But generating interest in road safety can bequite daunting, the former Formula 1 driver and currentsports commentator Christian Danner said in Ismaning.People think they’re born drivers with everything undercontrol. That’s a fatal self-deception: According to theWorld Health Organization, traffic accidents claim morethan 1.2 million lives every year. Worldwide, trafficaccidents represent the fifth biggest cause of death,and in the OECD countries it’s the number one killerin the 15-to-24 age bracket.“Risk management starts in the mind,” says AZT managerChristoph Lauterwasser – and that’s where sleekracing cars leave a lasting impression. “Formula 1 is anexcellent platform for Allianz and motor racing to reach awider audience,” says Lauterwasser. In particular, it evenaddresses those drivers who dismiss safety advocatesas killjoys. Meanwhile Allianz companies in variouscountries are successfully exploiting the appeal of premiermotor racing events and their heroes as a settingfor their local traffic safety campaigns.First-hand experienceNico Rosberg, a driver in the Mercedes AMG Petronasstable, also makes regular appearances in the name ofthe good cause. At the Auto Day he reported from firsthandexperience on the importance of safety in motorracing.The monocoque cell, the supplemental restraintsystem (SRS), side impact protection system (SIPS) andthe roll bar, not forgetting the carbon-fiber front endthat absorbs most of the energy in a collision – all thesefeatures, some of which have already been incorporatedinto production vehicles, have greatly enhanced driversafety. The 27-year-old said that he’s glad to be a Formula1 driver today rather than in the 70s, when the issuewasn’t that high on the agenda.For some time now Formula 1 has been discussingways of better protecting drivers’ heads. The crash atSpa has rekindled the debate on this weakness in thesafety concept. One option would be a cockpit canopy.Tests at the Institute for Motor Sport Safety of FIA haveshown that such a safety feature can withstand theshock of a tire traveling at 225 km/h. But like others inthe drivers’ camp, Nico Rosberg is skeptical. What if thecar lands upside down after a crash and catches fire?Would the driver be able to get out quickly enough?WWW.FIAINSTITUTE.COMweaknesses that car builders had previously overlooked.At the moment, the greatest challenge for designers andtechnicians is to develop a light, thrifty vehicle withoutforfeiting safety. Lightweight construction and good crashbehavior aren’t mutually exclusive. Formula 1 racing carsare the best proof of that and therefore also serve as amodel for production cars. In the racing world thoughthey seem to have run out of options. “We’re pushing thelimits,” Nico Rosberg said in Ismaning.But at least there is still the option of improving fuel consumption,and at the Allianz Auto Day seven electric carmanufacturers demonstrated what such cars might looklike. Well, imagination is a fine thing, and sometimes realitydwarfed the weirdest visions. However, the thoughtof high-tech racing cars some day humming around thetracks at Spa and Monte Carlo even surpasses the imaginationof the most hard-bitten motorsports cynic. Bonafide Formula 1 fans probably wouldn’t even consider theidea: it would be just too horrible to contemplate.WWW.DRIVESAFELY.ALLIANZ.COMIn many cases today’s safety standards are the resultof accidents in the past. Crashes often pinpoint design2829

EUROPEThe best of both worldsOld age comes at a price. For some, it may mean extra wrinkles and grey hairs, whilefor others it has more serious consequences, such as deteriorating health or reducedmobility. For companies, meanwhile, old age increasingly equals higher payments,as longer life expectancy pushes up pension costs.below: Shutterstock | right: ACPAJörg Braun (left) and Michael SchützeLOIS HOYALPeople are living a lot longer nowadays. According to theFederal Statistics Office in Wiesbaden, Germany, every secondman in Germany reaches at least 80 years of age, andone out of two women will blow out the birthday candleson their 85th birthday cake. This longevity is leading tocompanies having to pay their employees pensionsfor longer. Statistics also demonstrate that the higherthe pension the retired receive, the longer theirlife expectancy. No wonder that more and morecompanies are outsourcing the risk contained intheir pension schemes.Longer life expectancy is good news for AllianzCorporate Pension Advisors (ACPA), a jointventure between Allianz SE, Allianz LebensversicherungAG and Allianz Global Investors, whichwas set up in January 2011 to act as pensionadvisors to large companies, with Jörg Braun ofAllianz Lebensversicherung and Michael Schützeof Allianz Global Investors as managing directors.ACPA coordinates all of the Allianz units’ corporatepension activities, assuming responsibility for Germany’s200 largest corporate clients, ranked in terms of pensionobligations. “This is our chance to advise companies, providethem with solutions, persuade them to take rising pensioncosts seriously, to manage these risks and ideally removethose risks from their company,” says Braun.The effects of a minus one percentage point change in actuarialinterest rate can lead to a 20 percent increase in pensionobligations, explains Braun. “I always tell companies that youknow what happens if there’s a natural disaster or if there isa fire. But have you ever stopped to think about the age ofyour employees, what happens when your employees keepon growing older and what kind of financial burden thatmeans for your company? Many companies haven’t got aplan in place. Others rightly realize that pensions don’thave anything to do with a company’s core businessand they don’t want to deal with them anymore.”One such company is Fuchs Petrolub AG, theworld’s largest independent supplier of lubricantsand related specialties, which in December 2011transferred its pension commitments of some50 million euros for around 430 employees andretirees over to the Allianz Pensionsfonds AG. Thisoffered Fuchs the advantage that the insurancebenefits are guaranteed (guaranteed interest rateof 2.25 percent), and that biometric risks, such asincreasing life expectancy, death, incapacity andcapital market risks were transferred to Allianz.Braun and Schütze are convinced that more companieswill undoubtedly follow their example in future. Fora good reason: besides the risks associated with corporatepensions, companies additionally have to grapple nowadayswith changing demographics, as well as the introduction ofnew accounting standards and regulations, and the resultingchanges in the valuation of pension obligations on theircorporate balance sheets.ACPA works nationwide with all Allianz pension units, drawingon the know how, products and services of the entire group.“Its competence lies in its pooling of expertise from the marketleaders in both asset management and life insurance andits unique position in the Allianz Group, being able to offer thebest of both worlds,” adds Schütze.ACPA looks closely at each client, comes up with proposalson how it can minimize or transfer its pension risks andoffers advisory services. Analysis of the age structure of acompany’s employees with the aid of various computationaltools is used to demonstrate the development of future pensionobligations. ACPA then works together with the companyto construct the right solution for them. That can be apure asset management solution, which is about managingrisks, or a pure life insurance solution, which aims to transferthe risk. Or it’s a hybrid of both. The right solution dependson a company’s individual needs, explains Braun.While ACPA operates in Germany only, discussions arecurrently underway to see if the model could or shouldbe expanded to other countries worldwide. The demandis there.JOERG.BRAUN@ALLIANZ.DEMICHAEL.SCHUETZE@ALLIANZGI.COM3031

EUROPEAllianz Group Journal 1/2013Cheops times fiveThe St. Gotthard massif is a mythical place for many Swiss people.It’s a place where their ancestors created the Swiss Confederation,where they fought against the Habsburgs and where William Tellaimed his crossbow at apples and governors. For Beat Guggisbergthe mountain railroad is a reminder of childhood vacations, but ina sense the St. Gotthard is also his mountain of destiny.FRANK STERNBeat Guggisberg of Allianz Suissehas been involved in the constructionof the Gotthard Tunnel since thefirst test detonation33

EUROPESpage 32/33 and left: Stern | right: ShutterstockInstallation of the railsystems in the GotthardBase Tunnel is in fullswing. In total, 290 kmof track is being laid2500 m2000 m1500 m1000 m500 mMasterpiece of engineeringFor many years the Alpine range was regarded as thegreatest obstacle to traffic in Europe. Around 1870a journey by coach from Basel to Milan took two fulldays. This only changed in 1882 when the first railroadtunnel through the Gotthard was opened. At the timeit was the longest rail tunnel in the world. The engineerLouis Favre had estimated that construction wouldtake eight years, but he didn’t live to see the tunnel’scompletion ten years later: in 1879 he collapsed anddied in the tunnel.Nevertheless, the old Gotthard tunnel – one 15 kilometertube with two tracks – was a masterpiece ofengineering. The tunnel axes deviated only 33 centimetershorizontally and seven centimeters vertically.And that was without the high-precision, computeraideddirection, distance and elevation instruments oftoday. In the new Gotthard Base Tunnel the maximumdeviation was just under 14 centimeters horizontallyand 2 centimeters vertically.Chauve-souris, bats. That’s the first memory Beat Guggisberg has of the Gotthard.As a child he and his family once stayed at a campsite on the other side of themountain massif. That’s where French-speaking children taught him the word for“bat”. “Our vacation started as soon as we left the Gotthard Pass behind,” says thehead of Technical Insurance at Allianz Suisse. The Gotthard: the frontier betweenschool and freedom.Back then he never dreamed that the Alpine massif would become the focusof his professional life. Today the 56-year-old knows the Gotthard like the backof his hand. Since construction of the longest rail tunnel in the world began in1999, Guggisberg has driven into the mountains more than 100 times in hiscapacity as an Allianz risk consultant. But it’s never become routine. “Whenyou’re standing in a freshly breached tunnel section and hear the rock groaningand creaking around you, it still makes you cringe, no matter how many timesyou’ve heard it.”Colossal forceNo wonder, when you consider that in some sections of the 57-kilometer-longdual-tube tunnel between Erstfeld in the north and Bodio in the south there’s2,300 meters of rock towering above you. In some places the mountain causedthe tunnel to cave in several times, resulting in considerable damage to thecladding and tunnel-boring machines. The engineers finally managed to tamethis colossal force by using flexible steel arches that give slightly in response topressure from the mountain, thus preventing the finished structure being deformed.The tunnel cladding and load-bearing structure should serve up to 100years without any major maintenance work. The breakthrough of the first tubewas achieved in October 2010. It was an emotional moment for all concerned.Beat Guggisberg also has vivid memories of the first breakthrough in the Lötschbergrail tunnel in December 2002 – an engineering project insured entirely byAllianz. For the historic event, construction workers and engineers, dignitariesand a band waited at the rock face, which was then breached from the otherside to great fanfare. Utter chaos ensued. Within seconds a thick cloud of dust0 mBaselZurichZugArth-GoldauGöschenenErstfeldAiroloBiascaThe highest point of the old railroad is at an elevation of 1,150 meters, 600 meters above the Gotthard Base Tunnelhad settled on everyone and made some of the musical instruments unplayable.“Everyone was coated in dust from head to toe,” says Guggisberg, unable tosuppress a grin.Anyone accompanying the man from Berne to the Gotthard Tunnel can learnsomething about rock formations as well as Swiss history. The drive along LakeVierwaldstätter is a rich source of information for both disciplines. The trainedgeophysicist can tell you about how the Alps were formed and the propertiesof the various layers of rock, which drove the tunnel constructors to distractionin some places. The drive to the north portal of the Gotthard route also passesthrough terrain steeped in history. It was here that Swiss rebels fought theHabsburgs for supremacy over the mountains and valleys.On the other side of the lake is Rütli Meadow. According to national myth, itwas here that the Swiss Confederacy was created at the end of the 13th century.And of course national hero William Tell is omnipresent. The William Tell plaqueon the shore commemorates the place where the rebel escaped from his captors.He then lay in wait near the village of Küssnacht for the Habsburg provincialgovernor Hermann Gessler and shot him with a bolt from his crossbow: “Throughthis narrow pass he must come.”But enough digression into the humanities. We’re more interested in what’s happeningin the Gotthard right now. We drive to Amsteg, one of the base tunnel’sBellinzonaLuganoFACTS AND STATISTICSGotthard Base TunnelChiasso• Overall length: 57 kilometers• Construction costs: approx. CHF 12 billion(just under EUR 10 billion)• Maximum rock overlay: 2,300 meters• Maximum rock temperature: 50 degreesRail technology• 290 km of tracks• 250 transformer stations• 6,000 km of cables• 480,000 concrete tie blocks• 417 SOS telephones• 120 km of transmitting cables (for cell phones)Maximum speed• Freight trains: 160 km/h• Passenger trains: 250 km/h• Maximum elevation: 550 meters• Maximum gradient: 0.12%Construction of the main tunnels• 75 percent with a tunnel-boring machine• 25 percent with explosivesMilano3435

EUROPEAllianz Group Journal 1/2013left: Stern | right: AlpTransit Gotthard AGThe safety conceptThe tunnel system consists of two separate singletracktunnels. The other tunnel will serve as a refugein the event of an accident or fire. Crosscuts connectthe two parallel tunnels every 325 meters. Theyserve as escape routes in an emergency. Emergencystations are located at Faido and Sedrun. From therepassengers can reach six crosscuts in the paralleltunnel, which is under positive pressure and thereforesmoke-free. Trains coming in the opposite directionwill be automatically stopped. An evacuation train willpick up the passengers and transport them into theopen air.five construction sections. It’s a two-kilometer-long access tunnel in the mountainsidethat ends at the future railroad track. It was here in 2003 that work began ondriving the two tunnel tubes in the direction of Sedrun. The tubes are 40 metersapart and linked every 325 meters by crosscuts.Adding up all the crosscuts, access tunnels and shafts the entire tunnel systemin the Gotthard stretches over 152 kilometers. More than 13 million cubic metersof rock were excavated – a volume five times greater than that of the CheopsPyramid in Egypt. A large amount of the spoil is used to make concrete at the constructionsites and is returned to the mountain in the form of cladding. Millions oftons of it were also used to create artificial islands in Lake Urner for recreationaland conservational purposes.The Gotthard Base Tunnel is the centerpiece of the New Alpine Transversal (NEAT),which includes the Ceneri Tunnel (15 km) in the south, and the Lötschberg Tunnel(35 km), which was completed in 2007. The rail line should help shift a large portionof freight transport from the road to the railway. The number of trucks drivingthrough Switzerland has been on the increase for many years. As a result, theGotthard road tunnel and the old Gotthard rail tunnel, which opened in 1882, arestretched to the limit of their capacities. Today 140 to 180 freight trains ply alongthe mountain railroad every day. The NEAT will accommodate up to 260 trains,which can be longer and heavier to boot. Rail capacity will double from the current20 million tons to over 40 million tons annually.An exercise in patienceA quarter of the tunnel length was excavated with explosive charges, the rest by tunnel boring machines. These monsters are up to 400 metersin length and weigh in at over 3,000 tons. The drill heads, which are fitted with rotary cutters, are over nine meters in diameterAs was the case at the Faido construction site. Between 2005 and 2007, seismicdisturbances triggered several micro-tremors measuring as much as 2.4 onthe Richter scale. The mountain squeezed the tunnel profile a few times, and insome places the ceiling collapsed. The team needed two years to complete one200-meter section. “That put paid to the schedule,” recalls Guggisberg. The costsfor damage to the tunnel vault and the tunnel bore machine (which cost over tenmillion Swiss francs) were assumed by Allianz Suisse and Nationale Suisse, whicheach have a 50 percent share in the insurance program for the Gotthard Base Tunnel.The workers involved in the first Gotthard rail tunnel between Göschenen andAirolo had to contend with similar difficulties. 177 miners lost their lives duringthe ten-year construction period on the 15-kilometer stretch – the longest railtunnel in the world at the time. That’s more than ten deaths per kilometer oftunnel. Thirteen workers have so far been killed during construction of theGotthard Base Tunnel. The biggest risk to life and limb however isn’t collapsingceilings or flooding. “The greatest hazards in modern tunnel construction areposed by machines and transport vehicles,” says Guggisberg.LondonParisBrusselsBarcelonaAmsterdamCologneFrankfurtZurichHamburgMilanoMunichBerlinBolognaPragueRomeViennaWhereas the old Gotthard track has a gradient of 0.26%, the Gotthard Base Tunnel’sgradient is just 0.12%. With a maximum elevation of 550 meters (mountain section:1,150 meters) the new route is also quite a bit lower. Freight trains will beable to travel at up to 160 km/h, passenger trains at 250 km/h. Travel time fromZurich to Milan will be shortened by an hour to two hours 40 minutes, makingrail travel a real alternative to traveling by car or plane. The tunnel is to be handedover to the operator at the end of 2016.Meanwhile, installation of the railroad bed, rails, power supply and telecommunicationand safety systems is in full swing. In three years the work should befinished. Completion of the Ceneri Base Tunnel in 2019 will finally close the gapin the European high-speed network. When the last remaining open stretcheshave disappeared – plans are already in the offing – travelers will probably whizzthrough Switzerland without any view of the landscape. Actually, quite a shame.The New Alpine Transversal Railway will close the gap in the Europeanhigh-speed network. Travel time between Zurich and Milan willbe cut by an hourWhen construction work began, it was assumed that the first high-speed trainscould hurtle through the tunnel as early as 2012. But the Gotthard didn’t playball. “Mountains can’t be x-rayed,” says Beat Guggisberg succinctly. “Despite allthe structural test bores in the construction area, there’s always a risk that you’llsuddenly hit fault zones somewhere along the line.” And then the drilling processbecomes an exercise in patience.WWW.ALLIANZ.CH | WWW.ALPTRANSIT.CH3637

AfricaAllianz Group Journal 1/2013Africa has the youngestpopulation in the world –a cause for hope, a causefor worryall pictures: Shutterstock (where not indicated otherwise)right: Allianz FranceSetbacks includedSue Robinson / Shutterstock.comAfrica: the word alone evokesimages of untamed nature, wildnessand adventure, but also of war andchaos, child soldiers and droughtvictims. Africa is all that, but it’salso a lot more. Allianz has set itssights on the potential of the “DarkContinent” … and is prepared forsetbacks.FRANK STERNMaliSenegalIvory CoastBurkina FasoBeninTogoGhanaCameroonCentral African RepublicCongo BrazzavilleSo far Allianz has focused on thefrancophone countries in WestAfrica. But there are also otherpotential candidatesAn insurrection in Mali, civil war in the Congo, bloodshedin Kenya: when Africa makes headlines, it’s usuallybecause of news of this nature. Such horror storiesovershadow reports that could put the continent in adifferent light – reports about the progress, success andhopes of a younger, self-assured generation. “Africa,”says Hervé Gloaguen, “is completely underrated.” (Seeinterview on page 43)MadagascarAs a member of the Executive Committee of AllianzFrance responsible for business in eleven African states,Gloaguen is in a good position to make such an assessment.“Between 2000 and 2010, the sub-Saharan regionenjoyed higher growth rates than India and Brazil. It’s justthat few people are aware of that,” he says. Not that hewants to sweep the continent’s colossal problems underthe carpet. As a company you have to be extremely carefulwhat you invest in, he says. But civil wars and politicaluncertainty are by no means unique to Africa.3839

AFRICAAllianz Group Journal 1/2013and further expansion in other countries, Gloaguen believesthat volume could reach a billion euros in ten years’time – “a target that will focus attention on Africa withinthe Allianz Group,” which, he believes, is taking almost nonotice of the continent at the moment.Leapfrogging a stageright: Stern | above: Hector Conesa / Shutterstock.comThe Djenne Mosque in the Niger inland delta region of Maliis a World Heritage Site. The north of the country fell into thehands of Islamists last year. Below: the team of Allianz Africa:(from left) Frederic Baccelli, Claire Hamonic, Patrick Mommeja,Patrick Ehrhart and Serge AucagneHelp in an emergencyAllianz is now making a name for itself as a crop insurerin countries such as Mali and Burkina Faso. Farmers cantake out microinsurance to guard against crop failure,drought and flooding. In 2011 the response was muted.Only 361 farmers could be persuaded that such an investmentmade sense. After a severe drought destroyedlarge parts of their crops, the insured farmers receivedcompensation that allowed them to survive the crisis andbuy new seed. It did the trick. This year over 15,000 farmersin Mali and Burkina Faso took out policies against cropfailure with Allianz Africa.“Nothing could have done more to convince people thatinsurance makes sense than the claims payments wemade after the drought,” says Patrick Mommeja, head ofthe Life and Microinsurance Department. It’s not the onlyinsurance field in which Mommeja and his team are tryingto attract customers. In Ivory Coast, Cameroon and SenegalAllianz Africa offers death and disability microinsurancepolicies. The company has over 150,000 customers in thissegment. “A premium income of just one million euros inthe microinsurance sector may be small,” says Mommeja,“but in Africa such policies can ensure survival.”Until a few years ago, Allianz concentrated on francophonecountries in Africa, a continent comprising54 nations and home to a billion people. Following inthe footsteps of French colonization, AGF (AssurancesGénérales de France) opened an agency in Cameroonas early as 1924. In 2010 the company, since renamedAllianz, opened a subsidiary in an English-speaking country(Ghana) for the first time. A year later the companyreached the breakeven point. The most recent link in thechain was established in Congo-Brazzaville in 2011.But Allianz Africa manager Frédéric Baccelli still has hissights also set on several other candidates in East Africa,including Uganda, Kenya, Tanzania or Rwanda. There’s areason why Nigeria, Africa’s most populous country, andAngola, which is enjoying a boom, are not yet on the list.“There are plenty of states in Africa with a rapidly growingeconomy,” says Baccelli. “But corruption and politicalinstability remain an issue.”The annual income of EUR 124 million generated in 2011by the 450-strong staff at Allianz Africa through 15 P&Cand life insurance companies in eleven countries accountsfor just a tiny fraction of the Allianz Group’s total turnover.But Baccelli and Gloaguen are optimistic that this willchange in the not-too-distant future. With an averagegrowth rate of between five and ten percent per yearAlthough they mainly supported French firms initially,the Allianz Africa subsidiaries now also insure numerousindigenous companies. But private customer businessis still in its infancy, and a sizeable middle class owninginsurable assets is just beginning to emerge. Accordingto the International Monetary Fund (IMF), 65 millionAfricans now have an annual income of more than3,000 dollars. That figure could reach 100 million by2015 and 240 million by 2040.An obstacle to expansion of the private-client sectoris that very few people have a bank account, and traditionaldistribution networks hardly exist. “We have only20 insurance agents on the entire continent,” says HervéGloaguen. The rapid spread of cell phones could help.Africa currently has 735 million phone subscribers – afterAsia the world’s second biggest telecommunicationmarket. The “Dark Continent” virtually leapfrogged thelandline stage. Cell phone density in Senegal is higherthan the average for the USA or Canada, says Baccelli. InAfrica, though, a cell phone is often not just a communicationdevice but also a work tool and a source of income.Workers use them to send money home to their families –even without a bank account. In Kenya, for instance, theamount of money transferred by cell phone represents afifth of the country’s GDP. Farmers call up real-timeweather data on their cell phone and compare marketprices for their products. They then sell where they canearn the most. A study in Ghana showed that half of thefarmers there who receive text messages about marketprices have been able to increase their income.Allianz Africa is also using cell phones as a sales andbilling platform. In Madagascar and Ivory Coast, for instance,the company offers a whole life insurance policy,40 41

AFRICAAllianz Group Journal 1/2013Allianz France“Africa is24. This figure is set to double by 2045. At the same timethere is a dangerous potential for conflict, because thenumber of jobs can’t keep pace with rising demand. Six often unemployed in Africa are under 24. It’s one of the reasonsfor political instability in many countries – a risk thatAllianz Africa has taken into account in its calculations.underrated”Hervé GloaguenThe African UnionAllianz companies in Africa provide a widerange of insurance solutions for the aspiringmiddle classThe West African Economic and Monetary Union comprises Benin, BurkinaFaso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. They all sharethe use of French as a commercial language and the CFA franc (Franc de laCommunauté Financière d’Afrique) as a national currency. All these nationsalso belong to the Inter-African Conference on Insurance Markets (CIMA)and adhere to the same legal standards regarding insurance matters.This facilitates the development of products and their introduction ontothe market.an accident policy, and a savings product that can bepaid into from a cell-phone account. Claims are settledthe other way around.Of course premium income from this sector is stillmodest. The main source of income from Allianz Africaremains the corporate and industrial business, whereit cooperates closely with Allianz Global Corporate &Specialty (AGCS) – for example in the construction ofa new harbor in Togo’s capital Lomé and the Dakar-Diamniadio toll road in Senegal. But private-customerbusiness has potential. “We’re talking about hundreds ofthousands, if not millions of customers,” says Gloaguen.And young customers at that.Africa has the youngest population in the world withalmost 200 million people between the ages of 15 andPut on iceIts employees have already overcome some crises in thefield. In Ivory Coast, for instance, there was an emergencyin 2011 when parliamentary elections caused unrest.Business was put on ice for three weeks to ensure thatno one was put at risk. No new policies, no claims settlements.“We told our staff to stay home and paid themtwo months’ salary in advance when all main banks ofthe country halted their operations generating a cashcrisis,” says Baccelli. “No one knew how long the crisiswould last.”Despite this interruption, 2011 turned out not too bad forAllianz, and 2012 even became its most successful yearin Ivory Coast. In Mali, where Islamist rebels took over thenorth of the country, emergency plans are ready. If thesituation deteriorates, foreign staff will be flown out andbusiness will be moved from the Mali capital Bamako tothe neighboring state of Burkina Faso.Despite all the uncertainties and setbacks Allianz Africais set to expand its presence and increase its productrange. Gloaguen believes that the cooperation agreementbetween Allianz and Western Union announced inMay is a good opportunity to reach a target group thathas so far remained untapped. “We could use WesternUnion’s network for collecting insurance premiums andfor making claims payments to customers,” he says. Bothcompanies are currently discussing further opportunitiesfor cooperation.WWW.ALLIANZ-AFRICA.COMHervé Gloaguen, memberof the Executive Board ofAllianz France responsiblefor Sub-Saharan countries,talks about a misjudgedcontinent.INTERVIEW: FRANK STERNMr. Gloaguen, Africa is often perceived in Europe as a grim monolith, only makingheadlines with civil wars and drought victims. Is Africa a lost continent?Not at all. Africa is usually completely underrated by the West. Of course it’s beset bypolitical and judicial instability. Mali is a case in point. There was unrest last year in BurkinaFaso, and Ivory Coast is still in turmoil. But let’s not forget the wars in Kosovo and Bosnia.That wasn’t so long ago, and they were somewhat closer to Munich and Paris. Africa offersopportunities. You have to differentiate of course; countries develop at different rates.Besides unstable regions there are others that are developing successfully. We thereforehave to consider carefully where we commit ourselves. What we look for are clearcutrules of business and sound contractual practices. We could perhaps expand faster butwe won’t commit ourselves at any price.Does an African currently manage any of the eleven Allianz companies in Africa?There are a number of African deputy managers. We’re training them so that they cantake over as managers in due course. That takes time and won’t happen from one dayto the next but it will occur, I am quite sure about that. And I’d like our African colleaguesto become more mobile, so that they don’t stay in their own country but work in otherAfrican countries too. Business is becoming more and more international and Africa isno exception.So far Allianz Africa has focused on corporate and industrial business. Where doyou see growth opportunities in the private customer sector?In the cities mostly. People belonging to the middle classes have bank accounts, a houseor apartment, a car – assets that can be insured. It’s still a niche market but just wait afew years. Economies are growing more rapidly in African countries than in Brazil andIndia. I’m not sure that everyone in the Allianz Group is aware of that.But in the countries with the biggest growth rates – Angola, Nigeria, Mozambique– Allianz isn’t represented. What’s holding you back?We have to take a close look at the circumstances we commit ourselves. We have toensure that our standards with regard to transparency and sound corporate managementare met. We choose our partners, customers and agents very carefully. We alsohave a certain role model function to fulfill there. Let’s not forget how we built up ourpresence in Eastern Europe after German Reunification in 1990. Corruption was rampant,and we also had to make choices about who we could do business with. Africa is nodifferent. It all takes time.4243

AustraliaAllianz Group Journal 1/2013The aviation team inMelbourne: (from left)Chris Rose, Michael Dalton,Tom Laine, Linda Talevskiand Jamie Connorleft: Rob Fox Photography |above: Stern | right: Ibrahimfied with. In an era in which everything elseis processed digitally, Dalton’s colleaguesenter their data into tables manually. “Itcosts us time,” says the amateur pilot.It wouldn’t be doing Michael Dalton an injustice to say that Allianz’s launch on the Australianaviation insurance market was somewhat less than perfect. Shortly after Dalton had acquired ahelicopter company as a client in 2008, one of its aircraft crashed. It was a total loss.FRANK STERN“Yes, well,” says Mike Dalton, “that was unlucky.”Up to that point, the safety record ofthe helicopter company, which he landed forAllianz Global Corporate & Specialty (AGCS)in 2008, had been excellent. But the ink hadbarely dried on the insurance policy whenone of its helicopters hit a pylon. Needless tosay, Dalton had imagined AGCS’s entry intothe aviation business in Australia differently,but the accident provided an opportunityfor his team: “We were able to prove immediatelyhow well our claims managementworked. That certainly made an impressionon the market.”With 18,000 aircraft – from light plane tobusiness jets to rescue helicopters – theAustralian General Aviation sector is relativelysmall. Nonetheless, the marketis competitive. Dalton’s five-strong team inMelbourne has secured a 15 percent sliceof the market, which generates premiumincome of around EUR 12 million. His targetis 20 percent.“We’re doing pretty well,” says the aviationboss, who got his pilot license in 1985 beforehe had even passed his driving test. The ITequipment is the only thing he is not satis-Dalton owns three planesthat would make the heartsof every aircraft enthusiastbeat faster. Two of them canbe seen in the photo: a 1953Cessna 195B (above) and a1947 Cessna 140The aviation team keeps a close eye onpromising aviation companies, checkingwhich aircraft they have in their fleet, whatthey are used for and the training that thepilots undergo. The company that wantedto use its helicopter for deer hunting in NewZealand and needed insurance cover didn’tmeet the grade. It had planned to suspendthe dead animals from the helicopter andfly them down into the valley. “Much toodangerous,” says Dalton.An object of desire, however, would be theRoyal Flying Doctors Service. Founded bya Presbyterian minister in 1928, the flyingdoctors and their fleet of 60 planes providemedical care in the remotest corners ofAustralia. They are able to reach everyoneon the continent within two hours from oneof their 21 bases. “They have an excellentsafety record and would suit our conceptwell,” says Dalton.The aviation business has also benefitedfrom the revitalization of the mining industryin Western Australia, fueled mainly bygrowing demand from China. The miningcompanies prefer to maintain a shuttleservice and operate their own airstripsrather than build entire settlements fromthe ground up for their workers in theoutback, explains Dalton. The northeastby contrast is mainly about tourism, suchas flights over the Great Barrier Reef orto one of the numerous islands.Flying schools, aviation museums, fertilizerplanes and regional airlines are also customersof the AGCS division. “We’ve got agood mix,” says Dalton, who sometimestakes off in one of his three Cessnas to visitclients. But he’s become more cautious withhelicopter companies – and not just becauseof his bad experience when he first started.“More and more suppliers are coming on tothe market,” he says, “but they don’t all meetthe necessary safety standards. Accidentsare on the rise.” In 2010 he allowed half ofthe policies to expire.MICHAEL.DALTON@ALLIANZ.COM.AUWWW.ALLIANZ.COM.AU/AVIATION4445

SocietyAllianz Group Journal 1/2013Carer includedAllianz Global Assistance has developed a new productline for the Swiss market that meets the specific needs ofdisabled people while on vacation. Unlike conventionaltravel insurance products, Secure Trip MyHandicapoffers protection not only for the insured party but alsofor his or her carer. The insurance is activated if theinsuree’s health unexpectedly deteriorates just prior toor during a trip. The package also covers medical appliancesto ensure the client’s mobility.MyHandicap was set up following a tragic accident in whichthe founder, Swiss entrepreneur Joachim Schoss, lost anarm and a leg in 2004. Schoss didn’t let this stroke of fateget him down, but he found it very difficult to find informationand contacts to help him return to a normal life.In addition, a special insurance will be designed allowingmobility to be insured separately. »My HandicapAssistance« becomes active if, for example, a wheelchairdevelops a problem and the insured party is unable tocontinue his or her trip. Services include conveyancehome, transport of the wheelchair to a repair workshopand delivery back home, provision of a replacementwheelchair and care of the customer at their place ofresidence until mobility is restored.Whereas others might have been resigned to theirfate, Schoss came up with an idea that resulted inMyHandicap: he invested some of his wealth to set up afoundation of the same name and a website containingall the available information on living with a disability.He was also able to get former US President Bill Clintonto act as a patron.Insurance for the disabledAllianz is turning its attention to the needs of the disabled: the Swiss branch of AllianzGlobal Assistance is currently developing an exclusive range of services and productsspecifically tailored to their needs. Its partner is MyHandicap, an organization thatknows more about the subject than anyone else.ShutterstockSince the beginning of this year, Schoss has had anotherpartner in Allianz. Allianz Global Assistance (AGA)in Switzerland is currently preparing a product rangetailored to the needs of disabled people. Products rangefrom special travel insurance to home care insurance.A wheelchair insurance is in the pipeline. From theMyHandicap’s Swiss internet page a link leads directlyto the AGA portal.Allianz and MyHandicap joined forces for the first timetwo years ago when Allianz employees helped theGerman branch of MyHandicap improve its organizationand work processes as part of the Social OPEX Program(SOPEX). Not a very complicated task on an internetplatform, you might think, but MyHandicap is muchmore than that.For starters, it has more information than can be foundanywhere else – from job openings for the disabled toadvice on barrier-free living, sex and relationships.On the other hand the organization also enlists theservices of a number of counselors, who – thanks to theirown experience – can help others affected by disability tolive a full life. One of the goals of the Allianz SOPEX teamwas to organize these »ambassadors« as efficiently aspossible.It marks the first time that support of a social initiativehas resulted in a business arrangement through theAllianz SOPEX program.WWW.MYHANDICAP.COMWWW.MYHANDICAP.CHWWW.ALLIANZ-ASSISTANCE.COMFRANK STERN4647

SOCIETYboth pictures: Dolphine Research InstituteAllianz Group Journal 1/2013Flipper in distressA tight-knit community is fighting to save a unique ecosystem and its equallyunique inhabitants off the coast of Melbourne. With little money but a great dealof enthusiasm the Dolphin Research Institute, set up in 1991, tries to interestpeople around the Port Phillip Bay in the underwater world on their doorstep.But most people are more worried about the coral reef off Queensland.FRANK STERNA new dolphin species has been discovered in Port Phillip Bay. Weir and his team are ableto identify individual dolphins from their dorsal finsJeff Weir is fighting to save a unique ecosystem and is willing to make compromisesto that end. Not everyone approvesIbrahimSurveys can be devastating, and one of them must have hada very sobering effect on Jeff Weir. The head of the DolphinResearch Institute has been trying for the past 20 years toget his fellow countrymen in the Australian state of Victoriato support the protection of Port Phillip Bay. But as recentsurveys show, the Great Barrier Reef lies much closer to thehearts of 90 percent of Victorians, and they’re also preparedto reach into their pockets to save it. “The money goes whereit’s big, beautiful and sexy,” says Weir. He, on the other hand,has to fight for every single dollar. Of course he is a bit envious.Yet Port Phillip Bay has just as much to offer as the 2,000-kilometer-long limestone structure off the continent’s eastcoast, according to Weir. The biggest attraction in the Bayis a school of around 130 dolphins. Within their offshoresanctuary they have evolved into a new species that differsgenetically from their ocean-going cousins. But the bottle-nose dolphin’s habitat is under threat. Effluent encouragesthe growth of carpets of toxic algae; native plants andanimals are being displaced by exotic species; and tissuesamples have shown that mercury concentrations havereached critical levels in the marine mammals.Research trip in a rubber dinghySince 2009, Club Marine, the Allianz Australia boat andpleasure craft insurer, has been a co-sponsor of Coastcare, anetwork of 60,000 volunteers nationwide who have taken upthe cause of protecting Australia’s coastal regions. Jeff Weir’sDolphin Institute in Hastings, 60 kilometers south of Melbourne,benefits from the partnership too, because the instituteis one of Coastcare’s sponsored projects. An injection offunds from the Allianz subsidiary for instance helped extendthe reach of the Institutes’ training projects and workshops.Funds remain limited but the Institute is now on a solid footingcompared to the early days 20 years ago. In the first year of itsexistence, young scientists who Weir had taken on for researchprojects, camped in tents because there was no money for accommodation.Their “research boat” was a rubber dinghy theyhad to pump up three times a day just to stay afloat.Today Weir and his team are able to monitor the 2,000 squarekilometers of Port Phillip Bay in a proper motorboat. They nowhave more than 50,000 photos of dorsal fins in their archiveto identify every single dolphin in the Bay. But the researchersdon’t just photograph their protégées. They’ve also recordednine different dolphin and whale species that visit the bay fromtime to time. Sharks have turned up on the odd occasion too.Twelve years ago the Institute initiated a training programcalled “I sea, I care”, which provides schools with an environ-4849

SOCIETYAllianz Group Journal 1/2013Dolphine Research Institute© 2011, Scott Adams, Inc./Distr. Universal Uclick/Distr. BullsThe Dolphin Research Institute has launched I sea, I care, a uniqueeducation program for school children. “You only protect what you knowand cherish,” says Jeff WeirA USTRALIAMelbournePORT P HILLIP B AYHastingsdolphins and their habitat. They are particularly annoyedwith him for his moderate attitude to the dredging of theshipping channel in Port Phillip Bay. “We even got threateningphone calls and were almost spat upon,” recalls Weir.It happened a couple of years ago, but it left its mark.mental lesson of a special kind. The children learn aboutthe fascinating underwater world and their inhabitants offVictoria’s coastline in training modules specially developedby the institute. And in excursions at sea they learn aboutthe dangers to the environment posed by humans. Weirand his team make a strong impression when they bring outtheir 19-meter-long DIY whale, made of polythene sheetsand stuck together with 36 rolls of duck tape. “We’re a bitlike stand-up comedians who tell jokes and hope that thepublic passes them on,” says Weir.Harsh criticismThe strategy is bearing fruit. In the past 20 years over100,000 school children and adults have taken part in theprograms. 1,400 young people have become “ambassadors”for the cause and have organized information events at theirschools with the institute’s support. “You only protect whatyou know and cherish,” says Weir, whose passion for theunderwater world was awakened as a child when he wentdiving for the very first time. “Victoria’s underwater worldis simply too precious to lose.”The marine biologist, who was born in Melbourne, has attractedharsh criticism from some environmentalists for tryingnot to be ideologically blinkered in his commitment to the“The question for me is whether or not we compromiseour ethical principles when we sit at a table with industryrepresentatives and look for common solutions,” says Weir.He is convinced that environmental concerns and theinterests of business can be reconciled through dialog.More to the point, without a strong economy, Weir believes,the funding for effective environmental protection simplywouldn’t be available. He thinks that blaming industry forevery environmental problem is a cop out: “It’s all of us whodiffuse pollution. We should question our own behavior too.”This is essential if the dolphins in Port Phillip Bay are to havea future. Four million people currently live in Melbourneand the surrounding area. In 2050 there will be two to threemillion more. Weir hopes that by then a greater numberof Victorians will be interested in the treasure trove on theirdoorstep. You only protect what you know and cherish.WWW.DOLPHINRESEARCH.ORG.AUWWW.CLUBMARINE.COM.AUHTTP://KNOWLEDGE.ALLIANZ.COMAllianz Journalgoes iPadReaders can upload the Allianz Journal totheir iPads and iPhones. Simply e-mail the screenversion of the PDF file from the Group Intranet (GIN)and you have the magazine available offline at all times.HTTP://GIN.ALLIANZ.DE.AWIN/JOURNAL5051

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