Buy XP BTR and delve into health insurance and corporate benefits - NeoFeed

Buy XP BTR and delve into health insurance and corporate benefits – NeoFeed

Roberto Teixeira, Partner and President of XP Seguridade

In August last year, XP began testing the waters of the health insurance market and corporate benefits. To that end, its insurance arm has partnered with brokerage BTR Vantagens e Seguros to start selling health and dental plans to small and medium-sized businesses, it has exclusively revealed. Nieuvid in this occasion.

A year later, given the results obtained, XP decided to dive first into this market. For this purpose, it bought BTR, considering the corporate health insurance sector as a relevant part of its strategy to strengthen itself as a bank that provides products and services to businesses.

“This acquisition was very apt especially at this moment of wholesale consolidation and growth,” says Roberto Teixeira, Partner and President of XP Seguridade. Nieuvid. “What we’ve found in these 12 months is that health plans are a very relevant product for businesses and the wholesale sector.”

The agreement signed with BTR last year provided an option for XP to purchase the brokerage at the end of 12 months. And the practice ended due to the good performance shown by the partnership in that period, as 60,000 contracts with companies had already been closed. Financial details of the deal were not disclosed.

As part of the agreement, BTR founder Bruno Autran became a partner and head of corporate health and insurance at XP Seguridade. Without revealing the goals set for the health sector, he says the focus is on investing in the health plan management platform and the advantages of companies in the market.

XP Seguridade has developed a market that includes products from most of the operators and insurers in the market, such as Bradesco Seguros, SulAmérica, Porto Seguro, Hapvida, Unimed and Omint.

“Health, specifically, in most companies, corresponds to the second highest cost. When you provide a solution for health and benefits to that company, you help solve that problem. We succeed in doing that, while our competitors offer does not have that solution,” As Otran says.

The insurance offering complements XP’s strategy of positioning itself as a corporate bank, as well as investments for individuals, an area in which it has become well known and has become a reference, as it finished the second quarter with R$846 billion in assets under custody.

In June, XP announced the launch of its Wholesale Bank, which caters to businesses, institutional investors, and high net worth clients. XP Seguridade is not integrated into this new structure, but the corporate insurance portion is seen as closely related to enhancing the service offered to businesses.

“We see great potential in the corporate world, which is starting to play a very strong role,” Teixeira says. “Increasingly, the corporate segment becomes important to the group.”

Launched three years ago, XP Seguridade has more than R$40 billion in assets in custody, and operates on the retirement and life insurance fronts. It’s part of the new sectors XP has created over the years, which includes the Cards and Credits area. Projections indicate that, by 2025, this group will represent 25% of the company’s revenue. In the second quarter, XP posted a record total revenue of R$3.6 billion.

No friction?

XP is making its way into the insurance and benefits market at a time when health and dental plans are in high demand in the country. National Agency for Complementary Health (ANS) data for June shows the number of healthcare plan users grew 3.3% compared to the same period last year, to 49.8 million people, while exclusive dental plans expanded 7.4% to 29.9 million. users.

“If we look at the size of the insurance market in Brazil, we are talking about premiums of more or less than 413 billion reais. Only the health market in general, individuals and companies, is 245 billion reais. The health market corresponds to more than 50% of the health market, Otran says. the insurance market as a whole.

In order to conquer a relevant share of this market, XP is working on two fronts. First, in technology. The plan is to offer a simplified contracting experience, in the style the company has developed for investments in the insurance world.

“We sell mutual funds to the client, and with one click he goes to the advisor and speaks and accepts the term to join and that’s it. In health, in many insurance companies, there’s still paper exchanges and stamps and things from decades ago. We’ve worked a lot on this, says Otran. To make the experience more flexible, more fun, and faster.

The second phase of the strategy involves the involvement of a world of 539 offices and 11,300 investment advisors associated with XP, which will support the search for clients. This mobility is essential to reaching small and medium-sized businesses, sectors that the XP Seguridade initiative targeted first and that remain in the shadows when it comes to providing insurance.

It will also help XP investment advisor offices to compete with large banks and their agencies. In 2018, Itaú partnered with Amil to distribute Amil’s corporate health plans. Bradesco owns its own insurance district, Bradesco Seguros, and sells health insurance to the corporate sector. Itaú finished the second quarter with 3,800 physical service points, while Bradesco recorded a total of 2,900 branches.

“One very important aspect of an insurance broker is the number of clients and how to reach them,” says Christian Willisch, co-founder of brokerage Globus Seguros. “There are a lot of opportunities in SMEs, because large accounts are saturated, while SMEs are much higher in size and they are underserved.”

In addition to traditional brokerages, XP will also face competition from fintech companies. Digital brokerage Pipo Saúde is vying for corporate health plans, after receiving a R$100 million contribution last year from investors such as Thrive Capital and Kaszek. Another name entering this market is Vitta, which was acquired by Stone in May 2020.

And there are also health techs that offer direct offers to health plans for companies and individuals, as with Alice and Sami.

For Gustavo Leança, Insurance Solutions Leader at Capgemini Consulting, the arrival of XP in the corporate health insurance sector is another step by the big financial platforms to create large financial markets. He cites another example of the partnership signed in early 2021 between Nubank and Chubb Personal Insurance. “It’s a model one stop“, He says.

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