Hi. Next on stage with me this morning, I have the pleasure of being joined by Thomas Buberl from AXA, the CEO of AXA. As you know, AXA reported a strong set of first-half 2026 results. The business is on track to meet its 2026 ambitions. To keep everyone on their toes, last week, Thomas and his team launched AXA's new strategic plan as it seeks to grow from a position of strength. Now's a great time to catch up with Thomas. Thomas, thank you for being here with us today. Let's start with the strategic plan, if that's okay. Could you just quickly talk us through what you feel are the main highlights of that plan, and what you think people should be focusing on there?
Yes. Thank you, and good morning to all of you. Very nice to be with you and perfect timing, as you just indicated. The plan that we have launched last week for the period of 2027- 2029, is called Growing Forward. I think those two words more or less say it all. It's a combination of going forward, so a plan that is very focused on organic growth, that is very focused on a continuity, with a clear accentuation of growth. The pillars of this plan are growth, technical excellence, and productivity and cost excellence amplified by AI. We want to make sure that we use our good position, in which all lines of business, all countries are in good shape to now focus more on growth and more on market share gain in most lines of business.
And we are very confident that with the tailwind we've got from the existing plan, that we'll be able to implement it. Also on AI, we have given, I think for the first time, a very clear roadmap of what we want to do and where also benefits come from.
Okay. One place where in this set of strategic planning cycles, I guess you've been quite different, is introducing a book value target. Could you just talk a little bit about the message you and the board are trying to convey by introducing that particular target?
Yeah. We have a capital management policy, that is by the way, unchanged for the next plan, which is 60% dividend, 15% share buyback, and then the rest is being reinvested. The reinvestment is 25% more or less. It is a large part of the shareholders' money, and we want to make sure that there is a clear measure as well. How is this being invested? How is this performing? We have seen that over the past years, it has been performing quite well. Therefore we said, look, there needs to be a specific target on the retained earnings as well, that are being reinvested on behalf of the shareholder. The aim is to be mid-teens, as a progression of this book value.
When we put the financial targets aside, what does success look like outside of those financial targets? What does AXA's business model look like outside of that as you go through this cycle?
We have announced it that we want to have 100 million customers, and a much larger insurance company than we are today. We have added a bit more than EUR 20 billion. If you roll forward to the end of this year, over the last five years to the top line, we started at EUR 100 billion. Now, a little bit at the end of this year, over EUR 120 billion. First of all, it is a good proof that organic growth really gets you somewhere and you can make a big difference. Over the next plan, we want to replicate the same thing again. We have got a good business mix, we have got a good country mix, and making sure that AXA, by the end of this plan, is bigger and is more profitable.
If we could just move on a little bit to the organic growth initiatives in the plan. Effectively, your volume growth targets imply that you should capture some market share. Can you talk a little bit about why a customer will choose AXA over its competitors? Which type of incumbents do you expect to take that share from, would I-
What you see in general is that there is a flight to size in the market. The larger insurance companies are benefiting at the expense of the smaller ones. This is very much to do with the question around regulation and who has the ability to react to regulation. It is also true, and first and foremost true, to the question around AI, because AI demands a lot of investment. AI needs talents. The people that we are trying to recruit are more likely to go to a larger and more trusted brand than to a local brand.
We do expect that over the next years, share and new market share focus will be on fewer insurers and the bigger ones because they are the ones who can cope with the additional complexity and the financial necessity of this complexity, but who can also make sure that they implement it. Therefore, we will see a shift in the market structure. Yes, we have already seen in this current plan that in the countries where we did not have any major restructuring or turnaround to do, it is possible to grow. It is possible to gain market share, and we just want to continue and replicate what we have already done in many markets. I remind you that, for example, in the retail space, we have gained market share. We have had a net new inflow of over 2 million contracts.
This is really, going back to my first words, Growing Forward, going forward of something that we have already done. The same is true, for example, on AI. If you look at the AI agenda, it is a very, I would say, low risk AI agenda in the way that we say, "Look, we have tested many use cases, and we are just replicating what has been done well in one country at scale across the other countries." No risky experiments in AI.
I guess another element is the idea of customer acquisition, customer retention. If I get this right, I think acquisition was more the newer markets, the international markets, retention in the established markets. How have you had to adapt, whether it is products, distribution incentives, and so on and so forth, in order to try and deliver some of those ambitions around retention and acquisition in particular?
I mean, first of all, we've got a very diversified mix of distribution channels, and in particular, we are very strong in our own agents, which are mostly franchise agents. Your customer access is much more direct and much more controlled than if you were selling, for example, through an aggregator, where you're very far away from your customer. When we look at retention opportunities, technology will give us a very different way of doing retention. I used to be a Head of Distribution 20 years ago, and I remember very well when we were trying to push our agents to do retention. It was always a nightmare because you were sending them paper lists and say, "Look, you need to go to these customers.
You need to renew a contract." This was always seen as a very unattractive task because you only got a third of the commission of a new business. You didn't know what the customer was doing, and these lists were very mechanical. Each customer was treated in the same way. Today, this is very different. You get technology to analyze, okay, which customer is most likely to renew and which is not, and where is the likelihood of a customer leaving, higher or lower. Technology will give you a much more focused way that when you go to a customer, it's much more likely that you have success. All of a sudden, the equation between I run after new business versus I'd rather spend time to retain customers has changed, and you see it in the agent base today.
I believe that, given my own experience as the Head of Distribution, we can do better in retention. A retained customer is always a better customer because you know he or she from the history of your portfolio, and it's much easier to convince somebody to stay rather than to get somebody new who you don't know to get on board. Therefore, we said, "Look, there is a big opportunity for us to do more retention," which ultimately leads to higher growth because you lose less customers.
Thank you. Another aspect of the sort of organic growth was some of the structural growth opportunities you highlighted around autonomous vehicles, energy, infrastructure, so on and so forth. Of those long-term structural sort of drivers, which ones are you most excited about for the group, and how do you win in some of those markets, or what sort of positioning have you put in place already?
I think the core message is the biggest growth comes from our portfolio. So retention and growing with our existing customers. However, we want to make sure that in some very defined spaces, we make an extra effort to grow. If I start in the retail space, certainly in the area of social inclusion, we believe that there is a big growth opportunity. Just to give you an idea, in a market like France, roughly 20% of French citizens today do not have access to insurance because it's either too expensive or they are not deemed to be a good risk or desired risk.
Instead of neglecting these customers, we said, "Look," a couple of years ago, "what can we do to reinvent our product and make it a growth initiative to get into that segment at the same margins as we have in the base business?" We basically started this with zero customers, and we now have 24 million customers. You mentioned autonomous vehicles. The same thing, we have shifted towards more corporate risks a couple of years ago because we believe that many car insurance risks will turn from a private individual contract to a liability of a company when you think about autonomous vehicles. Obviously, there is no history around how does an autonomous vehicle drive in San Francisco or L.A. and so on. We are in some cases the innovation partner of these companies to help them to build insurance.
It's kind of like insurance as you go. You learn with the company, you adapt the prices as you go, and as you have history. I think the combination of being global, because these companies don't want to deal with 60 different insurers across their 60 countries. They want to have one global company that they do everything with, coupled with being deeply localized and understanding the local tissue, in particular through our agents, is extremely important. Or a last example, take direct insurance. We have done direct insurance quite a lot traditionally, but haven't really put such a great effort on it.
With the purchase of Prima last year, and also with the shift in customer needs that more customers are going direct, we said, "Look, we found out we've got the biggest franchise in direct across Europe." We have now made a concerted effort in growing this franchise more. Certainly, with the acquisition of Prima, we also have a different way of doing it in a much smarter way than just saying, "Okay. I'm taking my traditional products and I'm putting them in my online shop," but they remain the same products and the same processes.
And just on that point on Prima, is that model exportable across other markets, or is the focus at the moment to concentrate on the Italian market and succeed there
a bit more?
Prima is now very big in Italy, and they have been very successful. If you look at the initial business case versus where we are today, we are extremely pleased because it is doing much better than we have expected. Prima is also today in Spain and the U.K., and our focus is now to make the Spanish market the next success. Essentially, Prima needs a good brand, access to repair networks, and access to agent networks. Prima is not only a direct insurer, as they sell direct-direct, but they also use their product in the agency sales force. If the agency sales force cannot sell with the traditional tariff of their mother company, they use Prima to sell because Prima has a very, I would say, risk-based pricing without looking at any social considerations.
The 20 year or five year old driver pays much more at Prima than he or she would pay at a traditional insurance company. This trade-off works extremely well in the agency sales force.
Okay. Can we move on a little bit to dig into your plans of effectively scaling AI across the value chain? In particular, I guess if we start with, how does the AXA reshaped business model in your mind look in three to five years' time?
The honest answer is probably I don't know. Because we are at the beginning of AI and you discover every day, and where you are in a year's time, you laugh about what you have done so far. I think that's very good because you need to be humble and say, "Look, I'm going on a journey that is unknown." I think the business model will, at the end of the day, not look so different. We will be able to deploy AI across the different sectors. So one is the area around efficiency where we automate a lot, where we simplify the customer interface, where we personalize more, my example around retention from earlier. A second area is we use technology to increase margins on the technical side. So when it comes to pricing sophistication, when it comes to fraud detection and so on.
We will also use AI to grow more. Retention is one example, but you can also think about other areas where we use AI. So for me, it's important that we use AI across all the different segments and not only focus on cost savings. That we really make sure we use AI because the challenge in AI is not a tech challenge. The challenge in AI is a leadership challenge. How do you motivate and encourage all your people to use it, and to use it without fear, and to use it for the benefit of the customer and the shareholder? That's where I focus my time mostly on.
When you ask me how would AXA look differently, it would look differently in a way that many more people are using out of their own motivation AI because they believe it simplifies their daily business and it simplifies also the customer's daily dealings with us. There's also new opportunities. I said AI needs to also be focused on growth. Prevention will play a much more important role going forward. Prevention means how do you use technology to prohibit and avoid the next claim. That is very much a tech play. There I believe AI will play a big role. So when you look at the mix shift of AXA in 10 years, the pillar of prevention will play a much more important role.
Hmm. In the latest plan, obviously you had put out a gains number of between EUR 500 million-EUR 700 million.
After investments.
After investments. Could you talk about basically how you arrived at that number, i.e., is there a big amount of that that is related to costs or is it about improved productivity and more products per customer, so on and so forth, that you're thinking about?
First of all, we've been working on this plan for quite some time. Why did we take so much time? Because we wanted to involve the local entities in it. We've been working on this plan for more or less one and a half years. When you look at the plan, it's literally an aggregation of all the plans that the entities have given us. When we look at the AI initiatives, we had several rounds with the local entities to get to the right mix, because at the very beginning, it was very much focused on automation and cost savings, because that is something that all of us know. There is almost certain investments. But we said, no, we want to have a better mix.
Today, about 40% of the initiatives are focused on cost savings automation, and the other 60% are focused on margin improvement and growth. For me, it is important that we have a good balance and that we continue to learn. Again, if in a year's time, we have become smarter and have further developed our AI initiatives, I am actually quite happy that this is the case. I do not want to be stuck in today and yesterday. I want us all to develop and to learn every day and to understand the opportunities of AI better every day.
Do you feel what you have estimated? Because obviously there is some overlap with the, as I understand it, some of the non-commission expense reduction plan as well. Do you feel that the estimate is relatively cautious, conservative? Is there much more that you can do on that front as we go beyond the plan, would you like?
No, I think it is realistic as we speak today. How I will look onto it in a year's time, I do not know. I hope, again, that we have learned a lot and that we will further progress. But for me, it was important that in this investor day, we are putting out a very clear agenda around AI. What are we going to do, and how are we going to do it? And that also there needs to be a number attached to it, because what does not get measured does not get done. Would I be happy if it was more than that? Obviously.
Yeah. I guess before we go onto the business units, are there any questions in the audience that we can take at this stage? No? Okay. If we go onto the businesses, perhaps if we start with P&C. How should we think about how you are thinking about managing through this part of the cycle from an underwriting perspective and also utilizing some of your clear reserving strengths as well?
When we talk about P&C, I think we need to differentiate between three segments. Let's start with retail P&C. In the retail P&C, we still see a phase of rising prices. When at the beginning of this current plan that comes to an end, we had two turnaround cases. One was Germany and one was the U.K., and many others. We decided to sort our issues out very quickly so that we could, after having sorted them out, be in a position where we could take market share. I said to you earlier, we gained 2 million contracts net. We see that this continues in a rising market, where we also continue to up-price, but where we gain market share. We do believe that this will continue.
Inflation is at the moment increasing and will increase again, certainly to some of the geopolitical tensions we are facing. We need to be on the front foot to make sure that we anticipate well these inflationary effects and make sure that our pricing increase always remains above the inflation on claims. That's the retail segment. Then we've got the SME segment, which from a distribution perspective is similar to the retail segment, so very much agency driven, very much local and local tissue, where you don't have that much competition there as well. We see good growth. We still see price increases happening. We also see demand increases happening. If you think about cyber insurance, if you think about more international contracts, an SME in Birmingham with a warehouse in the U.S. and so on.
Their demand is increasing, and competitive intensity is not that high. That's a segment where the same logic applies as it applies in retail, making sure that we grow, making sure that we gain market share. Then you've got the larger business, and it's about 1/3, 1/3, 1/3. 1/3 retail, 1/3 SME, 1/3 the larger business. In the larger business, you have a softening market, not a soft market, softening market. We come out of a period of many years where we have had plenty of very rich price increases. Those price increases are not as rich anymore as they used to be. But most lines of business are still profitable and we are growing.
However, the focus there is very much bottom line protection and bottom line focus, and the top line growth is still happening, but it's not the same focus as it is in the other two segments.
Following up on that, on the commercial line side, where at this point in the cycle are the most attractive sort of risk reward opportunities, and which are the areas that you kind of think, we'll just leave for now, if you like?
Commercial large or commercial SME?
Both.
Commercial.
Or more of the large.
or the large. I mean, the SME, again, there is no issue that you see that most lines of business are actually in good shape. Competitive intensity relatively low. On the larger space, I mean it's difficult to say because, for example, AXA XL, they have got 400 lines of business in 26 countries, so we're not going through all 400 lines of business now. But just to give you an idea, when you think about natural catastrophes where we are not that exposed, we've obviously seen last year that prices have significantly decreased because the frequency of events was quite low. If you look at this year, the opposite is true, so prices will increase again. We had, for many years, a more difficult situation in U.S. Professional, where we also withdrew to a large part. Now, the market has become more rational again.
I think what's important is that you watch this market carefully and that you react very fast to where do you have to accelerate and where do you have to put your foot on the brake. I think that's the name of the game in insurance, and that's also how you maneuver through these cycles, where sometimes it's a bit softer, sometimes it's a bit harder.
Clearly, the view is the reinsurance market has a lot of capital in it, softening, et cetera. Is that a lever you can use and are using in order to improve your-
Obviously. Look, capital comes fast and goes fast where it's easy to place, and the reinsurance market is the easiest market. It's very difficult to think somebody trying to build up a local sales force to do SME business. That takes forever and has not always ended well. But in the reinsurance market, you see it, and obviously we are a much larger reinsurance buyer than we are a reinsurance acceptor, and therefore, obviously, the net benefit is quite significant for us.
Okay. I guess, moving on to the life business a little bit. Obviously following the sale of AXA IM and establishing your long-term partnership in asset management, how is the partnership developing, particularly around product design, product features, et cetera? How does it work on a practical level?
Maybe again, the rationale for the partnership. We were quite large in investment management, but we were very focused across a few disciplines where we were very good. Obviously, when you have a family member, you always try to make the family member benefit the most. We were in a situation in which we did not have access to quite a few product lines that we now have. With BNP combined with AXA IM, we have the full breadth of product lines that we need for these products. We have also made use of it in many countries now, implementing in our new products a much broader product line and also having then a better offer for the customer. So, this partnership is working well.
Combined with that, we have also shifted our approach from going from capital intense to capital light products, both in portfolio, you have seen that we have cleaned a lot of portfolios, but also in the new business. I think the biggest shift at AXA, and probably the most underappreciated, is the shift of the distribution sales force to capitalize business. As you can imagine, it is much easier if I sell you a product that has got a 3% guarantee and all the rest is sorted out, versus I have to explain to you that there is a partial guarantee and that you have some risk and so on. So we have retrained the sales force. We have relaunched all our products. We have sorted out our in-force, and now it is restarting again. You have seen that over the last two years we have restarted. Asset flows have become positive again.
New sales have significantly increased. I think if you ask me where is probably the biggest growth opportunity that we have, it is in the life business.
Okay. Is that by sort of re-energizing that business, or is it growth in the distribution, adding further distribution, or is it purely product development that you're thinking?
I think it's a combination of all. You need to sort out your in-force and you need to be clear to your sales agent that when it's sorted out, it's sorted out, because they're always worried that, "If you do the next transaction, what does it mean for my customer?" Secondly, you need to have good products to compete, and there as well, it's a flight to size because very complex products and very sophisticated products, not everybody can do them. Then thirdly, you need to have the distribution capacity, but also distribution confidence.
Because obviously when you make such a major shift in life, the first question an agent is asking you, "Hey, are you serious about this or are you going to stop life business in a year again?" To give them trust and also to invest in them in training, that's what we've been doing. We see in most of the countries that we are now present and active in life business, that it's rebounding extremely well.
Yeah. Where have you found you've had to think about setting up relationships with other asset managers outside of that agreement, where either they don't have the capability or some of your markets in the emerging area? Are there use cases there that you've had, if you like?
Yeah. Look, this is traditionally what we used to have an entity called AXA IM Prime which basically does the fund of fund business and secondary business. This business is also now part of the BNP franchise, and we are using them as we did beforehand when it comes to secondaries, when it comes to special expertise that is not part now of the base portfolio of BNP.
Nothing has changed there.
Sure. Moving on to solvency and capital. Obviously, the Solvency II review will boost the capital position by about 17 percentage points. How do you think about how you allocate that additional capital, if you like, between growth, asset, re-risking, if you like, and shareholders?
Most of this additional solvency that will hopefully come with the Solvency II review will be solvency that in form of future profits. It's not additional cash that is coming. The money is invested in the business and therefore the book value target, your second question that you were asking, is so important. We want to use, obviously, the solvency to grow our business because new business needs funding, and essentially when business rolls off and sheds off more capital than the new business uses, it's a very comfortable situation because you have enough business to fund your own new business. That's what we are focusing on, funding the growth that we need with our own capital and certainly the capital that matures from mostly life contracts of the past.
Okay. Moving on to the M&A topic, I guess your appetite around M&A has been bolt-on in the last couple of years. Given some of the favorable reaction to some of the transactions that your peers are doing or have done, has your view on that changed?
Which transactions are you referring to?
Some of your larger peers within the European space.
No, look, I think we've done well with focusing essentially on organic growth and making sure that we have here and there the one or the other bolt-on acquisition. We look at this carefully and with discipline, but we don't stress about it. Our focus is organic growth, and as I said earlier, in the last five years, we have added over EUR 20 billion to the top line. If you want to buy this, it's very expensive and it's very risky to integrate. So, I personally prefer, and look, I've seen both parts. In my first five years, we've done many, many deals. I think we have done EUR 30 billion of deals of selling and buying. Over the last five years, we've done very little deals and have focused on organic growth. If you ask me what I would prefer, definitely the second one.
Just to sort of finish off, you alluded to this a little bit. You have made a lot of progress in restructuring, repositioning the business in recent years. I guess the valuation probably has not fully appreciated that. What aspects of the investment case do you think are still completely underappreciated by the market?
Look, this transformation has been quite a complex journey because when you move from almost 80% life insurance and financial risk to 80% of technical risk, it is not an easy journey. Many of our long-term shareholders have accompanied us through these difficult moments, which I am extremely grateful for. Over the last five years, we have really made sure that the new AXA is really performing. We are now at a level where it is fully performing.
That is also why the launch of last week's plan, in an environment that is very different to the environment five years ago, is a sign of confidence to say, "Look, AXA is working extremely well," that we have now a totally comparable performance, and totally comparable targets with our main competitors, and that now is the moment where we have also delivered many quarters of very reliable, stable performance that I would expect that now this topic around the re-rating and the delta relative to our competitors should be addressed.
That is a great place to stop. Thank you very much for your time, Thomas.
Thank you