Belfius Insurance is launching Belfius Direct Assurances, a move aimed at disrupting the insurance market and better catering to the evolving needs of today's customers. The initiative seeks to address the frustration of Belgians who find themselves paying the same insurance premium for their vehicles despite significant differences in mileage. Belfius aims to leverage its strong brand presence to accelerate the adoption of direct insurance channels.
From insuring assets to protecting mobility: Driving growth in the evolving mobility ecosystem
The primary ambition is to make a real difference by offering straightforward yet highly relevant insurance products (covering auto, motorcycle, home, pets, etc.) at competitive prices, aligning with the diverse needs of customers.
Currently, less than 20% of Non-Life insurance policies in Belgium are sold through direct channels, a significantly lower figure than in neighboring countries like the Netherlands and the UK, where direct channels account for 30% and 62% of auto insurance premiums, respectively. However, consumer preferences in Belgium are shifting. An increasing number of Belgians are open to purchasing auto insurance online (57% in 2021, up from 51% in 2018). Moreover, 47% of customers doubt the efficiency of their insurer's processes, and 70% advocate for an omnichannel experience that offers flexibility in interacting with their insurer.
In response to these changing consumer expectations, Belfius has integrated its direct insurer, Corona Direct, into Belfius Insurance. The aim is to combine the strengths of both entities under the strong brand of Belfius Direct Assurances, offering innovative, affordable solutions through an efficient direct channel supported by a team of approximately 170 dedicated experts. Belfius Direct Assurances caters to all Belgians, whether they are Belfius Bank customers or not, with a disruptive offering spanning mobility (auto and motorcycle insurance), housing (renters' insurance), and family (home and pet insurance, funeral insurance), with plans to introduce more innovative products in the future.
Unique kilometer-based insurance
Belfius Insurance has observed a reduction in the number of kilometers driven in recent years, a trend accelerated by the COVID-19 pandemic. Factors such as environmental awareness, price sensitivity, purchasing power pressures, and new "multi-mobility" options continue to influence this trend positively. Paying a fair price that aligns with actual vehicle usage is increasingly essential for customers.
In Belgium, approximately two-thirds of drivers cover less than 15,000 kilometers annually with their cars, with some driving significantly less. Belfius Direct Assurances addresses this by offering Kilometer-Based Insurance, a unique product in the Belgian market. Over 111,000 of their clients have opted to pay only for the kilometers they actually drive.
This insurance is particularly attractive for those who drive fewer than 15,000 kilometers annually, as it can lead to significant savings. If a policyholder drives more than initially estimated, they remain insured and pay a year-end supplement based on their actual mileage.
What sets Belfius Direct Assurances apart is its commitment to reimbursing customers for unused kilometers. Unlike some insurers who offer premium reductions based on estimated mileage, Belfius Direct Assurances calculates premiums based on the exact kilometers driven. This transparent approach allows for an annual adjustment of premiums based on the previous year's actual mileage, with customers receiving refunds if they drove less than anticipated. In 2020-2021, during the peak of COVID-19-related reduced mobility, over 140,000 refunds were issued, totaling €4.7 million.
Belfius Direct Assurances is poised to disrupt the insurance landscape by offering customer-centric, cost-effective, and innovative insurance solutions that align with the evolving preferences of Belgian consumers.
