AXA knocked, but not down
AXA had a poor first half this year, and is now planning significant changes to its strategy and organisation.
Wednesday, May 31st 2000, 12:00AM
The group's New Zealand operations reported a loss of $2.1million for the period due to one-off adjustment costs. Overall the AXA group saw its profits fall 14 per cent to $145 million after tax, and before adnormals.
The problem in New Zealand was that the company was hit by worse than expected claims experiences for individual and group business.
Business volumes were similar to the previous period, however sales in the health insurance sector were down.
AXA says the company is planning significant changes to its strategy and organisation and it plans for a three-year transformation.
The major elements of the changes are:
- increased focus on retail investment and superannuation markets;
- ambitious management targets for profitability of new business, net retail funds flows, expense ratio, service delivery and employee satisfaction;
- launching a major transformation program aimed at becoming one of the top 20 performing companies in Australia and New Zealand over the next three years;
- and a new organisational structure focused around customer segmentation, including a new adviser management structure;
- and changes in senior management.
AXA Australia again suffered significant losses in its income protection business due to poor claims experience. This time it booked $13 million in product losses compared to $15 million a year ago.
It says other companies were recording losses too, because of inadequate pricing, product design and underwriting.
"A clear plan of action is being implemented which will address the tightening of claim management, the underwriting of new business as well as product design and the pricing of these products," the company says.
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