TrygVesta report 2 0 0 5 2 8 . february 2 0 0 6 Stine Bosse, CEO - PowerPoint PPT Presentation

TrygVesta report 2 0 0 5 2 8 . february 2 0 0 6 Stine Bosse, CEO Morten Hübbe, CFO TrygVesta • annual report 2005

2 0 0 5 in review Solid im provem ent – strengthen of position • Pre-tax profit DKK 2,913m up by DKK 861m • The technical result DKK 2,053m – up by DKK 353m • Investment yielded a return of DKK 1,681m – up by DKK 478m • Combined ratio 89.0 – Return on equity 28% after tax • Premium growth of 2.9% - from DKK 15,266m up to DKK 15,705m • Significant improvements in the three major business areas • Dividend payout ratio of 68% of the profit for the year, equal to DKK 21 per share • Expected result for 2006 s DKK 2,200m pre tax and a combined ratio at 91 02-03-2006 Side 2

The financial perform ance in figures Q4 Q4 DKKm 2 0 0 5 2 0 0 4 2 0 0 5 2 0 0 4 Gross earned premiums 3,961 3,820 15,705 15,266 Earned premiums, net of reinsurance 3,749 3,450 14,739 13,620 Gross claims ratio 70.0 75.1 72.0 69.3 Ceded business as a percentage of gross premiums 4.9 2.6 0.1 4.7 Gross expense ratio 16.8 16.9 16.9 17.1 Combined ratio 91.7 94.6 89.0 91.1 Operating ratio 89.6 92.7 87.2 89.1 Technical result 421 284 2,053 1,700 Investments 272 273 888 378 Other income/ expenses -15 -8 -28 -26 Profit before tax 678 549 2,913 2,052 Profit after tax 496 369 2,097 1,421 02-03-2006 Side 3

Large claim s on w eather related claim s • Expenses related to windstorms and disasters above normal year due to the January windstorm • + DKK 800m above the level of 2004 • Expenses related to large claims losses close to a normal year in 2005 • - DKK 45m relative to 2004 Gross disaster and w indstorm Gross large claim s expenses, total expenses 1.000 911 800 739 800 600 600 461 416 400 400 278 236 184 200 200 111 84 73 0 0 2001 2002 2003 2004 2005 2001 2002 2003 2004 2005 Normal level Normal level 02-03-2006 Side 4

Claim s Ratio Claim s Ratio, net 100% 83,6% 90% 78,3% 74,0% 72,6% 80% 72,1% 70% 60% 50% 40% 30% 20% 10% 0% 2002 2003 2004 2004 I FRS 2005 I FRS 02-03-2006 Side 5

2005 I FRS 16,9% 2004 I FRS 17,1% 21,2% 2004 Side 6 22,4% 2003 Expense ratio 23,6% 2002 Expenses 25% 20% 15% 10% 5% 0% 02-03-2006

Result breakdow n Effects of previous efforts continue to m aterialize • Technical result improved across country and business area • P&C Norway in particular supported by low claims ratios • Danish business hampered by the windstorm in January • Good balance in earnings between Denmark and Norway Technical result / business areas Technical result / geography 2500 874 900 831 756 2000 700 524 1500 1,138 1,023 464 500 DKKm 390 1000 300 500 956 722 100 0 -100 -41 2004 2005 -45 P&C DK P&C NO Corporate Other DK Norway 2004 2005 02-03-2006 Side 7

Highlights 2 0 0 5 • Customer satisfaction and loyalty in top • Two major events – storm and flooding • Nordic partnership agreement was prolonged to 2010 • Customer concepts successfully introduced in Norway • New Motor insurance in Denmark • Successful IPO • Decision made to enter Sweden in 2006 02-03-2006 Side 8

Side 9 Business areas 02-03-2006

Privat & Com m ercial - Denm ark

Private & Com m ercial Denm ark High grow th and strong earnings Growth at 5,6 % • Index 2,4% • Price increase 1,2% • Organic growth 2% • Retention rate from 84.4 to 85.0 • Increased market share Strong perform ance despite January storm 02-03-2006 Side 11

Private & Com m ercial Denm ark Good profitability despite the storm Claims ratio up 5.8 percentage points • January storm affects the claims development by approx. Gross claim s & gross expense ratios 11.3 percentage points before reinsurance and 104.9 99.8 1.4 percentage points net of 93.2 89.8 110 reinsurance 23.0 90 22.7 17.7 17.8 3.5 3.0 • Steady to declining claims frequency 1.7 70 50 79.5 78.4 74.1 • Reduced average claims for motor – 73.7 30 increased average claims for house- owners 10 -7.4 -10 2002 2003 2004 2005 • Strong focus on existing customers Gross claims ratio Net of ceded business Gross expence ratio and new sales 02-03-2006 Side 12

Developm ent in claim s frequency DK Side 13 Developm ent in claim s frequency 02-03-2006

Privat & Com m ercial - Norw ay

Private & Com m ercial Norw ay Positive indication from new price structure 4.4% growth • Growth in local currency at 1% • Index 1.1% • Price increase 0.6% • Organic growth -0.7% • Rentention rate 83.0 to 83.7 Very satisfactory claim s level 02-03-2006 Side 15

Private & Com m ercial Norw ay Strong profitability and basis for stronger custom er focus Claims ratio still at a very low level • Only limited effect of the heavy rains in Bergen in September • Low claims level Gross claim s & gross expense ratios • Low claims frequency on Motor and House 104.4 98.6 120 • Lower claims level for new customers 83.1 83.2 100 • Very low level of house fires 27.0 24.7 80 • Low level of large claims 5.4 2.0 20.8 20.4 1.3 – but one Property claim of NOK 27m 1.6 60 • Increasing number of claims handled 40 72.0 71.9 by telephone 60.8 61.4 20 0 Expense ratio down 0.4 percentage point 2002 2003 2004 2005 • Improved effectiveness and investments Gross claims ratio Net of ceded business in sales activities and improved customer Gross expense rartio service 02-03-2006 Side 16

Developm ent in claim s frequency N Side 17 Developm ent in claim s frequency 02-03-2006

Corporate

Corporate Good results after necessary initiatives Negative development of premiums driven by: • Aviation Pool • Full effect of net pricing • Increased deductibles Very satisfactory result 02-03-2006 Side 19

Corporate Profitable level im proved • Underlying claims level very Gross claim s & gross expense ratios satisfactory • Very positive development in the 108.9 100.7 Norwegian business in part due to 120 94.6 92.4 effects of price increases in personal lines 16.5 100 16.8 7.1 11.7 11.4 • January storm affects the claims ratio 80 9.0 15.4 11.4 by 2.7 percentage points before 60 reinsurance and 0.3 percentage point 85.3 net of reinsurance 40 71.5 72.0 68.5 20 Expense ratio down 0.3 percentage point 0 • Despite lower premium level 2002 2003 2004 2005 • Focus on efficiency incentives Gross claims ratio Net of ceded business • Synergies Gross expense ratio 02-03-2006 Side 20

New Markets Rolling out Profitable Bancassurance Approach Finland: Gross Earned Prem ium s DKK MM Growth 44% • Entry into new markets, i.e. Finland and Sweden without incurring substantial Greenfield costs • Leverage Nordea partnership • Product initially branded Nordea Danish GAAP IFRS TrygVesta Bancassurance in Finland • Ability to capture further growth potential by developing direct distribution channels • Finnish penetration on track • Long-term market share targets of 8% of the private market 02-03-2006 Side 21

Custom ers • Strong brands in the Nordic countries • Come up with solutions rather than economic compensation • Actively perform as supplier of peace of mind • Strengthening loyalty Said by the 100 90 90 custom ers, w hen Number of answers 80 asked if they w ould 70 60 recom m end Tryg as 50 40 insurance com pany 28 30 14 for friends and 20 8 5 4 4 2 1 1 10 0 collegeaus 0 Ved 1 2 3 4 5 6 7 8 9 10 ikke 1 0 is ”Abolutely” Appraisal 02-03-2006 Side 22

EPSI benchm ark Nordic countries Contentm ent and loyalty – private custom ers 76 October 2005 74 TrygVest a 2005 72 Branche 2005 Loy alt y 70 68 If 2005 Codan/ Tryg- Hansa 2005 66 64 64 66 68 70 72 74 76 Contentm ent 02-03-2006 Side 23

EPSI benchm ark Denm ark Contentm ent and loyalty – private custom ers 8 3 Øv rig 2005 8 1 October 2005 7 9 7 7 Alka 2005 7 5 Loyalty 7 3 Branc he 2005 Try g 2005 Ny kredit 2005 7 1 Top 2005 6 9 Alm.Brand 2005 If 2005 6 7 6 5 Codan 2005 6 3 6 3 6 5 6 7 69 7 1 7 3 7 5 77 7 9 8 1 8 3 Contentm ent 02-03-2006 Side 24

EPSI benchm ark Norw ay Contentm ent and loyalty – private custom ers 7 8 October 2005 7 6 Gjensidige Sparebank1 7 4 Øv rig 7 2 Branc he Loyalty 7 0 Vest a 6 8 If 6 6 6 4 6 2 6 2 6 4 6 6 68 7 0 72 7 4 7 6 7 8 Contentm ent 02-03-2006 Side 25

EPSI benchm ark Finland 2 0 0 5 Contentm ent and loyalty – private custom ers 8 2 The group ”Other” is constituted 8 0 by several small companies. Tapiola 7 8 Nordea Vahinkov akuut us Ot her 7 6 Loyalty 7 4 Branc he 7 2 Pohjola 7 0 If Ultimo 2005 6 8 6 4 66 6 8 7 0 7 2 7 4 76 7 8 Contentm ent 02-03-2006 Side 26