Axis Capital Holdings Limited · NYSE:AXS
Axis Capital — 2012 Citi Financial Services Conference
20 slides from Axis Capital's conference presentation, Mar 8, 2012
Slide 1: AXIS Capital – 2012 Citi Financial Services Conference
Exhibit 99.1 AXIS Capital 2012 Citi Financial Services Conference New York, NY Albert Benchimol, CFO March 8, 2012
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure Statements in this presentation that are not historical facts, including statements regarding our estimates, beliefs, expectations, intentions, strategies or projections, may be “forward-lookingstatements” within the meaning of the U.S. federal securities laws, including the P
Slide 3: Why P&C?
Why P&C? Resilient industry with tested business model Unexpected events successfully absorbed Flexible, disciplined business models based on “cycle management” Non-discretionary purchase Despite elevated catastrophe losses of last two years, balance sheets remain solid P&C companies have engaged in
Slide 4: AXIS Capital – Overview
AXIS Capital – Overview Bermuda-domiciled Global Specialty Insurer and Reinsurer Founded in 2001; IPO in 2003 $4.1 billion common stock market value (1); Annual dividend yield = 3.1% Gross premiums written in 2011 of $4.1 billion Strategic Global Diversified Underwriting Strong Balance Sheet Presenc
Slide 5: Diversified Global Insurer
Diversified Global Insurer AXIS Insurance 2002-2011 GPW AXIS Insurance $2,500 2011 GPW by LOB = $2,122 million 52% of Consolidated GPW $2,000 A&H/Other Liability $1,500 Professional lines A&H 6% Credit and political risk Liability $1,000 10% Aviation Property Terrorism 30% $500 Marine Property $0 Ag
Slide 6: Diversified Global Reinsurer
Diversified Global Reinsurer AXIS Reinsurance 2002-2011 GPW AXIS Reinsurance $2,500 2011 GPW by LOB = $1,974 million 48% of Consolidated GPW $2,000 Other Engineering $1,500 Liability Engineering Other 3% 2% Motor Liability $1,000 12% Catastrophe Credit and bond 24% Professional lines $500 Property C
Slide 7: Excellent Financial Performance
Excellent Financial Performance Excellent returns over time, despite several unprecedented industry stresses, and consistent dividend increases since IPO ROACE and Diluted Book Value per Share (1) Common Dividends Per Share $45 30% $1.00 $0.930 $0.90 $0.860 $40 $0.810 25% $0.80 $0.755 $35 $0.680 $0.
Slide 8: Key Drivers of Success
Key Drivers of Success Provide clients and distribution partners excellent product, value and service Broad range of products Ability to assume complex, volatile risks Meaningful capacity, underpinned by financial strength Excellent claims management Present underwriting staff of the highest quality
Slide 9: 10-Year Underwriting Profitability vs. Volatility
10-Year Underwriting Profitability vs. Volatility 2002-2011 Average P&C Underwriting Profitabilityvs. Volatility (1)(2)(3) Average Average Underwriting Underwriting Profit / Profit Volatility Volatility (1) US Specialty 9.5% 6.9% 1.4x US Scale 1.4% 9.7% 0.1x Bermuda Hybrid 5.3% 10.7% 0.5x Reinsuranc
Slide 10: 10-Year Underwriting Profitability vs. Volatility
10-Year Underwriting Profitability vs. Volatility Volatility by Quintile Lowest Highest st nd rd th th 1 2 3 4 5 US Specialty US Scale Bermuda Hybrid Reinsurance Predominating Property Cat Source: Company documents, SNL. Notes: Average P&C Underwriting Profitability is calculated as (1- average comb
Slide 11: Strong Entrepreneurial Culture
Strong Entrepreneurial Culture Investments in expanding our franchise over last several years offer meaningful potential for growth and portfolio optimization Distribution/ Geography New Initiatives Target Markets Established insurance Expanded capabilities New global A&H platform in to address smal
Slide 12: Strong Balance Sheet
Strong Balance Sheet ($ in millions) Balance Sheet Highlights Total Assets $ 17,806 Total Cash and Invested Assets (1) 13,499 Total Net Reserves 6,688 Strong, stable and competitive capital base with appropriate financial flexibility for this phase of the P&C cycle Security Amount % Long-Term Debt $
Slide 13: High Quality, Liquid Investment Portfolio
High Quality, Liquid Investment Portfolio Total Cash and Invested Assets * Credit Quality of Fixed Maturities Portfolio $13.5 Bn as of 12/31/11 $10.9 Bn as of 12/31/11 Other 100% Investments 5% Equities 5% 80% Short-term Investments 60% 1% Fixed Cash* Maturities 7% 81% 40% Accrued Interest 20% Recei
Slide 14: Conservative Reserving Policy
Conservative Reserving Policy ($ in millions) Net Unpaid Loss Reserves as of 12/31/11 Amount % IBNR Short / Medium Tail $2,531 44% Medium / Long Tail 2,215 78% Long Tail 1,942 70% Total $6,688 63% Historical Reserve Development $450 $423 2002-2011 Aggregate $400 $383 $376 Reserve $350 $337 Developme
Slide 15: Efficient Capital Management
Efficient Capital Management Share Repurchases Common Dividends Common Equity $750 Raised $250 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 -$250 2001- 2011 (Billions) -$750 Total Common Equity Raised $2.13 Common Dividends $0.89 Share Repurchases (authorized plan)$1.86 Total Capital Retur
Slide 16: Beginning of Year 2012 Market Environment
Beginning of Year 2012 Market Environment Mixed, gradually improving pricing environment with a positive bias in a number of lines, particularly in the U.S. Rate increases significant for U.S. cat exposure and loss-affected accounts globally, but more rate is required Generally, competitive reinsura
Slide 17: AXIS Strategy In Current Market Environment
AXIS Strategy In Current Market Environment Focused on a strong foundation for underwriting execution and a strong, stable and competitive capital base with financial flexibility appropriate for this phase of the P&C cycle Underwriting Investments Capital Manage risk appetite Maintain exposure to Ma
Slide 18: AXIS Strategy
AXIS Strategy Diversified range of specialty products across market segments and geographies Best-in-class service and effective risk management solutions for our clients and our partners in distribution Underwriting of complex and volatile risks with moderation of volatility through risk limits, di
Slide 19: Positioned for Industry-Leading Results
Positioned for Industry-Leading Results Capacity for greater-than-industry growth in favorable markets and less-than-industry revenue reduction in difficult markets Sufficient scale to provide larger capacity – competitive advantage Not so large as to lose agility Sufficient diversity to manage cycl
Slide 20: Conclusion
Conclusion Global insurance and reinsurance platform Diversified book of business by product and geography Excellent market reputation Deep relationships Ability to access and underwrite complex risks Strong entrepreneurial and underwriting culture Strong capital and ratings and conservative balance
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