Name: Assurant CEO Sees Double Digit Earnings Growth for Insurer
Uploaded: 2019-08-20
Duration: 4 min 55 s
Description: Tech support, not just insurance, on things like mobile devices bring in big bucks.

[ MUSIC ] Alan, let's start by talking about the business of Assurant. What exactly does your business do? So, what Assurant fundamentally does is the consumer is buying something expensive. So, for example, they're buying a house, they're renting an apartment, their buying a car, they're buying a cell phone They need to get value out of that ownership, they need it to work, they need to get the full value they expect and what we do is we protect around the reputational risk of if you lose it or breaks. But increasingly, we're providing services around the ownership and enable you to really get value out of owning these devices and items. So your services sound sort of like tech support. You repair, you troubleshoot. You make sure those expensive items that people buy are constantly working. Your phone, your car, your thermostat. How is this different from services like AppleCare, for example? Well, they're similar. So we're actually partnered with AppleCare on a variety of things. Where, for example, here in the US, if you go to the store in Apple, and buy AppleCare Plus Apple is providing the mechanical breakdown and we're providing the traditional insurance elements. Outside of the US we're providing, with Apple, much more than that. What we're providing the mechanical breakdown, for example in Japan, working with Apple. So the more the people buy let's say this tech devices the more they turn to you for support and I guess with all these trends for the connected home, Yeah. The connected car, that's gonna mean more business for your company, right? Yeah, one of our big growth areas last couple of years in our connective living businesses is what we call premium tax support. Which is the consumer typical consumer. You have a ring camera you have a nest thermostat you have an Alexa you have a router from Comcast and you have your cell phone from T Mobile. You can't get it all to work, what do you do? Or you call and we actually troubleshoot it and get that The consumer up and running. Well, you just came out with your latest earnings, another quarter of better than expected earnings, revenues and even assurance Doc, despite all the market sell offs that we've seen recently is still up 24 % so far in 2019, what do you have to do to keep up this pace of growth? Well, I think the positive is we have very strong momentum. So we've had our investor day earlier this year. We said over the next few years we expect we can grow EPS on average 12 % a year driven by earnings growth. The primary driver double digit earnings growth. So we have better than market growth, we're winning more clients. So we're gaining more subscribers, for example in mobile we're up to 48 million subscribers who have our service That would have been 30 million a couple years ago. Well, your whole business depends on consumer confidence and their confidence to spend more money. And as you know, there are now all these new fears about trade tensions with China and worries that all of that could slow down. Our economy, I mean, to what extent do you think all of these headlines could make consumers more cautious about opening up their wallets? So clearly, if you're a consumer, you read all of this, it's pretty scary. Now for us fortunately, we're largely an install based business. So we have 100 million, subscribers between our auto and our mobile business. What tends to happen in a downturn The persistency on our products goes up cuz, the consumer can afford even less to have it not work and, not be there when needed. So, we tend to keep our relationships longer with the consumer. And, most of our revenue and, profit come from things that have already been sold. So, we're pretty Insulated as assurance from the trends but certainly as a consumer, it's pretty scary. Well as you plan for assurance for the rest of this year and going into 2020 how are you preparing for a changing economy possibly. For us, it's more about thinking longer term. Consumers are always gonna buy things or rent them. And they are going to have problems with them. That is our business. So, we just need to be adaptive to what consumers are buying or renting. How they are buying or renting them. So, we are always trying to look ahead to those evolutions. The warranty group which we purchased last year. The reason we purchased that company was to give us clear market leadership around the auto. And you think about all the trends in auto the connected car, electric vehicles, ride sharing, autonomous vehicles As the clear market leader around service contracts, we can invest to be the winner no matter how that evolves. What are you most hopeful about for the year ahead? What I get excited about is when we do something new and innovative that helps us in the market. So I'm excited about all the experience. We have pilots, particularly around the connected apartment or their connected home Where nobody's really figured out how that might work. We have many, many pilots going in many regions of the world. I'm excited when those work. I'm also excited if they don't work, cuz you learn and you then can evolve it and move it on. But I I just look at this disruption we have, the change in everything for the consumer. It creates lots of opportunity if you're willing to evolve and transform your company. [ BLANK_AUDIO ]

Assurant CEO Sees Double Digit Earnings Growth for Insurer

Tech

Tech support, not just insurance, on things like mobile devices bring in big bucks.