Interview - Gregorio Santos: A new UK journey for Mapfre

Spanish insurance giant Mapfre is one the UK insurance industry's best kept secrets.

Despite the firm employing more than 30 000 staff across the globe and recording revenue in excess of €20bn (£16.8bn) in 2010 the insurer had, until recently, remained in the shadows.

It stepped firmly into the limelight in November last year with its swoop for travel insurance specialist Insure and Go, with the move taking Mapfre direct to UK consumers for the first time, a significant shift from its more traditional affinity and white-label approach to the UK insurance industry.

"With the acquisition of Insure and Go we have become an important player for travel insurance in the UK," Mapfre Assistance UK chief executive Gregorio Santos explains.

"This is not new for us in the rest of the world but it is the first time we have become an important player in this country."

Scheduled launches
As part of his remit for the UK arm of the Mapfre Assistance business, Mr Santos leads a workforce of around 500 staff across a number of business lines, including the insurer's pre-existing partnership, gap and payment protection insurance specialist Mapfre Abraxas, which was acquired in 2005, and Home 3, a home and emergency service brand created in partnership with customer assistance firm CPP.

In addition, Mr Santos will also be responsible for new UK business Mapfre Warranty. The start-up is scheduled to launch later this year and will focus on producing warranties for Mapfre's car manufacturer and dealership partners.

"We will launch our new company, Mapfre Warranty, before the end of the year," Mr Santos explains. "Warranties for new and used cars are core products for us. We will not only target the motor industry though, as we may also extend into other types of warranty in the future."

He adds: "We are bringing our technology, know-how and skills to this new venture and envisage that our partners will not only be car manufacturers and dealerships but also financial institutions and insurance companies.

"Because we are Mapfre, the launch will be much smoother; we already have a number of links in the market."

However, it is the acquisition of Insure and Go and the potential to explore the direct to consumer model that excites Mr Santos the most. The new business is being used by the insurer as a font of knowledge, an example of the way to conduct direct travel business in the UK.

"We have seen that the UK market for travel insurance is very developed and we want to take advantage of being here," says Mr Santos. "It is not necessarily an area we look at strategically for growth. We wanted to understand a mature market in and see what is the most advanced way of approaching clients, not only to sell travel insurance but also to provide assistance."

Part of the plan for the new acquisition includes streamlining its product set. Mapfre, which was the underwriter for Insure and Go before it completed its purchase, will focus the company's efforts on the travel front, abandoning products including car, home and life that are also currently offered.

Mr Santos explains that part of the revamp of the Insure and Go will include a re-launch of the website in the coming weeks, with the brand having a more defined focus.

"There are other products that are not related to Mapfre Assistance, that are currently offered by Insure and Go, such as car and home insurance. In the coming weeks we will launch a new website fully utilised for travel insurance," Mr Santos says.

"Distributing products in the car and home sector is not part of the strategy for us in this country in particular. We offer these products as Mapfe in many other countries but we will not do it here in the UK."

He adds: "We are yet to define a date for the re-launch but it is not going to be very soon. The overarching UK strategy for Insure and Go is to continue what it is doing in the travel sector. It is very good at doing what it has done so far and we don't want to break that trend."

Direct extension
However, while the insurer is not keen to pursue a route into motor and home it could extend its direct model into other lines currently offered by other Mapfre Assistance companies.

Mr Santos explains: "It offers a good opportunity to distribute Mapfre Assistance products in a different way. Once we understand the specifics of the online business and the importance of the position of the web and search engines, there are different opportunities we may explore."

In addition, as revealed in Post last week, Mapfre is also keen to use the Insure and Go direct model in a number of yet to be announced hubs across the globe.

"We have an important presence in most regions including North America, Latin America, the Middle East, Africa and more recently Continental Europe and the UK," Mr Santos says.

"We are within the five most important travel insurance players in the world but it is true that so far we have been in the shadows as we have mostly worked with third-party relationships in other countries and haven't worked as closely with consumers as many of the other travel insurance providers have.

"When an insurer or a consumer has a problem they call us and we sort it out. However, the fronting is normally done by another provider."

While white label and affinity deals are still a major part of the Mapfre business, Mr Santos says that, despite the push for direct consumers, it will continue to work closely with its other key travel partners.

He explains: "The knowledge we will acquire with Insure and Go will also help us to add value in our relationships with these distributors.

"We have long-term partners that are embedded into the DNA of the company. We don't want to break those relationships. We want to learn how to assist them with their business."

Although the deal for Insure and Go was beset by tax issues — the travel insurance company owed HM Revenue and Customs £6.73m in value added tax before the sale — Mr Santos is confident that the bill will not be a bad omen for the future.

Due diligence
"When we came to do the due diligence the HMRC issue is something that came up," he says. "For Mapfre it is mandatory — it is an absolute must — to work within the compliance framework.

"The only thing I can say is that it has been sorted out and it was in the plan when we made the acquisition. It was well known that was the situation."

"2010 has been a very important year in terms of coming into our new business distribution model. We have been used to the business-to-business environment here in the UK before but this is our first move into the direct business. We have high hopes for Insure and Go under the guidance of Mapfre," Mr Santos concludes.