Andrew Tjaardstra speaks to Mike Ramsay, director and co-founder of Alliance, who is bullish about his broker’s prospects.
Based in his Hong Kong office in Central, Ramsay, pictured, is setting out to deliver insurance products to both the Asian and international markets.
And the five-year-old broker is growing fast – by no less than 112% in the first half of 2014 (compared with H1 2013) and with a forecast for over 200% in the second half.
Ramsay moved to Hong Kong with health insurer Aetna, and one of the largest drivers of growth at Alliance is its international expat health and life insurance website NowCompare.
After launching in 2011, the site now has clients in 189 countries, and deals with more than 200 insurers worldwide. These relationships are led by senior director Dan Smith, who is often on the move between offices across Asia.
To Ramsay, the biggest surprise is that some of his competitors have not tried something similar – but he claims larger brokers don't have the entrepreneurial spirit to risk a large sum of capital on such a venture.
The key markets in Asia are Hong Kong (where 50% of customers are locals), China, Indonesia and Thailand, but Ramsay is keen to stress the unique international capabilities of the site, citing a recent client in Africa. Thailand is also growing particularly strongly for the aggregator.
However, Ramsay warns that China's market is "hugely complex" – noting such difficulties as fraud and currency controls – and firms must be properly resourced and prepared for the long haul to make it work.
The website's capabilities have been achieved thanks to painstaking hard work. For example, Alliance has worked with health insurers to tap into their individual algorithms and make them available to customers via its website – an achievement helped by Alliance's decision to build all its own IT infrastructure.
Ramsay says: "We are halfway between a high-street broker and an aggregator. We have a 60% conversion rate of people who look to buy insurance with us and have a customer service executive team ready to answer questions and act on renewals."
He believes this is a far more economical and successful way to sell health insurance than the agent model.
Most people start the journey online before Alliance contacts them by phone, although the company has the ability to activate online purchases at peak times.
Alliance also spends millions of dollars on search-engine marketing and is determined to be ahead of the competition in the rankings.
Ramsay says: "We have embarked upon a course of aggressive expansion and [have spent] a large amount on marketing – our budget is trebling every year. We expect to lose money in the first two years. We want aggressive expansion and expect long-term sustainable growth."
Alliance also sells employee benefits, including group health and life policies, to large commercial businesses in Hong Kong –companies with an average of 2 000 employees in the region – via its brand MyBenefits.
Alliance competes with some of Hong Kong's largest brokers and covers around 30% of local law firms and three of the top five shipping companies.
In addition the broker targets international firms with offices in Asia, and Alliance itself has offices in Bangkok, Beijing, Dubai, Hong Kong, Jakarta and Shanghai.
A member of the Professional Insurance Brokers Association, Alliance can provide general insurance, long-term insurance, investment-linked products and group pensions.
Ramsay strongly welcomes the move away from upfront large commissions on long-term indemnity policies starting on 1 January 2014.
Perhaps one of the reasons he is not worried about this is that all his staff are salaried, whereas many staff in Hong Kong at agents, brokers and independent financial advisers are heavily reliant on commissions.
In a further example of its diversity, Alliance has a wealth management arm, Alliance Capital Asset Management, which has $250m under management.
Together with this diversity, Ramsay has a motivational motto for his staff – "Say yes, not no" – which means they are not allowed to tell a client no without first going up the management chain.
The company's ambition is also outlined on its company website. Under the heading 'Determination', it states: "We are the best: We have a resilient, focused and self disciplined attitude towards short term and long term projects and objectives. We will never give up and we will never settle for second place."
Call it motivational or hyperbole, when you meet Ramsay you can feel his passion for his job and how much he wants his company to be number one in its respective markets.
Ramsay is so confident about the future that despite several interested parties and numerous discussions, he says he wouldn't sell the business "for a billion pounds".
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