Zurich Insurance Group Ltd · SIX:ZURN

Zurich Insurance — Merger or Acquisition (December 2020)

13 slides from Zurich Insurance's merger presentation, Dec 11, 2020

  1. Slide 1: Acquisition of MetLife Inc.'s U.S. P&C business

    Acquisition of MetLife Inc.’s U.S. P&C business December 11, 2020

  2. Slide 2: Key messages: Leveraging Zurich's strength to increase stable fee earnings

    KEY MESSAGES Leveraging Zurich’s strength to increase stable fee earnings and support Farmers Exchanges strategy Zurich to increase share of Farmers Exchanges1 GWP to increase ~18%2 with corresponding increase in FMS3 earnings from stable fee earnings year 3; pro-forma Farmers contribution to Group

  3. Slide 3: Contribution to Zurich earnings from Farmers stable fee-based earnings increased

    RATIONALE ZURICH Contribution to Zurich earnings from Farmers stable fee-based earnings increased FY-19 ZURICH GROUP BOP1 BOP by business (%) BOP by business pro-forma (%)2 Profitable U.S. personal lines market, largest in the world and growing in line with GDP 28% 31% Capital light fee-based busine

  4. Slide 4: Key financials: Attractive financials for Zurich with estimated cash ROI of ~10%

    KEY FINANCIALS Attractive financials for Zurich with estimated cash ROI of ~10% from year 3 of transaction and immediate accretion to earnings EXPECTED ZURICH P&L IMPACTS (USDm) EXPECTED ZURICH CASH AND BALANCE SHEET IMPACTS From 2023 equating to a ~7% MGEP margin, with phasing FMS BOP ~230m from ~5

  5. Slide 5: Purchase price of USD 3.94bn to be co-financed by Zurich and the Farmers Exchanges

    TRANSACTION OVERVIEW Purchase price of USD 3.94bn to be co-financed by Zurich and the Farmers Exchanges1, with expected closing in Q2 2021 SIMPLIFIED TRANSACTION STRUCTURE •1 Zurich provides an internal loan to its subsidiary Farmers Group, Inc. (FGI) that is funded from internal sources and MetLife

  6. Slide 6: Transaction gives Farmers a truly nationwide presence and increased scale

    RATIONALE FARMERS EXCHANGES1 Transaction gives Farmers a truly nationwide presence and increased scale in a consolidating market FY-19 U.S. PERSONAL LINES P&C DWP (USDbn)2 A TOP 10 U.S. PERSONAL LINES PLAYER NATIONWIDE2 Change in market position / FY-19 pro-forma DWP (USDm) / pro-forma market share

  7. Slide 7: Farmers Exchanges distribution deepened and diversified

    RATIONALE FARMERS EXCHANGES1 Farmers Exchanges distribution deepened and diversified FY-19 GWP BY DISTRIBUTION CHANNELS (%) FY-19 GWP BY LINE OF BUSINESS (%) Farmers Exchanges Farmers Exchanges pro-forma Farmers Exchanges exclusive Farmers Exchanges pro-forma ~11,300 agents 6% 13% Independent agent

  8. Slide 8: Potential to leverage Farmers brand and best of breed products to accelerate growth

    RATIONALE FARMERS EXCHANGES1 Potential to leverage Farmers brand and best of breed products to accelerate growth ABILITY TO LEVERAGE FARMERS BRAND OPPORTUNITY TO LEVERAGE PAST SUCCESS IN THE INDEPENDENT AGENT CHANNEL INTO EMPLOYER CHANNEL U.S. brand awareness (%)2 Total GWP ~4x • Leverage successful

  9. Slide 9: Farmers a unique business structure

    BUSINESS MODEL FARMERS Farmers a unique business structure Zurich owned Policyholders owned Farmers Group, Inc. Farmers Exchanges1 Provides non-claims and ancillary services to the Exchanges Services Carry underwriting risk and handle claims, as well as own the Farmers (e.g. underwriting, policy adm

  10. Slide 10: MetLife's U.S. P&C business an excellent complement to Farmers

    OVERVIEW METLIFE MetLife’s U.S. P&C business1 an excellent complement to Farmers GWP (USDbn) GEOGRAPHIC MIX PRODUCT MIX DISTRIBUTION CHANNEL +2% FY-19 DWP (%) FY-19 NWP (%) FY-19 NWP (%) 3.5 3.6 3.7 12% 21% 33% 12% 46% USD 3.6bn USD 3.6bn USD 3.6bn 50% 20% 16% 67% 19% 4% FY-17 FY-18 FY-19 Mid West M

  11. Slide 11: MetLife's U.S. P&C business with robust financials

    OVERVIEW METLIFE MetLife’s U.S. P&C business with robust financials STATUTORY NET INCOME (USDm) UNDERLYING ADJUSTED EARNINGS (US GAAP) (USDm) 345 368 51 245 230 249 45 197 24 FY-17 FY-18 FY-19 9m-20 FY-19 Deal perimeter1 Discontinued Other non- Underlying operations2 recurring items run-rate3 Underl

  12. Slide 12: Disclaimer and cautionary statement

    Disclaimer and cautionary statement Certain statements in this document are forward-looking statements, including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives of Zurich Insurance Group Ltd or the Zurich Insurance Group (the Group). Fo

  13. Slide 13: For further information

    For further information CALL US VISIT OR FOLLOW US Investor Relations and Rating Agency Management Richard Burden +41 44 628 96 40 Francesco Bonsante +41 44 628 00 68 Samuel Han +41 44 625 32 57 Michèle Matlock +41 44 625 28 50 Gianni Vitale +41 44 625 48 26 Events Patricia Heina +41 44 625 38 44 

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