Arranged by: Tryg Forsikring A/S Tier 2 subordinated bond issue Company presentation May 2016
Important information Disclaimer Certain statements in today’s presentations are based on the beliefs of our management as well as assumptions made by and information currently available to the management. Forward-looking statements (other than statements of historical fact) regarding our future results of operations, financial condition, cash flows, business strategy, plans and future objectives can generally be identified by terminology such as “targets”, “believes”, “expects”, “aims”, “intends”, “plans”, “seeks”, “will”, “may”, ”anticipates”, “continues” or similar expressions. A number of different factors may cause the actual performance to deviate significantly from the forward-looking statements in the presentations including but not limited to general economic developments, changes in the competitive environment, developments in the financial markets, extraordinary events such as natural disasters or terrorist attacks, changes in legislation or case law and reinsurance. We urge you to read our financial reports available on tryg.com for a discussion of some of the factors that could affect our future performance and the industry in which we operate. Should one or more of these risks or uncertainties materialise or should any underlying assumptions prove to be incorrect, our actual financial condition or results of operations could materially differ from that presented as anticipated, believed, estimated or expected. We are not under any duty to update any of the forward-looking statements or to conform such statements to actual results, except as may be required by law. 2
Strong value propositions High profitability | Strong customer retention | Low balance sheet risk Stable inflow of cash I DKK bn Return on Equity (%) Leading Scandinavian non-life insurer 35 35 30 30 25 25 20 20 II Strong earnings and high profitability 15 15 10 10 5 5 0 0 Robust capitalization and low leverage – assigned “A2” rating III with positive outlook by Moody’s Equity Acc dividends Acc share buy-back ROE Tryg’s combined ratio development IV Low risk balance sheet with conservative investments allocation 110 105 100 V Strong customer relationships with very high retention 95 90 85 80 VI Highly attractive market fundamentals 75 Sweden Norway Denmark * Note(*): Moderna Försäkringar is included from 2 April 2009 || Source: Company reporting 3
Tryg Forsikring A/S at a glance (I) Leading Nordic non-life insurance company Tryg’s operating fundamentals 2015 premiums split by COUNTRY • Tryg’s history dates back to the Customer Satisfaction 18th century 11% Denmark • Pure non-life insurer active in Denmark, Norway and Sweden Attractive Brand Norway • Retail is approx. 80% of total premiums Products Strength 38% • Motor, Property and Accident & Health 52% Sweden are Tryg’s main product lines • TryghedsGruppen, a mutual foundation rooted in Denmark, has Employee Distribution Satisfaction Network a 60% stake in the company • Bonus scheme recently introduced 2015 premiums split by BUSINESS MIX 2015 premiums split by PRODUCT LINE expected to boost retention long term • Unrivaled brand strength and recognition with significant local goodwill due to Motor TryghedsGruppen Private 10% 5% 31% Fire & property - 22% • Employees: 3,359 private 5% Fire & property - comm. Commercial • Customers: 2.8 million Health & accident 56% 11% • Premiums earned 2015: DKK 17,977m Worker' comp Corporate 22% Liability • Combined ratio 2015: 86.7 14% 24% Other • Total equity Q1- 2016: DKK 9,111m Source: Company reporting 4
Tryg Forsikring A/S at a glance (II) Operating in attractive market fundamentals 9% Tryg’s combined ratio development Market share Nordics Q4’14 Tryg 5% Topdanmark 42% 110 If EUR Codan 17% 25.7bn Gjensidige 105 Länsforsikringar 9% Other 100 9% 9% 95 Sweden 90 Tryg is operating in Sweden DENMARK Q1’15 18% through the following Market share Tryg 31% brands: 85 Topdanmark EUR If 80 Codan 7.0bn TOP5 17% Norway Gjensidige Alm. Brand 75 Other TOP3 10% 6% 7% 11% * Sweden Norway Denmark Key market characteristics A cquisition of Skandia’s 14% NORWAY Q4’15 Market share child insurance portfolio Tryg 29% during 2015: 1. Solid macroeconomic environment If #1 Denmark EUR Gjensidige 2. Consolidated and mature markets 22% 6.2bn Sparebank1 Other 10% 3. High degree of customer loyalty 25% 4. Rational key players and most of them listed Market position: #1 TOP3 TOP5 Moderna (Tryg) 5. High efficiency level with some of the lowest Market share: 18.0% 13.4% 2.9% 3% SWEDEN Q4’15 16% Market share If 18% expense ratios in the world Employees: 1,859 1,113 387 Trygg-Hansa Premiums earned: DKK 9,346m DKK 6,766m DKK 1,894m 6. High profitability and stable business (Codan) EUR 16% Gjensidige 7.9bn Technical result: DKK 1,371m DKK 844m DKK 328m 15% 7. Considerable barriers to entry Länsforsikringar Combined ratio: 85.2 87.9 82.7 2% 30% Note(*): Moderna Försäkringar is included from 2 April 2009 Source: Forsikringogpension (DK), FNO (NO), Svenskforsäkring (SE), Company reporting 5
Tryg Forsikring A/S at a glance (III) Long term profitable growth Leading Scandinavian insurer with strong track record Low risk and Customer care Financial targets 2017 Customer targets 2017 high returns worth recommending ROE : ≥21% • NPS +100% • Combined ratio: ≤87% • • Retention rate +1 pp 90% first contact resolution Matching assets and liabilities • • Expense ratio: ≤14% • ≥ 3 products +5 pp • Annual coverage check • • Low risk investment portfolio Dividend policy Payout ratio of 60-90% • Aiming for a nominal stable increasing dividend • Leading in Next level efficiency pricing Efficiency programme of DKK 750m • 25% of tariffs above peers in 2017 • Claims procurement • • Differentiated product offering Reducing expense level • Tryg strives to deliver long term profitable growth resulting in attractive value creation for all stakeholders Source: Company reporting 6
Resilient business model through cycles Proven operations ensure stable inflow of cash Pre-tax profit Technical result Investment result 4,000 High quality portfolio I Selected financial results with high retention rate 3,000 2,000 1,000 Highly attractive II 0 underlying profitability -1,000 -2,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Conservative asset III allocation Premium Smaller Premium Efficiency Customer hikes adjustments hikes program and efficiency focus 110 Stable operating result and proven track 105 Combined ratio IV record of a solid cash 100 flow generation 95 Combined ratio target : <87 Only one quarterly loss 90 in the last ten years V 85 due to extreme winter weather 80 2000 2001 2002 2003 2004* 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Note(*): IFRS from 2004 - previous years are Danish GAAP || Note(general): data before 2009 is not corrected for the sale of Marine Hull business, and Finland before 2008 || Source: Company reporting 7
Sustainable efficiency program 2015-2017E Expense and claims reduction of more than DKK 750m within 3 years Overview of efficiency program 2015 - 2017E Annual cost savings 2012 - 2017E Old program New program Expense Claims DKK Expense 400 250m reduction 350 113 82 125 300 DKK 250 750m 200 75 DKK Claims 150 300 500m reduction 55 282 60 50 250 100 150 15 120 105 50 100 30 0 2012 2013 2014 Target 2015 Target Q1'16 Target 2015 2016 2017 Development in FTEs New initiatives towards 2017 • Utilization of Nordic 4,000 3,914 procurement volume 3,800 3,703 • Sourcing 3,599 3,600 • Simplification 3,359 3,400 3,333 • First contact resolutions 3,200 • Improved retention rates • Enhanced fraud detection 3,000 2012 2013 2014 2015 Q1'16 Source: Company reporting 8
Tryg’s strategic business initiatives Focus on customer retention while increasing prices and product mix Private – Customer retention I High customer retention level at 85-90% 92% DK 90% 88% Price increases of 3% to offset claims 86% II NO inflation and improve profitability 84% 82% Product portfolio diversification focused on recent acquisition of III Skandia’s child insurance portfolio, Nordic extended warranty and pet Commercial – Customer retention insurance 92% 90% Continued development of DK IV digitalization – a key strategic 88% initiative from Tryg 86% NO 84% Danish members’ bonus to be paid on the 1 st of June 2016 and equal to V 82% approximately 8% of average premium paid Source: Company reporting 9
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