The Vienna Insurance Group is proud of its more than 185 years of history and tradition. The Company has grown from a local insurance company into one of the largest international insurance groups in Central and Eastern Europe (CEE). Committed customer counselling, innovative products and outstanding service were, and are, the pillars of the Vienna Insurance Group’s successful growth in a total of 23 countries, a success that continues moving forward with a focus on the Company’s goals.
A CEE pioneer
The management of the Vienna Insurance Group was quick to recognise the many opportunities for growth in Central and Eastern Europe following the political reorganisation in 1989 and 1990. The Vienna Insurance Group was the first Western European insurance company to make a cautious, risk-conscious move into the CEE region. Through its participation in setting up Kooperativa pojist’ovna in the former Czechoslovakia, the Company involved itself in this growth region right from the outset, taking advantage of the opportunity to gather valuable experience during the period of radical change while supporting the development of the market with its insurance and product knowledge.
Based on the knowledge gained in developing markets, further positions were taken in Hungary and Poland in 1996 and 1998. This was still done at the time in cooperation with Swiss and German partners. The focus of the Vienna Insurance Group at this early stage was on acquiring know-how about the special features of the various markets. In terms of geography, the Vienna Insurance Group concentrated on the countries bordering Austria. Austria’s historically close relationship with this region and the accompanying understanding of the mentality of its people proved to be a major advantage in the development of the Company’s business and distribution.
The government monopoly on motor liability insurance that still existed in the Czech Republic was repealed in 2000, leading to a significant change in the law and the beginning of a fundamentally new situation in Central and Eastern Europe. For the first time, private-sector insurance companies could also obtain licences for this mandatory insurance segment, thereby expanding their customer base by broadening their product range.
Following the privatisation in the Czech Republic, Slovakia eliminated its monopoly on motor liability insurance in 2002. Based on the experience it had gained, the Vienna Insurance Group made a conscious decision to actively pursue a broad entry into this business in the two countries. It was in the beginning stages of the partitioning of markets that the foundation for the outstanding position of the Group was laid.
The business opportunities and development potential that the Vienna Insurance Group has consistently taken advantage of were, and continue to be, based on the dynamic growth taking place in Central and Eastern Europe, which is primarily driven by a massive need to catch up in terms of insurance coverage and safeguarding the rising standard of living. In past years, the Group has made targeted acquisitions of many small and medium-sized private insurers that had made a name for themselves in the market and offered, in particular, new additional channels of distribution. The management principles that were used, namely anchoring in the local market, a multi-brand policy, and multi-channel distribution, ensured that their integration and business development would be a success.
V.I.G.’s leading position
The Vienna Insurance Group achieved its number one market position among international insurance companies operating in the CEE region by concentrating on its core markets in this region. Due to the increased need to make provisions for old age and the resulting increase in demand for life insurance products, the Vienna Insurance Group acquired the Erste Group’s insurance operations in the CEE region in 2008. Furthermore, the conclusion of a related long-term mutual cooperation agreement with the Erste Group gained the Group an important partner for the distribution of life insurance products.
The Vienna Insurance Group has responded to the changed conditions since that time which the economic crisis has brought to its markets by strengthening its focus on sustained growth and targeted increases in efficiency. Its competitive position is being continuously improved by portfolio realignments and cost-structure optimisations in the wake of company integrations. The focus is not only on short-term cost effects, but on a systematic, planned utilisation of synergies that will allow the Group to fully exploit the growth potential of the region over the long-term.