The strategy of consistent internationalisation

The strategy of consistent internationalisation through commitment to the high-growth markets of Eastern and south-eastern Europe secures our future as an independent market player.

UNIQA secures its future as one of the major market players in Central and Eastern Europe with a growth strategy of consistent internationalisation through development, primarily, of the dynamically growing new markets of Eastern and south- eastern Europe. As Austria’s leading insurance group, we view this strategy as the basis for a sustained, profit-conscious expansion and for securing our independence.

We are investing significant funds and personnel management capacities in the development of markets within and beyond the eastern boarder of the European Union. The countries of Central Eastern Europe (CEE) as well as the Eastern Emerging Markets (EEM) still exhibit underdeveloped insurance density and penetration in all sectors, and harbour enormous potential. They make a growing contribution to our further expansion and to an improvement in the profitability of the UNIQA Group.

In brief

• Eastern Europe as growth driver
  The UNIQA Group companies in Eastern Europe enjoyed growth rates far above average, improving their premium incomes in 2007 by 27.6% to €816 million, thereby increasing their share in total Group premium income to 15.5%. The property and accident insurance lines as well as the life insurance business have developed exceptionally dynamically in this growth region.


• Austria as firm foundation
  The Austrian market remained a firm foundation for the company, with a rise in premium income by 2.8% to €3.5 billion and a share in the Group premium income of 66.7%.

In consideration of the activities focused on profitable insurance niches in Western Central Europe (WCE), we now operate with approximately 11,000 employees and numerous partners in 19 markets outside of Austria, from the Adriatic to the Baltic Sea and from Lake Constance to the Black Sea. With a Group-wide total of 5.7 million customers and 13 million contracts, a Group premium income of €5.3 billion, a profit on ordinary activities of €340 million and capital investments exceeding €21.5 billion, UNIQA numbers among the leading insurance groups in Central and Eastern Europe.

Investment in Albania’s largest insurance company

UNIQA has consistently taken additional steps in accordance with its “Go East” strategy. In March 2007, we signed a cooperation agreement with SIGAL, the leading insurance company in Albania with its head office in the capital of Tirana. With a market share of 28%, SIGAL is not only the largest insurance company in the country by far, it also has subsidiaries and branches operating in Macedonia (market share 6%) and in Kosovo (market share 13%).

SIGAL has frequently been recognised as Albania’s best insurance company and offers products in all insurance lines via a comprehensive sales network. For the last two years, SIGAL has been expanding with two-digit growth rates. Jointly developed products by UNIQA and SIGAL in life and health insurance have already been positioned on the market during 2007.

Based on the positive experiences throughout the cooperation, UNIQA also decided to partially take advantage of the option for acquiring an equity majority by 2010 somewhat earlier than that. The decision to acquire 46% of SIGAL’s share capital was passed in December 2007. This is a clear declaration of our commitment to this dynamically developing region that harbours exceptional potential due to the significantly below-average penetration of the insurance market compared with Western European countries, particularly in the area of life insurance.

In 2007, we continued sucessfully our campaign “An insurance of a new generation”. In Eastern Central Europe, UNIQA is pursuing a uniform brand policy.

Property insurance company founded in Serbia

As the next step into the new markets, we took over the fifthlargest insurance company in Serbia in January 2007, rebranded it with the UNIQA name and made it the first company in the Serbian market to implement the required product-line separation. The new UNIQA property insurance company started in the middle of last year with automotive insurance policies for liability and collision, as well as new features such as family rebates.

In product design, marketing and sales, we were able to take advantage of the experiences of the UNIQA Group from the roughly four million vehicle contracts in Western, Eastern and south-eastern Europe. In selling the new automotive insurance products, we rely on cooperative agreements with vehicle inspection stations in addition to our own field service agents and specialised agencies.

The head office of the Serbian property insurer is the newly erected UNIQA headquarters in Belgrade, which also offers space for a branch of our cooperation partner in Serbia, Raiffeisenbank. Along with the opening of the modern office building, we also worked with two neighbouring schools to bring into being the “schools without violence” project supported by UNIQA.

Investments in Bulgaria expanded

With the name change to UNIQA and the simultaneous upgrading of our investment to a majority of 62% in Vitosha, Bulgaria’s fifth-largest insurance company with activities in property and life insurance, we have sent another signal of our growing commitment in south-eastern Europe.

In addition to cooperation with the previous majority partner, our strategic partnership with Raiffeisenbank has, once again, proven itself as a strong growth driver in the rapidly expanding Bulgarian market. Thanks to the significantly above-average expansion of the property and life insurance business, the two new UNIQA Group companies were able to increase their market share in Bulgaria to a total of roughly 8.2%. With a market share of over 15%, UNIQA already ranks third on the market in the life insurance area.

Massive expansion of the presence in the Ukraine

Shortly before the end of the year, UNIQA expanded its commitment in the Ukraine, one of the most promising and largest regions in the Eastern Emerging Markets. We increased our capital participation in one of the largest property insurers, Credo-Classic, to an initial 61% and indirectly increased to over 90% our stake in the life insurer UNIQA LIFE, founded jointly with Credo-Classic and with the head office in Kiev.

We are very well situated in the Ukraine thanks to the cooperation with the second-largest bank in the country – the Raiffeisen bank Aval with 1,300 branches and roughly four million customers – as well as the extensive modernisation of the product range, restructuring and expansion of the sales network. We will consistently take advantage of the opportunities in this prospering insurance market with a population of roughly 47 million, to continue our expansion in Eastern Europe.

EEM

Our activities in the Eastern Emerging Markets are built upon the enormous growth prospects offered by the countries on the eastern border of the European Union. The successful cooperation with the Raiffeisen bank group is an important strategic advantage in this area, and also a major cornerstone for our start in Serbia and the Ukraine.

Health insurance for Croatia

Health insurance for Croatia: In May 2007, the strongly expanding company UNIQA osiguranje in Croatia introduced its new health insurance product onto the market. The product introduction was accompanied by a print advertising campaign and various public relations activities.

In brief

• UNIQA Hungary becomes a super brand
  UNIQA Biztosító was selected by an expert jury of Superbrands, an independent organisation founded in 1995, as one of the best Hungarian brands that offers consumers advantages over its competition. Our Group company, which offers special insurance protection for skiers, divers and recently also participants in boating regattas, has expanded its diverse sports sponsoring in 2007, as a supporter of the National Association of Hungarian Basketball Players and sponsor of the UNIQA Regatta large-boat championship on Lake Balaton.


• Golden Coin for UNIQA Slovakia
  In the competition for the Golden Coin for the best banking and insurance products in Slovakia, UNIQA polšťovňa once again received high rankings in multiple categories, as well as in the symposium of the Slovakian insurance brokers’ association as one of the best insurance companies of 2007 in the area of automotive insurance.


• UNIQA Poland receives multiple awards
  With new insurance offerings, UNIQA Poland strengthens its market position and the credibility of the brand. The bundled product “Insurance for Small and Medium- Sized Companies” was recognised by the business paper “Gazeta Finansowa” as the best product in the category of property insurance. In addition, UNIQA received the “Bronze Laurel of Customers 2007” from the Media Partner Group.

New headquarters for UNIQA Czech Republic

The dynamic business developments of our Group company in the Czech Republic made it necessary to build a new headquarters for roughly 280 employees, which was opened in spring of 2007. The company, which has received one of the best ratings from Standard & Poor’s within the Czech market and numbers among the top ten, impresses customers with comprehensive solutions in life insurance as well as the nonlife sector, and profits, in particular, from cooperation with the Czech Raiffeisenbank, in addition to its presence at 100 locations throughout the country.

With the opening of the new headquarters, UNIQA presented a unique historical document: the Chronicle of the Life and Suffering of Saint Wenceslas, long thought lost, has now been purchased by us. We made an important contribution to the tradition and cultural history of the Czech Republic by bringing this unique illuminated manuscript from the year 1585 back to Prague.

At the opening of the new head office in Prague, UNIQA purchased the historical document: Chronicle of the Life and Suffering of St. Wenceslas.

Mannheimer AG Holding restructured

Mannheimer AG Holding is implementing a new customer and process-oriented organisational structure with a specially developed tracking system in the Western European markets. The system is comprised of three areas that simplify the coordination process, reduce interfaces and optimise customer service. In addition, a new work model with an employment guarantee for roughly 800 employees up to the year 2012 was agreed upon, and is considered by local media to be exemplary for the industry.

EBRD supports further international expansion

Our company strategy of consistent internationalisation received new support in 2007. In November, the European Bank for Reconstruction and Development (EBRD) expanded its cooperation with UNIQA, which has been in place since 1998, and increased the framework agreement from €70 million to €150 million. This provides new financial scope for the acquisition of minority investments by EBRD in existing UNIQA subsidiaries in Central and Eastern Europe.

EBRD has already invested in UNIQA Group companies in four Eastern and south-eastern European countries, and now the signing of the new framework agreement also placed a takeover of 20% of UNIQA Osiguranje in Bosnia and Herzegovina on the agenda. On the other hand, EBRD has pulled out of the Czech UNIQA company as planned after eight years of successful cooperation.

Standard & Poor’s confirms strong financial position

The financial strength of the UNIQA Group was confirmed by the international ratings agency Standard & Poor’s again in 2008, at “A” level with a stable outlook. The main reasons for this were the convincing competitive position in Austria, the strong operational performance and the growing share of international business. The successful profit improvement programme that has massively increased profitability in recent years and will generate further profit growth up to 2010, was also recognised.