Issue 1, February 2022 PCS Vision

Happy 2022 everyone. PCS is looking forward to sharing more growth and success with you this year. 

In this first issue of Vision for 2022, we hear from Anubhav Bhushan, CEO of PCS International* & Marco Tullio Valiante, our new Head of Switzerland. They share their insights on life insurance trends outside Northeast Asia as well as our international growth plans. 

*PCS International is a business unit within PCS Singapore

Anubhav Bhushan began his PCS career in November 2008 and was appointed to his current role as CEO of PCS International in September 2021.  

Currently based in Singapore, Anubhav leads the International Sales Team in our renewed focus on global clients (outside Northeast Asia), providing insurance-linked solutions to clients across Europe, Southeast Asia, the Middle East and the Indian diaspora. Anubhav also continues to work with our Bank partners in Switzerland and Dubai. 

As borders begin to open, Anubhav has travelled to a number of our global markets and here, he shares his insights into market conditions and opportunities. 

PCS is renewing its focus on markets outside Northeast Asia. Can you provide insights as to why? 

We are a people-oriented business, and our clients’ needs drive us; our renewed global focus is to service the growing international demand for insurance-linked products that we are seeing. There is not only pent-up demand that built during border closures, but also a pronounced new appetite, especially from Saudi Arabia, Jordan, Egypt and Israel amongst others. 

High-net-worth individuals are increasingly looking for ways to enhance value to their portfolios while simultaneously reducing risk exposure. This is partly in response to the two pandemic–challenged years we have lived through and the associated volatile macro environment. Life protection products are being recognized as a group of financial instruments/assets that can provide diversification, stability as well as growth. They are increasingly popular as an alternative asset allocation that balloons in value by the trigger of a mortality-based event at the onset 

Another advantage of insurance-linked products as financial assets is that they are transparent. With overall market maturity, there has been a general reduction in cost of insurance. At the end of every year, policy holders can clearly evaluate the charges deducted in the past 12 months. A part of the policy performance is guaranteed. The remaining is pegged to fixed income securities or global index options. 

An interesting phenomenon driving PCS’s growth is the increased interest in estate and liquidity planning. For instance, some of our global clients have real estate in the UK, exposing their families to eventual inheritance taxes. Those clients are therefore keen to build guaranteed liquidity through life protection products, enabling their families to meet the tax obligations. The versatility of life protections products also assists our clients in transferring their wealth to not just one, but multiple generations. 

The wish to look after those closest to you is universal, so our clients in the Middle East are also looking to secure future liquidity as well as achieve financial freedom and wealth equalization for their families. 

Even though we have done a lot of work remotely during the pandemic using our seamless non-face-to-face processes, human interface is still invaluable. To facilitate the servicing of clients in Europe, we recently appointed Marco Tullio Valiante as the Head of Switzerland. 

Of course, my colleagues in Northeast Asia are continuing to service our strong client-base there. One that is as much driven by financial savvy as the desire to leave generational legacies.

What are other growth plans for PCS International? 

We want to firstly establish a robust footprint in Zurich and from that base, service geographically near-by markets. PCS by Mercer has also set sights on South America and Africa, which we are already servicing remotely. Our clients’ needs in the two continents will direct our future growth plans – whether we set up physical presence in those locations, or service clients from an established base. 

PCS International has a diverse cultural portfolio, how do you service that diversity? 

Having been at PCS for almost 14 years, I can confidently say that geographic and cultural diversity are embraced and don’t affect our service delivery. The reason is because we approach each client as a unique individual. 

Understanding the clients’ needs is key! That enables us to work together objectively with the client on offering solution tailor-made to their needs and aspirations. Homework is equally important. Engaging with the banking partners is essential as it helps us understand the finer nuances of the client. Facilitating a life insurance policy is a lifetime commitment. When the client signs on the dotted line, our relationship has only just begun. 

Every day, we continue learning from our clients on how best to service them. 

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Marco Tullio Valiante joined PCS International in January 2022 as the Head of Switzerland with over 25 years of experience in wealth management and private banking. Marco was previously with UBS, where he was the Global Head of Life Insurance Solutions for Wealth Management. He has held various positions in UBS, first in Italy and then in Switzerland, focusing on product management and advisory for wealth planning solutions; substantially contributing to the growth in assets under management and return on assets for the bank. He has also held similar roles at Merrill Lynch. 

Marco has a MSc. in Economics and Accounting from the University of Venice Ca' Foscari in Italy, and he is a Certified Financial Accountant.

1. What attracted you to join PCS by Mercer? 

The common theme in my career, the purpose I am passionate about, is helping clients look after their families – both now and into the future. As I progressed in my banking and wealth management roles, it became increasingly apparent that insurance products are key in safeguarding lifestyles and generational wealth. I also realised I could have more impact in an insurance brockage because it is a client-led, unbiased function. 

I already knew of PCS from past collaborations as a banking partner and was excited by the prospect of working in the organization. I understood I could bring a 360-degree perspective to the insurance broking process as my previous roles gave me an important insight – the knowledge of exactly what bankers expect from brokers in an insurance partnership.

I also really love PCS’s ethos of building solutions entirely led by each client’s unique context and needs. 

2. Why is Switzerland an important growth focus for PCS?

Due to its stability, world-class reputation as a financial centre, and geographic position in the middle of Europe, Switzerland is one of the most important financial platforms for international private clients. While new private wealth is increasingly created in Asia and the US, wealthy clients globally want to diversify their booking centre and Switzerland is still a preferred destination. It is, therefore, crucial for PCS to build a strong presence here, and we are absolutely committed to doing so. Our first key goal is to strength our relationships with all our banking partners. 

There are two general trends that make Switzerland uniquely suited to our global growth strategy. Firstly, clients are needing more insurance options and we are able to offer a full spectrum of product choices. While European clients are generally seeking the more traditional life protection products, there is increasing appetite from international, non-European clients for products such Private Placement Life Insurance (PPLI) and Variable Universal Life (VUL). PPLI and VUL are gaining popularity because they offer a combination of insurance elements with a high degree of personalization; adjustments can be made to better meet individual client’s specific wealth management needs. 

The second trend is driven by growing complexity. As geographic mobility, sophistication in asset markets, diversification needs and life in general become more complex, the wealth planning needs of our clients are also becoming more multifaceted. Individual requirements need nuanced responses and products, driving the demand for product innovation and personalized servicing. PCS in Switzerland are in a fantastic position to address that complexity as we grow and establish a larger footprint.  We are also able to leverage our global capabilities and unique solutions offering. 

3. How are you strengthening the relationships with your Swiss banking partners?

However sophisticated, Switzerland is a very small place, and the finance sector here is even more so. In a sphere where everyone knows everyone else’s reputation, having strong relationships is crucial and that’s where we are focused. Strengthening my connections with previous colleagues is an important part of the process, as is introducing our full service and product offering. 

As a team, we are determined to build our banking partners’ trust and confidence that PCS is committed to Switzerland and in growth mode. 

It really is an exciting time, and I am proud to be part of the PCS team. 

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Case study: An offshore safety net

We helped our client create a US$10 million safety net despite a checkered medical history

 Background

Our client is married to the founder of a listed company and the second largest shareholder of the company. Our client has a child studying abroad.

Despite her current good health, our client experienced a major illness more than a decade ago, so she was worried about either being declined by the insurer or having to pay an exceptionally high premium. Our client was also concerned that recent legislative changes would adversely impact the extent of the family’s wealth and wanted to create liquidity overseas. 

 Solution

• An offshore US$10 million Whole of Life solution which continues for our client’s lifetime. Whole of Life policies have a number of benefits. They pay a death benefit and also have a savings component. The savings component can be invested. The client can access the cash during her lifetime, by either withdrawing or borrowing against it as required. 

• The policy therefore satisfies the client’s need to create offshore liquidity in the event of an accident. It also serves can as a safety net for the family wealth.

• Premium of US$3 million.

Key takeaways

1. Despite Covid lockdowns, the PCS client was still able to apply for and incept the policy with ease. PCS strongly advocated on her behalf to procure a standard rating – we asked the insurance company to consider her current health rather than medical history. 

2. PCS by Mercer solutions are consistently client-led. Before tailoring products, we always work to understand our clients’ specific needs and evaluate the entire spectrum of challenges they might face. Our comprehensive processes work to provide the best, most suitable and most economical solutions for our clients.

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Case study: Changing policies to suit life changes

PCS work with our clients to find the right policies for their unique changing needs. 

 Background

Our client is a successful business entrepreneur. Client was holding a Universal Life (UL) policy for more than 10 years through another insurance broker, but he was concerned with three key issues: 

1. The declining cash value of his UL policy 

2. The adequacy of the death benefit to provide liquidity for future inheritance taxes 

3. Perceived lack of choices if he was to change policies – as few insurers still have seamless remote (non-face-to-face) underwriting processes 

 Solution

PCS conducted an independent review of our client’s existing UL policy against market offerings. We also strategically negotiated with the potential insurer to achieve a cost-effective outcome that addressed all of our client’s key concerns:

• Change to a Whole of Life (WoL) policy with US$10 million sum assured to age 99

• WoL policy has a strong Guaranteed Policy Value component providing liquidity for future inheritance taxes 

The policy was written using PCS’s non-face-to-face processes, so unpredictable Covid-related public health orders did not affect the seamless process  

Key takeaways

1. For policy holders, it’s hugely beneficial to review existing policies through independent parties

2. After understanding the client’s needs, PCS works hard to source the right solution that addresses any and all of their concerns 

3. We present clients with a number of market-leading solutions, so they can make comparisons and decisions based on real data