Delivering superior customer experiences and stable returns

Transcription

1 Delivering superior customer experiences and stable returns Gjensidige Insurance Group Company presentation March 2015

2 Attractive value proposition - successful in balancing growth and profitability Proven track record Strong position in attractive market place with entry barriers Scalable, hard-to-copy business model and financial flexibility High and stable dividends Strong value creation since IPO driven by NOK bn solid growth, underwriting and cost discipline NOK bn % 20% 10% Equity base Cumulative dividend payments Pre-tax ROE (RHS) % 95% 90% 85% 80% Earned premiums Combined Ratio (RHS) 2

3 Gjensidige is a diversified general insurer Gjensidige Forsikring ASA Diversified product mix Motor 12% Property 33% Norway Nordic Baltics Accident & Health Other 20% General insurance: NOK15.5bn 75% General insurance: NOK 4.3bn 22% General insurance: NOK 0.5bn 3% 35% Pension and Savings AUM: NOK 32.2bn 80 % direct distribution Retail Bank Gross lending: NOK 27.5bn Direct Brokered and tied agents 20% 80% Earnings figures GI in Norway includes the Swedish commercial GI portfolio. Nordic includes all GI business in Denmark and the private GI business in Sweden. 3

4 Market leader in Norway and a strong position in the Nordic/Baltic region Consolidated markets Stable GJF market share development in Norway Market Top 5 Norway 77 % Denmark 64 % Sweden 84 % Finland 86 % Baltic states 69 % If Gjensidige 25 #6 #1 #7 # Tryg Sparebank1 Other Consolidated market shares for the 5 largest players in each market. Position in each country based on Q42014 Norway, Q42013 Denmark, Q42014 Sweden and Baltics. Source: Finance Norway. 25 companies in Other category Q414. 4

5 The Nordic region offers attractive market characteristics - also working as barriers to entry Cost efficient market place* Cost ratio 40% European GI Relatively favourable macro environment 30% Nordic GI Rational listed players 20% Cost efficient distribution 10% Integrated value chains Company High internet penetration Customer Automatic renewals * Source: Latest published figures as at European players: Direct Line, Country entities Generali (France, Italy, Germany), Aviva GI, RSA UK, Ageas. Nordic players: If, Tryg, Sparebank1,TopDanmark, RSA Scandinavia 5

6 Unique strengths to further preserve and enhance Unique strengths Platform for future growth Strong brand Differentiator in a digitalised world Loyal customers Low acquisition costs, high quality portfolio Customer dividend model Gjensidige Gjensidige Foundation Shareholder dividends Customer dividends Unique company specific model supports retention Technological and analytical skills One legacy system, fundamental for applied insight going forward 6

7 Delivering superior customer experiences and stable returns also going forward Targets Critical success factors Return on equity >15 % Combined ratio Cost ratio ~15 % % (~87-90 % discounted) Dividends Nominal high and stable (>70%) Becoming the most customer-oriented general insurer in the Nordic region Customer orientation Attracting customers and building loyalty through superior customer experiences Analytically-driven processes Improving operations through skills, insight and technology Efficient operations Maintaining underwriting, cost and capital discipline 7

8 Five strategic priorities towards 2018 Critical success factors Enhance and expand multichannel distribution Customer orientation Efficient operations Analytically-driven business processes Build dynamic organisational capabilities Develop value-adding services for loyalty and preference Further digitalise business and customer processes Strengthen business intelligence and analytics Customer 8

9 Set for ROE >15 % and high and stable dividends Solid capital position NOK bn Legal perspective Internal, risk-based perspective* Rating-based perspective Capital requirement Capital > Capital requirement Technical buffer Strategic buffer Dividend * Adjusted to reflect 0 % run-off and expected large losses effects Underwriting discipline CR% Q410 Q111 Q211 Q311 Q411 Q112 Q212 Q312 Reported Q412 Q113 Q213 Q313 Adjusted* Balanced investment portfolio 1% 6% 3% 12% 11% 3% 7% 7% 17% 33% Q413 Q114 Money market Bonds at amortised cost Current bonds Money market Other bonds Convertible bonds Current equities PE funds Property Other Q214 Q314 Q414 Match portfolio NOK 34.7bn Free portfolio NOK 21.8bn 9 Target 90-93

10 Strong value proposition Strong culture and proven track record Strong position in attractive market place with entry barriers Scalable, hard-to-copy business model and financial flexibility Return on equity >15 % Combined ratio % (~87-90 % discounted) Cost ratio ~15 % Dividend l Nominal high and stable (>70 %) High and stable dividends

11 Appendix

12 Strong 2014 result - best ever Q4 underwriting result Underwriting result driven by favourable underlying claims frequency, low proportion of large losses and run off gains Good underlying development in Pension and Savings. Affected by one-off expense of NOK 28.6m Good underlying development in Gjensidige Bank. Affected by fixed assets write-off NOK m Q Q Private Commercial Nordic Baltics (3) Underwriting result Pension and Savings 2 (16) Retail Bank Satisfactory contribution of 0.7 % in the quarter given difficult market conditions. Financial result from the investment portfolio Profit/(loss) before tax expenses

13 Expanding multi-channel distribution model contributes to cost efficiency and best in class profitability Local sales staff and branch offices On-line sale and service Cost ratio reduced to 15 % 18.9 % 15.0 % CRM Example: Targeted sales activities improve portfolio profitability in Private %-points Inbound call centres, chat and social media Outbound call centres Loss ratio customers Loss ratio customers left GJF 13

14 Value adding services increase loyalty and preference Example: Guide for used car shoppers: Useful tips for them - leads for us Example: Retail bank- for broader offering and stronger relations Mortgages Loan Loan + Insurance Retention Years Strong and improved customer retention Q12011 Q42014 Car finance 0 Private total Norway Private loyalty customers* Norway Private Denmark SME** Norway SME** Denmark 260,000 used cars bought via finn.no* every year 93,000 visits since launch Value-adding service for lead generation, loyalty and positioning Loan Loan + Insurance Important to secure attractive customer base 70 % private customers part of loyalty and affinity programs * Internet sales portal in Norway Based on number of customers with loan and insurance as at

15 Digital services provide everyday value to customers - and business opportunities for us Interactive front end systems Reporting of claims online Self administration of policies Reallocation of resources to handling of more complex claims Example: Online health declaration forms for speedier processing and better data quality Automation and self service ensure speedier claims handling (24 hours)* 80% 75% 70% 65% 60% 55% 50% % 50 % reports filed online 93 % of customers say they find it easier to file online form Better data quality improve internal processes * Percentage of high-frequency claims settled within 24 hours in Norway 15

16 Leveraging skills and insight for optimal risk selection and pricing Positive effects from complex tariff model* Further potential over coming years % New tariff Partially new tariff Old tariff Not relevant 5% 10% 85% Private NOK 8.1bn earned premiums FY % 20% Commercial % 60% NOK 7.3bn earned premiums FY % 20% 5% 10% Nordic NOK 4.3bn earned premiums FY2014 Earned premiums Claims incurred Loss ratio (RHS) 65% * Norwegian portfolio. Figures prior to Q are not restated according to the changes in segments made in April Figures prior to Q are not restated according to the changes in segments and large losses reporting made in May Earned premiums and claims incurred rebased to 100 in

17 Leveraging skills and technology for cost-efficient and customised claims handling 10 % reduction in handling cost per claim by 2018* Annual claims cost reductions by 2018** NOK m Claims segmentation 600 Increased automation Claims reported online from 26 % to 50 % Share of claims reported online % 50% 40% % 20% % 0% Quality Procurement Process Total Low case High case * Before inflation ** Effect from 2015 and full effect from Before inflation 17

18 Disclaimer This presentation and the information contained herein have been prepared by and is the sole responsibility of Gjensidige Forsikring ASA (the "Company ). Such information is being provided to you solely for your information and may not be reproduced, retransmitted, further distributed to any other person or published, in whole or in part, for any purpose. Failure to comply with this restriction may constitute a violation of applicable securities laws. The information and opinions presented herein are based on general information gathered at the time of writing and are therefore subject to change without notice. The Company assumes no obligations to update or correct any of the information set out herein. These materials may contain statements about future events and expectations that are forward-looking statements. Any statement in these materials that is not a statement of historical fact including, without limitation, those regarding the Company s financial position, business strategy, plans and objectives of management for future operations is a forward-looking statement that involves known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company s present and future business strategies and the environment in which the Company will operate in the future. The Company assumes no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements. This presentation does not constitute or form part of, and is not prepared or made in connection with, an offer or invitation to sell, or any solicitation of any offer to subscribe for or purchase any securities and nothing contained herein shall form the basis of any contract or commitment whatsoever. No reliance may be placed for any purposes whatsoever on the information contained in this presentation or on its completeness, accuracy or fairness. The information in this presentation is subject to verification, completion and change. The contents of this presentation have not been independently verified. While the Company relies on information obtained from sources believed to be reliable, it does not guarantee its accuracy or completeness. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its owners, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation. None of the Company, its affiliates or any of their respective advisors or representatives or any other person shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation. The Company's securities have not been and will not be registered under the US Securities Act of 1933, as amended (the "US Securities Act ), and are offered and sold only outside the United States in accordance with an exemption from registration provided by Regulation S of the US Securities Act. This presentation should not form the basis of any investment decision. Investors and prospective investors in securities of any issuer mentioned herein are required to make their own independent investigation and appraisal of the business and financial condition of such company and the nature of the securities. Any decision to purchase securities in the context of a proposed offering of securities, if any, should be made solely on the basis of information contained in any offering documents published in relation to such an offering. For further information about the Company, reference is made public disclosures made by the Company, such as filings made with the Oslo Stock Exchange, periodic reports and other materials available on the Company's web pages. 18

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20 Investor relations Janne Flessum Head of IR Mobile: Anette Bolstad Investor relations officer Mobile: Linn Soltvedt Investor relations officer Mobile: Address: Schweigaards gate 21, PO Box 700 Sentrum, 0106 Oslo, Norway