‘More efficiently structured’ ERGO to contribute over $600m to Munich Re profit
A year after a full-scale restructuring, Munich Re subsidiary ERGO claims to be more efficiently structured, and intends to contribute more than €600 million in to the long term to the annual net profit generated by its parent.
As part of the restructuring, ERGO is now investing systematically in digitalisation and aiming to strengthen its international organisation structures.
"Fit, digital and subsequently successful – these are the goals we have set ourselves", says ERGO CEO Markus Rieß in an update on the restructuring.
Ergo was formed in 1997 through the merger of D.A.S., DKV, Hamburg-Mannheimer and Victoria and has since been Munich Re’s primary insurance business segment.
Ergo has been loss-making for many years. In 2016 Ergo recorded a net loss of €40 million after a loss of €227 million in 2015.
ERGO is also investing more in digitalisation, through the formation of Berlin and Warsaw-based ERGO Digital IT, created with a view to develop new products more quickly.
As part of the reorganisation, ERGO is setting up ERGO Direkt in Nuremberg, as an ‘Online Competence Centre’, a requirement for offering customers access to ERGO product online and offline. Around 550,000 users are currently registered in the customer portals, representing an increase of 56 percent compared with the numbers in 2015.
ERGO’s subsidiary Nexible also plans to introduce its first motor product to the market sometime this year. Formal requirements have been met and Nexible will operate as a stand-alone enterprise with Neckermann Versicherung as risk carrier.
Furthermore, ERGO aims to strengthen its presence in Poland and the Baltics, while in terms of growth, it is looking into China and India, according to chief operating officer Alexander Ankel.
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