Tryg A/s · OMXCOP:TRYG
Tryg A/s — Tryg A/S Ord New — Q3 2023 Earnings Presentation
60 slides from Tryg A/s's earnings presentation, Oct 13, 2023
Slide 1: ) = s ) @ CT a) N —) N o o i“ So
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Slide 2: Disclaimer
Disclaimer Certain statementsin this presentation ar based onthe belles of our management as wellas assumptions made byand information curently avalableto the management. ForwardHooking statements other than statements of historical fat) regarding our future results of operations, nancial condition,
Slide 3: Financial highlights Q3 2023
@ | HicHuicHTs 93 2023 Financial highlights Q3 2023 Insurance service result Ei Ise adjusted for higher than normal large and weather claims [Hi isk as reported 2,056 3.2022 932023 Insurance service result of 1,513m impacted by 543m higher than normal weather and large claims, Storm Hans hitting Sca
Slide 4: Customer highlights Q3 2023
@ | HicHuicHTs 93 2023 Customer highlights Q3 2023 satisfaction KPI TryghedsGruppen has paid out a member bonus CMD Target 2024 Stable high level of customer satisfaction 88 TryghedsGruppen + In Q3, claims volumes have been extraordinarily high in both Denmark and «onthe 10th o October 2023, Tryehed
Slide 5: Lower insurance service result driven by higher than normal weather claims
@ | HicHuicHTs 93 2023 Lower insurance service result driven by significantly higher than normal weather claims Private Insurance service result ft Group insurance service result walk =| DkKm 1,254 DkKm 877 1,785 93 2022 93.2023 ‘uroff Q3 2023: KK im or 1.5% (Q3 2022: DKK 121m oF £98) Weaer claims Q
Slide 6: Status on RSA synergies per Q3 2023
@ | HicHuicHTs 93 2023 Status on RSA synergies per Q3 2023 Tryg realised synergies of DKK 80m accumulating to DKK 627m in the CMD period * Main synergy drivers continue to be cost initiatives with Admin and distribution, and Procurement driving the largest effect. Adverse currencies development have
Slide 7: 26-10-2023
7 26-10-2023
Slide 8: Insurance revenue up 4.4% in local currencies
@ | INSURANCE REVENUE AND PORTFOLIO Insurance revenue up 4.4% in local currencies, but declining in DKK compared to Q3 2022 Insurance revenue growth by segment Q: 5.0 41 1.4 2023 (local curr Private Commercial Corporate Group Revenue growth Revenue growth of 4.4% in local currencies. Growth adjusted
Slide 9: House and motor insurance - average prices moving upwards
@ | INSURANCE REVENUE AND PORTFOLIO House and motor insurance - average prices moving upwards House insurance, average earned premium, index development 140 —ok NO == SE Qt Q2 Q3 Q4 QI Q2 Qs Qh QI Q2 Q3 QW QI Q2 Qs Q4 QI Q2 Q A QI Qe Qs 18 18 18 18 19 19 19 19 20 20 20 20 21 21 21 21 22 22 22 22 23
Slide 10: Customer retention is broadly stable
@ | INSURANCE REVENUE AND PORTFOLIO Customer retention is broadly stable Private retention —=DK = NO = SE No 84 Q120° © 220, 0320, Q420. 121-221-321 QK21- N22) 222.0322, Q422_—QN23_--Q223_- 3.23, WH q22023 GE 032023 Commercial retention 94 No 84 Q120 © 220.320. Qh420. N21 = Q221- 324 421 N22 R22 Q32
Slide 11: Rebalancing the Corporate portfolio
@ | INSURANCE REVENUE AND PORTFOLIO Rebalancing the Corporate portfolio Tryg|o Rebalancing towards smaller local customer Significant reductions in risk exposure for property and US heavy liability 50% Larger global 10% 26% 23% INN Larger European 35% ae S reached CMD target as of 2023 Q3 ~50% reduc
Slide 12: Claims and expenses
Slide 13: Underlying claims ratio improving 50 basis points for the Group
© | claims anp EXPENSES Underlying claims ratio! improving 50 basis points for the Group Group underlying claims ratio <5Obps 72.8 i ai i : 9322 Q422 Q123 9223 9323 Private underlying claims ratio ~30bps 75.4 : i al Q322 422 Qt 23 Q223 323 Group underlying claims ratio at 67.5, 50bps better than Q3
Slide 14: Weather claims in Q3 DKK 451m higher than normal
© | claims anp EXPENSES Weather claims in Q3 DKK 451m higher than normal Cloudburst, Eastland Norway Total Weather claims, net Q3 2023 Storm Hans, Scandinavia [pqaeld DKK 611m Hailstorm, Italy Other
Slide 15: Weather claims, historical gross versus net development
© | claims anp EXPENSES Weather claims, historical gross development versus historical net development a3!) 664 7) a Weather claims, gross (DKKm) ES888382555 5 z SEeRP ERR SES BS Post RSA Scandinanvia Scandinanvia Tryastandalone integration (proforma) ay Weather claims, Net (DKKm) 611 14 RERARRELERE
Slide 16: Claims inflation, pricing and currency movements
© | claims anp EXPENSES Claims inflation, pricing and currency movements Claims inflation and pricing Windshield and spare parts impacted by adverse movements in exchange rates * Claims inflation differs from CPI, as insurance spend is less impacted by some volatile items present in the CPI calculat
Slide 17: Large claims, weather claims and run-off
© | claims anp EXPENSES Large claims, weather claims and run-off 4.200 4.140 392 1.000 800 600 400 200 292 2019 2020 2021 2022 2023 Post RSA integration 1) Large Loss incurred per claim represent 10m in local curency ex. recovery Claims reserves discounting rate (%) Q32022 © Q32023 3) 3 34 24 28 2 2
Slide 18: 6,836 6,910 6,518 6,736 4,674 4,400 4,076 3,913 4,027 4,151 3,703 3,599 3,359 3,264
6,836 6,910 6,518 6,736 4,674 4,400 4,076 3,913 4,027 4,151 3,703 3,599 3,359 3,264 3,373 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 Q2 Q3 2023 2023 2023
Slide 19: Investment and solvency
Slide 20: Investments - split in match & free portfolio
@ | INVESTMENT AND SOLVENCY Investments - split in match & free portfolio Match portfolio split, DKK 43n Free portfolio sp! KK 17bn ® oe Hl investment assets. Bl Equity futures 16 In Q3 Tryg has reduced the equities exposure by approx. DKK 900m from 3.4bn to 2.5bn reinforcing the low riskapproach to
Slide 21: Tryg investment return - low risk remains key
@ | INVESTMENT AND SOLVENCY Tryg investment return — low risk remains key Key figures investments (DKKm) Q32022 Q3 2023 Equity investments (exposure), DKK 2.5bn, split by sectors (%) 29 Free portfolio 233 -26 ‘Match portfolio 207 268 Income from RSA Scandinavia 0 0 Other financial income and expense
Slide 22: Solvency position Q3 2023
@ | INVESTMENT AND SOLVENCY Solvency position Q3 2023 Solvency position * Solvency ratio based on the Partial Internal Model is 194 (Q2 2023: 199). + Own Funds (OF) are primarily impacted by + Operating earnings + Deduction of dividends and DKK 1bn buy-back + Higher value of subordinated loans on ba
Slide 23: Solvency ratio historical development
Solvency ratio historical development Both 9M dividends (announced in November) and Q4 dividend (announced with FY results) are deducted from the FY Own funds 9 Approvalof new partial internal model, very strong Q2 result 75 and dividend decision for 2020 peed Es Own funds and SCR moved to year-end
Slide 24: Solvency ratio sensitivities
@ | INVESTMENT AND SOLVENCY Solvency ratio sensitivities Tryg Solvency ratio sensitivities +20% -20% | +30% -30% | +20% -20% | +100bps - 100bps - ~100 bps Ez ~100 bps - "| +20% 20% © +20% += -20% 2023, Equity Equity Property Interest (coe (conoeste (cornesen) NOK/DKK SEK/DKK Solvency ratio sensitivi
Slide 25: Strategic and organisational changes
Slide 26: Tryg announced strategic and organisational changes
(5) | STRATEGIC AND ORGANISATIONAL CHANGES Tryg announced strategic and organisational changes Tryg’s organisation pre and post restructure Organisational adjustments and changes Pre restructure 2 aD Commercial Lines Organisational Scale & DK/NO adjustments / efficiencies Sweden Commercial and Adjus
Slide 27: Financial targets
Slide 28: Insurance service result target updated for IFRS 17
@ | FINANCIAL TARGETS Insurance service result target updated for IFRS 17 Insurance service result target for 2024 in October 2023 Volatile macroeconomic factors ~200 ~7,200-7,600 ~7,000-7,400 i CMD target Education and CMD target Higher interest rates Currencies impact Reinsurance price impact _ In
Slide 29: Important things to remember in 2023
@ | FINANCIAL TARGETS Important things to remember in 2023 29 a In 2023 all quarters will show fully consolidated figures including Codan Norway and Trygg-Hansa. = Other income and costs from Q4 2023 will include an approximate DKK250m quarterly intangibles amortization (Codan Norway and Tryge-Hansa
Slide 30: 2024 strategy and targets will ensure highly attractive shareholders' returns
2024 strategy and targets will ensure highly attractive shareholders’ returns Insurance service result Combined ratio Expense ratio Return on Own Funds RSA Scandinavia Synergies target Ordinary dividends and extraordinary buybacks DKK 7.2-7.6bn <82% ~13.5% 225% DKK 900m DKK ~17-19bn in 2022-2024
Slide 31: It is important to know your investment case
It is important to know your investment case
Slide 32: Q3 2023 roadshows & conferences
@ | ROADSHOWS & CONFERENCES Q3 2023 roadshows & conferences Participants from Tryg [Arranged by Johan Kirstein Brammer, CCO Barbara Plucnar Jensen, CFO. 13/10/2023 Copenhagen roadshow MEETS Nordea Investor Relations Barbara Plucnar Jensen, CFO 17/10/2023 London roadshow Petey eee Danske Bank Barbara
Slide 33: Investor Relations contacts
w \4 | af Gianandrea Roberti Peter Brondt Khoi Nguyen lize Karahona Tobias Andersen Vice President, Manager, Investor Relations Senior Analyst, Investor Relations Coordinator (maternity cover), Investor Analyst, Investor Relations Head of Investor Relations & External +45 22 75 89 04 +45 6177 29 85
Slide 34: Background material
Background material
Slide 35: Tryg at a glance
@ | BackGROUND MATERIAL Tryg at a glance About Tryg Insurance revenue split by products Q3 2023 * Tryggoes back to 18th century. D wotor TG Workers’ comp Bi teeatth & accident DW tability Gl Fire & property- private [i Fire & property-comm. TD other * Very strong brand position especially in Denmark
Slide 36: Gross premium split by geography
@ | BackGROUND MATERIAL Gross premium split by geography DK: Gross premium by products 2022 Di Motor (i Workers comp [Bi Health and accident BB Liability Ii Fire & property- private BI Fire and property comm Di other NO: Gross premium by products 2022 CH Motor [E) workers comp [Bi Health and acciden
Slide 37: Reserves and run-off split by line of business
@ | BackGROUND MATERIAL Reserves and run-off split by line of business Reserves by products 2022 37 TC motor [Workers comp Bi realth and accident BB Liability [i Fire & property - private I Fire and property comm C1 other Run-off net by products Q3 2023, DKKm 33 161 111 22 42 29 LE Motor (J Workers
Slide 38: The run-off cycle
6) | BACKGROUND MATERIAL The run-off cycle Run-off cycle: e Initial assessment of the claims was DKK 18,000 but Tryg reserved for DKK 20,000 adding some conservatism to best estimate. e Atthe time of setting up the claims reserves and booking the claims in the P&L the loss ratio (hence the combined
Slide 39: Combined ratio development (IFRS 4)
Combined ratio development (IFRS 4) 87.7 : | | : . . : : | 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 10Y avg. 5Y ave. 85.1 84.3 39
Slide 40: Shareholder remuneration since 2012
| BACKGROUND MATERIAL Shareholder remuneration since 2012 (DKK) Shareholder remuneration since 2012 on 9.74 971 9.20 : [BB Ordinary dividend 8.60 as [Extraordinary buy back [Extraordinary dividend 7.80 6.29 1.85 6.80 7.00 , 6.40 6.00 6.20 5.20 5.40 #80 J 1.85 ! 1.85 2012 2013 2014 2015 2016 2017 201
Slide 41: Market share of the Scandinavian insurance market
@ | BackGROUND MATERIAL Market share of the Scandinavian insurance market Scandinavia market share EUR 26,3 bn (as at Q3 2022) Denmark market share DKK 67,4 bn/EUR 9,1bn (as at Q3-2022) CI tre Litre Or [1 Topdanmark i Topdanmark Gt [BB Lansforsikringar TB Gjensidige TB Gjensidige i aim. Brand TB oth
Slide 42: Distribution of new sales 2022
6) | BACKGROUND MATERIAL Distribution of new sales 2022 Distri Scandinavian market Distribution in the Scandinavian markets differs from many other insurance markets. * Direct distribution is the main channel for Private and Commercial 15% . . 9% S * There are no brokers in the private market and li
Slide 43: Things that you may not know
@ | BackGROUND MATERIAL Things that you may not know . Scandinavian economies have been performing better than most European countries for a longtime. The GDP growth y/y was approx. 2%, and unemployment rates remains much lower than European averages (2- 3% in DK and NO). Government indebtedness is
Slide 44: Things that you may not remember
@ | BackcRounn marERIAL Things that you may not remember 44 Our maximum annual net exposure to a single large Property claim is DKK 150m which falls to DKK 100m in case of a second claim and all afterwards claims at DKK 50m. This is based on our general reinsurance programme. Our maximum net exposur
Slide 45: IBM study from 2007, probably little has changed
@ | BackcRounn marERIAL IBM study from 2007, probably little has changed Danish customers either completely or strongly agree Overall | am very satisfied with the services of my | (3 i UK 133 insurance company DE 150 My insurance agent only sold me insurance UK ee 200 coverage that | really needed D
Slide 46: Denmark's 'biggest' family
Denmark's ‘biggest’ family Tryghedseruppen Bonus Bonus has a positive effect on retention us ‘lexpect to be in Tryg next year’ ot heard about member Bonus 79 2019 (es2)) ED Dividends grippen ‘protien = Premiums Re 67% ofmember bonus to 23% of member bonus to 10% of member bonus to Private customers
Slide 47: Remuneration structure
Remuneration structure The Executive Board are remunerated accordingto Trye’s remuneration policy: + Base salary © Afixed car allowance and other standard benefits in addition to the base salary + Pension ‘© 25% of the base salary + Variable pay Up to 50% of the basesalary including pension The vari
Slide 48: Sustainability & ESG governance
6) | BACKGROUND MATERIAL Sustainability & ESG governance Sustainability & ESG Board ‘Supervisory Board Executive Board Chair a ss, Barbara Plucnar Jensen, CFO Private, , Corporate Responsibility tea Commercial Corporate } I 7 7 I = I [ l Communications || Procurement HR 24 Facies Investments Investo
Slide 49: Sustainability & ESG strategy 2024
6 | BACKGROUND MATERIAL Sustainability & ESG strategy 2024 Driving sustainable impact Tryg wants to contribute to a sustainable future and create long-term value for our customers, employees, shareholders and society. We want to to integrate sustainability into every corner of our business. Sustaina
Slide 50: Environmental, Social and Governance (ESG) data
| BACKGROUND MATERIAL Environmental, Social and Governance (ESG) data Total direct and indirect carbon emissions (location-based) TonnesCO2e 4,538 2,082 2,501 6,436 5,386 Total direct and indirect carbon emissions (market-based) Tonnes CO2e 3,924 1,506 4,287 9,376 7,583 Car travel TonnesCO2e 898 724
Slide 51: Responsible investment
| BACKGROUND MATERIAL Responsible investment 2024 KPI 2030 milestone 2022 results Allexternal asset managers are UN PRI signatories ESG is an integrated part of the (esac AR aS iss investment process across all asset External managers External managers responsibility integration must be "best practi
Slide 52: Q3 2023 actual and Consensus 2023-2025
6) | BACKGROUND MATERIAL Q3 2023 actual and Consensus 2023-2025 52 Pm | re. Reported Gross premiums earned Insurance service result Investment income Other income and costs Pre-tax Net profit Claims ratio Expense ratio Combined ratio Large Claims Weather Claims Run off Result Discounting Underlying
Slide 53: Appendix
Slide 54: Group (IFRS 17)
| APPENDIX Group (IFRS 17) Insurance revenue (DKKm) Combined ratio (%) 100 40,000 34,814 90 86.8 30,000) pore 23,442 25,369 84.4 843 83.8 20,000 80 10,000 70 ° 2019 2020 2021 2022 60 2019 2020 2021 2022 Claims ratio, net of reinsurance (%) Expense ratio (%) 80 20 18 75 73.8 71.0 70.9 703 13.4 13.3 1
Slide 55: Private (IFRS 17)
@ | pprennix Private (IFRS 17) Insurance revenue (DKKm) Combined ratio (%) 25,000 22,776 100 20,000 “KA 15,096 16 35a oD 83.8 83.9 84.1 829 15,000 5 80 10,000 70 5,000 3 60 2019 2020 2021 2022 50 2019 2020 2021 2022 Claims ratio, net of reinsurance (%) Expense ratio (%) 90 20 80 18 70.8 71.2 72.0 70
Slide 56: Commercial (IFRS 17)
| APPENDIX Commercial (IFRS 17) Insurance revenue (DKKm) Combined ratio (%) 10,000 8,407 ao) 8,000 a 88.4 825 82.9 82.7 6,000) 4,195 4,978 5,350 80 4,000 70 2,000 0 60 2019 2020 2021 2022 50 2019 2020 2021 2022 100 20 +0 19 657 66.3 tas 67.0 18 ; 60 7 16.8 16.6 te 16 15.9 40 20 14 2019 2020 2021 202
Slide 57: Corporate (IFRS 17)
| APPENDIX . Corporate’ (IFRS 17) 6,000 5,000 4,000 3,508 3,366 3,464 3,631 3,000 2,000 1,000 0 2019 2020 2021 2022 100 90 85.9 80 79.9 16.6 79.3 70 60 50 40 2019 2020 2021 2022 57 | *Morethan 100 employeesor morethan 100mturnover Combined ratio (%) 110 100 90 8 7 6 5 sS8as 97.4 : ; L Z 2019 2020 20
Slide 58: Geographical combined ratio (IFRS 17)
@ | pprennix Geographical combined ratio (IFRS 17) 100 95 91.1 90 88.1 80 86.8 87.2 85 85.0 80.5 80 7913) ° 7.2 70 70 65 60 60 2019 2020 2021 2022 2019 2020 2021 2022 Norway (%) = = 100 92.7 92.3 90 86.8 85.0 80 70 60 2019 2020 2021 2022
Slide 59: Tryg has a long and proud history
@ | pprennix Tryg has a long and proud history, with the 2021 RSA acquisition pushing the boundaries even further 2022 Demerger 1 April Completed separation ci of RSA Scandinavia into ex, 2005 2018 DK, NO, SE 4 is TryeVestais listed v8 receives the final iM onthe OMX Nordic 4PProval of the Alka ————
Slide 60: Macroeconomic forecasts
@ i pprenvix 60 Macroeconomic forecasts y 2023 (forecast) Denmark GDP erowth 27 17 1.2 Private consumption 16 04 16 Unemployment 26 29 3.2 Consumer price index 77 4.0 3.2 Wages 3.6 43 56 Sweden 2024 (forecast) GOP growth 29 0.2 17 Private consumption 19 1.6 17 Unemployment. 75 75 78 Consumer price i