Swiss Re Ag · SIX:SREN
Swiss Re — Monte Carlo Media Briefing 2014
28 slides from Swiss Re's conference presentation, Sep 15, 2014
Slide 1: Monte Carlo
General Public Release Monte Carlo Media briefing, Monte Carlo, 15 September 2014 Media briefing | Monte Carlo | 15 September 2014
Slide 2: Today's agenda
General Public Release Today's agenda Welcome and introduction Christian Mumenthaler We're smarter together CEO Reinsurance Casualty: How we use applied Jayne Plunkett expertise to support clients Division Head Casualty Underwriting Michel M. Liès Summary & Outlook Group CEO Media briefing | Monte C
Slide 3: Welcome and introduction
General Public Release Welcome and introduction Michel M. Liès, Group CEO Media briefing | Monte Carlo | 15 September 2014 3
Slide 4: Our strategy is successful and remains unchanged; our focus is on execution
General Public Release Our strategy is successful and remains unchanged; our focus is on execution Outperform our peers Strategic goal: • Reinsurance • Asset Management The leading • Admin Re® player in the Current wholesale position Smart expansion re/insurance • Corporate Solutions industry • Long
Slide 5: The Monte Carlo question: pricing trends
General Public Release The Monte Carlo question: pricing trends…. Prices High ? Low ? ? Factors to increase prices1 Factors to decrease prices1 Drivers of re-/ insurance prices Media briefing | Monte Carlo | 15 September 2014 5
Slide 6: Major drivers of increasing demand for insurance
General Public Release Major drivers of increasing demand for insurance Agriculture Nat Cat Infrastructure Life Health 6 Media briefing | Monte Carlo | 15 September 2014 6
Slide 7: We're smarter together
General Public Release We're smarter together Christian Mumenthaler, CEO Reinsurance Media briefing | Monte Carlo | 15 September 2014 7
Slide 8: Our brand promise: We're smarter together
General Public Release Our brand promise: We’re smarter together Media briefing | Monte Carlo | 15 September 2014 8
Slide 9: We occupy the top or next-to-top slot in the Flaspöhler client survey
General Public Release We occupy the top or next-to-top slot in the Flaspöhler client survey Best overall (North America): 1st Best overall (EMEA): 1st Best overall (Asia): 1st Best overall (Latin America): 2nd Source: Industry Flaspöhler survey 2012/2013 Media briefing | Monte Carlo | 15 September
Slide 10: Our strategy is to create value through differentiation and targeted growth
General Public Release Our strategy is to create value through differentiation and targeted growth DELIVER GAAP & EVM profit DIFFERENTIATE GROW Data High Growth Markets R&D Structuring & UW Regionals & Nationals Client Relationships Policyholders/ Casualty Society Global Presence Health Brand L&H Pr
Slide 11: We have a "high touch" interaction model
General Public Release We have a "high touch" interaction model Visualisation of a client relationship Over the last four years… with a large global client • …we have documented approx. Swiss Re 2000 meetings and 1000 phone calls between Swiss Re employees (87 ) and those of a global Client (99 ) In
Slide 12: Example of a Global P&C Client
General Public Release We deliver much more than just reinsurance to our clients Full spectrum of traditional Knowledge exchanges, on- Directly supporting client's and innovative reinsurance site and virtual workshops, strategy with joint product solutions. trainings, etc. development, capital manag
Slide 13: We engage in preferred partnerships with global clients
General Public Release We engage in preferred partnerships with global clients to grow their underwriting, business and product offerings Global flood data Casualty services Nat cat steering Capital markets modelling support Benefits: Benefits: Benefits: Benefits • comprehensive access • regular eng
Slide 14: Casualty: how we use applied research to support clients
General Public Release Casualty: how we use applied research to support clients Jayne Plunkett, Division Head Casualty Underwriting Media briefing | Monte Carlo | 15 September 2014 14
Slide 15: We are growing our casualty portfolio again
General Public Release We are growing our casualty portfolio again Portfolio development and rates Steering and growth approach US GAAP Gross Earned Premium (USD bn) 7 140 • We manage the business according 6 130 to the pricing cycle 5 120 • We will continue to pursue a profitability-focused expansi
Slide 16: P&C Reinsurance: 2014 renewals
General Public Release P&C Reinsurance: 2014 renewals We have carefully increased our casualty book Gross premium volume, treaty portfolio Treaty business up Estimated outcome of Estimated outcome renewals ytd for renewal YTD July treaty renewals YTD July 13% 12% Casualty 32% 42% Nat Cat 25% 19% 1 P
Slide 17: We will broaden our casualty portfolio and continue to build our future
General Public Release We will broaden our casualty portfolio and continue to build our future Casualty strategy Key themes (2 examples) Broaden our portfolio through increased share of wallet and Increasing our new clients capability for Accumulation managing casualty risk accumulations Continue to
Slide 18: We need a forward-looking approach in liability modelling
General Public Release We need a forward-looking approach in liability modelling • Market failures lead to liability crises (e.g. USA mid '80s, Australia 2000) Inadequate Insurers No cover premiums and withdraw from available for Businesses rise in claims and public liability or many or only at have
Slide 19: Understanding what drives risk in liability is key to underwriting quality
General Public Release Understanding what drives risk in liability is key improving underwriting quality Cat event = "laws of physics" Hazard Vulnerability Values Conditions Loss Earth- Quake Frequency Liability event = "rules of life" Macro Social Legal Loss etc. Conditions environment standards sy
Slide 20: Quantifying tomorrow's loss potential by assessing changes in today's risk landscape
General Public Release Quantifying tomorrow's loss potential by assessing changes in today's risk landscape The Swiss Re Liability Risk Drivers™ (LRD) Liability event Breakdown of New products, Propensity Likelihood of cause & effect emerging risks? to sue? mass litigation? chain into Example: "LRDs
Slide 21: We offer select clients our LRD-based service suite
General Public Release We offer select clients our LRD-based service suite Service suite Expected loss indicator for emerging markets Example expected loss indicator Calculation of expected loss and • Calculation of contribution to expected loss and identification of identification of major risk dri
Slide 22: Summary and Outlook
General Public Release Summary and Outlook Michel M. Liès, Group CEO Media briefing | Monte Carlo | 15 September 2014 22
Slide 23: Secondary market spreads for cat bonds have stabilised
General Public Release Secondary market spreads for cat bonds have stabilised • Abundant Average Secondary Spreads from August 2013 – August 20141 capacity is compressing 8.0% spreads for cat 7.0% bonds in the secondary ILS 6.0% market • Spreads have 5.0% declined until early 2014, but 4.0% stabilis
Slide 24: The industry outlook: Pricing trends
General Public Release The industry outlook: Pricing trends Property: Liability: • Nat cat rates continue to • US insurance rates increasing, no experience pressure, but the clear direction for other segments decrease is expected to slow • Broad rate increases likely in case • Demand for nat cat cap
Slide 25: We know our clients' business and understand their needs
General Public Release We know our clients' business and understand their needs We continue to execute on our strategy while focusing on the bottom line in a softening reinsurance market. There are opportunities! Despite the challenging environment – there are vast protection gaps. Short term pricin
Slide 26: General Public Release Media briefing | Monte Carlo | 15 September 2014
General Public Release Media briefing | Monte Carlo | 15 September 2014 26
Slide 27: Corporate calendar & contacts
General Public Release Corporate calendar & contacts Corporate calendar 2014 7 November Third Quarter 2014 results Conference call 2015 19 February Annual Results 2014 Media Conference 18 March Publication of Annual Report 2014 and EVM 2014 21 April 151st Annual General Meeting Zurich Media Relation
Slide 28: Cautionary note on forward-looking statements
General Public Release Cautionary note on forward-looking statements Certain statements and illustrations contained herein are forward-looking. These statements (including as to plans objectives, targets and trends) and illustrations provide current expectations of future events based on certain ass