Work ethics: Claudio Gienal’s first job was to take care of cows – ten years
When schools closed and everyone was invited to work from home last year, Britain’s road network was strangely deserted. The streets were so empty, in fact, that insurance companies were able to lower their auto coverage premiums to account for far fewer accident claims.
But the boss of insurance giant Axa UK is warning today that the trend is about to come to an abrupt end.
In his first big interview, Claudio Gienal reveals that traffic levels have already returned to the same levels as before the first Covid lockdown in March 2020.
And he predicts that the number of cars on the road will accelerate rapidly once the lockdown is lifted from July 19.
The bad news for motorists is that in addition to clogging the trips between work, school and stores, premiums have already started to rise again.
“We expect travel to be heavier than before the pandemic,” Gienal said. “Right now what we’re seeing with some lockdown is we’re already at 100% of what the normal frequency would be.”
Earlier this year, drivers renewing their annual auto insurance policies were enjoying the best rates since 2015. Gienal said there had been a “huge drop” of 11-15% from the pandemic. The average annual premium between April and June was £ 629, according to comparison site Comparethemarket.com – £ 126 less than before the lockdown began in March 2020.
But according to Gienal, that could be the lowest it will be for a while. “Customers have had these policies much cheaper than before,” he says.
The Swiss executive grew up in a small village in the Alps, five minutes from the slopes. After stints in management consulting, he moved to Zurich, where he spent a decade, before joining Axa and becoming Managing Director of its UK and Ireland activities in 2018.
“The environment I grew up in was very simple – we always had what we needed but there was no vacation. I didn’t see a hotel until I was 20, ”he says.
His work ethic was also established at a young age: Gienal’s first job was tending cows at just ten years old. “They’re a lot bigger than you, so you can’t physically move them, you have to find ways to get them where you want them,” he says.
After seven years spent in a Swiss Benedictine monastic school – which he described as “very humiliating” – he studied environmental engineering. “At the time, there was no job market for environmental engineers, which seems ridiculous these days,” he laughs.
Axa is a French company and Gienal’s activities in the United Kingdom and Ireland represent 16% of its European activities in terms of turnover. It is one of the UK’s largest insurers for healthcare, home, travel and business, collecting £ 4.6bn in premiums in 2020.
Industry is emerging from the pandemic tarnished by fury over rejected claims from small businesses. In the end, it took a legal victory for the Financial Conduct Authority regulator to force a number of insurers to make payments to policyholders whose businesses were hammered by Covid-19. Axa was not one of the insurers named in the case.
Gienal, 47, says: “The intervention of the FCA was necessary because some parts [of many business insurance policies] weren’t as clear as they should have been, there’s no doubt about it. We should have done a better job to have more clarity. He says Axa has now paid 73% of its claims, or around £ 70million. The remaining 27 percent “we are working because we need more information,” he adds.
“I feel for all small businesses,” he says. “It has been extremely difficult, especially for trades like pubs and other entertainment where everything has been closed out of nowhere, I understand that.”
Still, he argues that most types of insurance were never designed to cover an unforeseeable event like the pandemic. Gienal adds, however, that insurance is never designed and priced according to the expectation that each insured will make a claim. “It doesn’t work if the government shuts everything down,” he said.
Gienal supervises more than 8,000 employees and wants staff to work flexibly in the future under a plan he calls “smart work”. He said, “We won’t go back to what we were. It would be a missed opportunity to improve everything.
“But on the other side of the spectrum, I don’t want us to become a completely virtual organization. I don’t think that’s the purpose of business. I want people to come together, young people need to learn. This is how I learned – on the job, chatting with colleagues. We haven’t done that yet, but we’ll ask people to come back to the office.
The goal is for staff to work remotely part of the week and be in the office when needed.
“With my own team, when we discuss strategy, I will ask them all to be there in person,” he says. “But for the weekly updates, I really don’t mind them doing this in the car, on a boat, in their bed. Wherever they are, as long as they participate.
Gienal is also very sensitive to the well-being of the employees. He gave staff the option to take up to 15 additional days off to deal with the pandemic. “We also gave everyone an extra day to do whatever they wanted, for morale,” he says.
It may have been his seven years of schooling in a Swiss monastery that instilled his values of respect and empathy, but Gienal is still a businessman with a plan to cut costs and grow the business. He is also cutting back on the company’s real estate assets, recently listing office space in Tunbridge Wells, Kent, as he remodels the workplace.
Gienal has now started to return to the office, although he spends most of his time working from home.
Is he driving to work and worried his car insurance will be increased soon? Fortunately for Gienal, he takes the train.
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