Presentation

Transcription

Presentation

The Munich Re Group
Navigating the Sea of Change
Goldman Sachs European Financials Conference
Mastering a challenging environment
through holistic competences
Dr. Torsten Jeworrek
8 June 2005
Agenda

Munich Re positioning
3

Future of reinsurance
10

Outlook and financials
14
The Munich Re Group
Goldman Sachs conference
8 June 2005
2
Agenda

10

14
3
The Munich Re Group
8 June 2005
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The Munich Re Group
Turning risk into value
Active risk
diversification
Only the
combination of
outstanding talents
in various
disciplines within
Munich Re will lead
to sustainable
success
Sustainable
success
Excellent steering
and control
Focus on risk as
our business
The Munich Re Group
8 June 2005
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Munich Re positioning – Focus on risk as our business
Munich Re's competitive advantage – Translate our core
strengths into client advantages
Core strengths
of Munich Re
Translated value
proposition
Client Advantages
High franchise value
Liability side driven
underwriting
Aligned interests of
reinsurance
manager and
reinsurer
Focus on technically
profitable
underwriting
Underwriting without
relying on
retrocession
Global presence in
every line of
business
High capacity and
financial stability
Broad set of
specialists
World leading
knowledge e.g. in
Engineering and
Marine
Develop clients to
better understand
and report risks
Reliable, predictable
and consistent
underwriting
decisions
Provide true world
wide experience
Munich Re's set up
guarantees best
mid and long term
market positioning
Reduced
reinsurance
complexity with a
one stop shopping
option
Improve own
business via
knowledge transfer
High acceptance of
Munich Re at senior
management
The market target is to be on the short list of every potential client
The Munich Re Group
8 June 2005
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GeoRisksResearch department –
Market leader in the scientific community
Consulting Munich Re
underwriters and clients
regarding natural perils
Estimation of loss potentials
Hazard and risk assessment
Development of service tools
(internal and external clients)
Know-how transfer
Modelling approach
Significant research know-how for
hurricanes over the last 30 years
Where third-party modelling tools
are used, they are
under close monitoring of Munich
Re experts
adjusted to reflect Munich Re
insights, e.g. as the number of
hurricanes is higher in a warm
phase third-party tools tend to
forecast too few hurricanes
GeoRiskResearch
department consists
of 25 employees with
high expertise in:
Earthquake
Flooding
Windstorm
General weather
Climate
Consequence of Munich Re's advantageous position
Cancellation of treaties not technically acceptable
Shift of capacity and attempt to achieve higher shares in treaties/layers where our
standards are met
ÆOur internal expertise on hurricanes materialised in a currently reduced
exposure
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Identification of emerging risks
Options for action
Number
Initial
expert
discussions
Publications in
scientific
journals
Public
awareness
from
press/media
Conferences
Politics
NGO (nongovernmental
organisations)
activities
Frequency of
weak signals
Degree of
uncertainty
Political parties
Parliament
Laws
Standards
Company
statements
Regulations
Time
Source:Allianz Global Risks Report 1/02
Example: Pharmaceutical Industry
DES
Thalidomide
Contergan®
1960
Mexaform®
(SMON)
1970
Factor VIII
(AIDS)
IUD
Silicone
breast
implants
L-Trp
1980
1990
Baycol® Thimerosal
Lotronex® PPA
Paxil®
FenPhen
2000
HRT
?
2010
The Munich Re Group
8 June 2005
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Munich Re positioning – Excellent steering and control
Renewal Steering & Monitoring (RSM)
Implementing VBM metrics down to underwriting level
Status of Renewals
Beginning
Middle
Last Days
Premium
Premium
Premium
Real-time
transparency of
monetary impact of
latest renewal
developments
Immediate
reconsideration of
portfolio distribution
Total
Value added
Total
Value added
Total
Value added
Complements whole
VBM process
Immediate
optimization of risk
capital allocation on
department level
and through
aggregation also on
division and resort
level possible
VBM Return Target
Not yet offered treaties
Treaties in progress
Renewed treaties
New treaties in 2004
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8 June 2005
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Munich Re positioning – Active risk diversification
Success by risk diversification
Active risk diversification
Measuring diversification
Transforming diversification into tangible benefits
Dynamic portfolio
management
Capital fungibility
Munich Re Group
capital model
Robust determination of
diversification and
concentration effects
using multidisciplinary
"state of the art" tools
Optimising intragroup
risk mitigation
instruments (e.g.
retrocession) with
effective Group
oversight to limit
contagion risks
Further derisking,
significantly improving
our quality and mobility
of capital
Active capital
management balancing
regulatory, rating agency
& economic needs
Active shift of capital in
reinsurance depending
on the cycle(s)
Comprehensive
accumulation control
Optimising portfolio risk
adjusted returns through
"best of breed" ALM
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Agenda

3

10

14
The Munich Re Group
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Reinsurance has and will always change
nontraditional
Short term
innovation
Type of
coverage
Long term
innovation
traditional
established
Risk
new
Focus
Short term innovation
Long term innovation

Identification of new types of
coverage a reinsurer can offer

Identification of new risks, that
can be reinsured

Efficiency improvement of
existing markets

Creation of new markets with
first mover advantages

One by one horizon

Long term horizon

Immediate transformation

5 to 8 years to create established
markets
The Munich Re Group
8 June 2005
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Innovation
Projects and topics at a glance
Time to implementation
Long-term "Pipeline"
long-term
New Risk
Parametric triggers
Claims
MIS
Solvency II
Risks &
Non-traditional
Outsourcing Solutions “Casualty“
Discontinuation of
Equalisation Reserves
Non-traditional
structure
New concept
Product Development
from Claim Scenarios
mid-term
Partial
German
Retirement
Medical
Multi-year
Professional Highways
Funds
Professional bouquet with
Liability for
Liability
Florida
Insurance
earnings
Hurricane
Agents
corridor
Multiline/
Multiyear
concepts
New Business
through Product
Development
Service
short-term Short-term "Quick win"
low
Leasing
concept
medium
high
Market potential
The Munich Re Group
8 June 2005
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We will continue to employ our core competence into
related segments to become less dependent of the cycle
Core
competencies are
well defined
Further
employment
strengthens core
competencies
Regional expansion
develop further
regions to
reinsurable markets
Resistant to
imitation or
substitutes by
competitors
Core competence
Further
detachment from
traditional clients
behaviour
risk assessment
technical u/w
Horizontal expansion
Vertical expansion
underwrite new risks
move closer to
original risk
The Munich Re Group
8 June 2005
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Agenda

3

10

14
The Munich Re Group
8 June 2005
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Group financial targets 2005
Next step on the path to sustainable profitability
Reinsurance
Primary insurance
Results Q1 2005
Non-life
Property-casualty1
Life
Life and health
Combined ratios:
Reinsurance
96.5%, Primary
insurance 99.1%
European embedded value
operating earnings
European embedded value
operating earnings
Investment result
strong at €2.5bn
Combined ratio
97%
8–10%
Combined ratio
95%
8–10%
Shareholders'
equity up by
€0.6bn to €21.3bn
Asset management
Group assets
Return on investment2
4.5%
Munich Re Group:
RoE3 2005: 12%
Outstanding result
in reinsurance
of €601m primary
insurance strong
with €121m
Q1 result of
€688m first
milestone on track
to our RoE-target
1
Inclusive legal protection.
IFRS investment result based on average IAS book values.
3 Profit for the year/average total shareholders‘ equity, both incl. minorities
2
The Munich Re Group
8 June 2005
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Appendix
Financial calendar
Contacts
Disclaimer
The Munich Re Group
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Appendix
Financial calendar

27 June 2005
Investors' Day

4 August 2005
Interim report as at 30 June 2005

7 November 2005
Interim report as at 30 September 2005

14 March 2006
Annual report 2005

19 April 2006
Annual General Meeting

20 April 2006
Dividend payment

9 Mai 2006
Interim report as at 31 March 2006

3 August 2006
Interim report as at 30 June 2006

7 November 2006
Interim report as at 30 September 2006
The Munich Re Group
8 June 2005
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Appendix
For information please contact
Pedro Janeiro Martins
Head of Investor Relations
Tel.: +49 (0) 89/38 91-39 10
E-mail: [email protected]
Ralf Kleinschroth
Robert Kinsella
Tel.: +49 (0) 89/38 91-45 59
Tel.: +49 (0) 89/38 91-30 19
Ingrid Grunwald
Frank Kopfinger
Tel.: +49 (0) 89/38 91-35 17
Tel.: +49 (0) 89/38 91-28 94
Fax: +49 (0) 89/38 91-98 88
Internet: www.munichre.com
The Munich Re Group
8 June 2005
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Appendix
Disclaimer
This report contains forward-looking statements that are based
on current assumptions and forecasts of the management of
Munich Re. Known and unknown risks, uncertainties and other
factors could lead to material differences between the forwardlooking statements given here and the actual development, in
particular the results, financial situation and performance of our
company. The company assumes no liability to update these
forward-looking statements or to conform them to future events
or developments.
The Munich Re Group
8 June 2005
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