Belgo-Dutch financial-services giant Fortis (FAMVY) is known for its knack in executing one of the trickier acts in finance--selling insurance products through a bank, or bancassurance in industry jargon. Fortis owes a good bit of that success to its CEO, Anton van Rossum, former head of McKinsey & Co.'s Brussels operation, who took over as chief executive last fall. Van Rossum's big success: turning Belgium's Generale Bank, acquired in May, 1998, into a giant insurance sales operation. Fortis sold more than $900 million of life insurance in the last quarter of last year to Generale Bank's customers, way more than the $400 million the bank predicted. More than one-third of the group's banking customers now buys its insurance products. Cost-cutting and sales from integrating the various parts of Fortis should add almost $1 billion a year to revenues by 2004, twice the level originally foreseen.
The group's success has tempted others to try bancassurance. But, van Rossum notes, "It took us a long time to get there." Customers may not mind getting mortgages from insurance brokers and insurance at bank branches, but staff at these financial giants may balk. Insurance agents don't like selling loans, and bankers don't like selling policies.
Van Rossum says the cultural differences between the two groups are so great that they might as well be from different countries. As a Dutchman who's married to a Frenchwoman and has lived in Belgium for 20 years, he knows about soothing cultural friction. To get insurers and bankers to cooperate takes persuasion, van Rossum says, and "you have to show you get better results by unifying the whole range of products and selling them through all the distribution channels."
So successful is Fortis at bancassurance that it's exporting its expertise. It launched a joint venture with Spanish savings bank La Caixa in 1992, and it established a joint bancassurance venture with Maybank, Malaysia's largest financial-services group in February.
The big question is what van Rossum will do next. One possibility is to merge with another European group. "We'd make an attractive partner," van Rossum says. Especially for someone who appreciates the art of persuasion.