CIG PANNÓNIA FIRST HUNGARIAN GENERAL INSURANCE COMPANY LTD.

Transcription

1 CIG PANNÓNIA FIRST HUNGARIAN GENERAL INSURANCE COMPANY LTD. QUARTERLY INFORMATION Q Febuary 2015

2 1. Summary CIG Pannónia First Hungarian General Insurance Company Ltd. (hereinafter: EMABIT) publishes this report, simultaneously with the Q4 report to the stock exchange of its parent company, CIG Pannónia Life Insurance Plc. with the data disclosed, on a voluntary basis, to the Association of Hungarian Insurance Companies (MABISZ). Data provided to MABISZ are included in Annex 1 to the present information. Main results and events of the fourth quarter of 2014: Desciption (A) (B) Change (A)-(B) million HUF Change % (A/B) Gross written premium % Technical result (without operating costs) % Operating costs % Technical result % Retained profit/loss for the year (without individual items)* % Retained profit/loss for the year % *the detailed desciption of the individual items are presented in point 3. - In 2014 the technical result of EMABIT increased significantly with HUF 652 million compared to the previous year in accordance with the management expectations after the portfolio reduction. The Company s retained loss without the individual items is HUF 95 million, while including the individual items it is HUF 266 million loss, which increased HUF 495 million compared to The shareholder s equity is HUF 1,386 million on 31 December The solvency capital is amounted to HUF 1,287 million, which covers 117 percent of the minimum solvency capital requirement. The Company decreased its presence of compulsory third party motor insurance to a minimal level and also reduced its casco portfolio. In the fourth quarter as transfering the portfolio of home and travel insurance to AEGON Hungary General Insurance Plc. the Insurer finished the process of the portfolio reduction and the creation of profitable operations. - In 2014 EMABIT generated a gross written premium of 2,496 million HUF, the majority thereof relating to the casco and liability. The total costs of the Insurer amount to HUF 1,397 million, of which HUF 413 million are administration costs, HUF 867 million are earned acquisition costs, HUF 1 million is investment costs and the remaining HUF 116 million are claim settlement costs. The amount of new acquisitions was HUF 1,663 million in 2014, the portfolio reduction resulted HUF 4,192 million of net decrease, which came to a portfolio of 1,987 million HUF on 31 December Based on the sales and experience in transportation insurance business in Poland and Hungary, EMABIT starts to provide suretyship-related insurance services as a cross-border activity in Italy for carriers. - On 17 October 2014 the Court of Registry registered the HUF 200 million capital increase of CIG Pannónia Life Insurance Plc. in EMABIT. With this capital increase, registered capital increased with HUF 5 million and the capital reserve with HUF 195 million. - On 1 November 2014 with the supervisory authorization of the Hungarian National Bank the EMABIT transfered the portfolio of home and travel insurance to AEGON Hungary General Insurance Plc The reduction of the portfolio was inevitable since the maintenance of this small volume portfolio was uneconomical. With the termination of the home and travel insurance portfolio the related intangible assets had to be derecognized, which caused an individual loss of 70 million HUF in the fourth quarter. - On 5 December 2014 the Hungarian National Bank withdrew the business activity license of Széchenyi Kereskedelmi Bank Zrt. and ordered its voluntary liquidation. EMABIT had a bank deposit of HUF 170 CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

3 million at Széchenyi Bank. The Insurer created 60% impairment according to the principle of prudence on this deposit, which caused an individual loss of HUF 102 million. Events after the balance sheet date: - On 22 January 2015 EMABIT and MVM Hungarian Electricity Ltd. contracted a suretyship insurance framework agreement. This means that one of the largest company of the national energy sector voted confidence for the company. - On 9 February the Board of Directors of EMABIT decided to reelect two of the members of the Supervisory Board of EMABIT - Imréné Fekete and Dr. Gábor Móricz - for a five year period (until 9th February 2020) with the effect from the date of the supervisory authorization. Budapest, 17 February 2015 CIG Pannónia First Hungarian General Insurance Company Ltd. CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

4 2. Financial Statements Headlines in the Insurer s Income Statement million HUF Changes in profit/loss (A) (B) Change (A)-(B) Change% (A/B) Gross written premium % Change in the unearned premium reserve (gross) (-/+) % Gross earned premium % Reinsurance premiums (-) % Reinsurer s share in unearned premium reserve % Net earned premium % Gross claim settlement expenditure % Gross claims paid % Gross changes in claim reserve % Claim settlement costs % Reinsurer s share of claim settlement expenditure % Reinsurer s share of claim payments % Reinsurers' share of reserve changes % Net claim settlement expenditure % Other changes in reserves % Acquisition costs % Changes in deferred acquisition cost % Commissions and profit shares from reinsurers % Other technical expenses % Technical result (without operating costs) % Operating costs % Technical result % Investment result % Other result % Retained profit/loss for the year % CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

5 Headlines in the Insurer s Balance Sheet (A) (B) Change (A)-(B) million HUF Change% (A/B) Intangible assets % Investments % Receivables % Other assets % Prepaid expenses and accrued income % Total assets: % Shareholders' equity % Technical reserves % Unearned premium reserve % a) gross amount % b) reinsurers share of the reserve (-) % Outstanding claim reserves % a) gross amount % b) reinsurers share of the reserve (-) % Premium refund reserves % a) gross amount % b) reinsurers share of the reserve (-) n/a Other reserves % a) gross amount % b) reinsurers share of the reserve (-) % Liabilities % Accrued expenses and deferred income % Total liabilities: % CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

6 3. Presentation of the Insurer s financial position the Insurer s nonaudited data for 2014, according to the Hungarian Accounting Act In 2014 the Insurer realized a gross written premium of HUF 2,496 million, of which the amount of premiums transferred to the reinsurer was HUF 801 million, the change of the unearned premium reserve was HUF 182 million, and the reinsurer s share of the latter was HUF 262 million. The total amount of the net earned premiums was HUF 1,775 million. This amount is 46% of previous year s data due to the portfolio reduction implemented in motor insurance segment. Within the gross written premium the composition of the portfolio transformed significantly; instead of the former casco (40%) and compulsory third party motor insurance (24%) businesses, now the dominant portolio is the liability (30%) sector. The share of the casco is still significant (28%), but decreased. The fire and natural forces, self-propelled, other damage to assets and freight sectors share are about 7-8% each. The rest is divided among accident, compulsory motor third party, illness, extended guarantee, assistance and funeral insurance. The most important item among expenses is the amount of claim settlement expenditure (HUF 735 million), which is made up of claim payments (HUF million), the change of the outstanding claim reserve (HUF million) and the costs of claim settlement (HUF 116 million). Due to the portfolio reduction the net claim settlement expenditure decreased by 71% compared to 2013, while the net earned premium decreased by 54%. The gross claim ratio decreased from 65% to 42% and the net claim ratio fall from 67% to 41% as compared to the previous year. The most significant part of change in Other Reserves (84 million HUF) was the release in cancellation reserve because of the leaving vehicle fleets. The Insurer maintains relationships with several reinsurance partners. The Insurer covers its risks by reinsurance in the field of property and technical insurance, liability insurance, carrier and transporter liability insurance, suretyship-related insurance and motor insurance. In connection with this, HUF 109 million were recognized as reinsurers commissions and profit shares. The gross operating costs of the Insurer amount to HUF 1,397 million, of which HUF 413 million are administration cost, HUF 867 million are earned acquisition cost (including deferred acquisition costs), HUF 1 million is investment cost and HUF 116 million are claim settlement cost. Level of acquisition costs (including deferred acquisition costs) decreased by 40% despite the fact that gross earned premium decreased by 54%, since products operating with higher acquisition cost ratio (transportation, property, liability) predominate instead of the formerly dominating motor insurance sector products with lower acquisition cost ratio. The claim settlement costs decreased significantly by 36% compared to 2013, while the administration costs decreased by 15% compared to The Other technical expenses line includes the insurance tax, the supervisory fee, MABISZ indemnification account, indemnification fund and the BM premium. These expenses decreased significantly due to the Company s smaller market s share on the compulsory liability and casco insurance s market. The investment result is a profit of HUF 88 million, consist of mostly interest received. The other result line shows the insurance tax, local tax expenses and the innovation contributions. This line also contains the two individual items in the fourth quarter: the impairment of HUF 102 million for the receivable against the Széchenyi Bank and the write off for intanglible assets after the transfer of the home and travel insurance portfolio (70 million HUF). On 5 December 2014 the Hungarian National Bank withdrew the business activity license of Széchenyi Kereskedelmi Bank Zrt. and ordered its voluntary liquidation. EMABIT had a bank deposit of HUF 170 million at Széchenyi Bank. The expected return of the deposit could be determined according the the activity closing financial statements of the Bank, which has not been published before this riport was made. Since the MNB ordered a voluntary liquidation and not a liquidation the Bank may have enough assets to pay off its creditors, but the voluntary liquidation might turn to liquidation and then the deposit would be only partly recoverable. Because of the uncertainity about the recoverability of the deposit the Insurer created 60% impairment according to the principle of prudence, which caused an individual loss of HUF 102 million. The Insurer s balance sheet total was 3,363 million HUF at the end of December 2014; the Company has met its liabilities in full. On 31 December 2014, the shareholders equity was HUF 1,386 million, the solvency capital of the Insurer available on the balance sheet date was 1,287 million HUF, which covers 117% of the minimum solvency capital requirement. CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

7 Annex 1 Presentation of the portfolio of the non-life business line of the Issuer at the end of the period (number) Opening stock on New business / Acquired stock Closing stock on Accident Illness Casco Freight Damage through fire or disaster Other damage to assets Total motor vehicle liability Of this: compulsory third party motor insurance General liability Suretyship-related insurance Total regular-premium policies Accident Illness Casco Freight Other damage to assets Suretyship-related insurance Total single premium policies Total CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

8 Presentation of the stock of the non-life business line of the Issuer at the end of the period thousand HUF Opening stock on New business/ Acquired stock Closing stock on Accident Illness Casco Freight Damage through fire or disaster Other damage to assets Total motor vehicle liability Of this: compulsory third party motor insurance General liability Suretyship-realated Funeral insurance Total non-life business line: The Insurer s gross written premium at the end of the period, broken down by insurance sectors Total gross written premium Gross written premium from single premium products thousand HUF Premiums earned Accident Illness Casco Freight Damage through fire or disaster Other damage to assets Total motor vehicle liability Of this: compulsory third party motor insurance General liability Suretyship-realated Assistance Funeral insurance Total non-life business line: CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

9 The Insurer s costs at the end of the period thousand HUF Acquisition costs Administration costs Claim settlement costs Investment costs Total Total non-life business line Of this: compulsory third party motor insurance The Insurer s claims paid and services at the end of the period in question, broken down by insurance sectors thousand HUF Expected amount of claims to be paid after the relevant period Claims paid in relevant period Opening total Closing total at the end of the relevant quarter Change Accident Illness Total Casco Land vehicle Casco Freight Damage through fire or disaster Other damage to property Total automobile liability Self-propelled land vehicle related liability Of this compulsory motor third party liability insurance General liability Guarantee Assistance Funeral insurance Total non-life business line: CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q

10 Expected amount of claims to be paid after the relevant period for events that have already occurred but have not yet been reported thousand HUF Claims in relevant year Opening total Closing total at the end of the relevant quarter Change Payments Claim reserve IBNR Accident Illness Total Casco Land vehicle Casco Freight Damage through fire or disaster Other damage to property Total automobile liability Self-propelled land vehicle related liability Of this compulsory motor third party liability insurance General liability Guarantee Assistance Funeral insurance Total non-life business line: The Insurer s costs at the end of the period Centre (no. of staff) Network (no. of staff) Senior management 2,2 0,0 Administrators 23,4 0,0 Risk assessors, damage experts and loss administrators 3,9 0,0 Business staff 2,4 0,0 Tied insurance agent 0,0 384,0 Total non-life business line 32,0 384,0 CIG Pannónia First Hungarian General Insurance Company Ltd., information on Q