Why did International Wealth Insurer choose to enter the UK market?
Luc: IWI redeveloped its business model in 2011, orientating it towards wealth management. Before that we were a more traditional life insurance company.
We developed a number of core markets in continental Europe and now cover five of the six most important cross-border markets in the region: Luxembourg, Belgium, France, Italy and Switzerland.
We decided to enter the UK market because we had requests from UK residents. It was on a very reactive basis but after we had demonstrated we could service the continental market, we knew we had a good product and the potential to market it. We have also found the right person in Mike [Foxall] to continue to develop the UK market.
"What is really exciting for me is that we are tweaking the core structures and insurance wrappers."
The Luxembourg insurance solution is not widely known in the UK, because traditionally the UK is linked with Dublin and the Isle of Man. The triangle of security is something specific to the Luxembourg market.
It means an insurance company has to comply with regulation and be sufficiently solvent. The assets of a company are held by a custodian bank, as opposed to a life company, and split, so if an insurance company were to go bankrupt the clients’ assets would always be preserved.
The regulator has to approve that the custodian bank and the insurance company are in good health, so it is always a three-way contract. It is what we call in Luxembourg the ‘triangle of security’. It gives customers a guarantee that whatever happens with the custodian or the insurance company, their assets are preserved.
Can you tell me about your background and how you came to be at IWI?
Luc: I have spent all of my career in the financial sector, starting in a bank branch doing payments and money transfers. From there I moved into the insurance industry, later becoming a board member of the company, which is now called Belfius Insurance – the fifth-largest insurance company in Belgium and the shareholder of IWI.
Belfius is the former Dexia Bank, which was bought by the Belgium state and changed its name.
As of 2008, I was a non-executive board member of IWI, and last year I took on the role of chief executive officer.
How do you distinguish IWI from other Luxembourg life companies, such as La Mondiale Europartner, Lombard International and Baloise?
Luc: Baloise is not only focused on international wealth insurance, it has other activities as well. Like Lombard, IWI is fully focused on structuring wealth insurance.
The French companies have their traditional French clientele, and they have their guaranteed rate fund, which is something we have not done for historical reasons. We are focusing on the dedicated funds or the collective investment funds. We have only five or six markets that we want to focus on because we do not have the size of Lombard or La Mondiale.
