In September 2022, Ageas became the first insurer in India to hold a stake exceeding 70% in an Indian life insurer. It also quietly acquired a 40% stake in Royal Sundaram General Insurance. The Belgian insurer has built a strong and diversified Asian footprint spanning nine markets, anchored by long-standing joint ventures in China, Thailand, and Malaysia—its three largest and most mature operations—where it holds top-five positions, including being the only foreign insurer in China's top 10. In an interview with TOI, Hans De Cuyper, the global CEO of Ageas Group, spoke about plans for India.
Plans for India: Expansion, Capital, and Listings
India is a key growth market for Ageas, and the priority is to scale up existing businesses rather than consider exits. Currently ranked around 12th in life insurance and 15th in non-life, the company, alongside partner Federal Bank, aims to build a top-10 life business. Ageas is growing faster than the market and remains open to inorganic opportunities or new distribution channels to accelerate this journey. As long as returns remain attractive, the company will continue deploying capital to support growth. Ageas is a long-term investor and is not considering IPOs or exits at this stage. Over time, growth is expected to be driven by both scale and a shift towards higher-margin protection products, with significant headroom in retirement and pension segments as the market evolves.
Bancassurance and Regulatory Concerns
With rising regulatory concerns around mis-selling, bancassurance remains a strong and relevant model. Banks are well placed to offer integrated financial advice, balancing short-term savings with long-term protection and retirement needs. It is also an efficient distribution channel that supports faster scale-up for insurers and adds fee-based income stability for banks. While concerns around mis-selling are valid, they are not unique to bancassurance and need to be addressed across all channels. If implemented responsibly, bancassurance continues to benefit customers, banks, and insurers alike.
Back-Office Operations and Localization
Many European firms offshore back-office operations to India, but that is not part of Ageas's strategy. The company's model is highly localized, with each market managing its own operations rather than centralizing back offices globally. The Indian business already operates its back office locally, and Ageas does not shift functions across countries. While outsourcing is common in markets like the UK, Ageas sees it as a local, market-driven decision rather than a group-wide strategy.
Monetization and Valuations
Ageas is far from considering monetization through an IPO or stake sale. At the current scale—around 12th in life and 15th in non-life—the focus is on growth, both organic and inorganic, rather than any exit. India is Ageas's highest-growth market in Asia, and the strong valuation multiples here reflect this potential, reinforcing the company's long-term commitment. The elevated multiples underscore the significant growth opportunity in the market and are seen as a reflection of India's strong trajectory rather than a concern, supporting the strategy to stay and expand.
Earnings and Margins
Improving return on equity is key, with margins expected to benefit from scale given the fixed-cost nature of the business. There is also substantial headroom to grow higher-margin protection products, while over time retirement and pension segments will contribute as the market matures. If the right opportunity arises, Ageas would be open to entering the pension business in India, as it has done in markets like China, given the long-term potential of the segment.
Regulatory Changes: Risk-Based Capital and IFRS
The shift to IFRS and risk-based capital in India is a positive move. IFRS, particularly IFRS 17, will improve transparency and provide a clearer view of the intrinsic performance of long-term insurance businesses, where annual results can be misleading. Risk-based capital will bring greater discipline, better risk allocation, and stronger risk control, as insurers are required to quantify and take ownership of their risks. While the transition phase may be challenging, requiring calibration and adjustment, experience from Europe shows it ultimately strengthens risk management. This enhances trust in the system, which is critical for customers in a long-term savings business like insurance.
ULIPs and Commission Structure
ULIPs are an evolving segment, and it is encouraging to see regulation moving in the right direction to strengthen customer protection. Transparency and clear communication of product features are critical. While ULIPs have their place, the focus of the market should increasingly shift towards long-term, stable savings rather than short-term, investment-oriented products. Regulatory adjustments, including around commissions, are part of a broader effort to steer the market appropriately. Maintaining high standards of customer service, transparency, and compliance is key to building trust in the segment.
The debate around commission regulation appears to be swinging back, but some level of regulation is necessary to bring discipline. Currently, the market remains heavily skewed towards upfront, new business-linked commissions, whereas in Europe there has been a shift towards more portfolio-based structures. That transition supports customer retention, improves loyalty, and ensures distributors continue servicing customers beyond the point of sale. A balanced approach—without overregulation—would likely involve moderating commissions and gradually moving towards renewal-based models. The transition needs to be managed carefully, as it can initially impact distributor incomes, but if done progressively, it creates a more stable, customer-focused system.
Esure Acquisition and Digital Strategy
Ageas was a mid-sized UK insurer focused on retail non-life segments like motor and home, operating in a highly price-driven market dominated by comparison websites, where scale is critical for profitability. To address its subscale position, Ageas set out to become a top-three player through acquisitions, including Saga's insurance arm with a long-term distribution tie-up and Esure, a digital-first insurer. These moves have lifted Ageas into the top three, diversified its distribution across brokers and price comparison platforms, broadened its customer base beyond the 50-plus segment to younger cohorts, and positioned the UK business to deliver £300 million in profits by 2028.
Ageas sees insurance, including in India, as a predominantly intermediated business driven by bancassurance, tied agents, and brokers, even as digital plays a growing role. Rather than replacing intermediaries, the company focuses on "digital-enabled distribution," combining the trust of agents and bank partners with strong digital tools to engage the next generation of customers. Ageas is investing heavily in digitizing bancassurance and agent networks, while also building capabilities to work with price comparison platforms, including through partnerships like Policybazaar in India.
European Ambitions and Growth
The transaction to acquire BNP's stake in AG Insurance in Belgium will take Ageas close to the top 15 in Europe, while simplifying its structure by moving from a Belgium-level partnership to BNP becoming a group-level anchor shareholder. Ageas will take full control of the Belgian entity—still contributing 40% of profits—while BNP will hold just under 25% at the group level. Alongside the earlier Esure deal, this has lifted Ageas's market capitalization to around €12–14 billion, strengthening its independence in a consolidating European market. With BNP and the Belgian government as stable anchor shareholders, Ageas now has the scale and stability to pursue its strategy autonomously.
Growth for European insurers has been subdued primarily because both life and non-life markets are largely saturated, offering limited expansion opportunities, while GDP growth across Europe has slowed over the past two decades. In contrast, faster-growing Asian markets—characterized by ageing populations, underdeveloped social security systems, and a young insurance base—offer far stronger growth prospects, prompting insurers to shift focus and export expertise to these regions.
Managing Regulatory Differences
Ageas manages regulatory differences through a highly decentralized model, where local entities operate with full autonomy. This ensures that data, investments, and decision-making remain within each market, so requirements like local data storage in India are not a constraint. At the group level, Ageas provides expertise in areas such as risk management, product development, and data analytics, but execution remains local. While Ageas sees value in European regulations such as GDPR and ESG frameworks, it believes they should not be imposed uniformly across markets. Instead, countries should adapt learnings to local contexts. Overall, regulation is becoming more customer-focused globally, which is positive, although in Europe it has also become overly heavy on reporting, sometimes at the cost of business focus.
