Please explain the history of ASN and its business model
The company was established by both K. Thawatchai Lertrungruang and K. Vanchanog Varunaprabha in 2005 as a licensed insurance broker for both non-life and life insurance products. Our go to market approach is predominately telesales with our 200 agents and 75% of revenues are from motor insurance with 25% from life insurance. We partner directly with the insurance companies to deliver to our customers in the retail market the most competitive and attractive range of insurance products.
What insurance products are most attractive for your retail customers today?
The product and partnership with insurance firms is important, we ensure that the insurance companies we partner with of good reputation and today represent over 28 insurance companies in Thailand. Within motor insurance we offer the entire range of products available including Type 1, Type 2, Type 2+, Type 3, Type 3+, and the mandatory insurance for customers to renew their car registration annually. Between 70%-80% of the motor insurance sold is Type 1 which provides full coverage with the remaining split amongst the other types of insurance, what we have seen is that the Type 2+ and Type 3+ insurance products are becoming more popular in the Thai market as it is suitable for certain cars that are 5 years or older and provides partial coverage. For Life insurance, we focus mainly on the savings products which were popularised from bancassurance. Customers pay for the insurance for 7 years, receive coverage for 15 and receive a return on an annual basis, but recently Personal Accident insurance is becoming more popular amongst customers.
How does ASN ensure that it targets the correct customer segment?
We have experience with which database vendor to work with and do a lot of our own segmentation and analyses from our databases. For example, we know which car brands and models have a low loss ratio and which insurance companies are strong in certain automotive brands. Thus, we will deal with one insurance company per car brand or model and if our customers drive that specific brand then we can make a commitment in terms of premium, receive a higher commission rate and our customer will receive a good price and our sales will can provide an excellent service because of our knowledge of the product.
ASN has recently expanded into the digital online space with oohoo.io and daingern.com
In the past 2-3 years we saw the digital trend coming as consumers become more active using the internet, mobile devices and social media. This trend will dictate our future customers behaviours and purchasing habits as they may no longer walk to a bank, contact an agent or want to be contacted by a telesales to purchase an insurance policy, that they would feel more familiar and comfortable with an online channel. In October 2016 we launched oohoo.io, our ecommerce platform, where we want to position it as an insurance supercenter providing customers the ability to compare a multiple types of insurance products for their features and prices and decide themselves whether to purchase it. We invested into creating a strong backend connection with the insurance policies to ensure that the data and the policy issuance and coverage is immediate. Furthermore, we have launched Peer-to-Peer Lending platform, daingern.com. We are in the midst of developing the software and expect for it to be completed soon. Now the Bank of Thailand is still coming up with the regulatory rules and processes for P2P lending but we will begin with ASN who is the parent company as the lender ourselves. Initially we will begin with 300 million baht of capital for retail customers to borrow funds using their automobiles as collateral and utilise our in-house database, underwriting teams to value the car and the customer to know whether to approve the loan. In the future we have the potential to expand to unsecured loans however we will proceed cautiously ensuring that we fully understand all the risks involved as we want to ensure that NPL's remain low. The expansion to the online space and InsurTech are exciting ventures for us and we are taking a very long term approach because this type of business model requires economies of scale before it becomes truly profitable.
What differentiates ASN from its competitors?
We have been in the business for 10 years and adhere to the Office of Insurance Commission (OIC) rules giving high priority to the sales service of our customers and ensure that we do not have a poor reputation as an insurance brokerage firm which is common in the industry. We are disciplined in the way we manage our customers’ premium payment ensuring that it is immediately provided to the insurance company and that the policy will be issued. Also, we believe in the partnership model and are not purely focused on volume, when we make a commitment to our partners we deliver, so we invest in our customer service team, our back-office operations because these operational elements are the intermediary between the customer and the insurance company. And this back-office operation is important because we cannot be a successful online business without it. In Thailand there are several competitors for the online space however in reality they are not as several of them only offer feature and price comparisons and then divert the customer to the brokers website or something else, whereas with oohoo.io and daingern.com everything is integrated into the platform providing a seamless experience for our customers. Finally with pricing we will ensure that both platforms are very competitive in terms of pricing because we want to ensure they can scale quickly.
Why did ASN decide to become a publicly listed company?
There are a few reasons why ASN wanted to become a publicly listed company. We wanted to transform the company from being a small team to a professionally well run organisation and by becoming a public company one must force themselves to make the necessary changes internally with systems and processes to ensure transparency and accuracy in information for all stakeholders. It also allows us to attract more professionals to the company that will further enhance the organisation. Finally by going public we were able to raise the capital necessary to fund our business expansions with telesales and our two online platforms.
What are the biggest risks facing your business?
Externally, the insurance and brokerage industry is regulated by the OIC so we are susceptible to potential changes in the regulations. Internally, the telesales industry does have a high turnover rate as job mobility is very high and this is a challenging environment because new entrants can set up operations and hire a team with minimal costs. To combat this, we have a strong human resources and sales operations team to ensure that the turnover rate is at a satisfactory level and to ensure that the staff that are successful and disciplined continue to remain us with for a long period of time.
Where do you see ASN in five years from now?
Today we are amongst the top 5 insurance brokerages and aim to continue growing our market share over the coming years. Our targets this year are to increase our telesales agents from 200 to 300 by the end of the year because our revenue growth for the next few years will be proportionate to this metric. For oohoo.io we will add more products into the platform with cars, motorcycle, personal accident, travel, health and life insurance products in 2017. In the future, we will look to add other types of insurance products as well to ensure that it is a completed online insurance platform for customers. With these strategies of ASN and oohoo.io and the launch of daingern.com we are confident that we will continue to be the leader in the insurance brokerage and fintech businesses focusing on world-class standards of service for our customers and benefitting our shareholders.
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