Toronto-based Manulife Financial Corp. (TSX:MFC) is revamping its corporate strategy in order to adapt to a rapidly changing operating environment, president and CEO Donald Guloien said on Monday.
Speaking at Manulife’s investor day in Toronto, Guloien outlined the life insurance company’s new strategy, which aims to help the company secure a competitive position for the future. He said the entire insurance industry is grappling with changes in areas such as technology, social media, regulations and demographics, which are forcing companies to adapt and evolve.
“Major trends and disruptors threaten to make our industry less and less relevant,” Guloien said. “In our opinion, the status quo is no longer an option.”
Manulife’s new strategy is comprised of three main areas of focus: developing more holistic and long-lasting customer relationships; building and integrating global wealth and asset management businesses; and leveraging skills and experiences across the company’s international operations.
As part of the first area, Guloien said Manulife will concentrate on getting a more comprehensive view of customers, and putting them at the centre of all of the company’s activities and operations. That includes establishing advice channels that clients can access anytime and anywhere, and providing advisors and other distributors with more tools, he said.
The Vitality insurance program recently launched by Manulife’s U.S. subsidiary, Boston-based John Hancock Life Insurance Co., is a prime example of the company’s new customer-centric focus, Guloien said. That program incorporates wearable technology, allowing clients to qualify for lower insurance premiums and other rewards when they demonstrate that they are taking steps to improving their health.
“That’s customer centricity in action,” Guloien said, noting that the program aims to engage clients on an ongoing basis, in ways that life insurance companies haven’t done in the past. He expects that program to help Manulife sell more insurance, while also allowing the company to develop deeper relationships with clients, creating more cross-selling opportunities.
“Because of the constant interactions with the customer, you’re aware of their other needs,” Guloien said. “It allows you talk to them about other things … and sell other products.”
Although the Vitality program is currently only available in the U.S. market, Guloien noted that Manulife is “actively” looking to launch that program in the Canadian market.
Manulife is also working to create simpler customer experiences, Guloien said. As an example, he pointed to Manulife’s recent launch of a new simplified issue term life insurance product.
The second component of the new strategy reflects Manulife’s continued efforts to beef up its wealth and asset management businesses, which have been a key area of focus for the company since 2008, Guloien said. He noted that last year’s acquisition of the Canadian-based operations of Standard Life plc fits in with that strategy, as the transaction expands Manulife’s wealth management operations considerably.
With respect to the third component of the strategy, Guloien said Manulife continues to take steps to expand its footprint around the world, with a particular focus on high growth markets such as Asia. He noted that the rise of the middle class in Asia is creating significant opportunities for insurance and wealth management companies.