Chartis – Celebrating 50 years!

AIU arrived on South African shores at a time when development was on the national agenda. The insurer naturally focused on opportunities in the schools, hospitals, housing, mines and infrastructure space. Its first major account was the 1960s Orange River Project with the Gariep Dam at its heart.

In the early days AIU provided construction all-risk cover and workman’s compensation to the megaproject. One of its employees (complete with family) was stationed at the dam town as a "claims man” responsible for advising on loss-prevention, liaising between contractors and government, and processing claims.

From these humble beginnings Chartis grew its South African operations to offer a complete portfolio of products in the commercial and consumer insurance markets. FA NEWS spoke to Mike Durek, Managing Director of Chartis South Africa, to find out what it takes to stay ahead of the competition over five decades.

FA NEWS: What has defined your business and driven its growth over the past 50 years?

Mike: We developed an approach in the 1960s that informs our market positioning to this day. We expanded our business into new areas such as property, marine and machinery insurance – and then took our product offering national – by establishing branch offices in Durban, Cape Town and Port Elizabeth.

We work closely with the regulator, brokers and agents to ensure our success. AIU – now Chartis / AIG – invested in the domestic insurance industry by bringing technical skills to the market and leveraging its global capacity to provide insurance protection for larger companies. I am proud to say that many of these "founding” clients are still with us today.

FA NEWS: What type of challenges did AIU face when setting up shop in SA? And what do you believe are the major challenges for Chartis / AIG currently?

Mike: Strong domestic competition and constant changes in technology are among the challenges we have navigated since the 1960s. Insurers have to stay up to date with product innovation and be ready to adapt to changing markets to remain relevant.

Chartis / AIG’s biggest short-term challenge is to change our organisational culture. We will overcome this challenge by becoming more visible, engineering better systems for faster response, and radically changing our attitude to delivery at every stakeholder touch point. Management is already hard at work to realign the business to put the customer first.

FA NEWS: Aside from rolling out a client-centric approach what will be your main focus over the next year or two?

Mike: There are definite opportunities to expand our domestic footprint from eight branch offices to around 15 over the next two years. Our goal is to provide the tools and information to support Chartis brokers and customers wherever they operate.

FA NEWS: You are part of a huge multinational insurance group. How can brokers leverage this to write additional business for the Chartis / AIG brand?

Mike: Brokers can market our products confident in the knowledge that the Chartis / AIG business is built on "best of breed” principles. AIG has a "let us build a product that nobody has ever seen before” approach to product design. That is why we have 42 product lines, something that no other domestic insurer can offer under a single brand.

FA NEWS: Chartis is re-branding as AIG from October 2012. What is the motivation behind this apparent backtracking?

Mike: During the global financial crisis AIG (in the US) came under tremendous financial pressure and had to access government assurances to survive. The company has recovered to such an extent that the stake that the US government took in AIG will generate an investment return of some $15-billion. We persisted with the Chartis brand locally as a safety measure during these turbulent economic times.

Chartis / AIG enjoy a sound reputation in the domestic insurance market. The group has an enviable track record of supporting its customers at their time of need. For brokers this proven name provides comfort to the most demanding client. With Chartis / AIG you have access to a broader product portfolio than any other insurer can offer. And this translates to more opportunities to sell policies across the spectrum.

• 1962: AIU sets up representation at 40 Commissioner Street, Johannesburg

• 1966: AIU changes its name to American International Insurance Company Limited, wholly owned by AIU Overseas, Ltd

• 1970: SA office reorganises, with the Engineering department combining CAR and boiler machinery

• 1971: Durban branch opens; the company shows dynamic growth with particular success in property lines and specialty programmes in Accident and Health

• 1985: Cape Town office opened

• Late 1980s: AIG divests ownership during Apartheid to returning with the birth of the new SA in the mid-1990s

• 2002: AIG South Africa headquartered in Johannesburg, complemented by three branch offices and a combined staff of 200. It serves as AIU Regional Head Office for Africa

• 2011: AIG reorganises worldwide to Chartis with two major commercial groups: Commercial and Consumer

• August 2012: Chartis celebrates 50 years in South Africa with eight branches and more than 440 staff members

• October 2012: Chartis reverts to AIG branding