For more information, please visit our website on Annual Report 2014 in brief. Today for tomorrow.

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1 For more information, please visit our website on Annual Report 2014 in brief. Today for tomorrow.

2 Key figures of the consolidated annual account Topic of illustrations Non-life and life in CHF millions Change in % Gross premiums 3, , Net earned premiums 3, , Net technical reserves 9, , Technical reserves for the account and risk of third parties Financial investments 15, , Financial investments for the account and risk of third parties Underwriting result Financial result excl. special effect divestment of stake in Nationale Suisse Special effect n/a divestment of stake in Nationale Suisse Financial result incl. special effect divestment of stake in Nationale Suisse Consolidated annual profit Consolidated capital and reserves 4, , Return on equity excl. special effect divestment of stake in Nationale Suisse 10.5% 10.0% Non-life Gross premiums 2, , Net earned premiums 2, , Net technical reserves 5, , Underwriting result Financial result excl. special effect divestment of stake in Nationale Suisse Special effect n/a divestment of stake in Nationale Suisse Financial result incl. special effect divestment of stake in Nationale Suisse Result after tax Net claims incurred 63.3% 63.0% Net cost ratio 27.2% 27.0% Net ratio of other underwriting costs 1.4% 1.4% (incl. surplus allocated to policyholders) Net combined ratio 91.9% 91.4% Life Gross premiums Net earned premiums Net technical reserves 4, , Technical reserves for the account and risk of third parties Underwriting result Financial result Result after tax Net cost ratio 15.8% 14.1% Change in percent (%) of a profit and loss account figure positive impact on result (+), negative impact on result ( ) n/a: not applicable From the start, our company s culture has been characterised by a sense of responsibility and by long-term thinking. Thinking ahead, however, requires a keen awareness of what is happening today. Because it matters to us what the world of tomorrow will look like, we support the development of creative and innovative ideas and explore new approaches, technology and methods. Our aim is to make a contribution towards a better future for our society and the coming generations. The pictures in this report offer glimpses of how Swiss Mobiliar meets its corporate responsibility. They present a cross-section of our various commitments and projects for the benefit of society as a whole, particularly in the fields of natural hazards and their prevention, climate research, data analysis and innovation processes. All photographs were taken early in the morning, symbolising the onset of a new day, the moment for embarking on something new. After all, what we do or don t do today invariably has an impact on tomorrow s success. Further information at 2 3

3 Financial year 2014 in brief Swiss Mobiliar achieved an outstanding result in At operational level, the growth process continued and a large number of new customers were acquired. Dear Customers Swiss Mobiliar has posted an excellent result for the financial year 2014, with a profit of CHF million. An important factor was the capital gain amounting to CHF million achieved through the divestment of our stake in Nationale Suisse. In non-life business, we remain very well positioned in the market with our attractive array of products, benefits and services. With a 3.7% increase, we again managed to markedly raise our premium volume and to clearly exceed the overall market growth of 1.0%. In the life sector, we maintained our position as market leader in the reinsurance of pension fund institutions and in pure risk life insurance for private individuals. Growth in individual life and pension insurance with recurring premiums continued unabated. The bulk of the increase in the premium volume in this area came from savings-oriented life insurance and, in particular, from unit-linked life insurance with guarantee was a very demanding year both from an economic and a geo-political point of view. Nevertheless, the recovery of the global economy continued thanks mostly to the ongoing expansive monetary policy of the world s most important central banks. Switzerland recorded solid growth, with domestic demand once more constituting a vital pillar. The contribution of financial operations to Swiss Mobiliar s profit was significantly higher than in the previous year. Markus Hongler, CEO; Urs Berger, Chairman of the Board of Directors We are well prepared for the challenges presented by new technology. By supplementing our business model in a carefully targeted way, we combine tradition with innovation and expand our services in line with digital developments. For Swiss Mobiliar, this means primarily strengthening our brand promises of customer proximity and uncomplicated claim handling by making appropriate use of new digital possibilities. Altogether, almost 1.7 million private individuals and companies put their trust in Swiss Mobiliar. We would like to take the opportunity here to say thank you. A special thank-you also goes to our employees. Their great commitment is the foundation on which we will, jointly, build a successful future. Urs Berger Chairman of the Board of Directors Markus Hongler CEO 4 5

4 Partnership and responsibility Sharing success Swiss Mobiliar conducts its insurance and investment operations prudently, independently, with a strong capital base and a long-term perspective. Swiss Mobiliar lets customers share in its success and ensures the company s survival and further growth on the strength of its own resources. Swiss Mobiliar the first private insurer in Switzerland was founded as a cooperative (mutual company) in It has maintained this legal form to this day. Nowadays, the mutual structure constitutes an umbrella over a powerful and efficient business organisation. As a consequence of this structure, the business approach remains focused primarily on customers, who share in the company s profits, instead of surpluses going as dividends to shareholders. Swiss Mobiliar puts its client focus into practice and ensures customer proximity through a tightly-knit network of 78 general agencies at around 160 locations all over Switzerland. Our pledge to customers is that we are Switzerland s most personal insurer, be it in advisory services, at contract conclusion or in the case of a claim, irrespective of the channel through which the contact is conducted. The philosophy resulting from the mutual structure also characterises the way business is conducted, with a long-term perspective as one of its key features. Sustainable, self-financed insurance operations require far-sighted strategies with a long-term focus, since losses can vary substantially from one year to another and from one decade to the next. As a company not listed on the stock exchange, Swiss Mobiliar needs to hold a healthy amount of capital to be able to bear such large fluctuations in losses incurred and to cope with unfavourable financial market developments. The risks we assume in our insurance business and financial investments are carefully balanced with the capital we hold. In terms of capital base, Swiss Mobiliar Group is the number one among Swiss primary insurance companies. A modest dividend is regularly paid to the cooperative as Swiss Mobiliar s sole owner. Primarily, however, it is the customers who share in the company s success. To remain successful in future, we are investing considerable means in the development of our business. Surplus participation also for non-life customers It is a widespread practice for life insurance clients to receive bonuses, i.e. shares in the surplus achieved. However, Swiss Mobiliar s policy of sharing profits with large segments of customers in the non-life sector, too, is unusual. Between July 2014 and June 2015, all customers with a MobiCar vehicle insurance or a MobiPro business and buildings insurance benefit from a 10% discount on their premiums. Overall, around CHF 140 million will thus be returned to our policyholders. From mid-2015, for one year, a total of approximately CHF 144 million will be used for a 20% premium reduction for policyholders of a MobiCasa household contents and buildings insurance. Payments to non-life insurance customers incl. accompanying measures, in CHF millions /12 12/13 13/14 14/15 15/16 6 7

5 07:26 Monday Zurich, ZH Dr. Irena Pletikosa Cvijikj Scientific Leader Mobiliar Lab for Analytics, ETH Zurich Global data traffic is expected to increase fourfold between 2013 and While this leads to challenges in terms of analysing large volumes of data, at the same time it provides great opportunities for the companies from various sectors. Companies are not the only ones to benefit from the value of big data. Individuals and society can also gain value through new insights and services that contribute to the quality of life. This side of big data is the focus of our research. I wish that in the future, Switzerland aims to find an optimal balance between differing demands and provide value to the Swiss society. 8

6 06:47 Thursday Bellinzona, TI Michele Masdonati General Agent Swiss Mobiliar, Bellinzona The area in and around Bellinzona has always been exposed to natural hazards. It s therefore good that so much has been invested in protective construction in the region. As a result, there is now considerably less damage caused by mudflow and floods. We are proud that the protective measures have been implemented so swiftly and that we can thereby provide real help for the population. I hope that other regions in Switzerland which are threatened by natural hazards can also benefit from such swift and effective preventive measures for the protection of the local population. 10

7 08:12 Sunday Wildhaus- Alt St. Johann, SG Jürg Walt Fire brigade chief, Wildhaus-Alt St. Johann The new flood relief channel and other constructional prevention measures have already proved their worth several times. High water now flows through the channel as planned and no longer through the village. However, there is no such thing as one-hundredpercent security. After all, nature is unpredictable. In future, we want to extend appropriate security measures to other hazard zones, too, in order to keep consequential damage as low as possible. My hope is that we will continue with such forward-looking and long-term planning in Switzerland, so that the high security level can be maintained. 12

8 08:06 Wednesday Lausanne, VD Prof. Dr. Marilyne Andersen Dean of the Faculty of Architecture, Civil and Environmental Engineering and Professor of Sustainable Construction Technologies at EPFL Lausanne By 2050, around two-thirds of the world s population will be living in cities. Turning these into a livable environment for all inhabitants is one of the major challenges of the 21 st century. What factors will determine communal living in future is largely up to us. To this end, we need an interdisciplinary approach, coordinated measures and an ongoing dialogue between research, education and practice. My hope for the Switzerland of tomorrow is that we can reconcile diverse requirements and create urban space that has something to offer to everyone. 14

9 Non-life Swiss Mobiliar achieved strong premium growth in 2014, once again clearly exceeding the average market increase. In a highly competitive insurance market, we again consolidated our position. Swiss Mobiliar s premium volume rose by 3.7%, which, as in previous years, was distinctly above the market average. Of the relevant overall market growth of 1.0%, no less than 64.5% was achieved by our company. Strong new business figures and a low cancellation rate compared to the overall market were the prime factors contributing to this result. We managed to raise our market share particularly in the motor, liability and property insurance segments. Growth relative to the market Non-life business (difference in percentage points) Market Market (basis: premium reporting, Swiss Insurance Association SIA) 2014 Reasons for success Swiss Mobiliar, with its mutual corporate structure, has always stood for trust, reliability, solidity and local presence. Our 78 general agencies are characterised by their proximity to customers and their high level of competence in matters of contract conclusion and claims settlement. Situated at around 160 locations and staffed by well qualified and highly motivated employees, they ensure top-notch, personalised services to customers. Swiss Mobiliar products are upgraded on an ongoing basis and are regularly aligned to customer expectations. This is made possible by our modern product development, rating and contract management systems, which enable swift, differentiated and efficient adjustments of our rates and benefits to changing market conditions. Moreover, we maintain successful relations with distribution partners, thereby supplementing our product range in a targeted fashion. Innovation and process optimisation Our claim is that we offer customers first-rate products with a good price-benefit ratio. And we aim to continue to set market standards with our products and services. We make use of technology available to enhance automation and the speed of back-office processes, and plan to increasingly apply such technology at interfaces with customers, too, for future product generations. Substantial added value for clients can, for example, be achieved by the use of telematics systems for vehicle and buildings security, as well as by an extended range of applications (apps) in mobile communication. Loss experience The 2014 loss experience proved favourable overall. The ratio of claims incurred to premiums amounted to 63.3% (2013: 63.0%), thereby remaining roughly in line with the average of the past ten years. Claims for damage caused by hail were distinctly lower than in the previous years. Apart from a few local storms in summer and autumn with a limited range of impact, there were no major natural hazard occurrences. Three fairly large storms in July generated losses of around CHF 18 million. After the devastating storms and floods in 2005 and 2007, prevention measures were initiated for which Swiss Mobiliar provided substantial start-up funding. They have since proved their worth by forestalling largescale damage from flooding

10 Life Growth in individual life and pension insurance with recurring premiums was maintained in line with the previous year. In the occupational pension sector, the premium volume recorded a decline. Whereas economic developments in Switzerland proved stable, the situation in the euro zone remained subdued. The European Central Bank s interest rate policy will continue to impact the Swiss economy, and there is no end to the low interest rate environment in sight. Clients investment behaviour is marked primarily by a quest for security without, however, the aim for an adequate return being abandoned. Individual life and pension insurance Business with recurring premiums in particular contributed to the growth in premium volume. We successfully expanded our market share in disability insurance and in the segment of savings-oriented products with recurring premiums. The increase in savings-oriented insurance was due primarily to our unit-link life insurance with built-in guarantee. Single-premium business receded slightly in an unappealing interest rate environment. Occupational pension insurance The annual premium volume in occupational pension business was lower than in the previous year as a result of the lack of economic growth and lack of growth in the number of persons to be insured. The trend towards more favourable net rates also had an important impact on the premium volume. The total of single premiums for the purchase of retirement pensions, too, registered a decline year on year. Reasons for success Each product in our range of offers for private individuals is structured in a readily understandable way. Swiss Mobiliar benefits from a very good image and is firmly established in the market thanks to its decentralised organisation. In the occupational pensions field, our legal quote in group insurance has been above-average for many years. Surpluses for customers The underwriting result incorporates the surplus participation for policyholders totalling CHF 43.3 million. In group insurance subject to legal quote, we passed on 100% of the returns on investment to the pension fund institutions in the form of pensions, lump-sum benefits, surplus participation and reserves. Surplus participation in group business subject to legal quote 100 % 98 % 96 % 94 % 92 % 90 % Ratio Swiss Mobiliar Life Median ratio competitors (if collected/available) Minimum ratio required by law Benefits Compared to the previous year, death benefits rose both in individual and group (occupational pensions) insurance. In individual insurance, benefits paid for disability increased slightly. Disability benefits augmented again in group insurance, as the number of persons with long-term disability continued to rise

11 Swiss Mobiliar as employer We look ahead and are constantly evolving. In doing so, we remain the most personal insurance company in Switzerland. Committed employees are the key to success. From the start, Swiss Mobiliar has been known as a reliable partner. We are proud of this. Swiss Mobiliar s staff members show above-average commitment in what they do. Swiss Mobiliar as employer In 2014, the Swiss journal Bilan named Swiss Mobiliar the best employer out of 83 companies in French-speaking Switzerland. In the Universum Swiss Student Survey 2 conducted again in 2014, around 11,000 students from various disciplines were asked to choose the most popular employer in Switzerland. Rated 73 rd overall, Swiss Mobiliar again ranked among the 100 most attractive employers for business and economics graduates in Switzerland. On the basis of our mutual corporate structure, we pursue a sustainable, future-oriented staff policy. Employees are treated fairly and with due regard to their family commitments. Moreover, they participate in the company s success. We currently employ people from a total of 28 different nations, and we ensure gender equality. As far as possible, we support flexible and family-friendly working hour models, including home office, part-time work, flexible working hours, job-sharing, top-sharing and unpaid leave. Our in-house crèches offering 52 places in Berne and Nyon are in considerable demand and help make it possible for parents to remain gainfully employed. Basic and advanced training Swiss Mobiliar offers a variety of specialist and management training courses. Of our overall personnel costs, 3.3% are dedicated to training and personal development. On average, staff members spend 3.1 days a year at internal basic or advanced training events. Fostering trainees and talented young employees We put great emphasis on practical training for trainees and up-and-coming young employees. Swiss Mobiliar provides positions for trainees throughout Switzerland. In 2014, a total of 325 apprentices and trainees were employed at our head offices and general agencies, in the fields of insurance (graduating with a VBV insurance assistant certificate), commerce, IT, facility management and social care. Education: Key figures trainees and insurance assistants with a VBV certificate Number in % Number in % Total Women Men Final exams passed Employment continued Attractive pension fund benefits We maintain staff pension funds with a solid financial base. Swiss Mobiliar Group manages its employees occupational pension provisions (BVG/LPP) via three pension fund institutions. One of them covers employees at the head offices and the general agencies, with 60% of the risk and savings contributions being borne by the company. The company bears the costs for AHV/AVS bridging pensions, too, in the case of early retirement. Swiss Mobiliar also assumes the operational costs, except in the case of external remuneration (auditors, pension fund specialists) and charges

12 Corporate Social Responsibility Solidarity, sustainability and a sense of responsibility characterise Swiss Mobiliar s conduct vis-à-vis all its stakeholders. Swiss Mobiliar, with its mutual structure, is not driven primarily by the desire for profits, but by the aim of long-term success. We share this success with our customers in the form of profit participation, and with society as a whole through social and ecological projects. In spring 2013, the company decided to set up a Cor porate Social Responsibility (CSR) unit. Its vision and mission statement underline Swiss Mobiliar s commitment to the country as a whole, and the fact that its support for research and its non-business-oriented projects make it a credible opinion leader on specific subjects. Mobiliar s commitment towards society Mutuality and innovation Key strategic topics All our undertakings are based on Swiss Mobiliar s tradition as a mutual company and the related values. People are invariably at the heart of our projects, be it in a personal or business context. The ultimate aim of our work is to strengthen conditions that enable people to take responsibility themselves for the building of a sustainable and creative future. Dealing with the topic of sustainability requires certain skills. Art and creativity foster such skills. We want to reinforce Swiss Mobiliar s brand claim, which says that we are close to customers, personal, uncomplicated in the event of a claim and a socially responsible and committed company. Sustainability Given our mutual structure, it is our duty to act in a responsible and sustainable manner in our core business, in the running of our organisation and in our use of resources. The values laid down in our mission statement shape our corporate identity and thereby also the way we interact with our stakeholders. Prevention Prevention projects Mobiliar Lab for climate risk and natural hazards, University of Berne Prevention + Art Art and Culture Collection Exhibitions Outreach Promotion Prevention Creativity Sustainability Solidarity Company and Work Mobiliar Forum Thun Sustainability at Swiss Mobiliar Decentralised projects Living and Community EPFL Urban Design & Sustainable Living Mobiliar Lab for Analytics, ETH Zurich Our prime obligation is towards our customers. Their trust is of key importance to us and one of our most significant success factors. Building and maintaining this trust is, to a large extent, the responsibility of our 78 general agencies, which ensure personal contacts with clients at around 160 locations throughout Switzerland. We work with reliable products, and through our product design we create incentives for a conscious and responsible use of resources. Our financial investment policy is in long-term alignment with our insurance business liabilities, and aims to achieve stable and sustainable returns for both our company and our customers. When investing in real estate and when purchasing, building and maintaining premises of our own, we also take into account not only economic, but also environmental and social factors

13 Research of climate risks and natural hazards We have expanded our successful collaboration with the University of Berne in the field of climate research and founded Mobiliar Lab, which explores natural hazards. The main emphasis is on floods, storms and hail. In the newly created lab, researchers and Swiss Mobiliar employees work hand in hand. Their findings help make our risk and loss management more efficient. Mobiliar Lab for Analytics The annual increase in the global data volume is staggering. This raises the questions of how such data can be used for future-oriented planning and acting, and what insights can be gained through data-analytical procedures. Mobiliar Lab for Analytics was founded on the joint initiative of Swiss Mobiliar and ETH Zurich. The aim of its research work is to exploit the potential of big data and advanced analytics for insurers and to draw conclusions for the benefit of the public in general. La Chaire Mobilière Swiss Mobiliar is supporting a new chair for urban design and sustainable life studies at the EPFL (École polytechnique fédérale de Lausanne). Its target is to gain a profounder understanding of the interaction between growth and quality of life in cities, what contributes to well-being in a city and how such factors can be strengthened, and so be better equipped to cope with current and future problems of urban life. concept is based on the interplay of spatial design and method. The method concerned comes from Design Thinking, a user-oriented innovation process that was developed at Stanford University in California s Silicon Valley. Swiss Mobiliar s commitment to the arts Swiss Mobiliar s tradition as a mutual company includes upholding corporate responsibility and forward-looking values such as sustainability and solidarity. Promoting and integrating arts and culture, for instance through outreach projects, are important elements of the company s social commitment. Our art collection counts over 1,000 works, a selection of which are permanently on display at the head offices in Berne and Nyon. The Prix Mobilière for young Swiss artists has been awarded annually since 1996, which makes it the oldest art award to be bestowed by a Swiss insurance company. Anniversary Foundation and Award Fund Swiss Mobiliar s Anniversary Foundation, set up in 1976, supports science and research projects, cultural projects from the disciplines of fine arts, performing arts, film and classical music, as well as heritage projects such as the renovation and restoration of historic buildings. Only projects in Switzerland are supported. Through its Award Fund, Swiss Mobiliar provides financial support to a large number of social, cultural and charity activities. Mobiliar Forum Thun Customer requirements are changing at an ever faster pace and new technologies generate new needs. And the more globalisation takes effect, the fiercer competition becomes. For companies to survive in such circumstances, they need, more than ever before, the ability to innovate. Innovative skills and creativity are something we cannot insure at Swiss Mobiliar, but we can help create conditions that are conducive to innovation. Our workshop 24 25

14 Prevention of natural hazards Capital base compared to competitors Swiss Mobiliar continues to be profoundly committed to the prevention and research of natural hazards. In 2014, we provided financial contributions to flood protection projects in 13 municipalities. The creation of dams and sediment traps and the relocation of brooks will help prevent or at least reduce future damage to infrastructure, property and farmland. Support for prevention projects Projects completed Projects approved Swiss Mobiliar exceeds the legal requirements many times over. Swiss Mobiliar Group fulfils the capital requirements pursuant to Solvency I with a ratio of 626%. Regularly conducted sensitivity analyses measure the impact of extremely negative market development scenarios on our solvency margin. The risk bearing capacity determined through the Swiss Solvency Test (SST) under Solvency II also shows that Swiss Mobiliar Group and its individual companies all have great excess capacity in terms of capital. The Group s SST ratio, calculated on the basis of the internal model assessed and provisionally approved by FINMA, comes to over 300%. A system with intervention thresholds regularly compares the capital requirements with the capital available and ensures that measures are taken at an early stage to prevent any under-capitalisation. Since the major floods of 2005, we have participated in 79 projects by making substantial amounts available as initial or partial project funding. At the end of 2104, this financial commitment totalled around CHF 22 million. Primary insurers active in Switzerland (groups and conglomerates) Share of equity ¹ in balance sheet total as at Solvency I Solvency II Rating calculated according to SST principles Solvency II principles (Standard & Poor s) Mobiliar 26.4% 626% > 300% Allianz Group 7.9% 181% 191% AA Allianz Suisse 9.7% 335% AA- AXA 8.1% 266% n/a A+ Bâloise 7.3% 354% A Generali 4.8% 164% n/a A-² Helvetia 10.3% 216% % A Swiss Life 6.7% 269% A- Vaudoise 19.7% 526% > 200% Zurich Insurance Group 9.1% 307% 215% AA- The above table shows solvency ratios and ratings as available on 8 April ¹ incl. minority interests ² rating agency: A.M. Best n/a not applicable does not have itself rated according to statements by the company, the requirements are met 26 27