Allianz ‘batons down hatches’

German insurer Allianz is not interested in acquisitions and does not need additional capital, management board member Clement Booth said, Reuters reports.

"We are one of the best capitalised insurers in Europe and the world," Booth said. "We have no need to raise extra capital."

Booth, with responsibility for UK and North America markets as well as Booth said the company was not interested in acquisitions because it wanted to "stick to basics" and be seen to offer good service and security in its core business.

"The priority right now with Allianz is to stay in good shape with very comfortable solvency and stronger ratings and solvency than our competitors," Booth said.

"To obtain our 2011 objectives (of becoming a leading insurer in the world), we don't need to buy. Allianz is not buying; we are growing organically," he said.

However, Booth did not rule out the possibility of acquiring AIG units, after being linked to the US insurer's asset sales last year.

"AIG hasn't put out a coherent plan. We will cross that bridge when we get to it," he said.

He added that Allianz's approach of battening down the hatches in the current climate will be reflected across the insurance industry, as companies look to "keep their house in order versus grand strategies".

"What you really want is an operator who understands how to control costs ... not, 'Can we do this new product range?'" said Booth.

"Insurers that have gone wrong have drifted away from core business," Booth said.

Booth said the greatest challenges for the sector were costs, "claims inflation related to the recession" and the affordability of products as premiums rise.

Turbulence in the sector has led to Allianz winning customers, especially in speciality lines, added Booth.