Following its acquisition as part of the Prudential takeover, Scottish Amicable International (SALI) is gearing up for a renewed assault on the European market next year, according to SALI chief executive Clive Cowdery.
“The Pru is backing our expansion plans in Germany and has given us an assurance that once other strategic matters are resolved, the international business will be expanded,” says Cowdery.
As a first step, SALI aims to double its sales force in Germany to 30 by the end of 1998. It is also introducing pension plans into the German market, with a few new twists that will be familiar to those in the UK.
The pension launch is designed to take advantage of the existing pension provisions in Germany. Cowdery says, “we will also be well positioned for when the legislation does change in Germany.
“The market considers the new pensions will introduce a more favourable tax environment.” However, the tax changes are not expected now until after the German elections in October 1998.
A new feature of SALI's German pension is, remarkably, not available there currently. Cowdery proudly proclaims: “We have invented the open-market option.”
The open-market option has been a feature of UK financial services for many years, allowing a pension client at retirement age to choose an annuity in the free market.
In Germany, if you have a pension with Allianz, you have to buy your annuity from Allianz.
Cowdery says, “We have cleared the contract so that it complies with German law and with SALI, at retirement, a German has the choice of any provider, German or otherwise, for the annuity.”
He calls it, ” an interesting blend of the best of our traditional flair for product design, with German fiscal and technical restraint.”
Last year, Scottish Amicable stole a march on its German competitors, including Allianz and Nurnberger, by winning a prestigious award for product excellence given by a German magazine.
Cowdery says, “The reason we have been able to compete with these much larger companies is because we are dealing through the broker market primarily, where the acceptance of unit-linking is that much greater.”