UNIQA Insurance Group AG · VIE:UQA
UNIQA Insurance — UNIQA Group — Investor Presentation (May 2014)
20 slides from UNIQA Insurance's investor presentation, May 23, 2014
Slide 1: UNIQA Group Economic Capital Figures 2013
UNIQA Group Economic Capital Figures 2013 23 May 2014 Kurt Svoboda, CRO
Slide 2: Agenda
Introduction Methodology Risk Strategy Results Reinsurance Rating Agenda • Introduction • Methodology • Group Risk Strategy • Results • Reinsurance • Rating 2
Slide 3: Introduction
Introduction Methodology Risk Strategy Results Reinsurance Rating Introduction Group Economic Capital Figures Disclosure of Economic Capital Model (ECM) results: UNIQA discloses ECM results 2013 on the basis of the underlying and published methodology of the Group Economic Capital Model Econom
Slide 4: Highlights
Introduction Methodology Risk Strategy Results Reinsurance Rating Highlights Solvency Position in target range • Group ECR-Quota 2013: 161% (2012: 108%) • Group Solvency 1 Quota 2013: 287% (2012: 215%) Adequate own funds structure Increase of own funds from 3.086 €m 2012 to 4.442 €m 2013 Increas
Slide 5: Methodology
Introduction Methodology Risk Strategy Results Reinsurance Rating Methodology UNIQA Group economic capital model is based on Solvency 2 standard approach Spread risk and concentration risk are valued on the basis of an internal approach (government bonds and ABS are treated like corporate bonds)
Slide 6: Methodology
Introduction Methodology Risk Strategy Results Reinsurance Rating Methodology Important valuation principles Goodwill is set to zero according to EIOPA´s specifications (471,78 €m) Market value of properties and loans replace the IFRS values Participations are valued at market price as of 31st
Slide 7: UNIQA Group Risk Strategy
Introduction Methodology Risk Strategy Results Reinsurance Rating UNIQA Group Risk Strategy UNIQA 2.0 risk strategy core dimensions Target risk profile UNIQA Group ECR quota target: 150% • Increase of proportion for underwriting UNIQA Group ECR quota target RISK CAPITAL risks due to profitable g
Slide 8: Summary of 2013 results
Introduction Methodology Risk Strategy Results Reinsurance Rating Summary of 2013 results Sufficient and stable capital basis for UNIQA 2.0 ambitions +61% €m 4.442 ECR-Quota increased from 108% in 4.500 2012 to 161% in 2013 Subordinated 600 4.000 168 695 ECR decrease by 103 €m 3.500 226 Market
Slide 9: Summary of 2013 results
Introduction Methodology Risk Strategy Results Reinsurance Rating Summary of 2013 results Sufficient and stable capital basis for UNIQA 2.0 ambitions +61% 4.442 Capital requirement consumption Subordinated driven by liabilities 600 80% of ECR is utilized for the Austrian business due to the stro
Slide 10: Own funds 2013 and development
Introduction Methodology Risk Strategy Results Reinsurance Rating Own funds 2013 and development 642 163 Planned Own funds development 108 4.442 Paid Own funds increased from 54 3.086 Mio.€ (2012) to 4.442 Mio.€ Other 877 2 Subordinated Major reasons for increase liabilities 150 Capital measure (R
Slide 11: The overall risk profile of UNIQA Group
Introduction Methodology Risk Strategy Results Reinsurance Rating The overall risk profile of UNIQA Group planned measures show the proposed effect 2012 2013 15,2% Interest Rate Risk Interest Rate Risk 21,0% 4% 6% 6% 13,5% Equity Risk 11% Equity Risk 16,6% 9% 7% 16,8% Property Risk Property Risk 13,
Slide 12: Asset Allocation
Introduction Methodology Risk Strategy Results Reinsurance Rating UNIQA Group Market risk profile Liability driven investment approach 2012 2013 Equities, Equities Equities, Equities participations & 3,1% Alternatives participations & 2,1% Alternatives alternatives: alternatives: Asset Allocation 3,
Slide 13: Market risk profile
Introduction Methodology Risk Strategy Results Reinsurance Rating Market risk profile Spread Risk ECR spread risk development Fixed income portfolio 2013 ECR spread risk composition 2013 By issuer type (€m) +19% 698 Other Corporate 1.358 Covered 8% 8% 1.142 9% 405 Financial 21% 44% 116 97 107 91 10%
Slide 14: ALM and interest rate risk reduction
Introduction Methodology Risk Strategy Results Reinsurance Rating ALM and interest rate risk reduction Increase of asset duration leads to… Modified duration UNIQA Group(a) Development 6,7 mod. duration Development High Grade 6,8 total assets bond exposure 3,4 Corporates 3,8 +0,6 +5,6 4,9 Asset clas
Slide 15: ALM and interest rate risk reduction: reduction of interest rate risk
Introduction Methodology Risk Strategy Results Reinsurance Rating ALM and interest rate risk reduction …reduction of interest rate risk 12/2011 12/2012 2.000 2.000 541 1.500 1.500 747 1.000 1.970 1.000 1.429 1.564 500 500 818 0 0 due to liabilities due to assets Interest rate due to liabilities due
Slide 16: UNIQA Group underwriting risk profile
Introduction Methodology Risk Strategy Results Reinsurance Rating UNIQA Group underwriting risk profile Life underwriting risk Health underwriting risk Non life underwriting risk 1% 2% Legal 1% 1% Disability Mortality 5% Accident & Health 4% 6% CAT 11% 8% 14% Expense 6% 11% TPL 12% Longevity 10% 10%
Slide 17: Risk Mitigation through reinsurance
Introduction Methodology Risk Strategy Results Reinsurance Rating Risk Mitigation through reinsurance Effective reinsurance program Diversification reduces ECR for NatCat exposure 1.310 675 • Diversification amounts of 51,6% Ceded Net • CAT XL is the most efficient coverage 394 and the main driver o
Slide 18: Rating development UNIQA vs peers
Introduction Methodology Risk Strategy Results Reinsurance Rating Rating development UNIQA vs peers Still rated below despite solid capitalization Overview of S&P financial strength ratings and outlooks over the course of time AA+ stable AA+ neg. 28 AA pos. AA stable AA neg. 25 AA- pos. AA- stable A
Slide 19: Appendix: Economic assumptions 2013
Appendix Economic assumptions 2013 ECM calculations use reference rates based on swap rates as at 31 December 2013 including a liquidity premium. The liquidity premium is derived from observable market data and based on the approach used for internal risk capital calculations. The derivation The
Slide 20: Disclaimer
Disclaimer Cautionary statement regarding forward looking statements • This presentation contains forward-looking statements • Forward-looking statements involve inherent risks and uncertainties, and it might not be possible to achieve the predictions, forecasts, projections and other outcomes descr