Allianz Deutschland remains on course despite natural disasters and low interest rates

The flood in Bavaria and eastern Germany, five hailstorms and two major weather depressions were the dominant features of 2013 for Allianz Deutschland and its customers. The Munich insurer is paying out 1.2 billion euros for these claims alone – 570 million euros for flood damage and 631 million euros for hail and storm damage.

 

Customers filed nearly 400,000 claims for flood, hail and storm damage – 100,000 more than in a normal year. To help these people quickly and unbureaucratically, Allianz Deutschland set up five special claims support units during the May and June floods, dispatched 360 experts and claims adjusters and organized repairs itself for 2,800 buildings right away through the Allianz Handwerker Service. Local Allianz agents, even those affected by the flood themselves, made an enormous personal effort to help their customers deal with damages. Following the hailstorms in July and August, Allianz experts assessed 60,000 cars with hail damage in 63 collective inspections.

 

“Our customers found that in Allianz, they have a strong partner to stand beside them,” said Allianz Deutschland CEO Dr. Markus Riess. After reinsurance, the net outlay for natural disasters came to 651 million euros: 206 million euros for the floods and 445 million euros for storm and hail damage. Although these exceptionally high claims expenses impacted operating profit, the figure of 1.6 billion euros (2012: 2.0 billion euros) was only 400 million euros below the prior year, because the core business remained sound and profitable and was able in part to compensate for the large impacts. The combined ratio, which in property insurance is the ratio of expenses and losses to premiums earned, remained below the 100-percent mark, at 99.5 percent (96.8 percent).

 

Allianz Deutschland’s net income declined by 32.9 percent, to 1.1 billion euros.

 

 

Allianz Deutschland still on a growth track

 

Revenues at Allianz Deutschland gained 6.8 percent in fiscal 2013, to reach 29.9 billion euros (27.9 billion euros).

 

Property and Casualty insurance remained on a growth track, growing premiums by 1.1 percent to 9.3 billion euros (9.2 billion euros). The 5.9 percent increase in commercial business provided an especially notable boost. Allianz car insurance saw a 3.4 percent increase in premiums to 3.3 billion euros (3.2 billion euros). Its new and additional premiums grew 4.3 percent to 784 million euros (752 million euros). At year’s end, some 8.1 million vehicles were insured with Allianz, under a total of 14.1 million policies. AllSecur, Allianz Deutschland’s direct brand, grew especially fast, with a gain of 80,000 vehicles insured.

 

The “PrivatSchutz” modular protection plan, introduced in May 2013, which custom-tailors combinations of liability insurance, home structure and contents insurance, and legal insurance, won customers over. This modular system accounted for nearly 20 percent more new premiums than the year before in these four lines of insurance. “That tells us that we’re meeting our customers’ needs,” said Riess.

 

 

Customers make “Perspektive” a success story

 

Life insurance premium revenues grew 12.0 percent, to 17.0 billion euros (15.2 billion euros), driven primarily by single premium business, which gained a substantial 29.8 percent from the prior-year figure. Recurring premiums picked up 1.2 percent to reach 9.5 billion euros (9.4 billion euros). New premiums increased significantly by 23.6 percent to some 8.2 billion euros. In addition, the historically low cancellation rate in terms of units, at 1.9 percent, demonstrated how satisfied customers are with their life insurance.

 

Customers made a success story of the innovative “Perspektive” retirement coverage concept, introduced in July 2013, which combines investment in reliable restricted guarantee assets with new guarantees. With nearly 20,000 policies signed, valued at over 720 million euros, “Perspektive” is the most successful product launch for Allianz Leben to date.

 

Because interest rates remain low, customers were generally looking more and more to capital market-related products with new guarantees. They represented a 35 percent share for private old-age provision. In the fourth quarter, as much as half of new business was in policies with new guarantees.

 

 

Health insurance business stable

 

Health insurance kept its premium revenue constant at 3.3 billion euros. New premiums, however, decreased 20.7 percent to 74 million euros (94 million euros). This reflected mainly the conversion to unisex rate plans, the reduction in the technical interest rate and last but not least the discussion of “Bürgerversicherung”, a basic health cover plan for all citizens. At year’s end, 2.6 million people were covered by private health insurance from Allianz, 1.5 percent more than a year earlier.

 

 

Investment results

 

Assets under management grew 2.5 percent, to 242.1 billion euros (236.1 billion euros). Because of rising interest rates and the upward valuation of the euro in 2013, net investment income decreased to 10.3 billion euros (11.3 billion euros).

 

 

Outlook for 2014

 

The exceptionally high natural catastrophe losses had a major effect on fiscal year 2013. “Assuming that impacts from natural catastrophes and major losses return to normal this year, we will achieve our goals in our forward-looking program for Property and Casualty insurance,” said Riess. Allianz Deutschland has set itself a revenue target of 9.5 billion euros in Property and Casualty insurance by the end of 2014, with an expense ratio of 26.0 percent and a combined ratio of 95.0 percent.

Allianz Deutschland CEO Markus Riess
Allianz Deutschland CEO Markus Riess: “Our customers found that in Allianz, they have a strong partner to stand beside them.”

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Christian Teichmann
Allianz Deutschland AG
Phone +49.89.3800-7578
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Ulrike Strauß
Allianz Deutschland AG
Phone +49.89.3800-12948
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Châu Báu Tang-Rupp
Allianz Deutschland AG
Phone: +49.89.3800-12944
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