UNIQA Insurance Group AG · VIE:UQA
UNIQA Insurance — FY2020 Earnings Presentation
23 slides from UNIQA Insurance's earnings presentation, Apr 8, 2021
Slide 1: Solvency Capital and Embedded Value 2020
UNIQA Insurance Group AG Solvency Capital and Embedded Value 2020 8 April 2021 Kurt Svoboda, CFRO
Slide 2: Executive Summary
EXECUTIVE SUMMARY Solvency Capital Embedded Value New Business Life, Health & Solvency Unrestricted Value Pension Fund Capital Ratio1 Tier 1 Capital MCEV2 EUR 170% 74% -5.3% 111m Impact ex-AXA Free Surplus Standard & Generation3 New Business on Solvency Poor’s rating Margin Capital Ratio EUR -26% A-
Slide 3: Content
CONTENT I. Group Solvency Capital ▪ Risk Strategy ▪ Results ▪ Sensitivities and other analysis II. Market Consistent Embedded Value ▪ Results ▪ Sensitivities and other analysis III. Appendix ▪ SCR Methodology ▪ MCEV Methodology ▪ Assumptions ▪ Glossary & Disclaimer 3
Slide 4: Key Elements of our Risk Strategy
I. GROUP CAPITAL REQUIREMENT Risk Strategy Key Elements of our Risk Ambition Strategy 170% ▪ Ambition is to have SCR Ratio above 170% Action ▪ We focus on underwriting risks and take Take measures to market/credit risks only to the extent reduce risk necessary 135% ▪ Target market risk share of tota
Slide 5: Features of UNIQA's capital position
I. GROUP CAPITAL REQUIREMENT SII capital ratio SII capital position1 EUR mn By Risk Module By Segment By Region2 221% 170% Health underwriting Non-Life SEM EEM Life CEE Non-Life underwriting 4% 3% 9% 2% 4.865 4.471 16% WEM 31% 5% Life underwriting 45% 2.628 2.203 18% 57% 5% 24% 81% Counterparty defa
Slide 6: Details on SII Capital Requirement: SCR development by risk module
I. GROUP CAPITAL REQUIREMENT Details on SII Capital Requirement SCR development by risk module EUR mn SCR increases by 425 EUR mn 174 154 621 -1.128 ▪ Increase of market risk driven by higher spread- and concentration risk (details slide 9) 65 -331 706 201 ▪ Life underwriting risk grows mainly in th
Slide 7: Own Funds variation analysis
I. GROUP CAPITAL REQUIREMENT Own Funds variation analysis Own funds development ▪ Operating earnings driven by new business and in-force EUR mn business coming from Life & Health as well as impact of UNIQA 3.0 strategy 415 ▪ The reduction coming from market variance is the result of a negative devel
Slide 8: IFRS reconciliation and financial leverage
I. GROUP CAPITAL REQUIREMENT IFRS reconciliation IFRS reconciliation (EUR mn) 2019 2020 Financial leverage EUR mn IFRS total equity 3.420 3.475 - Goodwill -291 -353 26% 37% - Intangible assets and VBI -226 -630 - Deferred acquisition costs (DAC) -1.124 -1.116 + Revaluation (after deferred taxes) 2.2
Slide 9: Market Risk Profile
I. GROUP CAPITAL REQUIREMENT Market Risk Profile SCR market risk profile EUR mn 28 20 5 27 8 12 ▪ Decrease of interest rate risk in low interest rate environment due to asset-liability management activities 426 271 -1.393 ▪ Increase both in equity risk as well as property risk 978 due to higher expo
Slide 10: Underwriting Risk Profiles
I. GROUP CAPITAL REQUIREMENT Underwriting Risk Profiles Life underwriting risk Health underwriting risk Non-life underwriting risk 2% Disability risk 4% 4% Expense risk 11% 9% Other 9% 10% 4% 5% CAT risk 5% Transport 5% 3% Mortality risk 8% 4% 4% 7% Accident Longevity risk 20% Mortality risk 24% 10%
Slide 11: Sensitivities: Impact on SII capital position
I. GROUP CAPITAL REQUIREMENT Sensitivities Impact of sensitivities on SII capital postion Percent Delta to base value, pp Base value 170 ▪ Interest rate sensitivities: stress applied to liquid part of the curve (negative and non-negative), extrapolation to UFR Interest rates +50 bps 193 +23 ▪ Equity
Slide 12: Content
CONTENT III. Group Solvency Capital ▪ Risk Strategy ▪ Results ▪ Sensitivities and other analysis II. Market Consistent Embedded Value ▪ Results ▪ Sensitivities and other analysis III. Appendix ▪ SCR Methodology ▪ MCEV Methodology ▪ Assumptions ▪ Glossary & Disclaimer 12
Slide 13: Life, Health & Pension Fund Embedded Value 2020
II. MARKET CONSISTENT EMBEDDED VALUE Results ▪ Total Life, Health & Pension Fund Embedded Value Life, Health & Pension Fund Embedded Value 2020 decreased by -5.3% (net of dividends and foreign In EUR mn exchange effects) to EUR 3,419mn Austria CEE2 Total ▪ Embedded Value increases by EUR 876mn to EU
Slide 14: New Business Value
II. MARKET CONSISTENT EMBEDDED VALUE New Business Value New Business Value New Business Margin Present Value of NB Premiums In EUR mn As a % of PVNBP In EUR mn Recurring Premium Single Premium 2019 * * 92 64 156 +4.7% 2019* 3,092 253 3,345 2020 65 46 111 +3.6% ** 2020 2,871 241 3,112 NBV ex-UNIQA NB
Slide 15: Analysis of Change: In-Force Business
II. MARKET CONSISTENT EMBEDDED VALUE Analysis of Change: In-Force Business 460 Restatement and opening adjustments include: 131 Rollforward ▪ Capital and dividend flows 111 776 3,611 ▪ Foreign exchange variance 329 Assumptions 1 3,419 ▪ Acquired business for ex-AXA and Variance -764 Increased New Bu
Slide 16: Analysis of Change: New Business
II. MARKET CONSISTENT EMBEDDED VALUE Analysis of Change: New Business 14 64 156 153 2 -3 28 ▪ Restatement change includes acquired ex-AXA Life 31 111 and Pension Fund Business, which is the most 92 dominant cause for the increase in NBV and PVNBP NBV ▪ Minor effects from foreign exchange variances a
Slide 17: Life, Health & Pension Fund Sensitivities
II. MARKET CONSISTENT EMBEDDED VALUE Life, Health & Pension Fund Sensitivities in EUR mn Change in Embedded Value Change in New Business Value ▪ Changes in interest rates remain the most relevant sensitivities for the Life, Health & Pension Fund 2020 20191 2020 20191 Embedded Value Base value 3,419
Slide 18: Content
CONTENT III. Group Solvency Capital ▪ Risk Strategy ▪ Results ▪ Sensitivities and other analysis II. Market Consistent Embedded Value ▪ Results ▪ Sensitivities and other analysis III. Appendix ▪ SCR Methodology ▪ MCEV Methodology ▪ Assumptions ▪ Glossary & Disclaimer 18
Slide 19: SCR Methodology
III. APPENDIX SCR Methodology ▪ Disclosure of Solvency Capital Requirement (SCR) results: ▪ UNIQA discloses SCR results 2020 on the basis of the principles and requirements as defined in the Solvency II framework directive as well as the corresponding delegated regulation ▪ UNIQA uses an approved pa
Slide 20: MCEV Methodology
III. APPENDIX MCEV Methodology ▪ Disclosure of Life & Health Market Consistent Embedded Value (MCEV) results: ▪ UNIQA discloses 2020 Life, Health & Pension Fund results on the basis of the Market Consistent Embedded Value (MCEV) principles ▪ Includes MCEV using bottom-up, market consistent methodolo
Slide 21: Economic Assumptions
III. APPENDIX Economic Assumptions Reference EUR CZK HUF PLN RUB HRK Exchange rates and Exchange rate Tax rate rates1 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 tax rates 2020 2019 2020 2019 1 year -0.62% -0.42% 0.39% 2.15% 0.29% 0.02% -0.15% 1.02% 3.49% 6.20% -0.26% -0.04% Austria
Slide 22: Glossary
III. APPENDIX ABS Asset Backed Securities Glossary ALM Asset Liability Management ANAV Adjusted Net Asset Value CAT Catastrophe Risk CDR Counterparty Default Risk EC European Commission EV, MCEV Embedded Value, Market Consistent Embedded Value FS Free Surplus Health NSLT Health Not Similar to Life T
Slide 23: Disclaimer
III. APPENDIX Disclaimer ▪ 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 described or implied in forward-looking statement