Group chief announces service quality study and warns over acquisition culture

AXA is conducting a "major" group-wide project to measure customer satisfaction.

Speaking at the AXA University in Bordeaux, the group's chairman and chief executive Henri de Castries said service quality was "essential" to the growth of the business, but that it could not be fully measured straight after point-of-sale.

He said the project would look at both quality of sale and quality of service "a long time" after a sale, for example when a claim is made.

"We need to have more precise indications of service," he said.

De Castries also warned of the dangers of focusing too much on attracting new customers rather keeping existing ones. "Acquisition costs us between €400 to €600 per client. We must keep clients for a long period of time if we are to be profitable."

He criticised firms that attempt to grow by acquisition without organic growth.

"The way to grow a company is not just to buy companies." he said.

"Organic growth must come first. If not you will just be buying yourself out of a problem."

AXA phasing out reinsurance broker
AXA's use of brokers to place its reinsurance is being reduced as they "do not add value".

Philippe Derieux, chief executive of AXA Cessions, the group's captive reinsurance company, said: "We use brokers 40% of the time to cede to reinsurers, but this is decreasing. We are developing our own in-house expertise."

AXA Cessions currently places €700m (£482m) in premiums with the reinsurance market.

Derieux said Lloyd's was "improving" as a reinsurance market. "It is becoming more visible. We currently place short-tail business there, but could start placing long-tail business there."