Mikael Olufsen: In a year with many large one-off claims events and an increase in the claims level in Denmark, the technical result of DKK 375m was not satisfactory. However, a strong capital structure and tight management of operations enabled us to generate a profit before tax of DKK 941m and a number of initiatives create a solid basis for future value creation for customers, shareholders and employees.
The technical result was DKK 375m and the combined ratio 98.8, which was not satisfactory, but still in line with the outlook reported in the third quarter 2010 report.
Morten Hübbe: The initiatives implemented in 2010 and activities planned for 2011 should be seen in conjunction with our target of a combined ratio of around 90 including any runoff results in the medium term, corresponding to a post-tax return on equity of around 20%.
In 2011, we expect an improvement of combined ratio based on the substantial initiatives implemented in 2009 and 2010 as well as planned initiatives in 2011. As far as reserves are concerned, our review in late 2010 revealed that we have maintained our strong level of provisions.
Balance sheet Total provisions for insurance contracts 26,005 26,969 25,228 29,042 32,031 Total reinsurers’ share of provisions for insurance contracts 1,561 1,587 1,036 1,320 1,588
Return on equity after tax (%) 35.5 22.8 9.3 22.5 6.6 Relative run-off gains/losses 3.0 4.2 4.1 3.6 3.9 Number of full-time employess, end of period 3,783 3,788 4,065 4,310 4,291
April 2009 to enhance the peace-of-mind delivery. The object was to become even better at helping injured persons pursue a full life through a closer dialogue with the federation. The Danish
With a view to strengthening the Group’s position, the Supervisory Board adopted a new strategy plan at the end of 2010, designed to strengthen the company towards 2014. Called ’Tryg in transition’, the strategy plan is based on the four perspectives: financial, customer, process and learning. The strategy plan defines ambitions of: • achieving an expense ratio of 10 by 2020
Tryg Transition is a change project and the next natural step in making the Group’s business model Nordic.
Denmark and Norway. We intend to launch customer commitments to commercial customers at a later date.
Fire & contents – Private Private fire & contents insurances account for 23% of the Group’s total premium income and include for example house and content insurances.
Fire & contents – Commercial Commercial fire & content insurances account for 14% of the Group’s premium income and comprise commercial building insurances that cover the loss of, or damage to, the buildings, inventory or equipment of commercial customers. In addition, Tryg provides cover for financial loss due to business interruption resulting from covered claims.
Gross earned premiums in Corporate Nordic were lower than expected at the beginning of the year, falling by 5.9% in local currency terms (a fall of 1.6% in DKK terms) to stand at DKK 5.0bn.
Group’s underwriting assumes profitability for such businesses, and accordingly Tryg did not participate in the tender rounds for reasons of profitability. Danish workers’ compensation insurance in particular recorded a declining number of customers. Corporate
The rising claims costs related particularly to the Danish part of the business, affecting the private, commercial and corporate markets alike, and were mainly attributable to the economic downturn.
Team Internet Norway Sales budget achievement: 90% Sales budget achievement: 165%
Winter claims and cloudbursts affected the claims ratio by 8 percentage point. Commercial Nordic had the highest level of large claims in 2010 and impacted the claims level by almost 10 percentage points.
Tryg Garanti introduced credit insurances, a product protecting policyholders against losses on debtors.
Corporate Nordic generally provides a full insurance package to customers within, for example, building, contents, transport, workers’ compensation and liability insurances.
In 2009, the European Parliament and the Commission adopted the directive setting out future solvency rules for insurance companies. The directive, which is expected to be implemented in early 2013, defines quantitative as well as qualitative requirements for insurance companies that will require extensive adjustment of existing legislation.
December 2010. Most of the provisions for claims related to personal injury claims. These provisions are exposed to changes in wage developments, the discount rate, disbursement patterns, economic trends, legislation and court decisions.
Operational risk relates to errors or failures in internal procedures, fraud, breakdown of infrastructure, IT security and similar factors. As operational risks are mainly internal, Tryg focuses on establishing an adequate controlling environment for the
security policy. Tryg has also set up a security and investigation unit to handle fraud, IT security, physical security and contingency plans.
of the business to handle an event of a prolonged IT breakdown. The Group has also set up a crisis management structure should Tryg be hit by a major crisis.
• Presentation of the annual report for approval and discharge of the Supervisory Board and the Executive Management, including determination of the Supervisory Board’s remuneration
Shareholders may propose items to be included in the agenda of the general meeting, and may ask questions at the general meeting. Shareholders may vote in person at the general meeting, vote by correspondence, or appoint the Supervisory
The Supervisory Board intends to consider any public takeover bid as prescribed by legislation and, depending on the nature of such bid, to convene an extraordinary general meeting of shareholders in accordance with applicable requirements and rules.
The Supervisory Board is responsible for the overall management and financial control of Tryg. In this work, the Supervisory Board uses targets and framework management based on regular and systematic consideration of strategies and risks. The Executive
The tasks of the Chairman and the Deputy Chairman are defined in the rules of procedure for the Supervisory Board. The tasks of the
Chairman of the Supervisory Board include chairing and assessing the work of the Supervisory Board, organising, convening and chairing Board meetings and being in charge of the collaboration with the
The age of each Supervisory Board member is disclosed in the section Supervisory Board.
The variable pay components would constitute a maximum of 50% of the fixed annual salary including pension in 2010.
Financial calendar 2011 14 April 2011 at 14:00 Annual general meeting 2011 15 April 2011 Tryg shares trade ex-dividend 20 April 2011 Payment of dividend 11 May 2011 after 17:00 Interim report for Q1 2011 17 August 2011 after 17:00 Interim report for H1 2011 9 November 2011 after 17:00 Interim report for Q1-Q3 2011
IFRIC 14 ‘The Limit on a Defined Benefit Asset’ • IFRIC 19 ‘Extinguishing Financial Liabilities with Equity Instruments’
For discounting of provisions for claims, the Group generally applies a risk-free market rate composed of a risk-free eurodenominated interest rate and a country-specific spread to the German government bond yield. As a result of the adoption of the temporary ‘Package to ensure financial stability’, from the end of October the Group has applied a synthetic interest rate that includes a certain mortgage yield spread, for liabilities denominated in Danish kroner. Liabilities in Norwegian kroner are still discounted using a Norwegian risk-free interest rate composed as described above. Liabilities in Swedish kroner and euro are discounted using a Danish risk-free interest rate.
Outstanding options from 2008 allocation 31 Dec 2009 52,088 162,883 28,000 242,971 - 17 - 11
Investments in associates 13 13 Reinsurers’ share of provision for unearned premiums 14 0 140 0 154 Reinsurers’ share of provision for claims 232 312 890 0 1,434 Other assets 48,990 48,990
Depreciation for the year -18 -8 0 -26 a) Addition on acquisition of subsidiary relates to the acquisition of Moderna Försäkringar, see note 29
Amortisation is recognised in the income statement under insurance operating expenses and claims incurred. External experts were involved in valuing some of the owner-occupied properties.
Investment assets at fair value according to balance sheet recognised through profit and loss 42,008
Notes 16 Reinsurer’s share Reinsurers’ share 1,337 1,605 Writedowns after impairment test -17 -17
Reserves from 1999 and prior years 191 Other reserves 101 Provisions for claims, end of year 1,434
Unaccrued timing differences of shares 134 0 Unaccrued timing differences of balance sheet items 68 25
Notes 24 Other provisions Other provisions, beginning of year 1 6 Change in provisions 5 -5
The remaining contract sum amounts to DKK 21.3m. The work i s expected to be finalised in 2011.
The remaining contract sum amounts to DKK 5m. The work is expected to be finalised in 2011.
Leases with related parties: There are no leases with related parties.
12 Reconciliation of differences in the profit and the shareholders’ equity The executive order on application of international financial reporting standards for companies subject to the Danish Financial Business Act issued by the Danish FSA requires disclosure of differences between the format of the annual report under international financial reporting standards and the rules issued by the Danish FSA. The following is a reconciliation of differences in the profit and equity.
Norwegian general insurance Comprises Tryg Forsikring A/S, Norwegian branch, Enter Forsikring AS and the Norwegian branch of Tryg Garantiforsikring A/S.
Tier 1 capital Shareholders’ equity less intangible assets/goodwill and tax asset