Zurich Insurance Group Ltd · SIX:ZURN
Zurich Insurance — H1 2014 Earnings Presentation
17 slides from Zurich Insurance's earnings presentation, Aug 7, 2014
Slide 1: Global Life Source of earnings – Briefing document
Global Life Source of earnings – Briefing document
Slide 2: Background and main changes to approach
Background and main changes to approach SOURCE OF EARNINGS What is the purpose of source of earnings? Sources of Earnings (SoE) reporting presents the key drivers of life IFRS results in more detail than the traditional insurance profit and loss account. This information is a shareholder view of e
Slide 3: Background and main changes to approach
Background and main changes to approach SOURCE OF EARNINGS Why have you taken a regional rather than product split approach, as with some peers? The regional view aligns with how we manage our business and SoE illustrates the regional variations in terms of underlying margin generation, growth inv
Slide 4: Margin overview: revenue components
Margin overview Key components REVENUES COMPONENTS DESCRIPTION Loadings & Fees Unit linked (UL) fund • For UL contracts, fund based fees is one of the main sources of income and we show based fees net of these separately within Fees and Loadings. Investment management charges are set investment expe
Slide 5: Margin overview: expense components
Margin overview Key components EXPENSES COMPONENTS DESCRIPTION Operating costs Overheads & Admin • These are the regular expenses of the business including depreciation and amortization of software and intangibles. It excludes acquisition costs and expenses directly related to income (e.g. investmen
Slide 6: How to interpret and use the KPIs (1/2)
Key performance indicators How to interpret and use the KPIs (1/2) KPIs H1-13 H2-13 H1-14 DESCRIPTION UL fund based fees 0.71% 0.70% 0.70% Interpretation • This KPI is based on fund based fees generated from both on and off-balance sheet unit Av. UL AUM linked funds, and compared against a simple av
Slide 7: How to interpret and use the KPIs (2/2)
Key performance indicators How to interpret and use the KPIs (2/2) KPIs H1-13 H2-13 H1-14 DESCRIPTION Investment margin 0.86% 0.81% 0.84% Interpretation • The investment margin mostly comprises spread return on assets backing non linked Av. NL reserves policyholder reserves. The discretionary policy
Slide 8: Analysis by region: North America
Analysis by region North America NEW BUSINESS SALES & EARNINGS KPIs & OVERVIEW New business value product split KPIs HY-13 HY-14 As a % of UL fund based fees 0.2% 0.2% Average UL AuM Corporate Protection Unit-linked Other loadings 29% 23% GWP & Deposits 3% 2% Investment margin 1.0% 0.7% Average NL r
Slide 9: Analysis by region: Latin America
Analysis by region Latin America NEW BUSINESS SALES & EARNINGS KPIs & OVERVIEW New business value product split KPIs HY-13 HY-14 As a % of UL fund based fees 0.6% 0.6% Average UL AuM Unit-linked Corporate Protection 8% Other loadings 23% 25% GWP & Deposits 8% Investment margin 2.5% 3.4% Average NL r
Slide 10: Analysis by region: Europe
Analysis by region Europe NEW BUSINESS SALES & EARNINGS KPIs & OVERVIEW New business value product split KPIs HY-13 HY-14 As a % of UL fund based fees 0.7% 0.6% Average UL AuM Savings & annuity Other loadings 10% 9% GWP & Deposits 8% Individual Protection Investment margin 0.7% 0.7% Average NL reser
Slide 11: Analysis by region: APME
Analysis by region APME NEW BUSINESS SALES & EARNINGS KPIs & OVERVIEW New business value product split KPIs HY-13 HY-14 As a % of UL fund based fees 1.4% 1.3% Average UL AuM Pension & other corporate Unit-linked Other loadings 13% 14% GWP & Deposits 5% 10% Investment margin 2.1% 2.1% Average NL rese
Slide 12: Analysis by region: Other
Analysis by region Other NEW BUSINESS SALES & EARNINGS OVERVIEW New business value product split Other region mirrors the segmental reporting in the Group Annual Report. Global Life manages its business through four main regions Unit-linked and the residual “Other” region includes business units tha
Slide 13: Appendix
@ ZURICH Appendix
Slide 14: Key financial data calculations
Key performance indicators Key financial data used in the calculations USDm USDm Total Global Life H1-13 H2-13 H1-14 Europe H1-13 H2-13 H1-14 Average total unit-linked AuM 111,213 116,838 125,965 Average total unit-linked AuM 91,669 96,579 104,328 Average total reserves 201,843 208,055 220,815 Avera
Slide 15: Key financial data calculations
Key performance indicators Key financial data used in the calculations USD bn USD bn Average unit-linked AuM 126 GWP & Deposits 13 13 117 1 4 12 1 1 0 111 6 1 1 1 3 1 2 1 3 5 12 2 5 2 1 11 1 11 1 97 104 9 9 8 92 Average total reserves 221 APE 2.1 2.1 208 4 1.9 0.1 0.0 202 6 0.1 0.1 4 10 0.1 0.1 0.4
Slide 16: Historical margins & KPIs: highlighting distorting impacts
Historical margins & KPIs Highlighting distorting impacts MARGIN HISTORY IMPACTS ADJUSTED MARGIN Business Operating Profit H1-13 H2-13 H1-14 H1-131 H2-132 H1-14 3 H1-13 H2-13 H1-14 UL fund based fees 395 410 438 0 0 0 395 410 438 Premium & Other loadings 1,614 1,755 1,640 0 95 0 1,614 1,660 1,640 In
Slide 17: Movements from H1-13 to H1-14: commentary on key variances
Movements from H1-13 to H1-14 Commentary on key variances ADJUSTED MARGIN MOVEMENTS COMMENTARY UL fund based fees Business Operating Profit H1-13 H1-14 Change 11% growth in fund based fees driven by growth in UL AuM in Europe, UL fund based fees 395 438 11% particularly in Ireland. Growth in CLP s
Zurich Insurance Group — H1 2014 Earnings Presentation on 6ix