SET FOR SUCCESS. MPF CEO Rachael Lavars on the business and its new Edge

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1 insurancebusinessonline.com.au Issue 5.5 MUTUAL UNDERSTANDING The insurer that calls imagining the unimaginable the name of the game REMAIN ALERT The upcoming changes to data protection laws at home and abroad AN OUT-OF-DATE RISK? The increasing risk posed by obsolescent technology and equipment SET FOR SUCCESS MPF CEO Rachael Lavars on the business and its new Edge Insurance Business has undertaken its annual search for the top brokerages across Australia

2 PEOPLE THE BIG INTERVIEW SET FOR SUCCESS Macquarie Pacific Funding CEO Rachael Lavars talks about opportunities in today s market and the new platform the funder will soon roll out to brokers IT S BEEN 18 months since Rachael Lavars became CEO of Macquarie Pacific Funding, an organisation born out of Macquarie Premium Funding s 2013 acquisition of Pacific Premium Funding. Talking to Insurance Business at the funder s Sydney office, Lavars speaks about the considerable work MPF has undertaken in recent times. It is a competitive space, but MPF is well placed in the market, and I think we re actually coming into the best shape we ve ever been as a business, Lavars says. We ve had a lot of dedicated focus and investment during the past 18 months on reshaping our business, and that s come off the back of integration and the need to finalise any residual items of the integration program. But also, it s reshaping to better position MPF to respond to the current market conditions. Lavars continues: In the past 18 months, we ve had a big program of work under way and it s involved a full review of our service platform, end-to-end, and that s from our relationship management approach, through our operating activities and through to our collections approach. We ve also had a big focus on making sure that we ve got the right people and the right skills in the business that will drive our future direction. We ve had a number of initiatives under way that we feel will help support a strong future outcome. Discussing the current industry climate, Lavars says: I think the premium funding market has reached a really interesting point. She mentions the substantial challenge growth has posed for MPF in recent times, the same problem facing a vast number of insurance businesses. With the experience of the premium cycle in the last couple of years, it s been a lot of growing to stand still and deliver to your volume result of the prior year, Lavars says. The foundations So, what does she think it takes to succeed in the current marketplace? I think you need to work hard to deliver enhanced value to your partners and, ultimately, through to their clients, and I think you need to work hard to effectively interact with your partners to help them to maintain and to grow their volumes, she says. a strategy that has worked well for our model. Lavars talks about what she believes MPF has been able to accomplish working under that combined strategy. I think the combined strategy has enabled us to develop deeper relationships, and relationships that have spanned the strategic level with principals and senior staff, through to the relationships with staff in the day-today activities, she says. So, it s helped us to better understand our clients and better understand their needs as they change through the industry. Asked about where the business sees major opportunities in the current climate, Lavars says MPF sees a chance to get its product out It is a competitive space, but MPF is well placed in the market, and I think we re actually coming into the best shape we ve ever been as a business That underlying theme of working to drive enhanced value has been cornerstone to the MPF strategy since we launched. We came into the market back in 2004, and the valueadd in our offering was the design and delivery of a broader range of financial solutions for the insurance broking sector, working under a combined strategy with Macquarie Business Banking. Through the years, we have worked proactively with our clients and we ve delivered a whole range of solutions. With everything we ve done, we ve tried to come at it with it being a holistic solution carrying efficiency benefits, and it s really been to a wider customer base, as well as a chance to contribute to the ongoing evolution of attitudes toward premium funding. The premium funding product is a very simple one, and it is a product that is suitable as a payment option to all insurance buyers, she says. So, the product needs to be delivered with ease and it needs to be made accessible to as many clients as possible make the offer, drive the conversion success. I see technology playing a key role in driving that outcome, both through the online product sale channels and through the traditional channels. 20

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4 PEOPLE THE BIG INTERVIEW The feedback for the system has been strong from the pilot group participants in viewing sessions and feedback from demonstrations from around the grounds, she says. We have got clients excited about the release. With everything we ve done, we ve tried to come at it with it being a holistic solution carrying efficiency benefits, and it s really been a strategy that has worked well for our model Enhancing the Edge On the subject of technology, Lavars highlights the upcoming launch of MPF s next generation Edge platform, a group-up rebuild of its existing Edge platform. We re really excited about taking that to market shortly, she says, before explaining the process upon which the creation of the new platform was founded. We surveyed users of the existing Edge platform, and the survey results came back really quite positive. But we recognise the need for change and the opportunity for improvement, she says. We then set out to engage the services of a digital design company, who ran us through workshops to really critically and honestly assess the points of friction or the barriers or any unnecessary steps in our processes in dealing with our broking clients and/or the end client. She says that process provided strong insights to the business and formed the basis for the new design. From there, we set out with design plans and we ve run a process where we ve gone back to a participant group of users to discuss the designs and to tailor them along the way, and what we ve ultimately worked to achieve is to build a contemporary platform that s very intuitive and easy for users, and one that s based on three key objectives: it s faster, smarter, simple. Lavars says the system has been put into a pilot launch and that the business is working towards an official launch in mid-october. Brokers and funders Talking about business relationships with intermediaries, does Lavars think there remain opportunities for stronger partnerships between brokers and funders? We see the range of conversion levels for the funding product ranging from probably about 10% at the lower end, up to 70-80% at the higher performing end, she says. And that higher end is more of an exceptional case, but it s a good example of what can be achieved through the right partnering model and with the right committed focus. She opines that there is a good opportunity to better partner to drive improved results and thinks that, when entering into such a partnership, two key principles need to apply as a first point. One, it s the committed focus, and, two, it s the belief that premium funding is a suitable payment option for the majority of, if not all, clients in a broker s portfolio, she says. From there, I think, our approach is not one-size-fits-all. We take the approach of understanding the broker s portfolio, understanding their client base, understanding their processes and, importantly, the way they interact with their clients. Then we tailor a solution that offers flexibility and choice and is the right fit to what they do, so it embeds as an easy core part of their activities. So, looking ahead, where will Lavars own focus be fixed within the next 12 months? Our key focus in the 12 months ahead will be on striving to deliver enhanced value to our clients, getting out [and] working proactively with our clients, and looking for ways to drive improved results. And is there something else Lavars 22

5 personally hopes the business can accomplish in the Australian marketplace in times to come? I d really like to see this business fulfil its potential, and I ve set a personal aspiration, which is shared with the MPF team. That s to shift funding to being the number one payment choice for insurance again, helping us reach that wider customer base, she says. That outcome will deliver benefits to our broking clients, but it also delivers benefits to the end customer, because funding is easy and it provides the benefit of wider future choices and the freedom that attaches to that. Why put cash out the door when you don t need to? MACQUARIE PACIFIC FUNDING AT A GLANCE JOINED FORCES The combined entity came into existence through Macquarie Premium Funding s acquisition of Pacific Premium Funding three years ago EXPERTISE Macquarie Pacific Funding has over 25 years experience working with brokers and their clients in Australia and New Zealand CLIENT BASE Macquarie Pacific Funding has over 70,000 clients both individuals and businesses across Australia and New Zealand BACKING Macquarie Pacific Funding is backed by the global Macquarie Group 23