talanx group annual report 2011 en

Overall assessment of
the economic situation
Non-financial
performance indicators
Corporate Governance Remuneration report Events of special
significance
Gross written premium slightly up
The segment’s gross written premium amounted to EUR 3.1 (3.1) billion
in the year under review. The individual companies made the
following contributions (before consolidation) to the overall growth
of EUR 62 million: EUR 191 million from HG-I, EUR 40 million from
our Dutch subsidiary and around EUR 20 million each from our
Belgian subsidiary and the reinsurer HDI-Gerling Welt Service AG.
Our US subsidiary HDI-Gerling America Insurance Company, Chicago,
also reported a EUR 20 million increase. HG-I grew especially
in motor lines thanks to premium rises in the in-force portfolio and
a gratifying level of new business, fire business did especially well
outside of Germany. In the Netherlands the take-over of Nassau
Verzekering Maatschappij N. V., Rotterdam (Nassau) by HG-I and its
merger with the Dutch subsidiary HDI-Gerling Verzekeringen N. V.,
Rotterdam (HDI Netherlands) were the main source of additional
premium income. The increase in Belgium came mainly from the
successful acquisition of new business, especially in the casualty,
fire, marine and engineering lines.
The Spanish subsidiary stayed more or less on a par with the
previous year’s level, market-related declines being compensated by
new business in property/engineering in Latin America and in the
middle market segment. The EUR 87 million drop at HDI Versicherung
AG, Vienna (HDI Austria) was due entirely to the fact that,
whereas in 2010 the entire company’s results were reported in the
Industrial Lines segment, as of 2011 45% of its business is booked in
the Retail International segment, which showed a corresponding
increase.
The net premium earned in the segment dropped by EUR 38 million
to EUR 1.4 (1.4) billion. This was mainly due to the higher cessions
to reinsurers, which rose by EUR 97 million to EUR 1.7 (1.7) billion,
disproportionately to the premium growth. Most of this increase
came from HG-I which, in addition to purchasing higher reinsurance
cover for natural catastrophes, posted reinsurance premiums (before
consolidation) that were EUR 225 million higher, at EUR 1.6 (1.3) billion,
due to a one-off effect. Because of the integration of Nassau,
HG-I’s Dutch subsidiary also posted EUR 21 million higher premium
cessions to reinsurers. By contrast, HDI Austria’s reinsurance premiums
dropped by around EUR 57 million due to transfer of business
to the Retail International segment.
Risk report Forecast and
opportunities report
Underwriting result
The other underwriting income rose by around EUR 99 million in
the period under consideration to EUR 109 (10) million; essentially
due to a special effect at HG-I that had the opposite effect on reinsurance
premiums ceded as mentioned above.
The net technical expenses fell by EUR 153 million to EUR 1.3 (1.5) billion.
This was mainly due to a drop in net claims expenditure by
EUR 162 million to EUR 1.0 (1.2) billion, although administrative
expenses for own account declined by around EUR 18 million to
EUR 212 (230) million; while acquisition costs rose slightly from
EUR 7 million to EUR 89 (82) million. The other technical expenses
showed a more significant change at EUR 20 (–1) million. Here, too,
the largest company in the segment, HG-I, had a major influence,
its net claims expenditure declining considerably – despite a year
fraught with natural catastrophes. The take-over of Nassau made its
mark on the Netherlands subsidiaries with a rise in claims expenditure,
which also increased at HDI-Gerling America Insurance
Company and HDI-Gerling Welt Service.
The net claims ratio improved significantly to 66.8 (82.0)%, while
the net expense ratio remained relatively stable at 21.9 (22.1)%. The
combined ratio was 88.6 (104.1)%. The net underwriting result improved
by a EUR 212 million in all to EUR 155 (–57) million.
Net investment income slightly down
The Division’s net investment income declined by EUR 27 million
to EUR 204 (231) million. This was due to a slight drop of EUR 14 million
in ordinary income, but also to an extraordinary result down
EUR 11 million and slightly higher investment-related expenditure.
The main drivers here were higher impairments on fixed-interest
securities at HG-I.
Segment’s results shaped by its biggest company
Other income was likewise quite significantly down by EUR 49 million;
a loss of EUR 38 million contrasted with a profit of EUR 11 million
achieved in the previous year. This change was again attributable
chiefly to HG-I, which strengthened its provisions for one-off
eventualities in the year under review and, what is more, had in the
previous year posted considerable income from release of sundry
provisions and from reversal of impairments on reinsurance recoverables.
Talanx Group. Annual Report 2011
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