Want to be among top 10, will also pursue inorganic opportunities: Ageas CEO

In September 2022, Ageas became the first insurer in India to have a stake above 70% in an Indian life insurer. It also quietly acquired a 40% stake in Royal Sundaram General Insurance.

The Belgian insurer has built a strong and diversified Asian footprint spanning nine markets, anchored by long-standing joint ventures in China, Thailand, and Malaysia—its three largest and most mature operations—where it holds top-five positions, including being the only foreign insurer in China’s top 10. In an interview with TOI, Hans De Cuyper, the global CEO of Ageas Group, speaks about plans for India.What are your plans for India, including expansion, capital needs and potential listings?India is a key growth market for us, and our priority is to scale up our existing businesses rather than look at exits.

We are currently ranked around 12 in life and 15 in non-life, and our ambition—alongside our partner Federal Bank—is to build a top-10 life business. We are growing faster than the market and remain open to inorganic opportunities or new distribution to accelerate this journey. As long as returns are attractive, we will continue to deploy capital to support growth.

We are long-term investors and are not considering IPOs or exits at this stage.

Over time, we see growth driven by both scale and a shift towards higher-margin protection products, with significant headroom also in retirement and pension segments as the market evolves.With rising regulatory concerns around mis-selling, is there a potential backlash against bancassurance?Bancassurance remains a strong and relevant model, as banks are well placed to offer integrated financial advice, balancing short-term savings with long-term protection and retirement needs. It is also an efficient distribution channel that supports faster scale-up for insurers and adds fee-based income stability for banks.

While concerns around mis-selling are valid, they are not unique to bancassurance and need to be addressed across all channels.

If implemented responsibly, bancassurance continues to benefit customers, banks and insurers alike.Many European firms offshore back-office operations to India. Is that part of your strategy?Not really. Our model is highly localised, with each market managing its own operations rather than centralising back offices globally. Our Indian business already operates its back office locally, but we do not shift functions across countries.

While outsourcing is common in markets like the UK, we see it as a local, market-driven decision rather than a group-wide strategy.When would you consider monetising your India business through an IPO or stake sale?We are far from that stage. At our current scale—around 12 in life and 15 in non-life—our focus is on growth, both organic and inorganic, rather than any exit. India is our highest-growth market in Asia, and the strong valuation multiples here reflect this potential, reinforcing our long-term commitment.How do you view the high valuations of insurance companies in India?The elevated multiples underscore the significant growth opportunity in the market. We see them as a reflection of India’s strong trajectory rather than a concern, which supports our strategy to stay and expand.How will earnings catch up with valuations, and where will margins come from?Improving return on equity is key, with margins expected to benefit from scale given the fixed-cost nature of the business. There is also substantial headroom to grow higher-margin protection products, while over time retirement and pension segments will contribute as the market matures.Would you consider entering the pension business in India?If the right opportunity arises, we would be open to it—as we have done in markets like China—given the long-term potential of the segment.Do you plan to offshore back-office operations to India?No. Our model is highly localised, with operations and decision-making remaining within each market rather than pursuing large-scale offshoring.India is moving towards risk-based capital and IFRS. What will be the impact?The shift to IFRS and risk-based capital in India is a positive move. IFRS, particularly IFRS 17, will improve transparency and provide a clearer view of the intrinsic performance of long-term insurance businesses, where annual results can be misleading.

Risk-based capital will bring greater discipline, better risk allocation and stronger risk control, as insurers are required to quantify and take ownership of their risks.

While the transition phase may be challenging, requiring calibration and adjustment, experience from Europe shows it ultimately strengthens risk management. At its core, this enhances trust in the system, which is critical for customers in a long-term savings business like insurance.ULIPs have faced criticism for being seen as investment products rather than protection tools. What is your view?ULIPs are an evolving segment, and it is encouraging to see regulation moving in the right direction to strengthen customer protection. Transparency and clear communication of product features are critical. While ULIPs have their place, the focus of the market should increasingly shift towards long-term, stable savings rather than short-term, investment-oriented products. Regulatory adjustments, including around commissions, are part of a broader effort to steer the market appropriately.

Ultimately, maintaining high standards of customer service, transparency and compliance is key to building trust in the segment.With ongoing efforts to rationalise costs and commissions, where do you see the market settling and what is the ideal structure?The debate appears to be swinging back, but some level of commission regulation is necessary to bring discipline. Today, the market remains heavily skewed towards upfront, new business-linked commissions, whereas in Europe there has been a shift towards more portfolio-based structures.

That transition supports customer retention, improves loyalty and ensures distributors continue servicing customers beyond the point of sale.

A balanced approach—without overregulation—would likely involve moderating commissions and gradually moving towards renewal-based models. The transition needs to be managed carefully, as it can initially impact distributor incomes, but if done progressively, it creates a more stable, customer-focused system.You have been in the news for the acquisition of Esure in the UK. What was the rationale behind the deal?We were a mid-sized UK insurer focused on retail non-life segments like motor and home, operating in a highly price-driven market dominated by comparison websites, where scale is critical for profitability. To address our subscale position, we set out to become a top-three player through acquisitions, including Saga’s insurance arm with a long-term distribution tie-up and Esure, a digital-first insurer. These moves have lifted us into the top three, diversified our distribution across brokers and price comparison platforms, broadened our customer base beyond the 50-plus segment to younger cohorts, and positioned the UK business to deliver £300 million in profits by 2028.You chose to acquire a digital platform for scaling. Do you see that as the future?We see insurance, including in India, as a predominantly intermediated business driven by bancassurance, tied agents and brokers, even as digital plays a growing role. Rather than replacing intermediaries, we focus on “digital-enabled distribution,” combining the trust of agents and bank partners with strong digital tools to engage the next generation of customers. We are investing heavily in digitising bancassurance and agent networks, while also building capabilities to work with price comparison platforms, including through partnerships like Policybazaar in India.You are still a mid-sized company in Europe. What are your ambitions for the future?The transaction to acquire BNP’s stake in AG Insurance in Belgium will take us close to the top 15, while simplifying our structure by moving from a Belgium-level partnership to BNP becoming a group-level anchor shareholder. We will take full control of the Belgian entity—still contributing 40% of profits—while BNP will hold just under 25% at the group level. Alongside the earlier Esure deal, this has lifted our market capitalisation to around €12–14 billion, strengthening our independence in a consolidating European market.

With BNP and the Belgian government as stable anchor shareholders, we now have the scale and stability to pursue our strategy autonomously.Why has growth slowed for European insurers?Growth has been subdued primarily because both life and non-life markets are largely saturated, offering limited expansion opportunities, while GDP growth across Europe has slowed over the past two decades. In contrast, faster-growing Asian markets—characterised by ageing populations, underdeveloped social security systems and a young insurance base—offer far stronger growth prospects, prompting insurers to shift focus and export expertise to these regions.You spoke about the challenge of regulation becoming extra-territorial in Europe and sometimes conflicting with local rules. How do you manage this in markets like India?We manage regulatory differences through a highly decentralised model, where local entities operate with full autonomy. This ensures that data, investments and decision-making remain within each market, so requirements like local data storage in India are not a constraint. At the group level, we provide expertise in areas such as risk management, product development and data analytics, but execution remains local.

While we see value in European regulations such as GDPR and ESG frameworks, we believe they should not be imposed uniformly across markets. Instead, countries should adapt learnings to local contexts. Overall, regulation is becoming more customer-focused globally, which is positive, although in Europe it has also become overly heavy on reporting, sometimes at the cost of business focus.