Allianz SE · XETR:ALV
Allianz — Investor Day (July 2007)
118 slides from Allianz's investor day presentation, Jul 12, 2007
Slide 1: Allianz in growth markets
Allianz Capital Markets Day Allianz in growth markets Munich, July 12th, 2007
Slide 2: Agenda
Agenda Allianz in growth markets Werner Zedelius A Allianz in China Christian Molt B Allianz in India Kamesh Goyal C Allianz in Russia & CIS Hannes S. Chopra D Allianz in Hungary Károly Salamon E Allianz Bank Hungary Adam Farkas F Innovation at Allianz – i2s Werner Zedelius G © Allianz SE 2007 Appen
Slide 3: Allianz in growth markets
Werner Zedelius Allianz in growth markets – when growth meets profitability Munich, July 12th , 2007
Slide 4: Agenda
A. Allianz in growth markets Agenda I. Key financials II. Growth pipeline and current initiatives © Allianz SE 2007 A 1
Slide 5: Growth markets – where do we stand?
A. Allianz in growth markets Growth markets – where do we stand? New Europe (CEE) + Asia-Pacific 2006 EUR 10.3bn GPW (stat.)1 EUR 539m net income1 23 countries GPW (stat.)1: EUR 10.3bn 30,000 employees 235,000 agents L/H: 5.7 P/C: 4.6 35m customers out of 3bn total population 54% 46% © A
Slide 6: Allianz in growth markets: The road traveled
A. Allianz in growth markets Allianz in growth markets1: The road traveled 1996 – 2006 GPW (stat.)1 EUR 10.3bn 10.0 CAGR 7.5 New Europe 26.4% EUR 3.3bn 5.0 Asia-Pacific CAGR EUR 7.0bn 37.6% 2.5 © Allianz SE 2007 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1) Including non-consolidated O
Slide 7: Profitable growth means being in the right markets at the right time
A. Allianz in growth markets ProfitableGrowth means being in the right markets at the right time Penetration (total premiums as % of GDP) 14 Taiwan Mature, mixed growth 12 Korea Japan 10 Hong Kong 8 High growth Singapore Malaysia 6 Australia Thailand Slovakia 4 Ukraine Czech Republic India Poland Ch
Slide 8: Allianz is the #2 insurer in New Europe
A. Allianz in growth markets Allianz is the # 2 insurer in New Europe 2006 GPW (stat.) Clients (’000) Market EUR m Ins. PF1 pos. 06 Hungary 671 1,930 434 1 Poland 651 1,200 320 3 Russia 655 7,645 - 3 Slovak Rep. 471 2,900 480 1 Czech Rep. 329 750 112 3 Romania 316 500 - 1 Croatia 119 220 545 3 Bulga
Slide 9: Future growth in Asia-Pacific driven by India & China
A. Allianz in growth markets Future growth of Allianz in Asia-Pacific will be driven especially by our strategic markets India & China 2006 GPW (stat.) Clients (’000) Market pos. EUR m Ins. ’06/segm. Korea1 2,054 2,500 5 L Australia 1,452 4,100 4 NL Taiwan 1,336 500 7 L India 1,030 6,100 22 Thailand
Slide 10: Growth meets profitability
A. Allianz in growth markets Growth meets profitability GPW (stat.)1 Combined ratio1 Net income2 RoRACN EUR bn in % EUR m in % CAGR -0.1%-p -3.6%-p CAGR 19.1% 42% 35.0 100.0 539 32.3 10.3 95.4 96.4 30.4 92.1 92.0 440 8.9 88.9 299 7.2 7.0 226 267 17.0 6.2 14.7 5.0 137 239 11.0 214 2.7 3.3 130 © Allia
Slide 11: Strong P/C growth rates in most Asia-Pacific countries
A. Allianz in growth markets Strong P/C growth rates in most Asia-Pacific countries … (EUR m) GPW1 2004 2005 2006 Δ06/05 Australia 1,324 1,469 1,452 -1.2% Gross premiums written (EUR bn) India 132 211 282 33.6% CAGR Malaysia 101 109 122 12.0% 7% Indonesia 50 50 54 8.0% Japan 49 51 54 5.3% 2.0 2.1 Si
Slide 12: Attractive level of claims & expenses
A. Allianz in growth markets … combined with attractive level of claims & expenses CR1 2004 2005 2006 Δ%-p 06/05 Australia 101.0% 95.3% 96.2% 0.9 Operating profit (EUR m) India 98.5% 98.6% 99.8% 1.2 CAGR Malaysia 95.7% 91.9% 93.9% 2.0 24% Indonesia 93.4% 92.5% 91.2% -1.3 261 260 Japan 94.2% 97.2% 98
Slide 13: Strong P/C growth in New Europe
A. Allianz in growth markets Strong P/C growth in New Europe … (EUR m) GPW1 2004 2005 2006 Δ 06/05 Russia2 312 457 649 42.0% Gross premiums written (EUR bn) Hungary 533 599 576 -3.8% CAGR 15% Romania 169 220 292 33.0% 2.5 Slovak Rep. 326 301 289 -3.9% 2.2 1.9 Poland 196 246 284 15.5% Czech Rep. 234
Slide 14: Combined ratio kept at favorable level
A. Allianz in growth markets … while combined ratio kept at favorable level CR1 2004 2005 2006 Δ%-p 06/05 Russia2 96.6% 80.1% 94.2% 14.1 Operating profit (EUR m) Hungary 96.2% 101.6% 97.0% -4.6 CAGR 10% Romania 88.9% 94.8% 92.0% -2.8 275 Slovak Rep. 94.9% 74.5% 86.4% 11.9 223 183 Poland 95.3% 93.3%
Slide 15: Strong but heterogeneous L/H growth in Asia-Pacific
A. Allianz in growth markets Strong, but heterogeneous L/H growth in Asia-Pacific … (EUR m) GPW stat.1 2004 2005 2006 Δ 06/05 Korea 1,476 1,857 2,054 10.6% GPW stat. (EUR bn) Taiwan 988 1,347 1,336 -0.8% CAGR 25% India 96 380 748 96.8% Thailand 364 404 383 -5.2% 4.9 4.2 China 19 29 120 309.6% 3.1 In
Slide 16: Increase in New Business Value and Embedded Value
A. Allianz in growth markets … with strong increase in New Business Value and Embedded Value (a/min, EUR m) New Business Margin (NBV in % of PV of NB premiums) New Business Value Embedded Value +0.0%-p 3.9 3.9 +18% +83%3 1.3%1 3.9% 129 732 2.6% 109 1422 2005 2006 371 400 PV of NB premiums -181 +19%
Slide 17: High L/H growth in New Europe
A. Allianz in growth markets High L/H growth in New Europe … (EUR m) GPW stat.1 2004 2005 2006 Δ 06/05 Poland 75 99 367 271.8% GPW stat. (EUR bn) Slovak Rep. 134 149 183 22.8% CAGR 46% Hungary 77 89 96 7.5% 0.8 Czech Rep. 53 64 76 18.0% 0.5 Croatia 25 41 48 18.5% 0.4 Romania 11 18 25 41.2% Bulgaria
Slide 18: Increase in New Business Value and Embedded Value
A. Allianz in growth markets … with strong increase in New Business Value and Embedded Value (a/min, EUR m) New Business Margin (NBV in % of PV of NB premiums) New Business Value Embedded Value -2.3%-p 8.4 0.8%1 +12% +20%3 6.1 42 416 6.1% 7.6% 37 -32 346 2005 2006 51 101 PV of NB premiums +57% 32 42
Slide 19: Capital management: Profitable and growing
A. Allianz in growth markets Capital management: Profitable and growing (% of risk-adjusted capital 2006 by region) RoRAC New Europe Asia-Pacific 80% Target Asia-Pacific: CoC norm. 82% of invested RAC exceed 15% 60% target and CoC New Europe: 99% of invested 40% RAC exceed 15% target and CoC 20% Tar
Slide 20: Agenda
A. Allianz in growth markets Agenda I. Key financials II. Growth pipeline and current initiatives © Allianz SE 2007 A 17
Slide 21: Pipeline of initiatives to support future profitable growth
A. Allianz in growth markets Pipeline of initiatives to support future profitable growth CAGR: GPW (stat) 19% >10% p.a. 10.3 8.9 7.2 2004 2005 2006 Integrated Pipeline Shared- Sustainab. Core Regional financial Distribution Pension service i2s growth of initiatives holdings services initiatives fund
Slide 22: Regional holding companies and shared-service center
A. Allianz in growth markets Regional holding companies and shared-service center: Capturing regional synergies Existing OE model Future OE model Regional BM1 Regional BM1 Regional holding Regional holding CEO OE CEO OE CEO Service unit Clients at arms length OE OE OE Processing IT IT Processing IT
Slide 23: Standardization of processes in regional shared-service center
A. Allianz in growth markets Standardization of processes, first step for finance & accounting in regional shared-service center for New Europe Allianz Business Services Main benefits for main beneficiaries Create savings in future IT AZ One investments New Europe SAP Higher efficiency and quali
Slide 24: Multiple efforts to realize economies of scale
A. Allianz in growth markets Regional holding companies and shared-service center: Multiple efforts to realize economies of scale Admin. exp. Financial block Insurance block Distribution block OPUS TIP SAS PLUS TIP PEGAZ Foxpro PAMS 18% 2004 PEGAZ PLUS ORACLE OPUS 3rd party IDALIA Foxpro 3rd party I
Slide 25: Blueprint for the AZ New Europe banking network
A. Allianz in growth markets Blueprint for the AZ New Europe banking network Business steering/central functions Technical product Sales/distribution provision Banking P/C Joint as one LoB1 in insurance Life Market a joint board of and banking management Pension funds management points of sale
Slide 26: Allianz initiatives: Leverage Group synergies
A. Allianz in growth markets Allianz initiatives: Leverage Group synergies Growth markets – best practice introduced: Sustainability program 9 growth market OEs covered by the first and second wave of Sustainability program E.g. apply international knowledge for product development - Motor (e.g.
Slide 27: Sustainability: Fighting list for profit-leader strategy in motor
A. Allianz in growth markets Sustainability: Fighting list for profit-leader strategy in motor Leverage current - Respond to competitive pressures aggressively with diversified multi-dimensional strategies. 1 strong market position - Exploit operational strengths: Leading market shares, customer inf
Slide 28: Customer Focus Initiative: New Europe
A. Allianz in growth markets Customer Focus Initiative: New Europe in good position, more efforts planned NPS position of AZ New Europe OE within OE-specific country benchmark1 -50% -40% -30% -20% -10% 0% 10% 20% 30% 40% 50% 60% AZ Romania Explanation AZ Bulgaria relevant market Allianz NPS average
Slide 29: Customer Focus Initiative: Asia-Pacific
A. Allianz in growth markets Customer Focus Initiative: Analysis for Asia- Pacific completed, action plans already in place NPS position of AZ Asia-Pacific OE within OE-specific country benchmark1 -60% -50% -40% -30% -20% -10% 0% 10% 20% 30% 40% 50% 60% 70% AZ India AZ Indonesia AZ Thailand AZ Taiwa
Slide 30: Distribution initiatives: Expand capacity and channels
A. Allianz in growth markets Distribution initiatives: Expand capacity and channels Channel Country Comments Agents Asia Roll out of regional agency model # 235,000 New Europe Regional recruiting campaign launched Bancassurance Poland Bancassurance growing faster than traditional > 100 bank pa
Slide 31: Well diversified channels in New Europe
A. Allianz in growth markets Distribution initiatives: Well diversified channels in New Europe… Country Tied agency Brokers NL Brokers L Corp. Sales L netw./ FA Bancassur. Direct sales Poland TA BN BL Cor L/F BA Dir Hungary TA BN BL Cor L/F BA Dir Slovakia TA BN BL Cor L/F BA Dir Czech Rep. TA BN BL
Slide 32: … and in Asia-Pacific
A. Allianz in growth markets … and in Asia-Pacific Life Tied agency Brokers Bancassurance DM / TM1 A/E2 General agency WSM3 China TA BR BA DM / TM A/E GA WSM India TA BR BA DM / TM A/E GA WSM Indonesia TA BR BA DM / TM A/E GA WSM Korea TA BR BA DM / TM A/E GA WSM Malaysia TA BR BA DM / TM A/E GA WSM
Slide 33: Exploiting the pension opportunity
A. Allianz in growth markets Exploiting the pension opportunity Allianz in New Europe Pension funds operating in six markets: Allianz pension Assets under Management Bulgaria, Croatia, Hungary & Slovakia (all top (EUR m) 3 positions) + Czech Republic, Poland CAGR +37% Strong growth in assets of
Slide 34: Core growth markets: Opportunities in selected countries
A. Allianz in growth markets Core growth markets: Opportunities in selected countries Acquisition of We fully participate in the dynamic growth of the life market minorities of We will further strengthen financial management, investment know-how Allianz President and corporate governance of the
Slide 35: Core growth markets: Key drivers China, India and Russia
A. Allianz in growth markets Core growth markets: Key drivers China, India and Russia China Very successful investment in ICBC: Positive for bancassurance channel Number of licensed provinces steadily increasing Multi-distribution channel strategy starting to pay off India Strong development
Slide 36: First quarter 2007: Positive trend continues
A. Allianz in growth markets First quarter 2007: Positive trend continues GPW (stat.)1 Combined ratio1 Net Income1,2 EUR bn in % EUR m +15.5% +3.0%-p -0.2%-p +41% 3.0 249 100.8 100.6 2.6 91.3 1.8 88.3 177 166 1.6 99 1.2 1.0 78 83 © Allianz SE 2007 1Q 2006 1Q 2007 1Q 06 1Q 07 1Q 06 1Q 07 1Q 2006 1Q 2
Slide 37: Outlook: Ambitious medium-term aspiration
A. Allianz in growth markets Outlook: Ambitious medium-term aspiration 15bn revenues from growth markets 30bn AuM from insurance operations 50m clients >10% top line and bottom line growth p.a. © Allianz SE 2007 A 34
Slide 38: Allianz in China
Christian Molt Allianz in China Munich, July 12th, 2007
Slide 39: China at a glance
B. Allianz in China China at a glance Key data 2006 Expected market growth (EUR bn) Population1: 1,314 m P/C CAGR 15% GDP (Euro): 2,039 bn L/H 97 20% GDP/capita (Euro): 1,552 26 55 Inflation: 1.5% 38 36 15 Insurance penetration: P/C 0.8% L/H 1.9% 10 11 71 28 25 40 FX Rate: 1EUR = 10.3RMB
Slide 40: Allianz in China (1)
B. Allianz in China Allianz in China (1) (EUR m) Revenues Operating profit Highlights Total number of Allianz clients in China 2006 is 134 7 more than 100,000, tripling the number of 2004 CAGR 132% -1 Number of agents more than tripled 14 53% -4 to 4,000 in 2006 120 -11 Number of bank outlets
Slide 41: Allianz in China (2)
B. Allianz in China Allianz in China1 (2) Product mix (2006)2 Distribution mix (2006)2 Allianz market share (%) Others 2% Bank 1% Rank5 9/22 7/23 5/26 P/C PA 3% Engineering 25% Agency 4% Direct Sales 50% Marine 8% Market share in JVs 6.4 Market share in all Credit 4.2 14% 3.0 0.0 0.1 0.1 Property 23
Slide 42: Major achievements in 2006
B. Allianz in China Major achievements in 2006 AZCL achieved GWP of EUR 120m (+310%) AZCL ranked # 4 among 26 life JVs in China, up from # 8 in 2005 AZCN achieved GWP of EUR 14m (+65%) AZCN ranked # 5 among foreign general insurers in China, up from # 7 in 2005 Gain AZCL present in 14 citi
Slide 43: Profitable growth strategy for Allianz China Life
B. Allianz in China Profitable growth strategy for Allianz China Life Geographic expansion Set up new provincial branches Expand presence within provinces Infrastructure People Accelerated growth Process Culture Multi distribution © Allianz SE 2007 Agency companies/ Direct sales/ Tied agents Bancass
Slide 44: AZCL's fast geographic expansion in China
B. Allianz in China AZCL’s fast geographic expansion in China … Existing provincial branches Provinces planned to be entered within next 3 years Entered cities Jiangsu Coming soon Shanghai Since 01/1999 Sichuan Zhejiang Since 11/2006 Since 04/2006 Guangdong Shenzhen Since 01/2005 1 EUR = 10.3 RMB Si
Slide 45: …to be continued
B. Allianz in China …to be continued Geographic expansion Entering new Penetrating provinces existing provinces Each province with a population Promising market even at like an European country and tier 2 or tier 3 city with growing purchasing power Less fierce competition Possibility of mas
Slide 46: Multi-distribution channel strategy: Key driver of growth
B. Allianz in China Multi-distribution channel strategy: Key driver of growth Business segments in FYP Key initiatives Agency (EUR m) Launch & enhance new agency model 145% Enhance training & performance management CAGR 16.2 Increase MDRT1 membership (1-2% of total agents) Build up e-agency
Slide 47: Fast growth of AZCL bancassurance
B. Allianz in China Fast growth of AZCL bancassurance Rank # 2 among JVs in China (by end of 2006) AZCL’s market share in ICBC (EUR m) 05/06 YoY growth Rank1 4/4 6/2 5/2 2/1 143.6 AIA -7% 90% 132.5 9.7 Allianz +790% 85.5 60% Generali 44.5 +78% 78.5 30% Aviva 53.2 +38% 72.8 0% Shanghai Guangdong Zhej
Slide 48: Strong potential for further growth of bancassurance channel
B. Allianz in China Strong potential for further growth of bancassurance channel 5 major bank partners cooperating with AZCL Bank name Bank outlets Bank outlets Outlets assigned for Allianz total China available for Allianz1 2006 2007 Q1 1 ICBC 18,764 2,226 474 588 2 ABC 24,900 1,374 127 141 3 CCB 1
Slide 49: Building up the foundation in agency force
B. Allianz in China Building up the foundation in agency force … Highest YoY growth in # of agents (by end of 2006) AZCL’s aspiration 05/06 YoY growth 23, 163 40,000 agents AIA 25, 442 +9.9% 10, 329 by 2010 Prudential 15, 401 +49.1% 3, 007 Agency Manulife 5, 699 +89.5% managers 2, 109 Generali +114.
Slide 50: … and advanced training programs
B. Allianz in China … and advanced training programs Allianz China Life Academy as pilot for Asia Agency Bancassurance For trainer & agency leaders For AZCL bank staff & bank representatives Professional Patterns of Management Classroom based courses & (PPM) training program e-learning materials For
Slide 51: Outlook: 2010/2011
B. Allianz in China Outlook: 2010/2011 Achieve 1bn Euro GWP Eliminate expense overrun & gain economies of scale in fast growing environment Triple bancassurance production Enlarge agency force to reach 40,000 agents to strengthen distribution © Allianz SE 2007 Implement consumer-driven marketing and
Slide 52: Allianz in India
Kamesh Goyal Allianz in India Munich, July 12th, 2007
Slide 53: India at a glance
C. Allianz in India India at a glance Key data 2006 Expected market growth (EUR bn) Population: 1,129 m P/C CAGR 33% 34.0 GDP (EUR): 613 bn L/H 8.0 21% GDP/capita (EUR): 555 31% 10,8 Inflation: 5% 6.3 7.6 3.7 38% 26.0 Insurance penetration: P/C 0.65% L/H 2.53% 2.7 2.8 3.6 4.8 7.1 FX rate
Slide 54: Allianz in India (1)
C. Allianz in India Allianz in India (1) (EUR m) Revenues Operating profit1 Highlights 1,030 # 2 foreign player in both P/C and Life CAGR 113% P/C 282 15 46% 7 Consistent growth with profitability Only private insurer to have underwriting profits 0 Life 228 748 -23 Revenue growth +97%YoY in 20
Slide 55: Allianz in India (2)
C. Allianz in India Allianz in India (2) Product mix (2006)1 Distribution mix (2006)1 Allianz market share (%) Travel agent 2% Agents Rank2 6/2 6/2 6/2 P/C Misc. 5% Motor 44% 33% National tie-up 7%3 Health4 6% Bancassurance Engin. 9% 9% 7.0 6.4 Motor Others 10% Dealers 11% 4.7 Property 26% Broker 16
Slide 56: The India story
C. Allianz in India The India story India is a mass market with impressive volumes Economic growth not limited to mega cities – rural areas participate as well Economic wealth quickly spreads through the population Only 1 national insurance license required Nationwide presence + Multi-channel
Slide 57: The Indian opportunity: Focusing on the middle class
C. Allianz in India The Indian opportunity: Focusing on the middle class Mapping India’s income classes (in m households) 1994 - 1995 1999 - 2000 2005 - 2006 Rich (above INR 2,000,000) Benefit maximizers: Own cars, PC’s 1 3 6 Consuming (INR 50,000 – 2,000,000) Cost-benefit optimizers: Have b
Slide 58: How it all started
C. Allianz in India How it all started Insurance environment Start of Bajaj-Allianz JV What we did differently until 2001 compared to our peers P/C market P/C P/C Agency was the only optional Focus on retail Tie-up with motor dealers distribution channel Pioneered several innovative and manu
Slide 59: We are the market shaper in retail insurance
C. Allianz in India We are the market shaper in retail insurance... GPW Today Will be driven by growth Increase premium in per capita income Develop agency Cross-sell (cross-sell health to motor customers) Auto manufacturer Increase no. tie-ups, motor dealers, of policies banks, travel agents 0-5 Ye
Slide 60: …and our retail strategy pays off
C. Allianz in India ....and our retail strategy pays off Our achievements Only P/C company with underwriting profits for the last three years (RoRAC > 18%) Lowest set-up expenses in the sector Strong productivity (highest premium per employee in the industry) Infrastructure in place (more th
Slide 61: The Banyan-tree agent network
C. Allianz in India The Banyan-tree agent network Bajaj Allianz agent network How it works? S S Branch sets up 4-5 satellites S Sales team managers S promoted to set up and grow satellites via hiring agents Satellite Satellites with small func- Certain Satellite Offices size Satellite tional o
Slide 62: Further success factors: Innovative products and services
C. Allianz in India Further success factors: Innovative products and services… Innovative products (EUR m) Sophisticated services Wedding cancellation/postponement SMS alert for status of motor claims, Film, event insurance renewals and all life policies issued Insurance for mules, cattle, o
Slide 63: …and superior IT solutions
C. Allianz in India …and superior IT solutions Internet based Management Information System - Key business information accessible everywhere - Real time management interaction “Wake-up” call - Automated SMS alerts each morning to top management and office heads - Key information about premium co
Slide 64: Challenges
C. Allianz in India Challenges Products - Customers getting increasingly sophisticated (big cities) - Product differentiation increasingly important - Deregulation in P/C provides more product flexiblity Competition - Number of foreign competitors increasing - Low barrier to entry - Fight for talent
Slide 65: Summary & Outlook
C. Allianz in India Summary & Outlook We have a strong presence in India and the foundation has been laid for enhancing it We aim to increase our total market share to 10% Differentiation is key especially with number of players increasing constantly Retention of employees is the biggest challenge w
Slide 66: Allianz in Russia & CIS
Hannes S. Chopra Allianz in Russia & CIS Munich, July 12th, 2007
Slide 67: Russia at a glance
D. Allianz in Russia Russia at a glance Key data 2006 Expected market growth (EUR bn)1 Population: 141 m P/C/H CAGR 15% 16.6 GDP (EUR): 755 bn L 27% GDP per capita (EUR): 5,305 15% 9.4 7.8 16.0 Inflation: 9% 5.5 7.6 9.2 Insurance penetration: P/C/H 1.1% L 0.0% 5.4 0.18 35% 0.6 FX rate: 1
Slide 68: Allianz in Russia (1)
D. Allianz in Russia Allianz in Russia (1) (EUR m) Revenues Operating profit Highlights CAGR 55% 45% TOP 3 insurance group in Russia and CIS2 756 1001 38 ROSNO – most recognized insurance brand on Russian insurance market 61% 50% More than 3m retail and 50,000 corporate clients, 17 46 more tha
Slide 69: Allianz in Russia (2)
D. Allianz in Russia Allianz in Russia (2) Product mix (2006)1 Distribution mix (2006)1 Allianz market share (%) Other 3% Motor OD. Agents Direct Rank 5 4 3 P/C/H Gen. liab. 2% 30% 20% 43% Acc. 3% Non-life real market 8.1 OMTPL 1.1 12% Organic 7.0 6.1 Property External2 5.2 25% Brokers, car dealers,
Slide 70: Allianz in Russia: From early mover to market shaper
D. Allianz in Russia Allianz in Russia: From early mover to market shaper Foreign insurers – GPW ’06 1990 Allianz entering Russian market Ost-West Allianz market entry EUR m 1990 Allianz 756 1994 AIG 79 2007 Allianz Group - TOP-3 insurer in Russia 1996 Zurich1 188 2002 ERGO 0.5 Protection Provision
Slide 71: Key factors for success in the Russian insurance market
D. Allianz in Russia Key factors for success in the Russian insurance market RGS Ingo Allianz Reso Distribution power Brand and client trust Large scale retail expertise Risk management and operational excellence Underwriting and product know-how Source: Allianz’ own assessment © Allianz SE 2007 All
Slide 72: Allianz is enhancing its competitive position
D. Allianz in Russia Allianz is enhancing its competitive position Market dynamics, GPW (EUR m) Allianz heading for leadership (mkt. share) Rosgosstrakh Ingosstrakh Allianz RESO Reso CAGR 29% 16% 14% 13.5% 9,119 11.6% 11.7% 12.1% 12% 12.5% 7,815 9.8% 10% 8.7% 9.3% 7.8% 9.2% 5,540 8% 6.4% 6.9% 7.2% 6
Slide 73: Leading position in most business lines in Russia
D. Allianz in Russia Allianz has a leading position in most business lines in Russia Portfolio structure1 (EUR m) Market position Brief description 740 Classical property lines with Top 5 mainly industrial risks 182 Property Classical motor own damage 457 Top 3 products 222 MOD P/C/H 312 187 Obligat
Slide 74: Well diversified presence in Russia
D. Allianz in Russia Well diversified presence in Russia GPW 2006 (in EUR m) 41 Progress-Garant (PG) More than 8,500 agents ROSNO More than 100 branches 424 and 1,100 points of sales 1 29 18 Moscow & Sales Moscow vs. regions Moscow region 2 42 7 Progress-Garant (%) Regions 2 Moscow 21 Severo Vol
Slide 75: CIS: A different view – centers of prosperity
D. Allianz in Russia CIS: A different view – looking at centers of prosperity … Russia Key CIS economic centers GDP 2006 CIS1 population Pop GDP GDP per 2005 (m)3 (EUR bn) cap. (EUR) Moscow Tymen 3.3 59.6 18,243 EUR 124bn 10.4m Moscow 10.4 107.3 10,332 Russia St. Petersburg Tatarstan Astana (Kaz.)2
Slide 76: Ukraine and Kazakhstan being key priorities
D. Allianz in Russia … with Ukraine and Kazakhstan being key priorities Russia Growth drivers Ukraine Kazakhstan 2nd largest 3rd largest Launch pad for CIS Size CIS economy CIS economy Leverage ROSNO Population 46.5m 15.4m - Infrastructure - Brand GDP CAGR 2001 - 2006 +22% +24% - Products - Back
Slide 77: Aspiration 2009
D. Allianz in Russia Aspiration 2009 1.3bn GWP from CIS markets of EUR 1.3bn 2.9bn AuM from insurance operations (CAGR 75%) points of sale and over 9,000 agents, 2,500 most productive agent network in CIS >20% Growth above market average © Allianz SE 2007 D 11
Slide 78: Allianz in Hungary
Károly Salamon Allianz in Hungary Munich, July 12th, 2007
Slide 79: Hungary at a glance
E. Allianz in Hungary Hungary at a glance Key data 2006 Expected market growth (EUR bn) Population: 10 m P/C CAGR 15% GDP (EUR): 85 bn L/H 5.51 GDP/capita (EUR): 8,430 15% 16% 2.82 Inflation: 6.5% 3.14 2.38 2.77 Insurance penetration: P/C 1.65% L/H 1.69% 1.55 1.41 1.55 14% F/X rate: 1 EU
Slide 80: Overview Allianz Hungária (1)
E. Allianz in Hungary Overview Allianz Hungária (1) Revenues Operating profit Highlights CAGR 5% 15% 2.364 m clients 672 80 1,721 agents 610 4% 60 12% Market leader 576 68 Countrywide network 533 54 Strong composite profile P/C 12% 41% Unique cross-selling potential L/H 77 96 12 6 2004 2
Slide 81: Overview Allianz Hungária (2)
E. Allianz in Hungary Overview Allianz Hungária (2) Product mix (2006)1 Distribution mix (2006)1 Allianz market share (%) SME TPL Others 1.0% Agent Rank 1 1 1 P/C 1.1% 35.0% Bank 44.0% Personal 3.0% 38.3 39.1 7.7% Dealer 37.6 16.0% Ind+Liab 21.2% Casco Broker 33.0% 36.0% 2004 2005 2006 Health Tradit
Slide 82: Major achievements and challenges
E. Allianz in Hungary Major achievements and challenges Achievements Challenges Retained market leader position Cultural change from a sales focused product oriented company to a customer Stable client base focused market oriented company Expense ratio in P/C is among Shift the market imag
Slide 83: Business Model
E. Allianz in Hungary Business Modell Finance Motor & Prop. Internal channels Private - Branches - Employed agents - Entrepreneurial agents Products Life & Pension Marketing/CRM Sales Market Compliance External channels Management - Brokers Corporates HR - Dealer - Bank channels Bank Direct © Allian
Slide 84: Initiatives to ensure profitable growth
E. Allianz in Hungary Initiatives to ensure profitable growth 1. Dynamic expansion in life insurance 2. Asset gathering 3. Motor insurance: Keep the leading market position 4. Administration: Standardized processes, centralized operation 5. Sales: Increase capacity and improve efficiency 6. Build fu
Slide 85: Initiatives: Dynamic expansion in life insurance
E. Allianz in Hungary Initiatives to ensure profitable growth 1. Dynamic expansion in life insurance EUR m New Product: Allianz Best Invest New financial advisor network targeting high income customer segment Mid double- digit CAGR Extension of sales capacity: Increase number of tied agents, M
Slide 86: Initiatives: Asset gathering
E. Allianz in Hungary Initiatives to ensure profitable growth 2. Asset gathering EUR m Low double- Increasing average salaries as digit CAGR base for pension contribution “Young” pension funds (start 1998), very low cash out-flow in the next 5 years Second position in the voluntary 1,953 insur
Slide 87: Initiatives: Motor insurance
E. Allianz in Hungary Initiatives to ensure profitable growth 3. Motor insurance: Keep the market leading position Number of contracts (’000) Competitive pricing in MTPL Low single- Product and pricing renewal in Casco digit CAGR Direct sales channel 2,254 MTPL market share 2006: 41% 448 1,8
Slide 88: Initiatives: Administration
E. Allianz in Hungary Initiatives to ensure profitable growth 4. Administration: Standardized processes, centralized operation Expense ratio P/C Centralized policy administration in Budapest starting in July 2007 Centralized policy administration in the 25% country-side planned for 2008 23% Mo
Slide 89: Initiatives: Sales capacity and efficiency
E. Allianz in Hungary Initiatives to ensure profitable growth 5. Sales: Increase capacity and improve efficiency Number of agents Number of Internal channels financial advisors Traditional composite agent network with new 2,000 financial advisor units at branch offices 1,721 Set up a new pure fi
Slide 90: Allianz Bank: Full range Financial Services Provider
E. Allianz in Hungary Initiatives to ensure profitable growth… 6. Allianz Bank: Full range Financial Services Provider Number of clients of Allianz Bank (’000) Assurbanking model achieved through CAGR bank’s full integration with Allianz 107 % Hungária insurance 279 85% of Allianz Hungária agent
Slide 91: A leading full-range Financial Services Provider
E. Allianz in Hungary …resulting in a leading full-range Financial Services Provider Client portfolio (cross-selling) 2.364 m clients 2.470 m clients Pension Pension 518 434 Life Life Bank 173 230 Non-Life Bank 15 Non-Life 1,809 279 1,936 2006 2010e © Allianz SE 2007 High single digit revenue growth
Slide 92: Outlook
E. Allianz in Hungary Outlook Keep market leader position Keep RoRAC above Allianz Group average Dynamic growth in life, banking and asset gathering Build a full-range Financial Services Provider Ambition: Offer best value for money © Allianz SE 2007 E 14
Slide 93: Allianz Bank Hungary
Adam Farkas Allianz Bank Hungary Munich, July 12th, 2007
Slide 94: Allianz Bank Hungary – key figures
F. Allianz Bank Hungary Allianz Bank Hungary – key figures Operations 1Q 2007 Plan 2007 # of clients: 25,557 # of clients: 60,000 # of current accounts: 17,782 # of asset-backed loans: 482 Total assets: EUR 186m # of credit cards: 8,709 Operating revenues: EUR 7m # of deposits: 272 Net income: EUR -
Slide 95: Second largest client base of any financial services provider in Hungary
F. Allianz Bank Hungary Allianz has the second largest client base of any financial services provider in Hungary Insura n Opportunity to cross sell to insurance clients avg. 1 ce custom .6 e custo 8 contract rs mer s/ 2.364 m clients Pension 434 Life Bank 173 Non-Life 15 1,809 2006 © Allianz SE 2007
Slide 96: Allianz insurance clients represent the largest market potential
F. Allianz Bank Hungary Allianz insurance clients represent the largest market potential Estimated gross monthly salary/individual (HUF) Income Age ~16% Pensioners over ~ 60 ~11% Affluent ~ 200,000 ~ 80,000 to ~41% Middle mass ~ 200,000 under ~23% Lower mass ~ 80,000 ~ 26 © Allianz SE 2007 ~8% Young
Slide 97: Allianz can also leverage its strong brand
F. Allianz Bank Hungary Allianz can also leverage its strong brand A leader in brand awareness among ...and also compared to banks, insurance companies... including market leader: OTP Spontaneous as Life & Property Insurer Spontaneous as Life & Property Insurer awareness (%)1 awareness (%)2 as MTPL
Slide 98: Existing distribution network can be used to sell banking products
F. Allianz Bank Hungary Existing Allianz distribution network can be used to sell banking products Network of over 1,700 sales agents & …and 128 outlets provide national brokers used as primary sales engine… coverage for establishing a branch network Share of products sold Brokers Sales agent networ
Slide 99: Blueprint for the AZ New Europe Banking network
F. Allianz Bank Hungary Blueprint for the AZ New Europe Banking network Business steering/central functions Technical product Sales/distribution provision Banking P/C Joint as one LoB1 in insurance Life Market a joint board of and banking management Pension funds management points of sale Ba
Slide 100: Focused product-approach, expanding to fully-fledged bank
F. Allianz Bank Hungary Allianz Bank to start with focused product-approach and expand to fully-fledged bank in 2-3 years Start with investments and loans followed by fully-fledged bank + Products Customers Channels Competitive offers around Cross sell to current Mostly rely on insurance bundl
Slide 101: Insurance/banking product bundling as differentiating factor
F. Allianz Bank Hungary Strong insurance/banking product bundling as a key differentiating factor Group insurance products Individual insurance sold Supports cross selling of included in package through package insurance and retention Current On avg. 84% of C/A consist C/A C/A C/A account of seconda
Slide 102: Core banking system operated by AZHU IT subsidiary
F. Allianz Bank Hungary AZB’s core banking system to be operated by AZHU IT subsidiary – IT platform suitable for regional synergies Other shared services include CRM and joint call center operations… Joint CRM enables use of customer database: Insurance clients master data Customer data used fo
Slide 103: Budgeted costs significantly lower than peers' branch costs
F. Allianz Bank Hungary Allianz Bank’s budgeted costs significantly lower than peers’ branch capex and operating costs Build-up cost of an average branch Operating cost of an average branch In thousand EUR In thousand EUR Maintenance costs Personnel costs 400 245 ~ -58% ~ -45% 135 168 Market average
Slide 104: Introduction of new products and services in 2007
F. Allianz Bank Hungary Introduction of new products and services in 2007 2006 2007 Allianz Status Package Feb 19 Overdraft Feb 19 SMS services Apr 1 Mixed deposit May Saving accounts May Personal loan June Internet bank July SME accounts Sept Mortgage Aug © Allianz SE 2007 SME loans Sept F 11
Slide 105: Outlook
F. Allianz Bank Hungary Outlook Value Proposition for the Customer Value Proposition for AZHU Trusted provider: Client retention through Personalized service from banking products trusted „mobile” agent Cross selling: Innovative provider: Additional insurance premiums Unique products bundled
Slide 106: Innovation at Allianz – i2s
Werner Zedelius Innovation at Allianz – i2s Munich, July 12th, 2007
Slide 107: Innovation is already happening within Allianz
G. Innovation at Allianz – i2s Innovation is already happening within Allianz: Examples of existing innovation Processes Products and Customers and Business model & services channels culture Mobile medical Index-linked life Heritage Allianz SE physical (Thailand) (US) (US) X-selling with Schutzbrief
Slide 108: Allianz Schutzbrief 55Plus
G. Innovation at Allianz – i2s Example for successful product innovation: Allianz “Schutzbrief 55Plus” Client needs Solution Assistance- Cash Accident P/C services + benefits Live an active life at home Health Schutzbrief Accident Frail care Remain 55Plus independent Market Assistance management and
Slide 109: Product innovation: Personal accident insurance in Germany
G. Innovation at Allianz – i2s Example of successful product innovation: Personal accident insurance in Germany Outgrowing the market … 158.0% 160% EUR 1.6bn 150% 140% Allianz 129.5% 130% EUR 6.1bn 120% Market EUR 1.0bn 110% EUR 4.7bn 100% 1996 1997 19981 1999 2000 2001 2002 2003 2004 2005 2006 … dr
Slide 110: i2s – ideas to success
G. Innovation at Allianz – i2s i2s – ideas to success: Build extensive innovation culture based on modern processes i2s Provides a platform for all staff, management and agents to submit ideas Follows a decentralized approach embedded in a global framework Makes innovation part of day-to-day b
Slide 111: Three key objectives of i2s
G. Innovation at Allianz – i2s Three key objectives of i2s Profitable growth Small & Big I’s Synergies Reach Perception Innovative (internal & external) culture © Allianz SE 2007 Communication Risk-tolerating Reputation Entrepreneurs Visibility Motivation G 5
Slide 112: Adding top-down idea generation to bottom-up approach
G. Innovation at Allianz – i2s Adding top-down idea generation to bottom-up approach Profitable growth = small i = Big I Small & Big I’s Synergies Reach Top- down innovation Small I’s and Big I’s Bottom-up Perception Innovative (internal & external) innovation culture © Allianz SE 2007 Communication
Slide 113: Growth markets: A successful start of the i2s journey
G. Innovation at Allianz – i2s Growth markets: A successful start of the i2s innovation journey 2006 achievements 2008 New Europe Becoming a ~ 3,000 ideas generated trusted innovator Of which more than 330 ideas implemented (implementation ratio ~ 11%) More than 15% of all employees submitted
Slide 114: Global Innovation Awards
G. Innovation at Allianz – i2s Global Innovation Awards: Setting the tone from the top © Allianz SE 2007 G 8
Slide 115: Appendix
Appendix Munich, July 12th, 2007
Slide 116: Investor Relations contacts
H. Appendix Investor Relations contacts Oliver Schmidt Tel. +49 (0) 89 3800-3963 Holger Klotz Tel. +49 (0) 89 3800-18124 Head of E-mail: E-mail: Investor Relations [email protected] [email protected] Susanne Arheit Tel. +49 (0) 89 3800-3324 Christian Tel. +49 (0) 89 3800-3892 Lamprec
Slide 117: Financial calendar 2007/2008
H. Appendix Financial calendar 2007/2008 August 3, 2007 Announcement of second quarter results 2007 August 10, 2007 Interim report second quarter 2007 November 9, 2007 Announcement of third quarter results 2007 November 9, 2007 Interim report third quarter 2007 February 21, 2008 Financial press conf
Slide 118: Disclaimer
H. Appendix Disclaimer No offer These materials do not constitute an offer to sell, or the solicitation of an offer to buy, any securities in any jurisdiction, including the United States. Cautionary Note Regarding Forward-Looking Statements The statements contained herein may include statements of