The pensions industry in Norway has experienced a rapid surge in recent years, thanks in large part to the healthy economic performance of a country bolstered by a vast amount of oil. Although Norwegians enjoy a generous provision of pensions compared to their Nordic and European neighbours, there are a number of companies vying for the attention of the country’s citizens.
One firm has established itself as the market leader in the country’s pensions market in recent years, with a dramatic surge in its market share (see Fig. 1) Nordea Liv, a subsidiary of the country’s leading financial services firm, Nordea Bank, is now the leading provider in Norway of pensions. World Finance spoke to the company’s CEO, Jørund Vandvik, about how it is leading the way in innovation, the challenges facing the industry and what the future holds for pensions providers in Norway.
Our key differentiator is a focus on creating value for everyone – customers, advisors and ourselves
How has Nordea Liv grown its market share so dramatically in recent years?
Dedication to bank assurance is the main reason for our growth. Our mission is to provide our partners’ customers with the best possible life and pension offering, and provide best in class sales support for the sellers and advisors. We have adapted our products, sales processes, service models and operating model to match their needs. As a result, we are being perceived as an important contributor to their success and they focus on our products more than before.
What sets the company apart from its competitors, and why is it the leading provider in Norway?
Our key differentiator is a focus on creating value for everyone – customers, advisors and ourselves. We always start with customer value, it has to be positive. In providing value for advisors, we focus on ease to understand products, swift processes and no after work. Products are simplified and standardised so we can automate. Add a customer oriented organisation that works well across functions and always wants to improve, excellent sales support and fun to the equation, and you have a flavour of our distinctness.
How does Nordea Liv work with Nordea Bank and Tryg to offer a unique product?
We shall be the best product provider to our partners. To succeed we need to be extremely dedicated, integrated and supportive – we aim to know them better than they know themselves. At the same time, our aim is to challenge the existing thinking to be able to develop unique and innovative offerings based on the strength of our distributors.
What are the benefits of being part of the Nordea Group?
Nordea is the largest banking group and asset manager in the Nordic countries. There are several synergies being a part of it, both in scale and scope. The most obvious is that we utilise their distribution channels and customer base to drive volumes. But there are benefits in other areas as well, for example access to Nordea’s vast asset management and risk management competence. Another example is that we are incorporating Nordea’s excellent global asset allocation strategy in our investment products, securing the customers with actively managed portfolios reflecting Nordea’s strategic advice.
In what ways is the company innovating in the pensions market?
We are innovating by simplifying. A pension is perceived to be a complex area for most people, our ambition is to make it easy. Our focus is on the advisors – it has to be easy for them. If it is easy for them, it is easier for them to take it to their customers. Another benefit from this approach is that simplicity for advisors provides simplicity for the customers. If it is easy and understandable for customers, they will buy our products.
An example of how we innovate is our iPad sales tool. In one of our sales channels, we developed an app-based sales tool on iPad for the sales force. It was very well received for its user-friendly interface, off-line usage and easy to use electronic signature feature. Since launch in January, sales are up 60 percent.
What are the challenges facing the industry at the moment in Norway?
The main challenge at the moment is the introduction of Solvency II and the impact on the guaranteed products. All sales of guaranteed products are closed, but it is a long-tailed business. Our strategy is to reduce the relative size of guaranteed products by strong growth in market return and life products.
Are there areas that Nordea Liv wants to expand into?
The market is moving, gradually, away from physical channels to online channels. Over the past years, we have eliminated paper processes in the sales processes. In addition, we have moved to electronic customer dialogues with portals and electronic newsletters, and leverage Lync and web-meetings with distributors and customers. The next step is to establish online sales solutions for all products, integrated with our partners’ online offering.
Where do you see the company in two years time?
Two years from now, we will still be the largest pension company, adding even more value to our partners and their customers.