Group business development

  • (including savings portions from unit-linked and index-linked life insurance) rose by 1.2 per cent to €5,372.6 million
  • improved from 96.8 per cent to 96.4 per cent
  • Earnings before taxes stable at €295.7 million
  • Consolidated profit of €232.4 million
  • Proposed dividend increased by 1 cent to €0.54 per share for 2019
  • Pre-tax profit at 2019 levels expected for 2020
UNIQA Group

In € million

2019

2018

2017

Premiums written including savings portions from unit-linked and index-linked life insurance

5,372.6

5,309.5

5,293.3

Cost ratio (after reinsurance)

27.2%

25.9%

25.0%

Combined ratio (after reinsurance)

96.4%

96.8%

97.5%

Earnings before taxes

295.7

294.6

264.6

Consolidated profit/(loss) (proportion of the net profit for the period attributable to the shareholders of UNIQA Insurance Group AG)

232.4

243.3

171.8

Changes in premiums

UNIQA’s total premium volume, including savings portions from unit-linked and index-linked life insurance in the amount of €309.8 million (2018: €320.5 million), increased by 1.2 per cent to €5,372.6 million in 2019 (2018: €5,309.5 million).

Premiums written including savings portions from unit-linked and index-linked life insurance

In € million

Premiums written including savings portions from unit-linked and index-linked life insurance (bar chart)

In the area of insurance policies with recurring premium payments, there was an encouraging rise of 1.4 per cent to €5,267.9 million (2018: €5,196.7 million). In the single premium business, however, the premium volume decreased by 7.2 per cent to €104.6 million (2018: €112.7 million) in line with the strategy.

written in property and casualty insurance increased by 2.6 per cent to €2,846.8 million in 2019 (2018: €2,774.4 million). In health insurance, in the reporting period rose by 4.1 per cent to €1,130.8 million (2018: €1,086.4 million). In life insurance, premiums written including savings portions from unit-linked and index-linked life insurance fell by 3.7 per cent overall to €1,394.9 million (2018: €1,448.6 million). Reasons for this included the strategic withdrawal from the single-premium business and subdued demand due to persistently low interest rates.

The Group , including savings portions from unit-linked and index-linked life insurance (after ) in the amount of €309.8 million (2018: €320.9 million), rose by 1.8 per cent to €5,170.8 million (2018: €5,081.7 million). The volume of earned (net, in accordance with ) increased by as much as 2.1 per cent to €4,861.1 million (2018: €4,760.7 million).

Changes in insurance benefits

In the 2019 financial year, before reinsurance (see note 8 in the consolidated financial statements) dropped by 1.2 per cent to €3,756.3 million (2018: €3,800.2 million). Consolidated net insurance benefits rose less sharply than , increasing by 0.6 per cent to €3,657.1 million in the past year (2018: €3,633.7 million).

Insurance benefits (net)

In € million

Insurance benefits (net) (bar chart)

The loss ratio after in property and casualty insurance fell to 64.2 per cent in 2019 (2018: 65.4 per cent) on the back of a favourable trend in basic losses. The combined ratio after reinsurance thus improved to 96.4 per cent (2018: 96.8 per cent) despite a higher  at Group level.

Property and casualty insurance

In € million

2019

2018

2017

Premiums written

2,846.8

2,774.4

2,639.7

Insurance benefits (net)

–1,719.5

–1,690.1

–1,644.8

Loss ratio (after reinsurance)

64.2%

65.4%

65.9%

Operating expenses (net)

–861.2

–811.0

–788.5

Cost ratio (after reinsurance)

32.2%

31.4%

31.6%

Combined ratio (after reinsurance)

96.4%

96.8%

97.5%

Net investment income

122.1

128.1

119.7

Earnings before taxes

116.0

120.3

95.1

Technical provisions (net)

3,061.3

2,970.6

2,939.7

Combined ratio after reinsurance

In per cent

Combined ratio after reinsurance (bar chart)

Operating expenses

Total consolidated (see note 9 in the consolidated financial statements) less reinsurance commission and share of profit from reinsurance ceded rose by 7.0 per cent to €1,407.1 million in the 2019 financial year (2018: €1,314.7 million). Expenses for the acquisition of insurance less reinsurance commission and share of profit from reinsurance ceded in the amount of €17.9 million (2018: €13.6 million) rose by 6.5 per cent to €907.4 million (2018: €851.9 million) due to increased amortisation of deferred in life insurance. Other operating expenses increased by 8.0 per cent to €499.7 million (2018: €462.7 million) as a result of higher staff and IT costs. This line item includes expenses for the innovation and investment programme amounting to around €51 million (2018: approx. €43 million).

The cost ratio after reinsurance, i.e. the ratio of total less the amounts received from reinsurance commission and share of profit from reinsurance ceded to the Group premiums earned, including savings portions from unit-linked and index-linked life insurance, increased to 27.2 per cent during the past year (2018: 25.9 per cent) as a result of the developments mentioned above. The before reinsurance rose to 26.7 per cent (2018: 25.2 per cent).

Health insurance

In € million

2019

2018

2017

Premiums written

1,130.8

1,086.4

1,042.0

Insurance benefits (net)

–960.3

–908.0

–877.6

Operating expenses (net)

–187.8

–183.9

–168.0

Cost ratio (after reinsurance)

16.7%

17.0%

16.2%

Net investment income

109.0

103.4

116.4

Earnings before taxes

94.9

96.2

109.7

Technical provisions (net)

3,359.1

3,190.9

3,037.7

Investments

The UNIQA Group’s investment portfolio (including investment property, financial assets accounted for using the and other investments) expanded by €1,287.7 million to €20,624.8 million in the 2019 financial year (31 December 2018: €19,337.1 million). This was mainly due to the general fall in interest rates on the international financial markets.

Net investment income remained on a par with the previous year at €585.2 million (2018: €585.0 million) despite the persistently low interest rates, thanks mainly to increased gains from the sale of real estate and fixed-income securities. The recognition of the 14.3 per cent equity-accounted holding in STRABAG SE also contributed €57.4 million to net income in 2019 (2018: €51.4 million). The previous year’s figure had included a capital gain of €47.4 million from the sale of the indirect holding in Casinos Austria Aktiengesellschaft. A detailed description of net investment income can be found in the consolidated financial statements (see note 4 in the consolidated financial statements).

Other income and other expenses

Other income rose by 8.5 per cent to €192.4 million in 2019 (2018: €177.3 million), while other operating expenses fell by 8.9 per cent to €191.1 million in the reporting year (2018: €209.7 million).

Results

The technical result of the UNIQA Group deteriorated by a substantial 25.2 per cent to €99.5 million in 2019 (2018: €133.1 million) due to the increased cost burden. Operating profit improved slightly by 1.4 per cent to €354.9 million (2018: €350.1 million).

Earnings before taxes at UNIQA remained virtually unchanged despite the poorer technical result, rising slightly by 0.4 per cent to €295.7 million (2018: €294.6 million). This was possible because the weaker technical result was offset by a rise in other comprehensive income. The profit/(loss) for the period rose by 0.6 per cent to €236.5 million (2018: €235.1 million). Income tax expense fell to €59.2 million in 2019 (2018: €59.5 million), while the tax burden was 20.0 per cent (2018: 20.2 per cent).

Earnings before taxes

In € million

Earnings before taxes (bar chart)

The consolidated profit, i.e. the proportion of the net profit for the period attributable to the shareholders of UNIQA Insurance Group AG, amounted to €232.4 million (2018: €243.3 million). This pushed earnings per share down slightly to €0.76 (2018: €0.79).

Earnings per share

In € million

Earnings per share (line chart)

Operating (earnings before taxes and amortisation of goodwill and impairment losses in relation to average equity, including and excluding the accumulated profits of the valuation of financial instruments available for sale) came to 10.6 per cent in 2019 (2018: 10.5 per cent). The return on equity (after tax and non-controlling interests) declined to 7.3 per cent in the reporting year (2018: 7.9 per cent).

Operating return on equity

In per cent

Dividend per share (bar chart)

On this basis, the Management Board will propose a dividend of €0.54 per share to the Supervisory Board and the Annual General Meeting (2018: €0.53 per share).

Dividend per share

In €

Operating return on equity (bar chart)
1) Proposal to the Annual General Meeting

Own funds and total assets

Total equity attributable to the shareholders of UNIQA Insurance Group AG increased by €428.9 million to €3,401.0 million in the past financial year (31 December 2018: €2,972.1 million). This was due to the increased measurement of financial instruments available for sale caused by the general fall in interest rates. came to €19.4 million (31 December 2018: €14.4 million). Total assets amounted to €28,728.4 million at 31 December 2019 (31 December 2018: €28,503.8 million).

Life insurance

In € million

2019

2018

2017

Premiums written including savings portions from unit-linked and index-linked life insurance

1,394.9

1,448.6

1,611.6

Insurance benefits (net)

–977.3

–1,035.7

–1,025.0

Operating expenses (net)

–358.1

–319.8

–319.5

Cost ratio (after reinsurance)

26.1%

22.6%

20.3%

Net investment income

354.1

353.5

336.0

Earnings before taxes

84.8

78.2

59.9

Technical provisions (net)

15,666.7

15,483.4

15,815.9

of which technical provisions for unit-linked and index-linked life insurance (net)

4,646.0

4,721.8

4,727.4

Cash flow

UNIQA’s net cash flow from operating activities amounted to €519.9 million in 2019 (2018: €–4.8 million). The cash flow from investing activities was €–526.9 million (2018: €210.0 million) while net cash flow from financing activities came to €–958.9 million (2018: €588.9 million). Overall, cash and cash equivalents fell by €964.8 million to €479.6 million in the 2019 financial year (2018: €1,444.4 million).

Employees

In 2019 the average number of employees (full-time equivalents, or FTEs) at UNIQA rose slightly to 13,038 (2018: 12,818). These included 4,202 (2018: 4,271) field sales employees. The number of employees in administration amounted to 8,836 (2018: 8,547).

In 2019 the Group had an average of 2,766 FTEs (2018: 2,708) in the Central Europe (CE) region – Poland, Slovakia, the Czech Republic and Hungary – as well as 2,278 FTEs (2018: 2,242) in the Southeastern Europe (SEE) region – Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Kosovo, Montenegro, North Macedonia and Serbia – and 1,647 FTEs (2018: 1,654) in the Eastern Europe (EE) region – Romania and Ukraine. There were 112 FTEs (2018: 108) working in Russia (RU). The average number of FTEs in the Western European markets in 2019 was 42 (2018: 48). A total of 6,193 FTEs were employed in Austria (2018: 6,058). Including the employees of the general agencies working exclusively for UNIQA, the total number of people working for the Group amounts to about 19,200.

In 2019 women made up 55 per cent of the staff working in administrative positions at UNIQA in Austria (2018: 55 per cent). In sales the ratio was 82 per cent men to 18 per cent women (2018: 83 per cent men to 17 per cent women). 15.4 per cent (2018: 14.6 per cent) of employees were working part time. The average age in the past year was 44 years (2018: 44 years).

In Austria almost all employees have a share in the company’s success through some form of variable participation programme. This will be either a bonus for managers and selected key employees or an employee participation programme. In 2019 14 per cent (2018: 14 per cent) of employees participated in the bonus system for managers and selected key employees – a variable remuneration system that is tied both to the success of the company and to personal performance. In 2019 a total of 79 per cent took part in the employee participation programme (2018: 76 per cent) in the form of a bonus. Everyone who has an employment relationship for the entire financial year is entitled to participate. Whether an employee participation bonus is paid depends on whether a profit target is met and to what extent other important corporate goals are achieved.

In addition, UNIQA offers young people in training the opportunity to get to know foreign cultures and make international contacts. Currently 81 apprentices are being trained.

Premiums written
All premiums due during the financial year arising from insurance contracts under direct insurance business, regardless of whether these premiums relate (either wholly or partially) to a later financial year. This involves (net) premiums written when reduced by the amount ceded to reinsurance companies.
Combined ratio
Total sum of operating expenses and insurance benefits in relation to the (net) premiums earned in property and casualty insurance.
Premiums
Total premiums written. All premiums from contracts written in the financial year from business acquired by the company directly and as inward reinsurance.
Premiums written
All premiums due during the financial year arising from insurance contracts under direct insurance business, regardless of whether these premiums relate (either wholly or partially) to a later financial year. This involves (net) premiums written when reduced by the amount ceded to reinsurance companies.
Premiums earned
The actuarial premiums earned that determine the income for the year. In order to determine these, the changes to the unearned premiums, the cancellation provisions and the premium volume not yet written are taken into account, along with the gross premium volume written attributable to the financial year.
Reinsurance
An insurance company insures part of its risk via another insurance company.
Premiums
Total premiums written. All premiums from contracts written in the financial year from business acquired by the company directly and as inward reinsurance.
IFRSs
International Financial Reporting Standards. Since 2002 the term IFRSs has applied to the overall concept of standards adopted by the International Accounting Standards Board. Standards already adopted beforehand continue to be referred to as International Accounting Standards (IASs).
Insurance benefits
Total of insurance benefit payments and changes in the claims provision during the financial year in connection with direct insurance and reinsurance contracts (gross). This involves net insurance benefits when reduced by the amount ceded to reinsurance companies. This does not include claims settlement expenses and changes in the provisions for claims settlement expenses.
Premiums earned
The actuarial premiums earned that determine the income for the year. In order to determine these, the changes to the unearned premiums, the cancellation provisions and the premium volume not yet written are taken into account, along with the gross premium volume written attributable to the financial year.
Reinsurance
An insurance company insures part of its risk via another insurance company.
Cost ratio
Ratio of total insurance operations expenses (net of reinsurance commissions received and share of profit from reinsurance ceded) to consolidated premiums earned (including savings portions of unit-linked and index-linked life insurance).
Operating expenses
This item includes acquisition expenses, portfolio management expenses and the expenses for implementing reinsurance. The operating expenses remain for the company’s own account following deduction of the commissions and profit participation received from the reinsurance business ceded.
Acquisition costs
The amount paid to acquire an asset in cash or cash equivalents or the fair value of another form of compensation at the time of acquisition.
Operating expenses
This item includes acquisition expenses, portfolio management expenses and the expenses for implementing reinsurance. The operating expenses remain for the company’s own account following deduction of the commissions and profit participation received from the reinsurance business ceded.
Cost ratio
Ratio of total insurance operations expenses (net of reinsurance commissions received and share of profit from reinsurance ceded) to consolidated premiums earned (including savings portions of unit-linked and index-linked life insurance).
Equity method
Investment in associates is accounted for using this method. The value assessed corresponds with the Group’s proportional equity in these companies. In the case of shares in companies that prepare their own consolidated financial statements, their Group equity is assessed accordingly in each case. Within the scope of ongoing valuations, this value must be updated to incorporate proportional changes in equity; it is used to impute the pro rata profit on ordinary activities to the Group results.
Return on equity (ROE)
The return on equity is the ratio of the profit/(loss) to the average equity, after deducting non-controlling interests in each case.
Non-controlling interests
Shares in the profit/(loss) that are not attributable to the Group but rather to companies outside the Group that hold shares in affiliated companies.
Non-controlling interests
Shares in the profit/(loss) that are not attributable to the Group but rather to companies outside the Group that hold shares in affiliated companies.