Dear Business Partners,
While I am writing these lines, the world could not be more different to what we knew before. The economy faces its biggest upheaval since the Great Depression and whilst Australia’s economy is strong, the “perfect” Covid-19 storm is relentless. For the first time in 29 years the “lucky country” could stumble into a recession. Many businesses in Australia carry the additional burden of a summer marred with devastating bushfires, floods and hailstorms and I would like to take this opportunity to let you know that whilst it’s difficult times for all of us, we want to support you in any way we can! We aim to find as many individual solutions as possible to help people and businesses back on their feet when all this is finally over.
The pandemic will force many changes in our industries. We will have to change our "just-in-time" economy - this lean approach to production, employment and finances that regarded inventories at factories as financially not viable. The COVID-19 situation has taught us that more risk management and the preparation for interruptions in supply chains will have to be calculated into future planning. Countries also have learnt that despite the many positives of our global interconnectivity, they need to be at least self-sufficient when covering the most essential needs of their citizens.
As other leaders have emphasized before me, a crisis doesn’t create character; it reveals it. Looking back in time, Shakespeare has overcome the boredom of a plague lockdown to write some of his most loved tragedies - “King Lear“, “Macbeth“ and “Anthony and Cleopatra“. Sixty years later - around 1665 - Isaac Newton used a similar quarantine period to develop the beginnings of calculus as well as his now famous theory on optics. As Albert Einstein phrased it, “in the midst of every crisis, lies great opportunity”.
One of these opportunities today is how we use technology to better our lives. We all realized that technology allows us to work remotely almost as well as in the office. Similarly, digitalisation and the Internet of Things help us not only create a deluge of new data, with the intelligent use of this data industrial insurers like ourselves can offer new services and improved risk management. Technology has enabled us to move our business model on from repair and replace, to predict and prevent. Over the long term, dedicated products and services can be created from this.
Other opportunities lie in how we interact as human beings. After some chaotic first days, when Australians were fighting over toilet paper, many of us have found that Aussie spirit again that makes the country unique: From helping neighbours to creating viral kindness via Facebook to showing great ingenuity. One of many examples are the breweries that stopped producing gin and instead provided hand sanitizer to help reduce the spread of the virus.
I am also proud how HDI Global SE reacted to the crisis, how we came together as a team, faced the challenge and continued our work with minimal interruptions, even achieving very pleasing first quarter results given the effects of the pandemic. Talanx Group which encompasses HDI Global SE as well as reinsurer Hannover Re reported a net income of €223 million, only a slight reduction compared to the €235 million the previous year. HDI Global SE contributed gross written premiums of €2,575 million in the past quarter, an increase of 12.2 per cent. We transferred our operations to our homes, worked from laptops in our kitchens and living rooms whilst connecting with brokers and customers virtually or over the phone. During a challenging time one of our specialists developed new protocols to streamline our International Programmes (IPs) and to make it easier to navigate through the complexities of locally servicing policies in 150 countries. She’s giving these programmes which have a long-standing tradition in our company renewed strength and a stronger profile in the Australasian market. At the same time, another colleague built four new insurance products in the Accident & Health sector covering Corporate Travel, Group Personal Accident and Sickness and Expatriate Medical Expenses Policy.
In the face of adversity, it seems we have formed even stronger bonds amongst ourselves as well as with our associates and customers. Talking to them I have found the same resilience that helped our company through the past few months. In the following we not only introduce you to our own crisis management and leadership efforts but also share some ideas and thoughts of our associates and customers.
I hope you will enjoy reading our inaugural newsletter for Australasia. I am looking forward to discussing ideas with you, sharing insights and learnings and lending a helping hand for any insurance needs you might have.
Warm regards,
Stefan Feldmann
Managing Director, HDI Global SE, Australia