Reinsurance Group Of America, Incorporated · NYSE:RGA
Reinsurance Group Of America — Investor Day (February 2011)
138 slides from Reinsurance Group Of America's investor day presentation, Feb 16, 2011
Slide 1: Delivering Value and Growth: RGA 2011 Investor Day
Delivering Value and Growth RGA 2011 Investor Day Reinsurance Group of America, Incorporated | Thursday, February 17, 2011 Reinsurance Group of America, Incorporated | Thursday, February 17, 2011
Slide 2: John Hayden, Investor Relations
John Hayden Senior Vice President, Controller and Investor Relations
Slide 3: Safe Harbor
Safe Harbor This presentation contains forward-looking statements, including among other things, investment performance, statements relating to projections of the revenue or earnings, and future financial performance and growth potential of RGA and its subsidiaries. Important factors could cause act
Slide 4: Capital Allocation and Non-GAAP Measures
Capital Allocation Effective in 1Q 2006, the Company changed its capital allocation methodology from a regulatory-based approach to an economic-based approach. To enhance comparability, all prior period segment results in this presentation have been adjusted to reflect the new methodology. This chan
Slide 5: Agenda
Agenda Delivering value and growth Overview A. Greig Woodring, President, Chief Executive Officer, and Director Finance Jack Lay, Senior Executive Vice President and Chief Financial Officer Investments Dave Fischer, Senior Vice President and Chief Investment Officer U.S. Mortality Business Mike Stei
Slide 6: A. Greig Woodring, President and CEO
A. Greig Woodring President and Chief Executive Officer
Slide 7: RGA 2011 Investor Day: Delivering Value and Growth
RGA 2011 Investor Day Delivering Value and Growth Financial Management Refinement, Deployment of Capital Management Team Strong Operations with History of Success Looking Forward Abundant Opportunities 7
Slide 8: Consolidated Operating Income
Operating Return on Equity 2006...13% 2007...14% 2008...14% 2009...13% 2010...13% Operating Income ($ in millions) Operating Income Per Share *See "Reconciliations of Non-GAAP Measures" at the end of this presentation. Operating ROE is computed excluding accumulated other comprehensive income, using
Slide 9: Consolidated Net Premiums
($ in millions) 4-year CAGR 11% 2010 includes $301 million of premiums related to the acquisition of ReliaStar Life Insurance Company's group life and health reinsurance business Consolidated Net Premiums Consistent growth
Slide 10: Book Value Per Share 10-Year Trend
10-year CAGR 11.7% *Book value excludes other comprehensive income. See "Reconciliations of Non-GAAP Measures" at the end of this presentation. Book Value Per Share* 10-Year Trend Continuous increase in value Trading Value 1.9 1.6 1.2 1.4 1.6 1.4 1.4 1.2 1.0 1.0 1.0 Multiple
Slide 11: Market Size & Shares - Individual & Group
Market Size & Shares - Individual & Group Contestable new and total cessions to 12/31/2010 Estimated individual new reinsurance premium = $2.3 billion Estimated group total reinsurance premium = $4.1 billion Source: 2009 NMG Consulting Reinsurance Study 11 Numbers exclude the markets of Germany, Lat
Slide 12: Business Capability Index: A Global Leader
Business Capability Index Key Decision Makers - Global 12 A global leader Source: 2009 NMG Consulting Reinsurance Study Asia, A&NZ, Canada, Europe, SA, UK&I and USA RGA's significant differential to sample average positioning AND to second- place indicative of positive momentum and likely lift in fu
Slide 13: Opportunities for the Life Reinsurance Industry
Opportunities for the Life Reinsurance Industry Increased capital requirements Consolidation in the primary life insurance industry Pressure felt by life insurers to improve ROEs and to grow revenues Continually improving mortality Focused on opportunities
Slide 14: Challenges for the Reinsurance Industry
Challenges for the Reinsurance Industry Decreasing U.S. cession rates Changing regulatory environment Increasing capital requirements likely Low interest rates Consolidation in the primary life insurance industry Accounting changes Capitalizing on a changing market
Slide 15: RGA in Transition
RGA in Transition Becoming a net producer of capital Diversification Combination of high-growth businesses and mature businesses Concerns regarding investment portfolio have largely abated; interest-rate scenarios include both inflation and deflation Abundant opportunities
Slide 16: A. Greig Woodring, President and CEO
A. Greig Woodring President and Chief Executive Officer
Slide 17: Jack B. Lay, CFO
Jack B. Lay Senior Executive Vice President and Chief Financial Officer
Slide 18: Finance Overview
RGA Overview = Historical Financial Performance = Liquidity — Premiums $200 Million December 2011 Senior — Operating Income Notes ; ~ Operating Earnings per Share ~ _RGA's Approach to Managing Leverage pe cearaing Rotum on Equiy — Funding at the Holding Company — Book Value per Share — Continuing Ex
Slide 19: Historical Financial Performance
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Slide 20: Net Premiums: Consistent Growth
10-Year CAGR 16.8% Net Premiums Consistent growth
Slide 21: Operating Income
10-Year CAGR 14.7% Operating Income* * See "Reconciliations of Non-GAAP Measures" at the end of this presentation.
Slide 22: Operating Income per Share
10-Year CAGR 10.2% Operating Income per Share* * See "Reconciliations of Non-GAAP Measures" at the end of this presentation.
Slide 23: Operating Return on Equity
Operating Return on Equity* * Operating ROE is computed excluding accumulated other comprehensive income, using quarterly average for equity amounts. See "Reconciliations of Non-GAAP Measures" at the end of this presentation. Strong returns
Slide 24: Continuing Expectations
Premium growth expected to continue The rate of that growth may be affected by transaction structure (relative level of risk transfer) ROE should continue at current levels, and could show improvement if investment yields increase BV/share (X-AOCI) should continue to show consistent growth RGA conti
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Slide 26: Total Capitalization Levels
($ in millions) $850 million Timberlake Notes/collateral finance facility not included in figures above. Hybrid to Total Capital Total Capitalization Levels (Excluding Other Comprehensive Income) Senior Long-term Debt to Total Capital 70% 50% 40% 30% 20% 10% 0% 60% 8.7% 16.3% $5,509 $4,944 $4,242 $3
Slide 27: Current Capital Management
Annual earnings generally provide enough capital to support the business Current estimate of excess capital is $500-$600 million Evaluating opportunities to refine our capital base by $300 - $350 million Options include: Retirement of PIERs units Common share repurchase To the extent a relatively la
Slide 28: Advantages of PIERs Retirement
Would remove securities that convert into 5.6 million shares of common stock 1.8 million shares currently in average shares outstanding calculation at $59 stock price Additional shares added to average share count outstanding as share price increases Annual effect would be to increase EPS by $0.17 W
Slide 29: Capital Management Going Forward
RGA is committed to maintaining an efficient capital base, balanced to meet business needs and provide attractive returns Capital generated by the businesses roughly matches capital requirements Target capital buffer of approximately $300 million Strong focus on ROE as a driver of enterprise value C
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Slide 31: Liquidity
$200 million December 2011 senior notes RGA's approach to managing leverage Funding at the holding company Liquidity
Slide 32: Schedule of Debt Maturities
Description Amount 6.75% Senior Notes due December 2011 $200 6.75% Junior Subordinated Debentures due 2065 (interest rate step up in December 2015) $320 5.625% Senior Notes due March 2017 6.45% Senior Notes due November 2019 $300 $400 Total Debt $1,220 5.75% Preferred Securities due 2051 $225 Schedu
Slide 33: $200 Million December 2011 Senior Notes
Notes due in December, and carry a coupon of 6.75% We may refinance with similar term debt in advance of maturity We continue to have a backstop $750 million line of credit with considerable remaining capacity $200 Million December 2011 Senior Notes
Slide 34: RGA's Approach to Managing Leverage
Debt is viewed as a permanent component of capitalization Maturities are laddered to provide flexibility Leverage is controlled to ensure overall capitalization fits risk profile of the business, rating requirements, etc. RGA's Approach to Managing Leverage
Slide 35: Funding at the Holding Company
Target level of liquidity is approximately $300 million Liquidity has historically come from securities offerings Moderation of historical growth levels diminishes the need to infuse significant amounts of capital into subsidiaries Funding at the Holding Company
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Slide 37: RGA Differentiation
Typically grouped with direct insurers How does RGA differ? Very low equity sensitivity Relatively low asset leverage Primarily a mortality investment Mortality rates much more predictable than interest rates Relatively high ROE Well-diversified, with exposure to virtually all of the world's life in
Slide 38: Jack B. Lay, CFO
Jack B. Lay Senior Executive Vice President and Chief Financial Officer
Slide 39: David Fischer, Chief Investment Officer
David Fischer Senior Vice President and Chief Investment Officer
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Slide 41: RGA Investments Mission
RGA Investments Mission Create optimal portfolios: Designed for liability matching and return goals Tailored for the market environment Meeting all constraints Balance needs for: Growing investment income Achieving total return objectives Ensuring balance sheet safety
Slide 42: RGA Investments
We are predominately a credit investor: Corporate Government Commercial Real Estate Residential Real Estate Consumer Investment yields appropriate for the business Meet balance sheet safety objectives RGA Investments RGA Investments
Slide 43: Risk Management Principles
Investment Policies Risk budgets Diversification requirements and limits Interest rate and currency matching Culture Credit-capital, cash flow, collateral, character Monitor portfolio on total return basis Is there "Margin of Safety"? Risk Management Principles
Slide 44: Investment Process
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Slide 45: ALM, SAA, IPS Process at RGA
New Deal Liability cash flows Asset classes Expected returns Risk analysis Feedback loop for pricing expected returns Risk budgets & limits Invest in asset classes Asset Liability Management (ALM) Strategic Asset Allocation (SAA) Investment Policy Statement (IPS) Process at RGA
Slide 46: ALM, SAA, IPS Process at RGA
Update Business Segment SAA, IPS Time Passes Business Segment Grouped liabilities Constraints Risk Regulation Target portfolio Tactical ranges Relative value process IPS limits actual to target SAA Combined Business Segment SAA Portfolio React to Market, Investment Tactics Business Segment Actual Po
Slide 47: ALM, SAA, IPS Process at RGA
Consolidated Portfolio Business Segment Actual Portfolios RGA Consolidated Portfolio Monitors Consolidated Risk Risk budgets 1) Diversification & limits Asset class Quality Per issuer 2) Interest rate risk VAR ^ 0 3) Currency risk VAR ^ 0 4) Credit risk VAR = credit risk economic capital appetite +/
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Slide 49: Allocation by Asset Class
Note: Includes Asset-Intensive Funds Withheld assets Excludes Policy Loans & Other Funds Withheld assets Allocation by Asset Class
Slide 50: Allocation by Rating
* Includes Derivatives & Mutual Funds Allocation by Rating
Slide 51: Asset Allocation by Currency
Note: Includes Asset-Intensive Funds Withheld assets Excludes Policy Loans & Other Funds Withheld assets Asset Allocation by Currency
Slide 52: Allocation by Type of Credit Risk
Note: Includes Asset-Intensive Funds Withheld assets Excludes Policy Loans & Other Funds Withheld assets Allocation by Type of Credit Risk
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Slide 54: RGA Earned Yield History & Projections
RGA Earned Yield History & Projections
Slide 55: Exposure to Europe & Periphery
Exposure to Europe & Periphery
Slide 56: Government Bond Summary
RGA Government Bond Summary December 31, 2010 Market Value (000s) % US Government Bonds $ 219,863 3.1% Foreign Government 256,226 3.7% Quebec (Province of) 1,364,804 19.5% JOntario (Province of) 1,169,376 16.7% JOther CA Provincials 581,442 8.3% Fannie/Freddie/Ginnie 1,606,019 23.0% Municipal Bonds
Slide 57: Commercial Real Estate Summary
Commercial Real Estate Summary
Slide 58: Commercial Real Estate - Direct Commercial Loan Portfolio
$886 million balance outstanding as of December 31, 2010 * Debt Service Coverage Ratio Excludes Asset-Intensive Funds Withheld CMLs Commercial Real Estate - Direct Commercial Loan Portfolio
Slide 59: Commercial Real Estate - CMBS
Commercial Real Estate - CMBS Note: Totals include directly held investments with book value of $1,353.3 million and fair value of $1,337.8 million as well as investments in funds withheld with book value of $481.3 million and fair value of $480.4 million.
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Slide 61: Macro Environment Outlook
"Steepest curve in history" Fed is easy (QE2) Enabling banks to heal Enticing borrowers to borrow, investors to take risk Fed is worried about deflation Others worried about bubbles, inflation Source: Data Insight Macro Environment Outlook
Slide 62: Asset Class Outlook
CMBS most attractive bond asset class in January 2011 Corporate bonds also attractive due to strong balance sheets RGA looks to increase to private corporates by $150 million Sources: Barclays, Bloomberg Asset Class Outlook
Slide 63: Commercial Real Estate Outlook
Jobs are key to absorbing vacancies Vacancies forecasted to improve in 2011 by 2 - 3% Existing inventory levels at historic lows Class "A" lending getting competitive at 4.75 - 5.5% CMBS market restarting RGA looks to grow CML portfolio by $200 million Commercial Real Estate Outlook
Slide 64: RGA YE 2010 and Projected YE 2011 Asset Allocation
Note: Includes Asset-Intensive Funds Withheld assets Excludes Policy Loans & Other Funds Withheld assets RGA YE 2010 and Projected YE 2011 Asset Allocation
Slide 65: David Fischer, Chief Investment Officer
David Fischer Senior Vice President and Chief Investment Officer
Slide 66: Mike Stein, Chief Risk Officer
Mike Stein Executive Vice President and Chief Risk Officer
Slide 67: Overview: U.S. Mortality Business
Financial Results Current Market Conditions RGA's Differentiator Mortality Research Underwriting Expertise Overview: U.S. Mortality Business Recognized leader with superior expertise
Slide 68: U.S. Mortality: Pre-tax Operating Income and Revenues
U.S. Mortality Business: Pre-tax Operating Income* and Revenues Steady operating income and revenues * See "Reconciliations of Non-GAAP Measures" at the end of this presentation. Pre-tax Operating Income ($ Millions) Pre-tax Operating Income Revenue
Slide 69: U.S. Mortality: Returns on Economic Capital
U.S. Mortality Business: Returns on Economic Capital Consistent returns * See "Reconciliations of Non-GAAP Measures" at the end of this presentation.
Slide 70: U.S. Mortality: Quarterly Volatility
U.S. Mortality Business: Pre-tax Operating Income* Quarterly Volatility Expect some quarterly volatility * See "Reconciliations of Non-GAAP Measures" at the end of this presentation. Pre-tax Operating Income ($ Millions) ? Pre-tax Operating Income
Slide 71: U.S. Mortality: In-force Distribution
U.S. Mortality Business: In-force Distribution as of December 31, 2010 Coinsurance peaks between 2002 and 2004 issues
Slide 72: U.S. Mortality: In-force Distribution
U.S. Mortality Business: In-force Distribution as of December 31, 2010 Older-age YRT peaks in 2005 and 2006
Slide 73: U.S. Mortality: Premiums
U.S. Mortality Business: Premiums Moderating growth in premiums
Slide 74: U.S. Mortality: Net Amount at Risk In Force
U.S. Mortality Business: Net Amount at Risk In Force Moderating growth in total risk in force
Slide 75: U.S. Individual Life Reinsurance Market
U.S. Individual Life Reinsurance Market Life cession rates continue to decline in U.S. Source: SOA/Munich Re Survey Available at http://www.soa.org/library/newsletters/reinsurance-section-news/2010/july/rsn-2010-iss68.pdf
Slide 76: U.S. Mortality: Market Position
U.S. Mortality Business: Market Position Increasing market share offset declining cession rates Source: SOA/Munich Re Survey Available at http://www.soa.org/library/newsletters/reinsurance-section-news/2010/july/rsn-2010-iss68.pdf
Slide 77: Indicators of Success: Flaspohler Cedant Survey
RGA voted 'Best Overall Reinsurer' in each survey since 2005 Indicators of Success: U.S. Flaspohler Cedant Survey Results
Slide 78: Indicators of Success: Net Promoter Score
RGA has the highest NPS, +45.6, overall Among RGA target list, RGA has NPS of +60.3 NPS measures 'How Likely to Recommend' on scale of 0 to 10 Promoters (9, 10) minus Detractors (0 to 6) as a percentage In B2B, any NPS of 40 plus is exceptional and wins international awards Indicators of Success: U.
Slide 79: RGA Internal Experience Study
RGA Internal Experience Study 83.7 million policy-years exposed $5.1 trillion reinsured face amount exposure Provides primary support for developing RGA's pricing assumptions Research Examples Unparalleled mortality experience, expertise
Slide 80: SOA/RGA Post-Level Period Term Project
SOA/RGA Post-Level Period Term Project Multi-company experience study sponsored by Society of Actuaries Research Examples Optimize valuation, modeling of term products
Slide 81: Research Examples: Prescription Drug Databases
Research Examples Leading research to improve mortality assumptions Prescription Drug Databases Comprehensive analysis of mortality results based on prescription drug history Published in The Journal of The Academy of Life Underwriting
Slide 82: Underwriting Expertise
Industry leader: More than 100,000 facultative cases reviewed in the U.S. each of the past four years Highly valued: Clients report RGA provides consistent, competitive offers Outstanding time service: 95%+ cases responded to within 24 hours Solid, individual life capacity: Provides clients over $50
Slide 83: Summary
Steady returns and operating income Limited premium growth, but attractive returns on new business Market leadership built on brand loyalty and customer satisfaction Summary Delivering value
Slide 84: Mike Stein, Chief Risk Officer
Mike Stein Executive Vice President and Chief Risk Officer
Slide 85: Paul Schuster, Global Group, Health, LTC and GFS
Paul Schuster Senior Executive Vice President, Global Group, Health, Long-Term Care, and Global Financial Solutions
Slide 86: A History of Growth and Diversification
A History of Growth and Diversification 1973 - First reinsurance treaty entered into through General American Life 1992 - Leadership position enables RGA to expand into Canada 1994 - International expansion continues with Spanish office opening We have since: Expanded our global reach Expanded our p
Slide 87: Diversification Method
Diversification Method Deliberate focus on mortality allowed RGA to achieve dominant position in U.S. Life Reinsurance Established a solid foundation and proven track record of organic growth Systematic growth through selective product additions enabled diversification Consistent increases in market
Slide 88: Building the Foundation in the U.S.
Building the foundation in the U.S. Geographic Diversification Product Diversification The U.S. provided the foundation 1973 General American launches life reinsuranc e operation 1978 Fac u/w department established 1980 Premiums exceed $1 million 1988 Expansion into special risk and financial reinsu
Slide 89: Consistent Growth in the U.S.
Consistent Growth in the U.S. 89 Source: SOA/Munich Re Annual Reinsurance Survey Recurring U.S. Ordinary Reinsurance Amounts (Net of Acquisitions) Strong focus and market dominance
Slide 90: U.S. - Continued Growth through Diversification
U.S. - Continued Growth through Diversification Calendar Year Product US Division Net Premiums $ million 2000 First XXX Term life surplus relief 1,039 2001 AURA, FAC Console First annuity asset-intensive transaction 1,223 2002 Coinsurance of indexed annuities 1,400 2003 RGA completed the acquisition
Slide 91: Continued Success - U.S. Mortality
Continued Success - U.S. Mortality Active Facultative and other underwriting initiatives Extremely active "exploration" Product development U.S. middle class Direct discussions with agents (Voice of the Customer project) Use of RGA's mortality data Group & Health Acquired ING Re Group, Accident, LTD
Slide 92: Canada - Diversification Enabled by Strong Foundation
Building the foundation in the U.S. Geographic Diversification Product Diversification Canada - diversification enabled by strong foundation 1973 General American launches life reinsuranc e operation 1978 Fac u/w department established 1980 Premiums exceed $1 million 1988 Expansion into special risk
Slide 93: Our First International Office: Canada
93 A story of continuous growth and diversification In 2004, nearly 100% of in-force premiums were associated with conventional risks By 2011, this had decreased to approximately 65% Exceptional growth based on Product and service diversification Strength of relationships Local servicing of Canadian
Slide 94: Continued Success - Canada
Continued Success - Canada Creditor $151 million premium from Barbados $44.2 million premium from risk taken within Canada Have a leading share of the creditor business within Canada Group $27.5 million premium Living Benefits $1.34 billion in face amount in 2010 33% market share of new business Mos
Slide 95: International Expansion
Building the foundation in the U.S. Geographic Diversification Product Diversification International expansion 1973 General American launches life reinsuranc e operation 1978 Fac u/w department established 1980 Premiums exceed $1 million 1988 Expansion into special risk and financial reinsuranc e 19
Slide 96: International Expansion
International Expansion Geographic diversification continues 17 offices opened since 1994 Building on foundation of value 2005 - International Division exceeded $1 billion in revenue Largest reinsurer of High Net Worth business in Asia "Australia and New Zealand Reinsurer of the Year" (ANZ Insurance
Slide 97: Experienced Executive Management Team
Experienced Executive Management Team Name Position Years in Industry Experience with RGA A. Greig Woodring President, Chief Executive Officer, and Director 36 31 Jack B. Lay Senior E.V.P. and Chief Financial Officer 19 16 Paul A. Schuster Senior E.V.P., Global Group, Health & LTC, Global Financial
Slide 98: The Future...
We have an ideal mix of business and are committed to further strategic growth and diversification. The Future...
Slide 99: Paul Schuster, Global Group, Health, LTC and GFS
Paul Schuster Senior Executive Vice President, Global Group, Health, Long-Term Care, and Global Financial Solutions
Slide 100: Mike Emerson, U.S. Group Reinsurance
Mike Emerson Executive Vice President, U.S. Group Reinsurance
Slide 101: Group Business Overview
101 Group Business Size of the Group Market Insurance Reinsurance Group Business at RGA Business Model Overview
Slide 102: Group Business Overview
Group Business Overview Group insurance typically includes Employment benefits - employee groups sponsored by their employers (the focus of this presentation) Association plans - employee or professional groups sponsored by their union or professional group or coverage attached to use of a credit ca
Slide 103: Size of Group Life and Disability Direct Market
Size of Group Life and Disability Direct Market Group Insurance Premiums Global growth Australia Canada UK South Africa Spain U.S. Source: Multiple RGA sources and data
Slide 104: Group Insurance Annual Growth Rates
Size of Group Life and Disability Direct Market Group Insurance Annual Growth Rates 104
Slide 105: Size of the Group Reinsurance Market
Estimated group Total reinsurance premium = $4.1 billion Estimated group Total reinsurance premium = $4.1 billion Source: NMG Financial Services Consulting * Includes Creditor in Canada and Europe Size of the Group Life and Disability Reinsurance Market - Distribution of Premium* Competitors Markets
Slide 106: RGA Group Business Global Earned Premium Volume
106 106 Source: RGA ? Acquired ING Business RGA Group Business Global Earned Premium Volume Consistent Growth
Slide 107: RGA Group Business 2010 Earned Premium
RGA Group Business 2010 - Earned Premium 107 International coverage growing
Slide 108: Why Direct Writers Reinsure
108 Risk sharing Reduce volatility Uncomfortable with risk Manage concentrations of risk Protect surplus Support growth Capital relief Price Value-added services... Industry Business Model: Why Direct Writers Reinsure
Slide 109: Value-Added Services
Market Research Industry Surveys, Client-Driven Market Research, RGA Market View Claims Advisory Services ROSE(r) and ROSEBUD(r) Claims Management Services, ROSE(r) Seminar, Continuing Education Seminars, Claims Benchmarking Survey, Claim Leaders Forum Actuarial and Risk Management Rater Development
Slide 110: Value-Added Services
Value-Added Services .... and makes RGA and its clients better risk managers
Slide 111: Significant Investments in Risk Management
Operational Risk Management Committee Scorecard Results Dedicated Risk Management Staff Income Statement by Contract (ISBC) Administrative System (Raptor) SOX Use of Retrocession Concentration of Risk Standards Catastrophe Modeling Security Committee Broker, Ceding Company, and Retro Standards Clien
Slide 112: State-of-the-art, Scalable IT Infrastructure
....and built an IT infrastructure which is state-of-the-art and scalable Custom-built Administrative System (RAPTOR) introduced in 2006, allowing 19 applications to be retired Fully integrated treaty management, premium processing, claims and rates administration in a single platform Robust reporti
Slide 113: Update on ING Acquisition
RGA Synergies Combined staff with RGA Canada to better serve Canadian group marketplace Cross marketing with U.S. Mortality business Sourcing deals and jointly working with Financial Solutions division in group marketplace Potential to leverage state-of-the- art group administrative platform and gro
Slide 114: Business Model Future Opportunities
114 Outlook in U.S. - cautiously optimistic. Job growth, health care reform and entrance to new markets all may create opportunities Growth in Australia market continues to be good, but competition among reinsurers is intense Combined strength of RGA Canada and former ING Reinsurance makes for stron
Slide 115: Mike Emerson, U.S. Group Reinsurance
Mike Emerson Executive Vice President, U.S. Group Reinsurance
Slide 116: Gary Comerford, Chief Marketing Officer
Gary Comerford Executive Vice President and Chief Marketing Officer
Slide 117: Geographic Expansion: Where We Were in 2001
U.S. Canada U.K. Australia Japan South Africa Mexico Spain Hong Kong Malaysia Taiwan Total Net Premiums 2001 = $1.7 billion Geographic Expansion Where we were in 2001...
Slide 118: Where We Are Today
118 U.S. Canada U.K. Australia Japan South Africa Mexico Spain Hong Kong Malaysia Taiwan India South Korea China Poland France Germany Italy Netherlands Middle East Total Net Premiums 2010 = $6.7 billion 10-year CAGR = 16.8% ....and where we are today:
Slide 119: Delivering Growth
Offices strategically positioned Delivering Growth Geographically well-positioned for growth Opportunities exist for product line extension RGA's focus is on identification of superior opportunities Managing execution risk is an essential part of our future growth
Slide 120: Positioning RGA for Future Growth
Able to capitalize on superior opportunities Positioning RGA for Future Growth Investigate thoroughly to understand: Population trends Environmental factors - regulatory, political, economic Competition Client needs - products, risks, and markets Long-term premium opportunities by product Follow our
Slide 121: RGA's Global Presence
Growth opportunities in all markets RGA's Global Presence U.S., Canada and International Contribution to 2010 Net Premiums
Slide 122: RGA's Global Presence: Established and Emerging Markets
Growth opportunities in all markets RGA's Global Presence Established International Markets, outside U.S. and Canada Account for 99% of RGA's International net premiums Consistent growth; continuing to seek out new opportunities Provide geographic positioning Emerging International Markets Investing
Slide 123: Geographic Growth: Major Markets
* Net Premium growth rates incorporate actual currency fluctuations ** Reflects acquisition Opportunity to expand market reach in all markets Geographic Growth Major Markets (Outside U.S. and Canada)
Slide 124: Geographic Growth: Emerging Markets
* Local presence established in 2010, license pending **2009 NP = $ 0.2 million USD Accounted for just 1% of total net premium in 2010 Geographic Growth Emerging Markets
Slide 125: Indicators of Success - NMG BCI
Consistent feedback from key decision makers, underwriters, claims managers and group managers. Consistent feedback from key decision makers, underwriters, claims managers and group managers Delivering results through breadth and depth of relationships Indicators of Success - NMG BCI Business Capabi
Slide 126: Growth through Product Line Extension
Product development support essential Growth through Product Line Extension RGA's strengths Underwriting expertise Actuarial skills Risk management capabilities Product development Global knowledge Client needs Market trends Opportunities for product growth exist where there is a match between:
Slide 127: Examples of Product Line Extension
Examples of Product Line Extension Market Product Year Spain Supported development of 1st Preferred Term product in Spanish market 2001 Korea Introduced 1st Critical Illness product in Korean market 2002 U.K. Developed industry-leading underwriting process and manual for impaired annuities 2008 Indi
Slide 128: Global Product Growth Prospects
Product Line Current Markets Growth Opportunities Overall Growth Assessment Mortality All RGA markets India Middle East China Higher in emerging markets Group U.S., Canada, Spain, S. Africa, Australia Canada, France, Korea, Japan, China Medium - Focus on growing current markets, evaluating opportuni
Slide 129: We Deliver Exceptional Services
Leveraging global experience and expertise We Deliver Exceptional Services Facultative Underwriting Significant, continuing growth E-underwriting programs Leadership position in underwriting driving our desire and ability to deliver technology solutions Product Development Extensive world-wide data
Slide 130: India and China Are Important Future Markets
India has the potential to be a $100 million market for RGA in 3 years China will dominate the reinsurance world 6th largest life market by premium in 2010* Annual market growth consistently exceeds 30% Foreign insurers' share steady at 5%** # of life policyholders with foreign insurers expected to
Slide 131: Looking Forward: Middle East and Latin America
Middle East Sept. 2010 - opened local office More people than the U.S. and Canada combined, in a financially prosperous region Latin America Exploring and evaluating the possibilities Emerging middle class Est. 57 million in Brazil Est. 45 million in Mexico Selective and deliberate growth Looking Fo
Slide 132: Measured Growth, Managed Risk
Deliberate, methodical and measured growth Measured Growth, Managed Risk People Local Management Local leadership is the critical element Local Expertise Business Development Underwriters Actuaries Rigorous oversight through command and control structure Processes Local Mandates Defined and document
Slide 133: Global Direction, Local Execution
Global direction, local execution Global Experience Proven track record Consistent growth Seasoned management team Entrepreneurial spirit
Slide 134: RGA's Theme for 2011: We Deliver...
"The people who get on in the world are the people who get up and look for the circumstances they want and if they can't find them, make them" - - George Bernard Shaw RGA's theme for 2011: "We Deliver..."
Slide 135: Gary Comerford, Chief Marketing Officer
Gary Comerford Executive Vice President and Chief Marketing Officer
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Slide 137: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures
Slide 138: Delivering Value and Growth: Q&A
Delivering Value and Growth RGA 2011 Investor Day Q&A Reinsurance Group of America, Incorporated | Thursday, February 17, 2011 Reinsurance Group of America, Incorporated | Thursday, February 17, 2011
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