Selling Life Insurance, Pensions and

Wealth Management - for HSBC

Dr Patrick Dixon Chairman Global Change Ltd

Patrick Dixon is Chairman of Global Change Ltd, Author of

15 books and has been ranked one of the 20 most

influential business thinkers alive today (Thinkers 50)

Future of the insurance industry

fro HSBC (2008)

500 videos of keynotes

www.youtube.com/user/pjvdixon

Over 4 million views

Dixon’s Futurist Website

www.globalchange.com/

14 million unique visitors.

F ast

U rban

T ribal

U niversal

R adical

E thical

As important as health and education

Advisors need to respond faster

• Web makes

clients

impatient

Wild Card Impact on Insurance / Wealth Management

Low probability, high impact events insurance Your mission really matters – death with no cover (story)

Sovereign Wealth Funds • >$3.5 trillion by early 2008

• Expect big impact on different sectors

Everything you sell

depends on emotion

Don’t believe market research

Shows what insurance purchasers want today

but they will behave differently tomorrow!

Fast

This ad about life and death was

banned on UK TV! Why?

A news story can destroy

a brand in a week Fast

TRUST at RISK

Hard to gain

Easy to lose

Example: Retail

Investment Funds

• Most fund managers do not recommend their own funds to friends or family

• Growing demand for

independent financial advice

1 billion

children in

Africa and

Asia means

more parents

need life cover

China – 23 million people a year cities 500m 800m by 2020

66% of over 50s in Asia by 2050

• 81 million now

over 60 in

India

• Big impact on

China growth

Europe

Dying

4 couples

needed to

produce just

one great-

grandchild

1 million

voters over

90 years old

in Italy by

2026

Retirement Age is

Last Century Idea

• Many will work beyond 70 yrs and still have

long retirement

• Huge wealth inherited by over 70 year olds

– Second generation middle class

• Home owners will release capital

Surprised to be still alive and well

• Most people think they

will die 5-6 years earlier

than official figures (UK)

• Government figures

also too conservative

• Result: Most people

are going to live at

least a decade longer

than they imagine

Eat more – weigh less

• 30% of US

newborns will

become diabetic

• $100bn cost per

year

Can we stop ageing ?

Ageing Hair Follicles Hair in all the wrong places

Hair regrowth – boom industry

chemicals, gene treatment, cloning

Sexual Performance

Permanent Hair Colour

• Adenovirus

• Infected mouse hair cells

• Permanent colour change

Treatment which restores and

maintains the youthful elasticity of

hardened arteries – and helps

wrinkled skin. Global sales?

Elastomore

Intravenous

Facelift

Total body lift – works in mice and rats

Grow New Teeth

• Pigs teeth

grown inside

rats

• Mice grow new

teeth from nerve

cells / gum

tissue

Successful Heart repair

• Inject bone marrow stem cells after bypass

• Improves heart function up to 85%

Urban

Near-perfect repair

of heart or brain

damage following

coronary / stroke

Your

Brain

Can

Repair

Itself

Daily

Brain Function Enhancement

Women with male brain

Cure for old-age

loss of sight

• Macular degeneration – 10

million affected in US

• Single injection could restore

sight

Cure for Deafness

Gene in people over 100 is same as

that in long-lived yeast and worms

We will copy animals that don’t age

Turtles, sturgeon fish , some humpback whales

Expect major unrest from growing

gap between rich and poor

Life Insurance is a Tribal Product

People need to belong

Sense of identity

Community

Life insurance is always bought for other members of the same tribe

HSBC Insurance culture

Tribal

Female tribe • Most online

accounts are

operated by

women

• Most household

bills paid by

women

• Most new jobs

won by women

Urban Tribal

Life Insurance: Tribal Messages

• Marketing: We are here to protect your family, to

pay out generously and quickly if something

happens to you, giving you peace of mind at a

fair price. We believe in the value of what we do

for you.

• Investor Relations: Our mission is to make

shareholders as much wealth as we can without

breaking the law and landing up in prison. We

raise life insurance premiums as high as we can

get away with, and pay out as little as possible.

Insurance and Pensions

Consolidation

2010-2020

Mass market services

Premium relationships +

resource management

India Insurance Market

• Total Insurance premium 2% of GDP

• Below world average of 7.8%

• Insurance penetration only 1.95%

• Worldwide, Insurance used as risk cover

whereas India = tax-saving and investment

• 250 million middle class population can be

unleashed by repositioning as risk cover

Urban Universal

la

Impact of online competition for life

insurance and wealth management

• 3 years ago who was talking about

Youtube? Did not exist.

• No advertising

• 400 million videos viewed a day

• 12 months later bought for $1.6bn

Will beat any direct Life cover quote

Call back in less than an hour

Environment

Single Issues

Hidden commission

Gene tests insurance

Iraq war

Funding Medicare

Radical

Genetic Prophecy – Are We Ready?

Genes for speech, memory, criminality,

depression, obesity and stable marriage

• FOXP2 gene is vital to language and speech development

• 17CREB genes are all needed for learning and memory

• Vasopressin receptor gene on chromosme 12 – huge effect on mating and pair binding in prairie voles.

• Low monoamine oxidase A activity on X chromosome strongly linked to violent, antisocial or criminal behaviour

• Gene for obesity: 6% have MC4R gene

• Gene linked to serotonin production strongly linked to depression. CREB1 carries 80% risk of depression – in women

Sustainability

Global Warming - facts

CO2 at highest level for 1 million years

Biased advice?

• Commission disclosure not enough

• Disclosure of commissions on all products

• Payment for advice, not activity

Payment by Commission

• Temptation to oversell

• Temptation to sell high commission products

Independent or Independent?

• UK customers lose

£140m a year - sold

investments that offer

highest commission

rather than most

suitable

• Source UK FSA

Advice – Price Pressure

• Few customers will agree to pay as much for

advice as they did in commissions

New trend – get a life

• 10,000 US, Japanese and UK

managers

• Work-life balance is now first or

second most important factor in

looking for a job

• Second greatest career priority in

1,000 young managers

Ethical

Managing imbalance is about friends and family

Making a Difference

• Growth

• Profits

• Shareholder value

( + customers…)

Companies will change how

they talk Ethical

Individuals talk about…

• Own needs

• Family + friends

• Community

• Wider world

Ethical

The basis of every sale for an

insurance company

• For individuals – protecting wealth

• For family – providing for their future

• For community – or society enhancing

• For the whole earth – the good of all

Leaders tell their own good news story

Take Hold of Your Future - Slides globalchange.com/ppt

10 million unique visitors

Patrick Dixon is Chairman of Global Change Ltd, Author of

15 books and has been ranked one of the 20 most

influential business thinkers alive today (Thinkers 50)

Future of the insurance industry

fro HSBC (2008)

500 videos of keynotes

www.youtube.com/user/pjvdixon

Over 4 million views

Dixon’s Futurist Website

www.globalchange.com/

14 million unique visitors.