Protector Forsikring ASA · OSL:PROT
Protector Forsikring ASA — FY2011 Earnings Presentation
29 slides from Protector Forsikring ASA's earnings presentation, Feb 29, 2012
Slide 1: Preliminary year-end results 2011
Preliminary year-end results 2011 Investor presentation 29 February 2012
Slide 2: Facts about Protector
Facts about Protector • A focused non-life Norwegian insurance company • Vision: “Protector will be the challenger to the established insurance • Established Jan.1, 2004. (Listed on Oslo Stock Exchange May 2007) companies” • Entered the Swedish market in 2011 and Denmark 1 Jan. 2012 • Main targets:
Slide 3: Highlights 2011
Highlights 2011 Poor financial results, -2,3%, but...... ....will be back in 2012? ROI approx 80 mill per Feb 27th. ROI average to peers 2007-2011 Strong growth, strong combined ratio and Scandinavian startup • Volume up 19 % No. 1 in Nordic market • Gross cost ratio down to 15.0% No. 1 in Nordic ma
Slide 4: Gross written premium 2011
Gross written premium 2011 GWP up 19%, from NOK 1.011m to NOK 1.202m • GWP up 18% within the commercial and public lines of business – Good renewal rate of 88% up from 85% in 2010 – Strong new sales and good access to quotations • Change of ownership insurance, 20% growth, driven by – Increased real
Slide 5: Claims development 2011
Claims development 2011 Net claims ratio 74.2%, down from 78.3% - including indirect claims settlement costs¹ • No large claims (> NOK 5m) within the commercial and public sector (3 large claims in 2010) - Claims incurred in Q4 affected by natural disaster claims totalling NOK 13 mill (in connection
Slide 6: Cost ratio 2011
Cost ratio 2011 Gross cost ratio 15%, down from 17.9% in 2010 • Administration costs in nominal value at the same level as in 2010 • Scalability and reduced staff within commercial segment driving cost ratio down • Cost ratio 2012 expected to continue down Net cost ratio 11.1%, down from 15.9% in 20
Slide 7: Highlights 2011 - Commercial and public lines of business
Highlights 2011 - Commercial and public lines of business • Volume up 18% - Strong competition in the Norwegian municipality sector, still rate pressure, 4% decline in Protector volume - Still fast growing in the commercial sector, 25% GWP 2007 – 2011 (NOKm) - 1 large none renewal in Q4 with a very
Slide 8: Quality leader among Insurance Brokers
Quality leader among Insurance Brokers 78 74 Protector 72 • Protector receives the highest 66 score when brokers are asked 62 Competitor 1 51 to rank insurance companies 45 41 according to how satisfied they 60 63 are with their service and Competitor 2 61 2011 offerings 60 2010 57 Competitor 3 57 2
Slide 9: Scandinavian startup
Scandinavian startup • Same Vision, Business Idea, Strategy and Values • Initial project completed at minimal cost in Sweden (2010) and even lower costs in Denmark (2011). IT, products, processes and reinsurance in place. • Start up team in Sweden in place, country manager from If Skadeförsäkring •
Slide 10: Sweden – Customer base Jan 1st 2012
Sweden – Customer base Jan 1st 2012 • Public lines of business, approx. 30 municipalities/ companies on the customer list • Commercial, 11 companies on the customer list Malmö Karlskrona Eskilstuna 10
Slide 11: Denmark – Customer base Jan 1st 2012
Denmark – Customer base Jan 1st 2012 • 5 out of 98 municipalities on the customer list • Denmark’s largest waste incineration plant in Aarhus, on the customer list Billund Esbjerg Aarhus
Slide 12: Highlights 2011 - Change of ownership insurance
Highlights 2011 - Change of ownership insurance • Volume up 20% GWP 2007 – 2011 (NOKm) - Market share well above 50% 400 - Hit-ratio on a historic high level, around 80% 332 - Real estate prices up 9% in 2011 relative to 2010 297 263 265 - 5-6% growth in the real-estate prices in 2012 expected • Pro
Slide 13: Evaluation of Protector among Real Estate Brokers
Evaluation of Protector among Real Estate Brokers • All-time-high, 88% 92 90 What is the value of COI for your client? 91 90 What is the value of COI for you as a real estate broker? 89 When asked for your opinion on Protector, to what extent 87 2011 will you speak of the company in positive terms?
Slide 14: Results 2011
Results 2011 NOKm Q4 2011 Q4 2010 YTD 2011 YTD 2010 Premiums written gross 179,5 162,6 1 202,5 1 011,0 Premiums earned gross 300,1 267,7 1 177,0 987,7 Claims incurred gross (203,4) (222,4) (839,2) (755,7) Premiums earned for own account 229,5 217,0 903,5 792,3 Claims incurred for own account (165,8)
Slide 15: Balance sheet 2011
Balance sheet 2011 NOKm 31.12.2011 31.12.2010 Financial assets 2 354,8 2 021,5 Bank deposits 112,7 99,9 Other assets 332,4 264,5 Total assets 2 799,8 2 386,0 Total equity 384,5 516,0 Total reserves 2 132,6 1 755,6 Other liabilities 282,6 114,4 Total equity and liabilities 2 799,8 2 386,0 Solvency ca
Slide 16: Investment performance 2011
Investment performance 2011 • Net investment result of NOK -51.4m, -2,3% return (NOK 176.2m, 9.7%) - NOK 48m in Q4 (NOK 107.4m) • Equities, return of -20.4% (30.9%), OSEBX -12.5%, OSEFX -18.8%, in 2011 - Return of 7.7% in Q4 (22.8%), OSEBX 10.5%, OSEFX 8,5% - Equities have in 2012 (per 27 February)
Slide 17: Investment performance 2007 – 2011
Investment performance 2007 – 2011 72,6 % 30,9 % 16,1 % 9,7 % 4,3 % 4,3 % 6,5 % 4,2 % 4,2 % 5,8 % 4,2 % 4,7 % 2,2 % 3,0 % 2007 2008 -2,1 % 2009 2010 2011 2007 - 2011 -2,3 % -20,4 % -44,7 % Equities Bonds Total •Return on investments 2007 – 2011; 4,7% p.a. (equities 6,5% and bonds 4,3%) • Return on i
Slide 18: Asset allocation
Asset allocation • Bonds 82.2% of portfolio, Norwegian equities 17.8% • Allocation in equities reduced from 24.6% to 17.8% - Decline in value and new capital allocated to bonds Allocation of investments 31.12.2011 Allocation of investments 31.12.2010 Equities 17,8 % Bond funds; Equities; 20,5 % 24,6
Slide 19: Portfolio structure and quality bond portfolio
Portfolio structure and quality bond portfolio • Duration (credit) of bond portfolio is 2 years (2,2 years) -Interest duration 0,26 years, unchanged from 31.12.2010 • Reduced risk in funds • No exposure to PIIGs Bond portfolio 31 Dec 2011 Quality bond portfolio 31 Dec 2011 Foreign funds; 1,7 % Split
Slide 20: Development in earnings and key ratios
Development in earnings and key ratios Return on solvency capital ¹ Net combined ratio¹ 40 % 40 % 97,9 % 100 % 95,8 % 88,9 % 94,2 % 29 % 85,3 % 30 % 80 % 19 % 20 % 11 % 60 % 10 % 1% 0% 40 % 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Gross premiums written Gross cost ratio 1 500 20 % 18,0 % 17
Slide 21: Long term financial objectives
Long term financial objectives • Medium term GWP growth rate: 10% Net combined ratio 95,8 % 97,9 % 100 % 94,2 % • Net combined ratio: 92% 88,9 % 85,3 % Target < 92% 80 % • Solvency margin: 80% 60 % • Return on solvency capital: 20% 40 % 2007 2008 2009 2010 2011 Solvency margin Return on solvency cap
Slide 22: Nordic peers
Nordic peers Premium growth Combined ratio¹ 35 % 100 % 25 % 15 % 90 % 5% -5 % 80 % 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Tryg Topdanmark Sampo ¹CR Protector UW year Pohjola Bank Gjensidige Protector Return on investments (%) RoNAV 20 % 65 % 15 % 45 % 10 % 5% 25 % 0% 5% -5 % -10 % -15 % 2
Slide 23: Peers - Combined ratio 2011
Peers - Combined ratio 2011 118,1% 120 % 103,4% 100 % 93,5% 91% 91,9% 92,0% 85,3% 80 % 91,6 % 80,5 % Claims ratio 60 % 68,4 % 72 % 75,5 % 76,7 % 74,2 % Cost ratio 40 % 20 % 23,5 % 22,9 % 26,5 % 19 % 16,4 % 16,8 % 11,1 % 0% Protector Storebrand Gjensidige If Tryg Sparebank1 KLP 23
Slide 24: Shareholders February 2012
Shareholders 22 February 2012 Shareholder No. shares Percent Related parties shareholding ODIN NORDEN 7 264 555 8,43 % MSF-MUTUAL FINANCIAL SERVICES FD 4 479 410 5,20 % HANSARD EUROPE LTD 3 690 836 4,28 % PROTECTOR FORSIKRING ASA • Management’s direct and indirect shareholding totals 4,4m shares or
Slide 25: Outlook 2012
Outlook 2012 • Volume up 18% (19% in 2011) + January 1st volume on a strong level + Startup in Scandinavia + Strong real estate market - Rate pressure in the commercial and public sector • Net claims ratio 78% (74,2% in 2011) + Good start in 2012 + Improved portfolio quality + Real-estate prices up
Slide 26: CEO Summary, Outlook 2012
CEO Summary, Outlook 2012 Risk + Volume significant up in commercial & public sector Low + Sweden and Denmark support growth No + Volume significant up in Change of Ownership sector Low + Balance sheet growing leads to increased financial income Low + Cost ratio Gross & Net going down No + Price inf
Slide 27: Key figures, UW year
Key figures, UW year¹ Net combined ratio UW-year – Outlook 2012 Net claims ratio, UW-year – Outlook 2012 100 % 91.2% 78 % 88.7% 88% 74,1 % 84,1% 86.5% 84.2% HTD 89.4% 80 % 71,7 % 68,4 % 69,9 % 73,1 % 80 % 17,2 % 17,0 % 10,0 % 15,7 % 16,6 % 11,1 % 60 % 60 % 40 % 40 % 74,1 % 78,0 % 71,7 % 68,4 % 69,9
Slide 28: Outlook 2012
Outlook 2012 NOKm Res Outlook 2011 2012 Return assumptions 2012: Premium growth (%) 19 18 Equity allocation approx. 15% Operating profit 83 250 New capital allocated to bonds. Equity allocation reduced. Investment Income -51.4 125 Return equities: 8% p.a. Gross cost ratio (%) 15 13 Return bonds: 4%
Slide 29: Summary 2011 and Outlook 2012
Summary 2011 and Outlook 2012 Poor financial results in 2011, -2,3%, but... ...Strong growth, strong combined ratio and Scandinavian startup • Volume up 19 % No. 1 in Nordic market • Gross cost ratio down to 15.0% No. 1 in Nordic market in our segments • Net combined ratio 85.3% No. 1 in Nordic mark