Trends to watch in 2018. AIG acquires Validus. This week in insurance tech.
In 2016, AXA CEO Thomas Buberl put forth a strategy of transitioning AXA’s position in health from that of a “payer to a partner” by 2020.
In other words, AXA hoped to address more of its customers’ needs by developing digital capabilities in areas such as prevention and care.
In the past, AXA’s Buberl has also stated that insurers are under threat from tech companies muscling in on their health businesses. In a December 2016 interview with the Financial Times, Buberl said,
“Technology companies may attack us on motor insurance, but they will mostly attack us in health. If we do nothing, then in five years they’ll run us over. They will break down the barriers between pharma and device companies, and between doctors, hospitals and patients.”
Earlier this week, AXA acquired Chicago-based Maestro Health for $155M to establish a foothold in the US healthcare market.
On a November 2017 conference call, AIG CEO Brian Duperreault explained what he was looking for in M&A deals:
“My first thought is, is it strategic? Is it something that makes us better? Do we get better people or better technology or better market penetration…I want us to…have more diversification on our earnings stream.”
This week, Duperreault made his first major acquisition since taking over in May 2017. In acquiring Validus for $5.6B, AIG adds a global reinsurer, a specialty US P&C underwriter, an insurance-linked securities investment advisor, and a Lloyd’s of London syndicate.
Speaking of M&A
Only 12% of (re)insurance and investment professionals with knowledge of their company’s innovation strategy believe acquisitions are their organization’s primary outlet for innovation. More results from the survey to come soon.