Three years of ERGO Mobility Solutions

Three years ago, ERGO Mobility Solutions (EMS) was launched as an insurance partner to the automotive and mobility industry. The cooperation with BMW is its latest success. In an interview, EMS Executive Board member Karsten Crede talks about the developments in recent years and the challenges that have been overcome.

Mister Crede, first of all congratulations on the deal with BMW. That sounds like a real coup.

Karsten Crede: You can say that again. After all, BMW is the world’s most powerful premium manufacturer. The deal is also special, because ERGO lost this very cooperative partnership a few years ago. We have now recovered it and even built on it with our united forces. It shows that we are one of the leading insurance partners in the automotive and mobility industry.

What exactly does the partnership with BMW involve?

Crede: It is a strategic cooperation model. We are BMW’s flat-rate model partner in its financing and leasing business. We also want to jointly develop innovative and digital insurance and mobility solutions. That is why we have agreed on a development partnership in which teams from both companies systematically work on integrated car leasing and insurance solutions.

The deal with Great Wall was also such a milestone in the history of EMS, wasn’t it?

Crede: Absolutely. We are still the only European insurance company to have a wide-reaching strategic partnership, such as this, with a Chinese car manufacturer. The negotiations with Great Wall were lengthy. But after a year of negotiations, we managed to get the joint venture on a stable footing. So we kept at it and our work has finally paid off. We are now up and running and have already negotiated over 13,000 contracts.

An insurance company and automotive companies – explain how you bring these players together.

Crede: That's the big challenge. If we look at the players: the automotive market is very open to investment and innovation but also extremely emotional. An insurance company is more cautious and views things much more long term. It is a case of different cultures coming together. In spite of this, these worlds are a good fit because ultimately cars need to be insured. We are focussing on the new technologies: connectivity, autonomous driving or electric mobility. There are lots of common interests.

You need to persuade car managers about your ideas. How do you proceed in specific terms?

Crede: It's like a huge jigsaw puzzle that we have to put together piece by piece. We need to eliminate scepticism among the managers and show them that we have automotive expertise in the company. We need to pique their imagination and prove that our ideas can be implemented in the market. It is major confirmation of our work once we have persuaded them and also implemented the projects.

Please describe to us the launch of ERGO Mobility Solutions three years ago. How did it start?

Crede: It was all about the basics at the start. We had to put together a strong core team – with people who are basically entrepreneurially motivated and have a certain attitude. At some point it became clear to the team: we’ll show the market! This is because we are more modern, more digital and more tech-savvy than our competitors. We have cars in our blood! Now we have a number of top people on the team – from product owners to delivery managers. And we are constantly evolving.

How did the first project turn out?

Crede: Not everything ran smoothly in the first year. We suffered a few setbacks and we were unable to implement various projects. But that is precisely the time when you need to stay on course. The following year, we took decisive decisions about our infrastructure. For instance, we introduced a SAP IT platform and took decisions about the selection of our risk carrier, the direction of our product policy, cooperation with Munich Re and our foreign strategy.

Can you explain this foreign strategy in more detail?

Crede: It was logical for us to keep an eye on the important markets. Germany is our anchor market. But we are also focussing on China as the world's most important car market, as well as the USA. In future, China will also be extremely important for innovations, such as electric mobility and data management. In the USA, issues such as "autonomous driving" and "mobility as a service" are crucial. Of course, we want to be involved in bringing these innovative solutions to Europe.

It is then clearly about having an instinct to try something new, question the tried and tested …

Crede: You might compare it to a boxer who is boxing at middle distance. If you attack too cautiously, you run the risk of being beaten down by the force of ERGO. However, we need a certain proximity to exploit the potential and synergies of such a large corporation. So we always have to ask ourselves: at what point do engage someone and network with them? And when should we go the full distance? These instincts are really important.

In 2019, EMS finally concluded other important partnerships.

Crede: Exactly. This includes the cooperation partnership with the car dealer NRW-Garage, with which we were able to improve its insurance business model in the dealership. We have also completed innovative projects with Volvo. They include “Care by Volvo”, the flexible subscription model for cars, or the “Volvo Car Protection App”, an “insurance-on-demand” solution that lets customers conveniently and quickly insure their travel abroad or car rental by mobile phone. These projects gradually enabled us to position ourselves and show the automotive industry that we "understand cars" and have real innovation prowess. That was the real breakthrough.

Interview: Benjamin Esche