Allianz Q2 and Q3 revenues could take a hit, as LV= will not transfer commercial lines business to Allianz until later in the year
Allianz started transferring personal lines business to LV= from the start of this month, with LV= set to send over their commercial lines business later in the year.
As part of a strategic partnership between the two insurers, the first tranche of Allianz business to be transferred started via Acturis for car, home and van policies activated for 1 May quotes and 1 June inceptions.
No transfers were conducted within Q1 for Allianz, however. Allianz UK chief executive Jon Dye explained that the preparation of the transfer process from 1 May was the reason for the levelling off of GWP in the personal lines sector of the business, as shown by Q1 results.
Commercial lines business will only start being transferred from LV= to Allianz from Q3, and Dye conceded that the timing of the two-way transfers would have an impact on expected Q2 results.
Dye said: “From now we will start to see the revenue for car and home moving out of Allianz and moving across into LV=. There will be some impact of that in the second quarter and then as we move up into the third and fourth quarters those transfers will gather pace.
“It will be a phased transfer, software house by software house, scheme by scheme starting from 1 May and then rolling up through the rest of the year and beyond. So you’re going to start to see the revenues move away from Allianz in personal lines, car and home and over into LV=.
“On the commercial side of the house it will be the opposite, so from the end of the third quarter we will start to see transfers move from the LV= commercial business into Allianz.”
And he added: “These things are going to move at different speeds because we’re starting with personal lines earlier, and so you will start to see our personal lines revenue dip down as the business moves away. But you will see our commercial lines business kick up as business starts to come in.”
The whole business transfer process between the two is expected to take up to late 2019, early 2020.
Allianz will retain on the personal side their pet, musical and legal protection insurance business, along with other specialty products. This will still account for estimated revenues of £840m by the year end.
Dye confirmed that the number of jobs to be lost by those at Allianz as a result of this agreement with Allianz had already come down from the January estimate.
He said it was still too early to give a precise number on the number of job losses, and said he expected the agreement with LV= to create many job moves in both directions between the two insurers.
LV= today confirmed the appointment of Jonathan Santer as their new head of home underwriting, having moved from Allianz where he was personal lines motor manager.