Cutting out insurance agents has paid off for I.D.I., better known as Bituach Yashir, as it overtakes traditional rivals.
22 years after becoming Israel's first direct insurance company, IDI Israel Direct Insurance Ltd. (TASE: IDI) has surpassed Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) in terms of its company value (market cap), and become the country's most valuable insurance company.
I.D.I., better known to the Israeli public under its marketing name of Bituach Yashir, is controlled by Zur Shamir and the Schneidman family and has a market cap of NIS 2.8 billion. Since its IPO in August 2013, at a company value of just NIS 1 billion, it has earned returns of 1725 for its shareholders. Over the same period, insurance companies have had a difficult time and the Tel Aviv Stock Exchange's (TASE) insurance share index has fallen 20%.
I.D.I.'s success can be attributed to good management, which has increased premiums and profits, led by very effective ad campaigns with successful slogans like "Why pay for agents?' investment in expensive TV ad campaigns have presented an image of one of the country's top insurance players, which it has now become. In parallel, Israel's major insurance players made no effort to brand themselves directly with the public and continued relying on agents.
Harel's reign as Israel's most valuable insurance company was short lived, having taken over top spot from Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL) in November 2015.
Muki Schneidman