Quarterly statement as at 30 September 2016 9 November 2016 Jrg - PowerPoint PPT Presentation

Source: Shutterstock [M] Quarterly statement as at 30 September 2016 9 November 2016 Jörg Schneider

Agenda 1 Munich Re (Group) 2 2 ERGO 8 3 Munich Health 12 4 Reinsurance 14 5 Outlook 18 2 Quarterly statement as at 30 September 2016

Munich Re (Group) – Financial highlights 9M 2016 Business highlights Q3 2016 Developing innovative propositions ERGO completes acquisition of ATE with digital insurance start-ups and and becomes largest property- digital verticals, e.g. Slice, Trov casualty insurer in Greece ERGO Strategy Programme well on July renewals with signs of price stabilisation – track – Reconciliation of interests’ agreement Munich Re almost entirely offsets decreases by writing attractive new business for German sales force reached in August Excellent position in the Dow Jones Sustainability Indices – New big-data - based Global No. 13 for the 15 th consecutive year platform M.I.N.D. improves on Fortune’s Change the World Top 50 List clients’ risk management in Mexico Munich Health study 1 shows private Developing a new Pandemic product which provides health insurance in China will surge insurance solutions for companies that could fivefold to RMB 1.1 trillion by 2020 suffer financial loss as a result of epidemics 3 1 Study by The Boston Consulting Group and Munich Re. Quarterly statement as at 30 September 2016

Munich Re (Group) – Financial highlights 9M 2016 After pleasing Q3 result, annual profit to significantly exceed € 2.3bn guidance Munich Re (Group) Q3 2016 (9M 2016) € m € m € m Net result Technical result Investment result Net result € 684m (9M: € 2,095m) 2,6022,290 5,872 5,942 2,391 2,095 Good underwriting performance across most segments – investment result in line with expectations 2,750 974 816 1,619 684 529 Return on investment 1 2.7% (9M: 3.4%) Q2 Q3 9M 9M Q2 Q3 9M 9M Q2 Q3 9M 9M 2016 2016 2015 2016 2016 2016 2015 2016 2016 2016 2015 2016 Resilient return given low interest rates – increased value of equity portfolio but write-downs of hedges Reinsurance ERGO Munich Health Life: Technical result € 146m Reinsurance: L/H Germany: (9M: € 318m) – Well on track to Result impacted by low interest rates Combined ratio 98.7% (9M: 100.9%) Shareholders' equity achieve annual target of € 400m P-C: Primary insurance: € 32.4bn (+1.1% vs. 30.6.) Combined ratio 96.1% (9M: 96.0%) Combined ratio 86.8% (9M: 92.6%) P-C: Combined ratio 92.5% Further increase of valuation reserves – (9M: 93.7%) – International: Solvency II ratio stable at ~250% Major-loss ratio 6.6% (9M: 7.2%) Combined ratio 98.6% (9M: 98.5%) 4 1 Annualised. Quarterly statement as at 30 September 2016

Munich Re (Group) – Capitalisation IFRS capital position € m € bn Equity Capitalisation 30,966 Equity 31.12.2015 Change Q3 0.4 0.4 0.4 0.4 0.3 2,095 684 Consolidated result 4.2 4.3 4.3 4.4 4.4 Changes – 1,329 – Dividend 2,315 304 Unrealised gains/losses – 565 – 177 Exchange rates – 711 – 318 Share buy-backs – 416 – 149 Other 13.6 13.4 32,355 343 Equity 30.9.2016 12.8 12.6 12.4 Unrealised gains/losses Exchange rates 30.3 31.0 31.8 32.0 32.4 2014 2015 Q1 2016 Q2 2016 Q3 2016 Fixed-interest securities FX effect mainly driven by US$ 9M: + € 2,353m Q3: + € 84m Debt leverage 1 (%) Non-fixed-interest securities Senior and other debt 2 9M: –€ 31m Q3: + € 222m Subordinated debt Equity 5 1 Strategic debt (senior, subordinated and other debt) divided by total capital (strategic debt + equity). 2 Other debt includes Munich Re bank borrowings and other strategic debt. Quarterly statement as at 30 September 2016

Munich Re (Group) – Investment portfolio Investment portfolio Investment portfolio 1 % Portfolio management in Q3  Ongoing geographic diversification Land and buildings Fixed-interest securities 2.7 (2.9) 56.2 (55.7)  Slight increase in corporate bonds  Reduction of cash and bank bonds  Increase of net equity exposure to 4.4% Shares, equity funds and participating interests 2  Increase of asset duration in reinsurance 5.5 (5.2) TOTAL € 242bn Miscellaneous 3 6.5 (7.5) Loans 29.1 (28.7) 6 1 Fair values as at 30.9.2016 (31.12.2015). 2 Net of hedges: 4.4% (4.8%). 3 Deposits retained on assumed reinsurance, deposits with banks, investment funds (excl. equities), Quarterly statement as at 30 September 2016 derivatives and investments in renewable energies and gold.

Munich Re (Group) – Investment result Investment result € m Investment result Return 1 Return 1 Return 1 Return 1 Q2 2016 Q3 2016 9M 2016 9M 2015 1,823 3.1% 1,550 2.6% 5,001 2.8% 5,588 3.1% Regular income – 22 – 0.0% – 43 – 0.1% – 284 – 0.2% – 653 – 0.4% Write-ups/write-downs 910 1.5% 696 1.2% 1,823 1.0% 2,321 1.3% Disposal gains/losses – 446 – 0.7% – 196 – 0.1% – 999 – 0.6% Derivatives 2 176 0.3% – 137 – 0.2% – 137 – 0.2% – 402 – 0.2% – 385 – 0.2% Other income/expenses 2,750 4.7% 1,619 2.7% 5,942 3.4% 5,872 3.3% Investment result 8.9% 5.8% 9.3% 0.7% Total return 3-month Write-ups/ Disposal Write-ups/ Disposal reinvestment yield Q3 2016 write-downs gains/losses Derivatives 9M 2016 write-downs gains/losses Derivatives – 50 – 25 15 506 1,620 356 Fixed income 3 Fixed income 3 1.8% Q3 2016 – 41 – 421 – 296 – 538 190 334 Equities Equities 1.6% Q2 2016 – 14 7 78 Commodities/Inflation Commodities/Inflation 1.9% Q1 2016 – 17 – 1 – 41 – 131 18 1 Other Other 7 1 Annualised return on quarterly weighted investments (market values) in %. 2 Result from derivatives without regular income and other income/expenses. Quarterly statement as at 30 September 2016 3 Thereof interest-rate hedging ERGO: Q3 € 48m/ € 7m (gross/net); 9M € 494m/ € 59m (gross/net).

ERGO 8 Quarterly statement as at 30 September 2016

ERGO ERGO 9M 2016 vs. 9M 2015 € m € m Gross premiums written Major result drivers 9M 9M Technical result 9M 2015 12,490   9M: L/H Germany ( –€ 55m), mainly due to 2016 2015 – 98 usual assessment of interest-rate Foreign exchange – 154 298 453 Technical result assumptions in Q3 in Life – 47  in Q3 9M: P-C Germany ( –€ 17m), esp. due Divestments/investments 419 236 183 Non-technical result to higher costs; large losses slightly below thereof – 209 Organic change 4,126 3,703 423 previous year’s level investment result  9M: International ( –€ 82m), mainly from – 828 – 272 – 556 9M 2016 12,136 Other disposal of Italian entity and in Q3: Declines – 111 – 528 417 in Belgium, Austria Net result  Life and Health Germany ( –€ 202m) Increase in investment result Property-casualty Germany (+ € 36m)  Q3: Return on investment 2.8% Q3 Q2 International ( –€ 189m)  9M: Derivatives result significantly higher;  2016 2016  Life Germany: Decline of regular premiums in Q3: decline – 131 Technical result 22 153  9M: Release of unrealised gains for ZZR, due to ordinary attrition while single mainly in first half of 2016 premiums suffered from lower product sales – 234 58 292 Non-technical result Other  Property-casualty Germany: positive thereof – 705 1,022 1,727  Q2: Restructuring expenses development in almost all lines of business investment result  Q1: Negative one-off effect from accounting  International: Increase in Property-casualty, – 132 – 479 Other 347 difference between IFRS and local GAAP decrease Life (esp. Poland, Belgium and regarding pension liabilities – 52 – 34 – 18 Net result disposal of Italian entity)  9M: Higher tax expenses 9 Quarterly statement as at 30 September 2016

ERGO ERGO Property-casualty Germany € m Combined ratio % Gross premiums written Other 279 582 Motor  Loss ratio  Expense ratio 95.3 63.1 32.2 2014 97.9 64.7 33.2 Legal protection 309 2015 61.3 34.7 9M 2016 96.0 62.8 33.3 96.1 Q3 2016 TOTAL € 2,566m 103.9 98.6 98.1 97.1 96.1 Fire/property 453 96.1 93.4 93.3 Liability 461 482 Personal accident Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2015 2015 2015 2016 2016 2016 10 Quarterly statement as at 30 September 2016

ERGO ERGO International – Property-casualty Gross premiums written – Property-casualty € m Combined ratio % Other 287 710 Poland  Loss ratio  Expense ratio 97.3 58.5 38.8 2014 TOTAL Greece 132 104.7 65.3 39.4 2015 € 1,849m 59.5 39.0 9M 2016 98.5 Turkey 185 535 Legal protection 60.1 38.5 98.6 Q3 2016 Combined ratio 9M 2016 % 115.3 103.8 99.9 98.8 97.6 98.5 86.7 103.6 100.4 98.7 98.6 96.8 104.1 93.2 Poland Legal Turkey Greece Other Total Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 protection 2014 2015 2015 2015 2015 2016 2016 2016 11 Quarterly statement as at 30 September 2016

Munich Health 12 Quarterly statement as at 30 September 2016