BBVA partners with Allianz
BBVA and Allianz have reached an agreement to create a bancassurance partnership, aimed at jointly boosting the non-life insurance business in Spain, excluding the health segment. The agreement, which is subject to the approval of regulatory authorities, is expected to generate a net profit of €300 million. Additionally, Allianz could pay up to €100 million more, depending on a series of goals.
Allianz and BBVA will combine know-how in underwriting, data and business analytics to digitally embed insurance into banking customer journeys and build together a new and innovative bancassurance platform. Its customers will now have easy access to Allianz’ insurance solutions through BBVA’s extensive branch network (~2,600 branches in Spain) and leading digital platforms.
The agreement considers the creation of an insurance business joint venture, to which BBVA Seguros will be adding assets and liabilities related to the non-life insurance business. The in-force business that will be transferred to the new JV includes around 300 million of gross premiums written as of 2019. BBVA Seguros will sell a 50% plus one share of the new JV to Allianz, for an initial fixed price of approximately €277 million, which will be adjusted according to the variation of the JV’s shareholders equity between signing and closing date. In addition to the fixed price, Allianz will pay a variable price up to €100 million, related to achieving specific business goals and attaining some milestones expected in the integration plan agreed by both parties. The agreement provides that BBVA will distribute, on an exclusive basis, the JV’s insurance products during a 15-year period.
“We are confident that the strategic alliance with Allianz announced today will strengthen BBVA’s strategy and it is fully aligned with our priority of improving clients’ financial health. Partnering with a top insurer like Allianz will bring a wider and more innovative insurance offering to BBVA clients in Spain.” – BBVA chairman Carlos Torres Vila.
“Our strategic focus is very similar and our collaboration in building one of the biggest bancassurance partnerships in property-casualty insurance, including a focus on digital solutions will lead to mutual success. This partnership will enhance BBVA’s offering by delivering a full range of attractive non-life insurance products to customers, leveraging on its leading position in the country, as well as on Allianz’ recognized brand and capabilities. We continue to innovate and join forces in co-creating world-class digital products for our customers, and we are pleased that BBVA has chosen Allianz as the best solution provider for its customers.” – Oliver Bäte, CEO of Allianz SE.
“BBVA holds a key head start in the non-life insurance business given the knowledge of its customers and clients and distribution capabilities through physical and digital channels. Allianz boasts a clear international leadership in innovation and development of insurance products.” – Peio Belausteguigoitia, head of BBVA Spain.
“We are very pleased to enter into a long-term bancassurance relationship with BBVA in Spain. This partnership strengthens our position in the market and demonstrates our strong commitment to continue growing in Spain, even more during these difficult times. Together with BBVA, we aim to develop new innovative insurance solutions that are simple and attractive for the customers.” – Iván de la Sota, Chief Transformation Officer of Allianz SE.