07 and 09/10/2024 The Finest CEElection Investor Conference 2024
Investor Presentation
WELL DIVERSIFIED AND SOLIDLY CAPITALISED INSURANCE GROUP WITH CONTINUOUS DIVIDEND PAYOUTS SINCE 1994
Represented in
30
markets
Around
32mn
customers served by ~30,000 employees
Solvency Ratio
269%
as of
2 STRATEGY
More than
50
insurance companies and pension funds
S&P Rating
A+
with stable outlook
Dividend per share for 2023:
€1.40
continuous dividend payout since 1994
Insurance service revenue of € 10.9bn at YE 2023
Life1MTPL
14.1%17.4%
Health
6.8%
Motor own
14.7% damage (casco)
47.0%
Other property & casualty
1 Life insurance is divided into life with profit participation (7.8%),
life without profit participation (5.4%) and unit- & index-linked life (0.9%)
VIG
VIG - LEADING INSURANCE GROUP IN CEE
VIG as early mover with excellent market shares
NO
Top 3
Albania Baltic states
FIBulgaria Czech Republic Hungary
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Country |
Market positions |
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Non-life |
Life |
Total |
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1 |
1 |
1 |
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1 |
1 |
1 |
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4 |
4 |
4 |
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2 |
1 |
1 |
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2 |
2 |
1 |
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1 |
1 |
1 |
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3 |
2 |
3 |
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2 |
6 |
2 |
Total Market Share
22.6%
31.6%
9.4%
29.0%
24.6%
19.6%
13.3%
11.2%
FR
DK
DE
LI
SE
CZ
1
AT
1
SI
Slovakia
2
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LV |
>Top 3 |
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1 |
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LT |
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1 |
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BY |
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PL |
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UA |
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SK |
2 |
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1 |
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MD |
Special |
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HU |
1 |
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Markets |
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RO |
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1 |
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VIG operating in:
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20 |
+ |
10 |
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Core Markets |
Special Markets |
Source: local authorities; FY 2023 (Q3 2023:
HR
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BA |
RS |
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BG |
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3 |
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AL |
MK |
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2 |
1 |
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TR
3
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STRATEGY |
VIG |
DYNAMIC DEVELOPMENT SINCE EU ACCESSION IN THE CEE MEMBER STATES
VIG markets CZ, EE, HU, LV, LT, PL, SK, SL are becoming EU members as of
|
Major developments and future growth drivers |
GDP per capita as % of EU15 (in pps)1 |
- Within 20 years, GDP per capita grew from as low as 30% of WesteEuropean levels to over 70%
- CEE is well-positioned to capitalise on the nearshoring trend - EU to strengthen EU-centric value chains especially in critical/ strategic sectors
- Digital transformation is particularly dynamic in the CEE region
- Green transition is seen both as an opportunity and a challenge
80
60
40
20
0
Romania Bulgaria Latvia Lithuania Poland Estonia Croatia Slovakia Hungary Czechia Slovenia
for the CEE region given its current substantial reliance on non-renewable energy
2004 2022
- EU-CEEeducation spendings increased, creating a well-educated and boosts productivity and improves the position of the EU-CEE markets in
price-competitive labour force; promotion of skill development the global value chains
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Source: wiiw Spring Forecast Report, |
1 Source: AMECO; wiiw Monthly Report, |
4
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STRATEGY |
VIG |
5
4
3
2
1
0
-1
TAKING ADVANTAGE OF THE LONG-TERM GROWTH POTENTIAL IN CEE
Annual insurance spending as indicator for growth potential
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Insurance density 2023 (premiums per capita, in €) |
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Insurance density in 2023 in |
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1,443 |
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786 |
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503 |
502 |
473 |
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467 |
455 |
423 |
398 |
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272 |
219 |
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193 |
189 |
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167 |
145 |
113 |
83 |
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74 |
60 |
35 |
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Türkiye |
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GDP growth forecast (real change in % against previous year) |
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4.6 |
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4.5 |
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4.0 |
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3.8 |
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3.6 |
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3.6 |
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3.5 |
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3.5 |
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3.3 |
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3.0 |
2.9 |
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3.0 |
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3.4 |
3.0 |
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3.4 |
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2.7 |
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2.7 |
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2.6 |
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2.6 |
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2.6 |
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Türkiye |
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2024 |
2025 |
2026 |
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5 |
Source: VIG internal calculation ( |
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VIG |
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STRATEGY |
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STRONG MACROECONOMIC OUTLOOK FOR CEE
Excellent average annual real GDP growth rates (2024-2028) expected for major VIG markets
For most CESEE countries 2024 will be better than 2023
- GDP growth for the EU members in the region is forecasted at average of 2.5%, rising to 3% in 2025 - significantly outperforming the stagnant euro area (0.6%), and still growing next year twice as fast as the euro area (1.6%)
-
Romania (3.0%) andCroatia (2.9%) are seen to grow particularly strong in 2024, supported by in-flows from EU fundsCzech Republic ,Poland ,Slovakia andHungary are expected to grow at an average rate of 2.4% this year, rising to 3.0% in 2025
- Inflation in most of VIG markets has slowed significantly on the back of falling food and energy prices, allowing for rapid real wage growth
- Private consumption is driving the growth on the back of rising wages (tight labour markets) and falling inflation
Source: wiiw Spring Forecast Report (
Real GDP average annual change
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2024 - 2028 |
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+ 4.0% |
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+ 3.4% |
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+ 3.1% |
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+ 2.9% |
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+ 2.8% |
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+ 2.8% |
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+ 2.6% |
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+ 2.5% |
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Czechia |
+ 2.3% |
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+ 1.9% |
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+ 1.8% |
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+ 1.5% |
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+ 1.4% |
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+ 1.3% |
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Euro area |
+ 1.2% |
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+ 1.0% |
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+ 1.0% |
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+ 0.9% |
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+ 0.7% |
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CESEE - Central, East and |
Source: |
6
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STRATEGY |
VIG |
SUCCESS IS BUILT ON DIVERSIFIED AND RESILIENT BUSINESS MODEL
VIG's 4 proven management principles
Local entrepreneurship
Multi-brand policy
- Knowledge of local needs and markets
- Decentralised structures & efficient decision-making procedures
VIG Holding responsible for steering the Group
- Utilisation of established local brands→ Local identification through market-specific brand(s)
- "
Vienna Insurance Group " underlines the Group's internationality and strength
Multi-channel distribution
8%
Conservative investment and reinsurance policies
- Various distribution channels
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(incl. partnership with Erste |
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35% |
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Group) |
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▪ |
Strongly customer-oriented |
49% |
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8% |
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distribution |
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Employed sales forces & tied agents |
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Brokers & agents |
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Banks |
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Other (incl. online sales) |
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- 35.3bn
2023
Investments held at VIG's own risk
- Focus on secure and sustainable investments
- Spreading risk by means of diversification
7
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STRATEGY |
VIG |
VIG 25 STRATEGIC PROGRAMME SECURES FURTHER DYNAMIC DEVELOPMENT
Initiatives and projects to optimise, enhance and expand VIG's business model
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STRATEGIC TRENDS |
DEVELOPMENTS |
OBJECTIVES
VIG 25 STRATEGIC
DIRECTIONS & INITIATIVES
|
OPTIMISE |
ENHANCE |
EXPAND |
CO³
COUNTRYCOMMUNICATION
PORTFOLIOSCOLLABORATION
COOPERATION
VIG PRINCIPLES
Optimise operational excellence by
- simplification and automation of processes
- exchange and implement best practices
- further optimisation in underwriting and pricing
Enhancecustomer value and access including partnerships and platforms
- increase visibility and attractiveness of products
- moving towards a hybrid sales model
Expand value chain beyond insurance
- focus on asset management
- become more active in pension fund business
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8 STRATEGY |
VIG |
GROUP-WIDE SUSTAINABILITY PROGRAMME COMPLEMENTS VIG 25 STRATEGIC PROGRAMME
Sustainability in VIG means creating economic value today without doing so at the expense of tomorrow
Objectives
- Promote risk literacy
- Grow corporate volunteering
▪ Focus on customer satisfaction
▪Close the protection gap
- Attractive employerwith equal opportunities for all
- Employee focus
Social focus Environmental focus
Objectives
▪Reduce emissions of investment portfolio to net zero by 2050
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▪Reduce emissions of corporate and |
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SUSTAINABILITY |
retail underwriting portfolios to net |
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ALONG OUR |
zero by 2050 |
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BUSINESS MODEL |
▪ |
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Increase the share of sustainable |
products
▪Climate neutral operation of our offices by 2030, net zero by 2050
9
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STRATEGY |
VIG |
RISK AWARENESS AND RISK LITERACY IN CEE TO BE IMPROVED
VIG defines risk literacy as the ability to make informed and considerate decisions in relation to risks
Risk literacy in CEE according to a representative study not particularly strong
▪
Around 2/3 of the population have little to no awareness of the health, work, housing, liability, and cyber risks and believe that the public authorities would intervene
- 7 out of 10 respondents do not believe that the risks are likely to become a reality, despite judging potential loss/damage to be high
1 out of 5 has taken no risk-prevention measures at all
The global protection gap (need in % of economic loss)1
76
57
22
Health Mortality NatCat
Insurance 889 406 368 potential ($ bn)
In addition to GDP growth and increased wealth of the population,
improved risk literacy is an important driver for further developing insurance density,
reaching potential future customers and helping individuals and society to achieve economic resilience (closing the protection gap).
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Reference: Representative study by |
1 Source: Insurance Resilience Index of |
10
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STRATEGY |
VIG |
Attachments
Disclaimer
François G. Henriquez moves up at Fed Bank
Best’s Market Segment Report: AM Best Revises Outlook to Stable on Indonesia’s Non-Life Insurance Segment
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