2021 Interim Report Q4.pdf

4TH QUARTER AND PRELIMINARY FULL YEAR 2021

PROTECTOR FORSIKRING ASA

(UNAUDITED)

2 FEBRUARY 2022

Financial highlights and key ratios

Q4 2021 and Preliminary Full Year 2021 Report | PROTECTOR FORSIKRING ASA | PAGE 3 of 19

Premiums

In Q4, gross premiums written increased by 8% or NOK 57.0m to a total of NOK 785.9m. The growth In local currencies was 14% and is mainly driven by Denmark and Sweden. We recognize that the low client chuwhich we have encountered in the first three quarters has remained throughout Q4.

Furthermore, premium growth is supported by price increases above claims inflation.

The growth per country was;

In 2021, gross premiums written totalled NOK 5,950.6m, representing 8% growth (10% in local currencies). The growth in the Nordics was 3% (NOK 143.9m) and in the UK 22% (NOK 290.4m). In local currencies the growth was 6% in the Nordics and 24% in the UK. The renewal rate for the total portfolio was 90.3% (83.0%) supported by price increases of 8.9%.

Protector has as earlier communicated, withdrawn from worker's compensation (WC) covers within the Norwegian health and welfare industry due to the Government's decision to define Covid-19 as an occupational disease within the WC cover. Moreover, Protector has withdrawn from WC as a single product in Denmark due to capital consumption on this product combined with poor profitability. These deliberate measures represent a premium reduction of approximately NOK 191m or 3.5% in 2021.

Growth per country is presented in the table below.

Results

In Q4 the profit for the quarter totalled NOK 238.8m, against NOK 442.2m in Q4 2020. The technical result was NOK 101.2m (NOK 53.6m), corresponding to a net combined ratio of 91.6% (95.4%). The technical result was driven by strong results in Sweden.

The net combined ratio by country is provided in the table below.

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In Q4, the company had run-off losses of 4.3% compared to run-off-losses of 3.5% in Q4 2020. The run-off losses is mainly driven by Norway and the UK. In Sweden the run-off-gains continued.

The claims ratio for own account is still improving and decreased from 83.8% in Q4 2020 to 80.9 % in Q4 2021. Price increases and other profitability measures drives the claims ratio downwards. The large loss level was as in Q4 2020 higher than normal - mainly driven by the UK, which was hit by several large claims, including the storm Arwen.

There were no measurable positive effects from Motor in Q4 related to Covid-19 as driving patteis back to normal. In the same period last year, Covid-19 had a positive impact on the net claims ratio of 3 percentage points, mainly related to motor insurance.

The net expense ratio was 10.7%, down from 11.6%, driven by lower personnel costs.

In 2021 the profit totalled NOK 1,204.0m against NOK 981.6m in 2020. The technical result was NOK 594.4m (NOK 246.6m), corresponding to a net combined ratio of 87.3% (94.8%). The technical result is driven by strong results in the Nordic countries. The UK came in weaker due to an above normal number of large and medium sized claims.

The net combined ratio for the full year, by country, is provided in the table below:

The claims ratio for own account was 77.4%, down from 84.6 % in 2020. Price increases and other profitability measurers drives the claims ratio downwards. The large loss ratio was somewhat lower than normal and the Covid-19 pandemic had a positive estimated impact at approximately 0.8 percentage points. In 2021 the company had run-off losses of 0.3% against 2.2% in run-off-losses in 2020

The net expense ratio was 9.9%, down from 10.2% due to higher reinsurance commissions. The gross expense ratio increased slightly due to higher bonus costs (significant part linked to the share price development) and broker commissions. Growth in the UK drives broker commissions up. On the other hand, the relative UK cost level continue to decline.

Discontinued operations

In Q4, the technical result for discontinued operations (change of ownership insurance) was NOK -17.2m (NOK -2.2m) and the profit for the quarter was NOK 0.0m (NOK 31.0m). In Q4, the company continued to sell change of ownership insurance due to existing agreements with some real estate brokers. These agreements are terminated as from 2022 due to new legislation coming into force.

In 2021, the technical result was NOK 10.8m (NOK 14.2m). The profit for the period was NOK 67.4m (NOK 94.3m) driven by a strong retuon investments.

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