Swiss Re AG · SIX:SREN
Swiss Re — FY2006 Earnings Presentation
12 slides from Swiss Re's earnings presentation, Apr 3, 2007
Slide 1: Life & Health Embedded Value 2006
ab Analysts’ conference call 3 April 2007 Life & Health Embedded Value 2006 George Quinn Chief Financial Officer Alberto Izaga Head of Life & Health Products ab Agenda Executive summary George Quinn Reconciliation 2005 to 2006 EV Alberto Izaga New business details EV earnings for 2006 Capi
Slide 2: L&H Embedded Value Executive summary
ab L&H Embedded Value Executive summary EV 2006 CHF 22.6bn, up CHF 2.6bn (CHF 3.2bn at constant fx rates) GE Insurance Solution acquisition (“GEIS”) adds CHF 2.0 bn EV new business Value added of CHF 664m up 135% (2005: CHF 283m) 2006 GE Life Admin Re® transaction added CHF 256m in value I
Slide 3: Reconciliation 2005 to 2006 EV
ab Agenda Executive summary George Quinn Reconciliation 2005 to 2006 EV Alberto Izaga New business details EV earnings for 2006 Capital movements Value not recognised in primary accounts Embedded value Appendix Conference call 3 April 2007 Slide 5 EV earnings added 12%, GEIS ab acquisi
Slide 4: Strong new business value added
ab Strong new business value added Capital invested in new business Value added by new business lRR new business after tax CHF m Admin Re® Trad. business CHF m Admin Re® Trad. business % 894 1 906 283 664 2 0 00 7 00 1 1079 6 00 256 13.1 1 5 00 12.7 5 00 4 00 1 0 00 59 3 00 38 5 00 2 00 408 835 827
Slide 5: L&H generated capital of CHF 2.9bn
ab L&H generated capital of CHF2.9bn CHF m Capital invested in new Admin Re® business 1 079 Invested in new traditional business 827 Repatriated to Group 1 257 Reduction in Free Surplus -242 Total 2 920 Î Capital invested to acquire the GEIS L&H business is not included in the numbers above, it is i
Slide 6: Excellent 2006 EV Results
ab Excellent 2006 EV Results EV 2006 CHF 22.6bn, up CHF 2.6bn (CHF 3.2bn at constant fx rates). EV new business Value added of CHF 664m up significantly (2005: CHF 283m) 2006 GE Life Admin Re® transaction added CHF 256m in value EV earnings 2006 EV Profit CHF 1.0bn, up CHF 0.4 bn (2005: CHF
Slide 7: Assurance of Embedded Value
ab Assurance of Embedded Value For the 2006 embedded value results Swiss Re complies with European Embedded Value principles. PricewaterhouseCoopers (PwC) has provided reasonable assurance of the 2006 embedded value and embedded value earnings calculations and issued an unqualified opinion in accord
Slide 8: Components of Embedded Value
ab Components of Embedded Value 2005 2005 2006 EV at ‘06 CHF m fx rates Free surplus 2 134 2 059 1 892 Required capital 7 266 6 981 8 729 Adjusted net worth 9 400 9 040 10 621 Value of in-force business 12 248 11 903 13 779 Cost of holding required capital -1 583 -1 510 -1 762 Embedded value 20 065
Slide 9: Economic sensitivity of EV to assumption changes
Operating sensitivity of EV ab to assumption changes Mortality/morbidity Mortality improvement Other CHF m; Base value 22 639 CHF m; Base value 22 639 CHF m; Base value 22 639 10% reduction Set required 3 50 0 3 50 0 3 500 in maintenance capital to 5% expenses minimum reduction 2 50 0 2 50 0 Increas
Slide 10: Operating sensitivity of value added by new business
Operating sensitivity of value added ab by new business to assumption changes Mortality/morbidity Mortality improvement Other CHF m; Base value 664 CHF m; Base value 664 CHF m; Base value 664 10% reduction Set required 10% in maintenance capital to minimum 5% 5% Increase decrease in expenses 130 1 3
Slide 11: Key parameters for risk adjusted discount rates
Key parameters for risk adjusted ab discount rates Excluding products with financial options and guarantees, beta of aggregate L&H profit stream is less than 0.1 Î most business is protection with no exposure to equity markets Equity risk premium of 3.5% in line with research conducted by Swiss
Slide 12: Corporate calendar & contacts
ab Corporate calendar & contacts 20 April 2007 143th Annual General Meeting 08 May 2007 First Quarter 2007 Results Conference Call 07 August 2007 Interim 2007 Results Conference Call 06 November 2007 Third Quarter 2007 Results Conference Call 11 December 2007 Investors’ Day Investor Relations Zürich