Arranged by: Tryg Forsikring A/S Tier 2 subordinated bond issue Company presentation October 2015
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 Proven distribution platform | High profitability | Low balance sheet risk Stable inflow of cash I DKKbn Return on Equity (%) Leading Scandinavian non-life insurance player 30 35% 25 30% 20 25% II 15 20% Solid and stable earnings and profitability 10 15% 5 10% 0 5% III '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15* Strong capitalization – “A - ” rating from S&P Acc. share buy-back Acc. dividends Equity Return on Equity Favorable combined ratio development IV Low risk balance sheet with stable return on investment 110% 105% 100% V 95% Strong customer relationships with high customer retention 90% 85% 80% VI Attractive market fundamentals 75% '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15* Denmark Norway Sweden** Note(*): 2015 year-to-date || Note(**): Moderna Försäkringar is included from 2 April 2009 3
Tryg Forsikring A/S at a glance (I) Leading Nordic non-life insurance company • Tryg’s history dates back to the Tryg’s operating fundamentals 2014 premiums split by COUNTRY 18th century Customer • Focuses on non-life insurance in Satisfaction Denmark, Norway and Sweden 12% • Primarily provides insurance to private Denmark individuals but are also active towards Attractive Brand the commercial and corporate sector Products Strength 47% Norway • Motor, retail & commercial property 41% Sweden and health & accident are Tryg’s main product lines Employee Distribution • TryghedsGruppen, a mutual foundation Satisfaction Network rooted in Denmark, has a 60% stake in the company 2014 premiums split by BUSINESS MIX 2014 premiums split by PRODUCT LINE • The foundation recently implemented a members’ bonus scheme • Unrivaled brand strength and Motor recognition with significant local 20% goodwill due to TryghedsGruppen 21% Private 31% Private property • Employees: 3,425 Commercial Commercial 11% • Customers: 2.7 million property 56% Health & 23% • Premiums earned 2014: DKK 18,652m Corporate Accident 14% Other • Current market cap.: DKK 35,963m 24% • Total equity as of Q3-15: DKK 9,235m 4
Tryg Forsikring A/S at a glance (II) Operating in attractive market fundamentals Tryg figures Market combined ratio development Market share DENMARK Tryg 18% 100% 31% Topdanmark Codan EUR 95% Alm Brand. 6.9bn 18% TOP5 Gjensidige 6% If 90% 6% 12% Other Sweden 10% 85% Market share NORWAY Norway 80% Gjensidige 29% 25% '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 TOP3 If Norway Denmark Sweden EUR Tryg 6.4bn Key market characteristics Sparebank1 10% 22% Other 14% 1. Solid macroeconomic environment #1 Denmark 2. High degree of customer loyalty and acceptance for product bundling Länds- Market share SWEDEN forsikringar 16% 3. Consolidated and mature markets If 2% Market position: #1 TOP3 TOP5 30% Folksam 3% 4. Structurally high operational and Market share: 18.0% 13.5% 3.0% underwriting efficiency among key EUR Trygg-Hansa (Codan) 7.7bn players in the industry Employees: 1,903 1,131 391 16% Moderna (Tryg) Premiums earned: DKK 9,361m DKK 7,337m DKK 1,975m 5. Established and rational key players Gjensidige 18% 17% Technical result: DKK 1,510m DKK 1,478m DKK 44m Other 6. Considerable barriers to entry Combined ratio: 81.2 84.8 89.0 Source: Forsikringogpension (DK), FNO (NO), Svenskforsakring (SE) 5
Tryg Forsikring A/S at a glance (III) Attractive equity story 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 will consecutively deliver long term profitable growth resulting in attractive shareholder value creation 6
Solid track record Proven operations ensure stable inflow of cash 4,000 3,500 Established premium 3,000 I portfolio with high Selected financial results 2,500 retention rate 2,000 1,500 1,000 Attractive underlying 500 II underwriting 0 profitability -500 -1,000 -1,500 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Conservative asset Investment result Technical result Pre-tax profit III allocation with favorable return Customer Premium Smaller Premium Efficiency hikes adjustments hikes program and efficiency 110 focus 105 Stable pre-tax profit Combined ratio IV and lucrative return 100 on equity 95 90 Hands-on management and lean organization - V 85 well suited to efficiently cope with change 80 '00 '01 '02 '03 '04 '04* '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15E '16E '17E 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 7
Sustainable efficiency program 2015-17E Expense and claims reduction of more than DKK 750m within 3 years Overview of efficiency program 2015-17E Annual cost savings 2012-17E OLD program NEW program DKK Expense 250m reduction DKK 395 388 375 750m 118 DKK Claims 225 45 Q3 500m reduction 175 150 H1 73 2012 2013 2014 2015 Q1-Q3 2015 2016 2017 Achieved Target Development in FTEs New initiatives towards 2017 4,077 • Utilization of Nordic 3,914 procurement volume • Sourcing 3,703 3,599 • Simplification 3,425 • First contact resolutions • Improved retention rates • Enhanced fraud detection 2011 2012 2013 2014 Q3 2015 8
Sound investment approach and related return Conservative asset allocation and low return volatility provides consistency Portfolio Q3 2015 (DKK 39.7bn) Standard deviation of Return on Investment 2011-13 60% Bonds/deposits 13.0% 50% Inv. Property 5.1% 40% EM 1.0% 30% Free HY 2.2% 10.6bn 27% 20% Equities 5.8% Match 29.0bn 10% 73% Bonds/deposits 4.2% 0% Cov. Bonds 68.6% DLG Aviva Allianz Talanx Tryg Mapfrre RSA Zürich Gjensidige Sampo Vienna Generali Topdanmark PZU AXA Key comments MAX and MIN deviation in quarterly return 2007-15YTD 5.0% • Tryg aims to be world class in insurance • Aim of investment is to support insurance 2.5% • Less risk on investments requires discipline on the insurance result 0.0% • Allows focus on core business -2.5% • Matching of assets and liabilities implies lower net capital requirement in Solvency II -5.0% - High Return on Risk-Adjusted Capital (RORAC) Topdk If Gjensidige Alm.Br. Tryg Min Max Average 9
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