MDS Turns 30

It all began in 1984 when Sonae group established a captive broker with the aim of creating a particular skill – understand and fulfill the complex needs of a challenging client and shareholder. In 1997, the company opened its business to clients from outside the Sonae group, but the major thrust, which was to transform MDS into what it is today, began in 2000. In a new chapter of its development, the company, founded in Porto, became the leading insurance broker in Portugal and a member of an international group that is now a benchmark in the insurance industry – MDS group.

Executing a differentiation strategy, MDS grew and established itself in the market thanks to the investment in its team knowledge and skills, the development of a solid brand and reputation, the high demands of its shareholders, the focus on strategic partnerships and the pursuit of a long-term vision.

All the progress made thus far has been characterized by an apparently simple, but differentiating endeavor – always Innovate, at every level. Innovation has been reflected in MDS undertakings over the past 30 years, and is an integral part of the company’s guiding principles: the international perspective, the ongoing investment in the creation of new solutions and products, knowledge as a central resource and value creator, and the belief that technology is instrumental in bringing all these elements together.


The international perspective – theworld as the target market

While the competition was focusing its attention on the domestic market, MDS adopted an internationalization strategy at a very early stage. Starting from a small, peripheral market, the broker quickly sought to expand its operations. It began by collaborating with Lazam, the captive broker of Suzano Group.

This relationship became stronger in 2002 when MDS acquired a 45% share in the broker’s capital to create the current MDS Brazil. In 2009, the Suzano Group in a roll up operation, assumed a ownership stake of 49.99% in MDS Holding, an entity that was created specifically to regroup all ownerships in companies operating in the insurance industry. The remaining 50.01% are owned by Sonae Group. At a time when Brazil was a much-favored destination for Portuguese foreign investments, MDS invested in its local response capacity. Today, MDS Brazil is the third largest corporate broker in the country.

The company’s international expansion continued. In 2001, MDS acquired a significant ownership stake in FirstAssur, a broker specialized in affinity. The investment in the French market continued in 2003 with the acquisition of a company’s stake in the Lyon-based broker Pérouse, giving rise to Pérouse-MDS.

By 2004, the foundations had been laid for the creation of Brokerslink, one of MDS’s most significant and farthest-reaching strategic decisions. Born of the desire to combine the interests, capacities, and knowledge of a small group of brokers, the network of independent insurance brokers is currently an undeniable benchmark worldwide, present in over 80 countries, operating from over 300 offices and drawing on a pool of over 7,000 professionals. MDS remains heavily involved in Brokerslink.

Cooper Gay entered the MDS ecosystem in 2007. In the largest foreign investment ever seen in the Portuguese insurance sector, the broker became a major shareholder of what is today one of the world’s leading players in reinsurance and wholesale. This operation meant that MDS had access to an expanded range of skills and solutions and the capability to respond to the needs of larger customers or those featuring highly complex risks.

In 2013, MDS expanded its international footprint once again by moving into the little-exploited but promising African market. The broker opened an office in Luanda and is considering other opportunities in this continent.

If MDS has always adopted a differentiating stance in terms of its international presence, the same can be said about the solutions and products it has developed. The market status quo was of little interest to the broker, who was constantly trying to keep ahead of industry trends and customer expectations.

In 2001, MDS took its first steps in the little-exploited Affinity segment, which would turn out to have enormous potential. Another unique undertaking in the brokerage market was the MDS 24Auto line, an innovative support service for auto insurance customers. The company also developed own-brand products such as Safe Flights, Traveller and Protector. The establishment of a partnership with Towers Watson in 2012 added a further service dimension to the Employee Benefit solutions MDS was able to offer its customers.

MDS’ strategy also involved exploring new distribution channels. The best example is the launching of Seguros Continente which uses the digital channel and a call center to offer products to individual clients. The initial partnership with Continente made it possible to reach out to a significant customer base by offering highly competitive solutions.

Also of significance were the projects leading to the constitution of new companies in the MDS universe, enabling a vast array of complementary solutions to be offered. In 2000, the creation of SonaeRe brought MDS a decisive instrument for managing the insurance architecture of Sonae companies.

Ten years later MDS Auto was created as a result of a partnership with the Salvador Caetano group. This was the first Portuguese insurance broker exclusively focused on the auto sector.

The following year saw the entry of Herco in the Portuguese market, a company specialized in the provision of Risk Management services and heavily resorting to cutting-edge technology. In 2013, HighDome PCC was created. As an insurance and reinsurance company registered and domiciled in Malta, its purpose is to answer to the ever-increasing demand for alternative solutions to the traditional insurance market.

These initiatives reflect MDS’ consistent focus on innovation with the aim to keep ahead of the market and propose solutions and products that are very different from those already available.

In a service company, knowledge is a vital factor. At MDS it is even more – it is seen as the source of a competitive edge, the basis for the service rendered to the customers, for the positioning assumed in the market and for the attitude of sharing knowledge that characterizes the Portuguese broker.

MDS strives to be a knowledge center, a benchmark in highly complex fields such as liabilities (e.g. Directors & Officers Liability, Environmental Liability, etc.). This pool of skills resulted from a combination of factors including the capacity to attract experienced professionals. The two most recent examples are Jacqueline Legrand and Jorge Luzzi. Alongside this aspect, is the investment in technical training for employees. The exposure to, and sharing of knowledge acquired from the broker’s aforementioned international perspective is also particularly beneficial in this respect, which brings it into daily contact with different realities.

FULLCOVER, launched in 2009 and now in its 7th issue, embodies this strategic line taken by MDS. Also the result of the major partnerships established between MDS and many of its stakeholders, the magazine has made a name for itself internationally as an important vehicle for the dissemination of expertise and know-how in the field of insurance and risk.

MDS is at the forefront of technology use. This translates into investments in strategic applications such as Proximity, which relies on the most recent technologies.

Proximity is an advanced customer extranet portal that leverages SugarCRM, a leading edge open source platform, running on PHP, MS-SQL server. Extensively using open source components gives MDS more control and flexibility on the development of additional features overtime as well as their maintenance. These solutions are cost effective and allow for high quality maintenance as well as a greater independence from vendors using traditional proprietary platforms.

Proximity is implemented in a cloud environment. Its innovative features permit access through any web browser, via desktops or mobile devices. SugarCRM , a robust and stable IT platform, provides front end users real-time access to policy information, claims and receipts with SOAP (Simple Object Access Protocol) and web services to fetch data from the MDS back office system. The technology allows clients to make any change requests in real-time and to access a wide array of policy documents simultaneously.

MDS was also a partner in the development of advanced mobile solutions such as Staflist and Translaterms. Staflist is the new generation of corporate directories allowing knowledge management and company-wide instant messaging. Translaterms is the first ever multi language insurance terms translator in ten languages. Using a pending patent on the data architecture, all content can be updated in real time on the mobile devices without users’ intervention. Both mobile applications were developed using advanced programming technologies including Node.JS to enable faster response time, MongoDB, a highly flexible Data Base and Phonegap3, to allow an identical user experience across Apple, Android and BlackBerry devices.

Overall, Innovation has been instrumental at MDS since the beginning, making the firm stand out in the market while introducing new ways of thinking and operating.

The company’s future will be marked by the passion for the insurance business and the desire to innovate and better serve clients. MDS team will go on taking their company values to the heart such as client oriented, professional, creative and collaborative.