talanx group annual report 2011 en
talanx group annual report 2011 en
talanx group annual report 2011 en
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60<br />
The Talanx Group Strategy Enterprise<br />
managem<strong>en</strong>t<br />
Talanx Group. Annual Report <strong>2011</strong><br />
Research and<br />
developm<strong>en</strong>t<br />
In our target markets of Germany and North America, our business<br />
fared better in the year under review than had be<strong>en</strong> expected<br />
after high losses at the beginning of the year: premium volume<br />
rose to EUR 1.9 (1.8) billion. The combined ratio stood at 106.1%,<br />
after 97.4% in the previous year, the operating profit (EBIT) was<br />
EUR 184 (301) million.<br />
The underwriting result of the segm<strong>en</strong>t as a whole deteriorated<br />
to –EUR 264 (78) million. Net investm<strong>en</strong>t income rose by 13% to<br />
EUR 880 (779) million. The operating profit (EBIT) for the non-life<br />
reinsurance at 31 December <strong>2011</strong> fell to EUR 629 (909) million due<br />
to high exp<strong>en</strong>diture on large-scale claims.<br />
Life/Health Reinsurance<br />
<strong>2011</strong> 2010 2009<br />
Figures in EUR million<br />
Gross writt<strong>en</strong> premium 5,270 5,090 4,529<br />
Net premium earned 4,789 4,654 4,078<br />
Underwriting result –281 –290 –258<br />
Net investm<strong>en</strong>t income 512 508 525<br />
Operating result (EBIT) 225 276 371<br />
The Life/Health Reinsurance segm<strong>en</strong>t brings together our reinsurance<br />
activities in the life, annuity and health lines under the<br />
Hannover Life Re brand name. Hannover Life Re is one of the four<br />
biggest life/health reinsurers in the world. It has operating units at<br />
more than tw<strong>en</strong>ty locations on all five contin<strong>en</strong>ts so as to be able<br />
to offer the cli<strong>en</strong>ts optimum on-the-spot service.<br />
Tried and trusted business model<br />
We carry on the international life/health reinsurance activities of<br />
the Hannover Re <strong>group</strong> under the brand name Hannover Life Re.<br />
We offer customised reinsurance solutions in the fields of life, annuity<br />
and health insurance worldwide, deliberately conc<strong>en</strong>trating<br />
on providing cover for the biometric risks of mortality, longevity<br />
and morbidity. We also write the accid<strong>en</strong>t line in this segm<strong>en</strong>t to the<br />
ext<strong>en</strong>t that it is transacted by life insurers, and also retakaful business,<br />
i.e. reinsurance specifically for insurance products compliant<br />
with Islamic law.<br />
Markets and<br />
g<strong>en</strong>eral conditions<br />
Business<br />
developm<strong>en</strong>t<br />
Assets and<br />
financial position<br />
Our core business policy is based on the five pillars of conv<strong>en</strong>tional<br />
reinsurance, new markets, multinational insurers, bancassurance<br />
and financial solutions. Each of these pillars calls for special skills,<br />
features a unique marketing approach and is geared towards differ<strong>en</strong>t<br />
cli<strong>en</strong>t needs and products. Within the conv<strong>en</strong>tional reinsurance<br />
segm<strong>en</strong>t we selectively participate in attractive, traditional life/<br />
health reinsurance business. Through the other four pillars we offer<br />
customised, innovative and targeted insurance solutions.<br />
Conv<strong>en</strong>tional reinsurance traditionally accounts for the lion’s<br />
share of our portfolio. But especially through our activities in the<br />
UK <strong>en</strong>hanced annuities sector we have significantly increased our<br />
business volume in the new markets, so that this pillar is making a<br />
consist<strong>en</strong>tly growing contribution to our business results.<br />
Good business tr<strong>en</strong>ds despite a difficult <strong>en</strong>vironm<strong>en</strong>t<br />
The ongoing volatility on the international financial markets and<br />
the governm<strong>en</strong>t debt crisis in Europa are causing uncertainty<br />
among private and corporate investors worldwide. In the wake of<br />
the banking sector, the insurance industry is also being affected<br />
more and more by these developm<strong>en</strong>ts. This has <strong>en</strong>abled us as<br />
a financially strong business partner to tap into new business<br />
pot<strong>en</strong>tials by offering our crisis-strick<strong>en</strong> cli<strong>en</strong>ts the security they<br />
are looking for. For this reason, and despite unfavourable market<br />
conditions, we have be<strong>en</strong> able to achieve largely satisfactory results<br />
in our life/health reinsurance business.<br />
On the life primary insurance side, the pronounced fluctuations on<br />
the money markets, stock exchange swings and the persist<strong>en</strong>tly low<br />
interest level are fueling demand by for reinsurance cover. More<br />
and more primary insurers are showing an interest in tailor-made<br />
reinsurance solutions to <strong>en</strong>able them on the one hand to keep their<br />
cost of equity to a moderate level while on the other complying<br />
with more string<strong>en</strong>t solv<strong>en</strong>cy requirem<strong>en</strong>ts.<br />
Over the past four years we have be<strong>en</strong> able to significantly expand<br />
our market share in US organic new business by chalking<br />
up double-digit perc<strong>en</strong>tage increases in new business every year,<br />
despite the US reinsurance market overall having shrunk in the<br />
period in question.