Sunday, 4 August 2019

GENERALI GROUP CONSOLIDATED RESULTS AT 30 JUNE 2019 (1)- EXCELLENT OPERATING RESULT AT € 2.7 BILLION (+7.6%) AND STRONG GROWTH IN NET PROFIT TO € 1.8 BILLION (+34.6%). THE SOLID CAPITAL POSITION IS CONFIRMED




The operating result increased thanks to positive developments in all business segments 
The Group net profit stood at € 1.8 billion (+34.6%), also including the result of discontinued operations. Adjusted net profit2 rose to € 1.3 billion (+6.4%)
Life net inflows grew to € 7.4 billion (+29.5%) and technical reserves reached € 358 billion (+4.3%). Gross written premiums stood at € 35.7 billion (+1.8%), due to the positive performance of both Life and P&C segments 
The technical excellence of the Group is confirmed with the combined ratio at 91.8% (-0.2 pps) and the New Business Margin at 4.40% (-0.18 pps) 
Asset Management net profit stood at € 133 million (+22%), with third-party AuM in this segment rising sharply to € 102 billion 
 The Preliminary Regulatory Solvency Ratio remains solid at 209% (217% FY 2018; -8 pps) 
 Generali Group CEO Philippe Donnet declared: “These results show the Group’s capacity to generate sustainable financial and industrial value for all of its stakeholders. The first half of the year confirms the effective and disciplined implementation of the three-year strategic plan ‘Generali 2021’ in all business segments. Generali today is an increasingly global insurance and asset management group, with technical excellence in the Life and P&C segments and distinctive expertise in asset management, allowing us to successfully overcome the competitive challenges of the sector to become lifetime partner to our customers.”

https://www.generali.com/

Saturday, 3 August 2019

Allianz reports strong profitability in 2Q 2019. Operating profit outlook for full-year confirmed.



 Internal revenue growth of 4.1 percent in 2Q 2019
 2Q 2019 operating profit up 5.4 percent to 3.2 billion euros
 2Q 2019 net income attributable to shareholders up 13.1 percent to 2.1 billion
euros
 6M 2019 operating profit at 6.1 billion euros reaches 53 percent of full-year outlook
midpoint
 6M 2019 net income attributable to shareholders rises 7.3 percent to 4.1 billion
euros
 Solvency II capitalization ratio at 213 percent at the end of 2Q 2019 compared to
218 percent at the end of 1Q 2019
 Operating profit outlook for 2019 confirmed at 11.5 billion euros, plus or minus
500 million euros

Management Summary: Strong total revenues and profitability
After a successful start into 2019, Allianz Group continued with a very strong operating performance in thesecond quarter of the year. At the heart of this result is Allianz’ focused strategy, strong execution, and its diversified business portfolio. Internal revenue growth, which adjusts for currency and consolidation effects, was 4.1 percent in the second quarter of 2019. Total revenues increased 6.1 percent to 33.2 (second quarter of 2018: 31.3) billion euros. Operating profit grew 5.4 percent to 3.2 (3.0) billion euros in the second quarter of 2019, largely driven by our Life/Health business segment with a good underlying performance and a one-off profit in the United States. Our Asset Management business segment’s operating profit increased mainly as a result of higher assets under management driven revenues. A lower investment result led to a decrease in our Property-Casualty business segment’s operating profit.

Net income attributable to shareholders increased 13.1 percent to 2.1 (1.9) billion euros in the second
quarter of 2019 due to operating profit growth and an improved non-operating result. The latter improvedas the second quarter of 2018 was burdened by a negative impact from the sale of our traditional life insurance portfolio in Taiwan.

Basic Earnings per Share (EPS) increased 10.2 percent to 9.76 (8.86) euros in the first half-year of 2019. Annualized Return on Equity (RoE) amounted to 14.7 percent (full year 2018: 13.2 percent). The Solvency II capitalization ratio decreased from 218 percent at the end of the first quarter 2019 to 213 percent at the end of the second quarter 2019. The decrease was predominantly driven by market movements and capital management actions, which were partially offset by positive operating Solvency II earnings.

In the first half-year of 2019, operating profit grew by 6.4 percent to 6.1 (5.8) billion euros, which is above the mid-point of our full-year target range. Our Life/Health business segment’s operating profit increased, supported by a one-off profit in the United States. Property-Casualty business segment recorded an improved underwriting result while our Asset Management business segment operating profit was stable.
Our operating profit growth was the main driver for the 7.3 percent increase of net income attributable toshareholders to 4.1 billion euros.
On February 14, 2019, Allianz announced a new share buy-back program of up to 1.5 billion euros.
6.2 million shares have been acquired by June 30, 2019, representing 1.5 percent of outstanding capital. “I am proud that the Allianz team has once again delivered a healthy performance,” said Oliver Bäte, Chief Executive Officer of Allianz SE. “Sustainable performance is the result of our rigorous strategy execution that provides desired solutions for our customers. Our half-year results testify that Allianz is on track to achieve its full-year targets.”

Half Year 2019 Earnings: Disciplined execution and delivery




• Total revenues1 up 4% to Euro 57.9 billion 
• Underlying earnings2 up 7% to Euro 3.6 billion 
• Underlying earnings per share2 up 10% to Euro 1.46

“AXA continued to deliver strong operating performance, with a +4% growth in revenues and a +10% increase in underlying earnings per share in the first half of 2019”, said Thomas Buberl, Chief Executive Officer of AXA. “AXA’s earnings benefitted from a virtuous double dynamic, both growing volumes and improving profitability across all our geographies and preferred segments.” “AXA XL had a great first half with continued and disciplined growth in revenues and a solid contribution to the Group’s earnings. Synergies are materializing well, and AXA XL should benefit from the increasingly positive pricing context.” “AXA is very well advanced on its transformation journey. The Group has reduced its sensitivity to financial markets, created the #1 Global P&C Commercial lines insurance platform and strengthened its position as a world leader in Health insurance. We also further advanced in our Payerto Partner strategy by launching our own medical centers, notably in Mexico and Egypt, with the aim to simplify and enhance the healthcare journey of our customers.” “I would like to thank all our colleagues and partners for their critical role in the execution of our transformation, as well as our clients for their continued trust.”



Tuesday, 30 July 2019

EU insurers suggest improvements to EIOPA paper on sustainability in Solvency II




Insurance Europe has responded to a European Insurance and Occupational Pensions Authority (EIOPA) opinion paper on sustainability in Solvency II. Insurance Europe said that Solvency II is not a barrier to the integration of sustainability and also noted that sustainability risks are already incorporated into the framework.
Insurance Europe warned that the direct incorporation of a uniform quantitative approach into the own risk assessment (ORSA), based on a standardised set of climate change scenarios, would contrast with the very nature of the ORSA, which is company-specific and with a unique time horizon.
With respect to the use of a forward-looking approach, Insurance Europe said that insurers should be given maximum flexibility to use the most suitable tools to deal with sustainability risks in line with their undertakings’ characteristics.
Insurance Europe added that proportionality should be duly considered in any proposed requirements.

Tuesday, 2 July 2019

EIOPA outlines key financial stability risks of the European insurance and pensions sector




The European Insurance and Occupational Pensions Authority (EIOPA) published its June 2019 Financial Stability Report of the (re)insurance and occupational pensions sectors in the European Economic Area.
The risk of a prolonged low yield environment has become more prominent in recent months, as central banks have put the process of monetary policy normalisation on hold amid concerns over economic growth following growing trade tensions and political uncertainty. The low yield environment remains the key risk for both, the insurance and pension fund sector, and continues to put pressure on profitability and solvency positions. This could trigger further search for yield behaviour by insurers and pension funds, which is slowly becoming visible in the investment portfolio of insurers. EIOPA will therefore continue to monitor closely this risk to identify at an early stage any potential vulnerabilities.
At the same time, valuations remain stretched across financial markets and a sudden re-assessment of risk premia cannot be ruled out, which could be exacerbated during a period of economic slowdown with concerns over debt sustainability. A sudden increase in yields driven by risk premia rather than an upward move of the risk free rate curve could significantly affect the financial and solvency position of insurers and pension funds in the short run, as the investment portfolios could suffer large losses, which may only be partly offset by lower liabilities. In this regard, the high degree of interconnectedness with banks and domestic sovereigns of insurers could lead to potential spillovers should a sudden reassessment of risk premia materialize. Relatively high exposures towards real estate can also be observed for insurers in certain countries, making them as well vulnerable to a potential downturn in real estate markets.
Furthermore, new types of risks are emerging with the onset of climate change and cyber risk. The climate related risks pose threats in particular for the insurance industry, as insurers act simultaneously as investors and underwriters, while the digital transformation makes insurers and pension funds increasingly exposed to cyber-attacks. In this respect, the 2019 EIOPA stress test exercise for occupational pension funds also incorporates Environmental, Social and Governance (ESG), while the results from the questionnaire on cyber risk included in the 2018 Insurance Stress Test exercise will be used to analyse the exposures of insurers towards cyber risk in more detail in the course of 2019.
This Financial Stability Report shows that while overall the insurance sector remains adequately capitalized, profitability is under increased pressure in the current low yield environment. The Solvency Capital Requirement ratio for the median company is 223% for life and 207% for non-life insurance sector, although significant disparities remain across undertakings and countries.
The reinsurance industry has proven resilient despite again suffering significant catastrophe losses in 2018, which ended up as the fourth costliest year in terms of insured catastrophe losses. In general, natural catastrophe losses are showing an upward trend, with the 10 costliest years in terms of overall losses all occurring after 2004. The price renewals continue to show only moderate price increases, indicating potential excess capacity in the reinsurance market, with the alternative reinsurance capital market in particular showing a strong appetite for insurance risks.
In the European occupational pension fund sector, total assets and cover ratios remained broadly stable. However, the current macroeconomic environment and ongoing low interest rates continue to pose significant challenges to the European occupational pension fund sector, in particular for the Defined Benefit (DB) pension schemes. The sector has also come under increased pressure in 2018 by the fall in stock values towards the end of the year, pertaining to significant losses in IORPs' equity investments.
Gabriel Bernardino, Chairman of EIOPA said: "The economic environment has become more challenging for European insurers and pension funds in recent months. The risk of a prolonged low yield environment has become more prominent again, as central banks have become more cautious about monetary tightening amid concerns over economic growth. This is particularly challenging for life insurers and pension funds with long-term liabilities and could trigger further search for yield behavior. At the same time, we continue to observe high valuations in certain equity, real estate and bond markets and a sudden reassessment of risk premia could potentially lead to significant losses in the investment portfolios of insurers, which could be exacerbated during a period of economic slowdown. EIOPA will continue to closely monitor these developments by assessing vulnerabilities at both, the macro- and micro-level and deliver its mandate of supporting the stability of the European financial system."
This Financial Stability Report also includes a thematic article assessing the impact of green bond policies on insurers. This study employs an empirical analysis based on the European equity market.

Wednesday, 12 June 2019

Insurers ask if GDPR has delivered on its aims




Insurance Europe has published an insight briefing that examines whether the General Data Protection Regulation (GDPR) has delivered on its aims of enhanced protection and greater harmonisation of data protection rules. It also asks if the GDPR is compatible with insurers’ need to innovate for the benefit consumers.
The European Commission is currently taking stock of stakeholders’ experiences of implementing the GDPR to prepare its report on the evaluation and review of the Regulation, due by May 2020. The briefing has been published ahead of a Commission event on the GDPR’s anniversary which takes place on 13 June.
The briefing highlights the positive effects that the introduction of new rights has had on consumers and how this helps insurers to build and maintain trustworthy relationships with consumers.
Importantly, the document notes that the GDPR has not fully achieved the level of harmonisation that was initially intended. While the GDPR has secured the same level of protection for consumers in all EU member states to a certain degree, it is not always applied uniformly across member states.
The briefing also highlights how — despite significant efforts to modernise privacy rules — the GDPR and the guidelines adopted by the European Data Protection Board (EDPB) introduce, in some instances, requirements that are at odds with fast-evolving technology and that may slow the pace of insurers’ digital innovation.
Looking ahead, it will be crucial for the Commission to ensure that the application of the GDPR and its guidelines allow insurers to continue operating cross border and guarantee the safe development and introduction of innovative products that can benefit consumers. 

Wednesday, 5 June 2019

AMICE further strengthens Board membership for comprehensive representation across diverse countries and members




At its General Meeting in Brussels (5 June), the AMICE (the Association of Mutual Insurers and Insurance Cooperatives in Europe) membership unanimously agreed the appointment of all proposed members of the Board. AMICE is a key stakeholder in the European advocacy sector for the insurance industry, representing distinct models and structures which are responsible for more than one-third of all European insurance business.
AMICE’s Board, which is elected for a three-year term, now comprises:
       Grzegorz Buczkowski, Saltus (PL)
       Odilo Bürgy, Swiss Mobiliar (CH)
       Stephane Cossé, Covéa (FR)
       Carlo Enrico de Fernex, Reale Mutua (IT)
       Jari Eklund, LähiTapiola (FI)
       Cornélia Federkeil, AAM (FR)
       Michael Garvey, IPB Insurance CLG (IE)
       Klaus-Jürgen Heitmann, HUK-Coburg (DE)
       Róbert Lilli, KÖBE (HU)
       Christopher Lohmann, Gothaer (DE)
       Allan Luplau, Sygeforsikringen “danmark“ (DK)
       Tom Meeus, Fédérale Assurance, (BE)
       Pablo Mongelos García, Seguros Lagun Aro (ES)
       Christophe Ollivier, FNMF (FR)
       Robert Otto, Achmea (NL)
       Norbert Rollinger, R+V Versicherung (DE)
       Ann Sommer, Länsförsäkringar (SE)
       Jorge Vázquez Morenés, Mutua Madrileña (ES)
       Ana Teresa Vicente Custódio de Sá, Mutua dos Pescadores (PT)
       Dimitrios Zorbas, Syneteristiki (GR)

Grzegorz Buczkowski was unanimously reappointed as President of AMICE for a second three-year term. Christophe Ollivier was unanimously reappointed Vice-President for a second three-year term, and Christopher Lohmann was unanimously appointed Vice-President for the first time. Róbert Lilli was reappointed – also unanimously – as AMICE’s Treasurer.

The Board welcomed two new members to its ranks, Michael Garvey, CEO of IPB in Ireland, and Ana Vincente, CEO of Mútua dos Pescadores in Portugal. They both represent more specialised and smaller mutual insurers, and reflect the geographic diversity of AMICE’s membership. Michael Garvey is the first Irish member of the AMICE Board.


Sarah Goddard, Secretary General of AMICE, said: “AMICE’s core strength lies in its ability to represent our diverse membership, reflecting one of our four key values – inclusiveness. We bring together insurers from different European countries, of different sizes, structures and directions, who are united under the banner of mutuality and cooperation. This value sits alongside three others – accountability, sustainability and ethical behaviour, and excellence – as the core of AMICE’s new strategy which commenced at the beginning of this year.”


The AMICE General Meeting was followed by a symposium on sustainable finance, featuring presentations from AMICE’s newest supporting member, OFI Asset Management, and Better Finance, the European Federation of Investors and Financial Services Users.

Tuesday, 28 May 2019

Mutual insurers lead the German market



German insurance market analysis ranks CEOs in Germany; mutual insurance leaders come out top

Mutual/cooperative insurance CEOs have emerged as the top leaders according to analysis undertaken by German insurance magazine Versicherungswirtschaft.Assessing criteria such as leadership style, innovation and external perception, the magazine has placed leaders of the mutual/cooperative insurance sector firmly in the first, second and third places in a “performance check”.
The top position is given to Norbert Rollinger, CEO of R+V, who the magazine describes as versatile, convincing and approachable. Klaus-Jürgen Heitmann, CEO of HUK-Coburg, fills the second place on the list, and in third place is Ulrich Leitermann, CEO of Signal Iduna.
All three insurers are members of AMICE, the Association of Mutual Insurers and Insurance Cooperatives in Europe, the voice of the mutual and cooperative insurance sector in Europe. Mr Rollinger and Mr Heitmann are both Board members of AMICE.
Grzegorz Buczkowski, AMICE President commented,
AMICE’s Secretary General, Sarah Goddard, added:
“This ranking backs up remarks made by Oliver Bäte, Chairman of Allianz, at last week’s Insurance Europe conference, that local mutual insurers in Germany are providing benchmarks for other insurers in terms of client service.”

Thursday, 23 May 2019

European policymakers must act to ensure insurers can fully contribute towards a sustainable Europe




EU insurers have already committed to invest an estimated €50bn in sustainable investments between 2018 and 2020
To allow European insurers to maximise their contribution towards a sustainable Europe, policymakers must: take action to ensure prudential capital requirements reflect the real risks insurers face; provide a clear taxonomy that avoids greenwashing; and ensure conduct rules give consumers real choice over environmental, social and governance (ESG) and non-ESG investment products.  
Beyond regulation, demand for sustainable and long-term investment is significantly higher than the supply of appropriate assets, as shown by recent green energy/infrastructure projects that were oversubscribed. Action is also therefore needed to achieve the creation of suitable, sustainable investment opportunities.
This was the message from Insurance Europe’s president, Andreas Brandstetter, CEO and chairman of UNIQA Insurance Group, speaking at the 11th International Insurance Conference that takes place today in Bucharest.
Brandstetter said that insurers can contribute towards a more sustainable Europe in multiple ways: through stewardship, investment and divestment strategies, and co-investment with governments in key green infrastructure programmes.
“Insurance Europe estimates that European insurers have committed to invest well over €50bn in sustainable investments between 2018 and 2020,” he said. “Through the combined efforts of all stakeholders, including industry, civil society and governments, we can make Europe sustainable for generations to come.”
Brandstetter also called on policymakers to help insurers refine the protection they offer against cyber-attacks, which are increasing in both frequency and severity. One of the main barriers to the development of the cyber insurance market is the lack of data on cyber risks. However, recent pieces of legislation that require companies to report cyber incidents to relevant authorities (eg, GDPR and the NIS Directive) have created a wealth of useful data.
“Policymakers could help insurers to better protect society by providing them with access to anonymised information about cyber-attacks,” he said.
Brandstetter also highlighted closing the pension savings gap as a key priority. This is another challenge where insurers can play a key role but requires EU policymakers to improve Solvency II, so that capital requirements reflect the real risks insurers face. This will enable them to offer the best possible returns to customers with long-term insurance savings products and, in turn, could help to address the growing pension savings gap by encouraging more people to save in private pension products.
“Pension provision is and will remain under the remit of national governments. However, their solvency regulation falls under the remit of EU co-legislators, so it is encouraging to see that they recognise the potential of personal pensions as a way to stimulate long-term savings,” he said.