Editor Investor Relations | Publication 20 January 2017 | Layout amo design | Proofreading TextMinded 17 Commercial 21 Sweden 23 Investment activities 25 Capital and risk management 27 Shareholder information 29 Corporate governance 33 Supervisory Board 35 Executive Board 36 Corporate Social Responsibility in Tryg
New online claims reporting Tryg launched new improved digital claims reporting solution, enabling customers to report claims on tablets and smartphones.
Tryg strives to continuously strengthen customer relations through our advisory services, products, concepts, claims handling procedures and claims prevention measures. In 2016, we had a strong focus on initiatives supporting the customer targets for 2017.
Contrary to developments in motor insurance, other areas are expected to grow in the future.
An important SuccessFactors tool which was implemented in 2016 is People Review. People reviews are carried out for all managers and
Digitalisation is one of the key drivers for improved customer service and claims handling processes. In 2016, focus was on self-service, automation, lead generation and cross-sales.
A profit after tax of DKK 2,471m (DKK 1,969m) was posted, together with a return on equity of 26.2%
DKK 500m. Adjusted for gains on investment properties and domiciles, an investment result of DKK 487m was posted, boosted strongly by positive capital market developments.
The share of customers with three or more products increased from 56.7% to 57.2%. In Denmark, the number increased by 1 percentage point whereas there was a drop in Norway. To reverse the trend in Norway, a more focused approach for cross-selling to customers who have bought motor insurance through the car sales channel has been initiated.
In 2016, many new products were added to Tryg’s product portfolio. Tryg bought a child insurance portfolio from Skandia in Sweden. The product is very profitable, and with a good sales potential.
Corporate saw a drop in premium income of 1.2% (0.0%) in local currencies. In general, more substantial fluctuations in premium income for this area are expected on account of the competitive situation and the impact of gaining or losing major clients. Developments were generally more positive in Corporate in Denmark as customers welcomed TryghedsGruppen’s members’ bonus.
equity. The Tier 2 capacity has been fully utilised after the SEK 1bn sub ordinated debt issue in May 2016. Currently, some DKK 200m of Tier 2 instruments are not included in the own funds as they exceed the 50% SCR cap. Tryg has an additional
Tryg’s solvency ratio displays low sensitivities to capital market movements. The highest sensitivity is towards spread risk, where a widening/tightening of 100 basis points would impact the solvency ratio by approximately 14 percentage points. Lower sensitivities are displayed towards equity market falls and interest rate movements. A change in the UFR
Norway, many initiatives were implemented which will reduce employee numbers by a total of 60, the primary impact of which will be seen in 2017 after almost no impact in 2016. Employee numbers were reduced from 933 at the end of 2015 to 929 in 2016, mainly through job cuts in back-office functions but also transfer of employees from the
The combined ratio was positively affected by a lower level of weather and large claims but also a lower level of run-off. The development in premiums improved in 2016, but was still not satisfactory.
The various initiatives will continue in 2017 with the aim of improving profitability, especially for extended warranty insurance of electronic products.
(18.7). Integration and efficiency initiatives will support a lower expense ratio and strengthen
The other financial income and expenses component is primarily made up of interest expenses related to outstanding subordinated debt, the cost of the currency hedge to protect our shareholders’ equity and the cost of running our investment operations. These are the main elements included in other financial income and expenses. The other financial income and expenses line produced a result of DKK -162m. Tryg issued additional subordinated debt of SEK 1bn in
bonus to Tryg’s Danish customers corresponding to 8% of the annual premium paid for 2015.
Starting 2017, Tryg has decided to move from effecting extraordinary buy backs to paying out extraordinary dividends when the capital position
CSR policy at tryg.com > CSR > CSR strategy > CSR policy.
Board and report on compliance with limits defined by the Supervisory Board and in legislation.
(higher degree of customers who are fully insured in Tryg), creating a strong customer centre, empowering the different lines of business, achieving high levels of innovation and development of products /services and the impact and success of Tryg's leaders. Read more about the Matching Shares
Education: MSC in Political Science, European Health Leadership Programme INSEAD, Executive Management Programme INSEAD, Executive Program Columbia Business School, Executive Program Singularity University. Board member: Tryg A/S and Tryg Forsikring A/S, TryghedsGruppen smba, Plougmann & Vingtoft A/S and Hans Knudsen Instituttet (business trust).
Born in 1965. Joined Tryg in 1998. Joined the Executive Board in 2006.
These areas are closely linked to our business model (see page 6), since CSR concerns issues relating to our focus on insurance, prevention and claims handling. By addressing some of the areas most closely linked to our business model,
DNA marking and labelling is one simple preventive mechanism that has proved rather effective in preventing break-ins and theft. In 2017, we will continue to focus on the area and try to establish large-scale DNA-marking projects.
Parent’s ability to continue as a going concern, for disclosing, as applicable, matters related to going concern, and for using the going concern basis of accounting in the preparation of the consolidated financial statements and the parent financial statements unless Management either intends to liquidate the Group or the Parent or to cease operations, or has no realistic alternative but to do so.
Standards on Auditing and additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the consolidated financial statements and the parent financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
Profit/loss on continuing business 2,472 1,920 2,547 2,373 2,180 Profit/loss on discontinued and divested business after tax) a) -1 49 10 -4 28
Total equity and liabilities 49,861 51,281 1 Risk and capital management 26 Sale of properties 27 Contractual obligations, collateral and contingent liabilities 28 Acquisition of activities 29 Related parties 30 Financial highlights 31 Accounting policies
a) Other reserves contains Norwegian Natural Perils Pool. b) A new executive order from the Danish FSA from 1 January 2016 has abolished the requirements of equalisation reserves in credit and guarantee insurance.
Annual report 2016 | Tryg A/S | | Menu – Financial statements
Company’s own risk assessment ‘ORSA’ (Own Risk and Solvency Assessment) ORSA is the company’s own risk assessment based on the Solvency II principles, which implies that Tryg must assess all material risks that the company is or may be exposed to. The ORSA report also contains an assessment of whether the calculation of solvency capital requirement is reasonable and is reflecting Tryg’s actual risk profile. Moreover, the projected capital requirement is also assessed over the company’s strategic planning period. Tryg’s risk activities are implemented via continuous risk management processes, where the main results are reported to the Supervisory Board and the risk committee during the year, while the ORSA report is an annual summary document assessing all these processes.
The loans are taken by Tryg Forsikring A/S. The creditors have no option to call the loans before maturity or otherwise terminate the loan agreements. The loans are automatically accelerated upon the liquidation or bankruptcy of Tryg Forsikring A/S.
Equity investments in associates 229 229 Reinsurers’ share of premium provisions 17 16 140 0 0 173 Reinsurers’ share of claims provisions 141 408 2,422 32 0 3,003 Other assets 46,838 46,838
Claims ratio, net of ceded business 79.7 65.2 79.8 81.3 76.8
a) In May 2015 each share with a nominal value of DKK 25 was replaced by five new shares with a nominal value of DKK 5. The share split does not change the Group’s share capital. Comparative figures have been restated to reflect the change in trading unit.
Profit/loss on discontinued and divested business primarily relates to Marine Hull insurance.
In 2014, Tryg acquired Securator A/S, Optimal Djurförsäkring i Norr AB and Codan’s agricultural portfolio. The insurance activities were incorporated into the Tryg Group’s business structure and merged into Tryg in 2015.
Additions for the year 1 75 12 88 Disposals for the year 0 -1,810 -97 -1,907
Increase in applied rate of return of 0.25% -51 -70 Decrease in applied rate of return of 0.25% 57 78 Decrease in net rental income of 3% -37 -57 Decrease in occupancy rate of 3% -9 -13 14 Equity investments in associates Cost Cost at 1 January 201 201
Average return on plan assets 0.7 2.6 Weighted average duration of the defined benefit obligation (years) 13 18
The maximum amount paid in severance pay to an individual is DKK 7m.
• Claims provisions The claims provisions has changed following the transition to a new interest curve. The executive order prescribes a change from applying a yield curve issued by the Danish Financial Supervisory Authority to applying a new yield curve published by EIOPA – the new yield curve is at a lower level.
Other comprehensive income which cannot subsequently be reclassified as profit or loss Change in equalisation provision and other provisions 0 21 Change in taxrates on security provisions 0 141 Sale of owner-occupied property a) 215 0 Sale of owner-occupied property, revaluation from previous years a) -115 4 Tax on sale of owner-occupied property -53 0 Tax on revaluation of owner-occupied property from previous years 29 2 Actuarial gains/losses on defined-benefit pension plans -95 -12 Tax on actuarial gains/losses on defined-benefit pension plans 24 3
Profit/loss for the year -1,668 1,878 1,759 1,969 Other comprehensive income 135 135
Name and registered office Ownership share in % Equity 2016 Tryg Forsikring A/S, Ballerup 100 10,127 2015 Tryg Forsikring A/S, Ballerup 100 10,135 5 Current tax assets Tax receivable at 1 January 18 14 Current tax for the year 15 18 Tax paid for the year -18 -14