A Tale of Trust

If you happen to pass by Doneztebe, a small picturesque town in the Basque region of northern Spain, stop by to say hello to Miriam Arnedo. An insurance agent for Allianz, she’s something of a celebrity here. Few insurance and investment decisions here are made without consulting the lady.

It’s easy to spot her insurance agency when you enter Doneztebe, characterized by red sandstone set against lush green mountains.

When dusk falls, the narrow streets bring out the medieval beauty of the town, giving it the feel of a close-knit village. Elderly women chat up the priest after the mass, a yapping dog protests being sent out of the house, the bars teem with the old and young sharing stories over wine and steaming plates of squid as freshly-baked breakfast baguettes hang from the door handles.

Miriam’s world is small and yet, so big. Over the past 15 years, she has been selling insurance and investment products for Allianz in this rural idyll. With 2,300 customer accounts in a village of 1,800 souls, she is one of Allianz’s most successful agents in Spain.

With good reason – with her easygoing smile, Miriam has win-win solutions for the most complex of customer problems.

An example presents itself soon enough. Driving a little out of town, we pay a visit to a farm at an altitude of 1,000 meters. The air is pure, and the twists and turns of a single-track mountain road give way to a farmhouse nestled in the mountains. Looking down at the valley, you see the green landscape dotted with grazing sheep. At the farmhouse, puffs of smoke blow out of the chimney. Grunting pigs and the noise of a drill from the workshop disturb the tranquility of rural life, with the smell of stables, hay, engine oil and new metal shavings completing the picture.

Miriam’s heels make a clicking sound on the rough concrete of the entrance, which is dotted with dried cow dung. In her hand are a notepad and tablet, which holds Allianz Spain’s entire world. Everything Miriam needs for her daily work is stored in the tablet in digital format.

Three product lines are going fully digital in autumn - home, motor and term life insurance. Four more will follow by the end of 2016. By 2018, Allianz Spain aims to offer all products for private individuals in digital form.

A stooped woman with bright eyes greets us at the farmhouse. Decades of hard farm work show in her tanned hands. Her name is Milagros - ‘miracle’ in Spanish – Jaimerera. The windscreen on Milagros’s second tractors broke and she had called in the morning to know if it was insured. At the time, a quick check of her motor insurance policy showed it was not.

Miriam and Milagros, sitting together at a roughly hewn table under a rather draughty awning in front of the house, soon come to an agreement. Windscreen insurance for the tractors isn’t worth it. Miriam brings up a new page on her tablet. “I’ve brought something else for you.” It’s updated motor insurance, which also pays out for damage caused by wildlife. This used to be covered by the state, but now it’s down to the individual. Using her tablet, Miriam explains the new policy to Milagros.

At first, Milagros is skeptical. “A new motor insurance policy? How much more will that cost?” “No te preocupes,” replies Miriam. You hear ‘no te preocupes’, which means ‘don’t worry’, quite often in Spain, especially if you ask a question. Milagros will save nearly 90 euros a year by taking the new motor insurance policy. She’s finding that hard to believe. “The new policy gives us additional insurance for damage caused by wildlife, but also costs less than the old one?” “Exactly,” says Miriam, pointing to the new tariff on her tablet. “This time, you don’t have to discuss it with your husband first.”

Milagros is convinced. A few clicks and everything is done. The old contract is cancelled and the new one with the updated cover is bought. “If you give me your mobile number, Milagros, I can send you the contract right now.” Milagros has no smartphone, but her son does. The phone number is entered into the tablet and a couple of clicks later, an email with the new contract arrives, completing the process. It doesn’t get simpler.

The tablet has a lot more to interest Milagros. Miriam quickly explains the benefits of some investment products, then she says goodbye. “We can talk in detail about investing money tomorrow at the agency.” She has invested nearly an hour in this customer visit. The outcome is a minor update to a contract, but the trust built is priceless. “Without being asked, I’ve replaced something good with something better. The people here remember that and pass the word around.” Milagros takes no decision on insurance and investment without consulting Miriam first. This relationship is for keeps. “In rural areas, things are different from a city.” Miriam drives about 35,000 kilometers a year for such visits and she needs a new car every four years.

A TOOL CALLED TECHNOLOGY

At Allianz’s annual meeting of top management in Munich, Miriam managed to impress everyone by emphasizing the need to create radically simplified digital products that are easy to explain, easy to select and easy to bundle into packages. Such packages can significantly increase cross-selling and radically increase agent productivity. “As an agent, I gain valuable time for my customers and I can use it more efficiently to generate more sales.”

In the future, all agents should be able to sell anywhere, any time. Miriam recalls a chance encounter on the train journey from Pamplona to Barcelona, which ended with a contract being concluded there and then via smartphone.

“Keep it simple, listen to your agents and, together with Allianz, we can make a crucial difference to quality in the market,” Miriam says. The advice works. Allianz Spain has been getting the highest customer ratings for six years running.

MORE THAN JUST DATA

At Allianz Spain, digitalization is much more than entering customer data on a computer. The whole value-creation chain is going digital - product configuration, the software that supports advisory activities and policy formation, and customer contact, including electronically delivering the policy. The menu navigation is intuitive and everything is explained in simple terms. Customers can take out the policy themselves on a PC or a smartphone. Minor damages covered under home insurance can be reported using a photo clicked with a mobile phone, and the claims status can be tracked at any time.

The single platform that connects the customer, Allianz and the agent is very important. “It has to be the best and work perfectly,” is often heard at the Allianz Tower in Barcelona. One example of the benefits brought by this digital integration is a new cross-selling program in which Miriam was involved. It notifies brokers when a policy will expire and the customer has to be contacted without fail so that it can be renewed and new offers made.

Those who designed the program believe that going fully digital means time-savings of at least 40 percent for the agent as administrative work shrinks. It benefits the customer too.

Miriam also contributed to the digitalization project. José Luis Ferré, the CEO of Allianz Spain, sees the Full Digital project as a chance for growth and development, not just for enhancing efficiency.

The tariff criteria have also been radically simplified for Full Digital, to speed things up. In Spain, the price of car insurance is determined by two factors: the customer’s claims history and credit score. No other enquiries are needed. Another reason Milagros is able to save money.

TRUST OPENS DOORS

It’s great when customers trust you. But building it is hard work. “It’s incredible, the sort of things customers ask me that really aren’t within my area of expertise,” Miriam says. Sasoi Eraikuntzak, the boss at the building firm where Milagros’s son works, asks Miriam about the special permits he needs to drive trucks on certain roads in the Basque region and Navarra.

Miriam will get the answer to that too. However, he has an insurance problem that she cannot solve on her own. The addition of a new truck to his 48-vehicle fleet has led to a massive jump in price. Is that a data entry error? Miriam contacts José Emilio Solano, the head of agency sales in northern Spain. A witty and friendly man, José Emilio believes in getting things done. He is a father figure for the agents and he quickly identifies the problem.

As we navigate the twists and turns of the Basque motorway between Bilbao and San Sebastián, José Emilio tries to resolve the problem by speaking to his commercial business man in Pamplona, José Miguel Valencia, and to the head office in Barcelona. The person at the head office doesn’t call back.

Unperturbed, José Emilio recalls delightful customer stories from his early years on the job, including one full of drama when a young, newly married woman died. Officials from Allianz, dressed in their Sunday best, turned up with a check for the compensation payment. But the young widower got into a violent argument with the brothers of his late wife over dividing the death benefit. The check was torn to pieces before the disconcerted Allianz representatives.

The narration of stories is interrupted by the matter at hand. An agreement has been reached that José Miguel will come to Doneztebe to settle the building firm’s pricing issue to everyone’s satisfaction. It turns out that not only are all the vehicles insured by Allianz via Miriam, there is also company liability insurance, construction site insurance and group accident insurance. What’s more, the firm’s boss has also taken out his private savings and retirement plans with Allianz and many members of his staff are Miriam’s customers.

FLEXIBILITY IS KEY

“It’s impossible to plan an agent’s working day,” sighs Miriam, who has already wasted a great deal of time on this tariff problem. “You get to office at 9 AM, planning to deal with the first customer phone calls and there’s already someone from management or the agency who wants you to do something else for them.”

An annoyed customer called the evening before about her car breaking down in Paris. She wanted Allianz to bring her and the car back to Doneztebe. Miriam patiently explained to the customer that the appropriate thing to do in this case was to get the car repaired in Paris. The customer called a day later to apologize for her outburst.

“That was resolved quickly. Yet, I spent at least two hours yesterday evening organizing the repair in Paris.” If anything goes wrong, customers call the agent, no matter what other phone numbers they’ve been given. When things go well, if they’re happy with the work Miriam did, they get in touch too. “In fact, they get in touch all the time.” But a call from another customer can potentially wreck her entire daily schedule. Visitors who come in with concerns of a completely different kind have the same effect.

STRETCHING THE NOTION OF AGENT

Two middle-aged men stand in front of the agency looking indecisive hesitantly come in. Down the street, there’s a small bar and the two want to lease it. The bar owner is Miriam’s customer. One of the two visitors asks Miriam if she could take them to the bar owner and draw up a lease agreement. She politely declines. “I’d be delighted to arrange any sort of insurance for you, but I don’t get involved in property business,” she says.

One of the two visitors decides not to give up. Rumor has it that the bar owner is behind on his rent payments, he casually mentions. Miriam knows that’s not true. And she firmly cuts the conversation short, giving the visitors the bar owner’s name and nothing more, before ushering them out of her office. A quick SMS to the bar owner warns him of the impending visit of the two. He’s grateful that Miriam didn’t share his number. This is a kind of closeness city-dwellers rarely enjoy.

UNPAID WORK, BUT SATISFYING

Miriam has a visit scheduled to a customer who needs help. The members of a young family renovated their parent’s house in a small village near Doneztebe. When they went on a holiday after the renovation, a beam made of spruce caught fire. The copper chimney flue had been wrongly mounted and it came into contact with the beam, an obvious error by the architect. The fire started when heating came on in the unoccupied house. Flames were already leaping out of the roof by the time anyone noticed. The family is fully insured with Allianz, except for fire insurance. The bank made it a condition of the building loan that this policy and the motor insurance policy were held for at least a year with its home insurer. It shouldn’t have been this way, but rural life is different.

The bank sent an unconcerned loss adjustor and the bank’s representative was nowhere to be seen. The young family turned to Miriam for advice on what sort of costs insurers bear in general and how to get rid of the acrid smell of soot from the walls and wooden beams. Miriam has the answers and the young woman has made up her mind to go to Allianz when the policies come up for renewal.

On the bumpy ride back, Miriam explains: “The fire had nothing to do with me or Allianz. But tomorrow, everyone in the tiny village behind us will know that I was there and tried to help.” People remember that. “All I did today was lose time and money. In a year’s time, we’ll take stock of what I’ve gained in sales from this visit.”

COMPARISONS ARE INEVITABLE

Doneztebe may be small and rural, but competition exists here too. We’re driving out of Doneztebe to visit José Luis Arrachea. He and his wife are Miriam’s customers, but the house is still insured with a competitor. The last time they talked, Miriam explained Allianz’s new digital home insurance policy to José Luis. Allianz is counting on simple, smart pricing in this sector. Pricing is based on just two criteria; land registry information and postal code. Where surface area and floor level are concerned, the land registry data is usually available on the internet. In the countryside, however, Miriam has to make a laborious trip to the public authority to get the data. She has done this already and can now make José Luis a binding offer.

He’s a thoughtful man, loves hunting and lets Miriam explain all the options to him. He’s decided to cancel the old policy and insure the house with Miriam. Afterwards, she readies everything at the agency – the cancellation letter and the new policy (basic or with all-round cover). Selling insurance takes a bit of time. When we were saying goodbye, José Luis said he thought his hunting insurance policy was still with another insurer. “When it’s due to end, I’ll bring that to you too.” The message doesn’t get clearer.

RISK ASSESSMENT OVER SNACKS

José Miguel Valencia and Jesús Nagore, the heads of the commercial and private customer businesses, have come along from Pamplona. The customer, Maika Ariztegui, has a problem called borda. Bordas are windowless stone huts in the mountains of the Basque region and most are used as stables or for storing hay. Sometimes, they are renovated and rented out to hunters.

Maika owns eight bordas and wants to insure them, but neither home nor commercial insurance is suitable. José Miguel and Jesús will now look at the whole picture so they can get a suitable price from Barcelona. Maika’s husband, José Maria Miquelarera, is up in the mountains – hunting season has started. We meet him later with his hunting pals for a mid-morning meal in a borda.

Before you know it, we’re sitting in a windowless room surrounded by the finest fresh walnuts and baguettes, venison salami, sheep’s cheese, chistorra (Basque sausages) and fried pork rind, all from their own land and made at home.

The food is accompanied by Spanish cider, red wine and a good deal of banter. Only an agent treated as a part of the family gets to experience such hospitality.

A FULL CIRCLE

Sixteen years ago, when Miriam told her friends in Pamplona that she wanted to take over her parents’ Allianz agency, they weren’t impressed. But Miriam was determined. “I didn’t want to just sell insurance. I wanted to develop a professional insurance business.” She’s achieved a lot more. “My friends no longer laugh about it; instead they are amazed at what I’ve created here,” says Miriam with pride.

The relationships don’t end with a sale. Milagros Jaimerera comes by for advice on investment products. José Luis Arrachea cancels his old home insurance policy and opts for a cover from Allianz. A friend of the woman who suffered the fire damage gets in touch for a review of her fire insurance. She wants to cancel her old policy with the bank and get insurance from Allianz. Her mother comes to Miriam’s agency and insures a tractor.

Meanwhile, the head office in Barcelona has decided that a borda is a special case. Miriam can set a price for it as originally suggested and she has already sent off three suitable policies for Maika Ariztegui. More will follow.

Miriam’s success is a story of trust. A story that deserves telling and retelling.

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