The majority of registered shareholders are based in Switzerland. Measured by the free float, 62.6 % of the shares are held by investors who have their registered office in Switzerland (previous year: 61.3 %). A total of 37.4 % (previous year: 38.7 %) is held by foreign investors. Compared to the end of the previous year, the structure of the types of investors has shifted slightly from financial institutions (19.9 %) to private individuals
Conditional capital: the share capital can be increased by a maximum of CHF 129,793.20, which equates to 13 % of the existing share capital, by issuing a maximum of 6,489,660 fully paidup registered shares with a nominal value of CHF 0.02 each. The conditions for this are set out in Art. 4 of the Articles of Association ( helvetia.com/corporate/web/en/home/investors/ overview/publications/business-publications.html).
Appointments at listed companies Member of the BoD of Julius Baer Group Ltd; Member of the BoD of Fundamenta Group AG
3.5 Internal organisation Corporate governance at Helvetia is based on the relevant legal provisions (in particular company law and stock market legislation) and on internal directives and regulations.
The Chairwoman heads the Board of Directors. She convenes the meetings of the Board, prepares the agenda for the Board meetings and chairs these meetings. She prepares the Shareholders’ Meeting and the invitation to the Shareholders’ Meeting, and also chairs this meeting. She draws up the strategic objectives that are discussed by the Board of Directors and represents the shareholders in important strategic projects in consultation with the CEO. She ensures that shareholders receive timely and correct information on the Group’s business operations and nurtures relationships with major investors. Together with the other executive bodies of the Group, the Chairwoman ensures good corporate governance and an effective internal control system. She serves as line manager to the CEO and acts in consultation with the CEO whenever possible. She and the CEO prepare the CEO’s annual agreement on objectives, and she assesses the CEO’s performance every year. The Chairwoman may take part in important meetings of the Executive Management as a guest; to this end she receives the agenda and accompanying documents for all meetings. She manages the Group’s internal audit team as well as the head of the General Council, assesses requests for information, meetings or inspection of documents from members of the Board of Directors as well as their acceptance of new board or similar mandates (the Strategy and Governance Committee decides on such mandates of the Chairman ), signs Commercial Register applications and handles other tasks delegated to her by the Board of Directors. She may inspect any and all documents at all times. If the office of Chairwoman is vacant, the Board of Directors appoints a Chairperson from among its own members until the conclusion of the next Ordinary Shareholders’ Meeting.
Financial report Corporate governance the head of Internal Audit attend its meetings in an advisory capacity. The attendance rate was 100 % at meetings held to discuss the financial statements. In order to deal with specific issues, the Committee may call on internal or external specialists to attend its meetings, which is regularly the case. Most of the meetings lasted half a day.
Appointments at other companies Member of the BoD of Abraxas Informatik AG, St. Gallen
Financial report Corporate governance approval. No payment / share allocations may take place before the final approval of the compensation for the Board of Directors and the Executive Management by the Shareholders’ Meeting.
The variable compensation components for members of the EM – and all Helvetia employees in Switzerland – are determined by the Nomination and Compensation Committee during the first quarter of every year once the key figures for the past financial year and the individual target achievement results are available to the BoD for final approval by the SM (EM total amounts). The Nomination and Compensation Committee uses a criteria matrix to assess the results-based target achievement; this matrix is discussed in detail below in conjunction with the long-term compensation component (LTC).
The members of the Board of Directors still have claims to deferred shares arising from variable compensation in previous years. A claim for the 2016 financial year is currently still outstanding for which the definitive share transfer will take place in 2020. All deferred claims to shares of the members of the Board of Directors will expire with the transfer of ownership in 2020.
a) Fixed compensation Every BoD member receives a fixed basic fee determined in advance, which is generally the same for all members of the BoD. Differences arise from the allowances that are paid to the Vice-Chairmen and the members and chairpersons of the committees. These payments take account of the responsibility and specific functions of each of the individual BoD members. The higher total compensation paid to the Chairwoman takes into account her greater involvement in the company’s management and operational activities.
Thirty percent of the total compensation calculated on the basis of the basic fee as well as the allowances for committee chairpersons and committee members will be paid out in the form of shares that are blocked for at least three years (standard solution). The members of the BoD can apply for an extension to the vesting period for each generation of shares. There is a claw-back option, i.e. the return of the blocked shares if the business performance is bad during the vesting period, the reasons for which lie in gross mistakes made by the BoD during the reference year (analogous to the LTC rule in the compensation regulations for the EM).
For the LTC (EM), there is an additional restriction in that no deferred shares are allocated if the Group as a whole reports a loss, and/or the solvency figures are insufficient. The percentage of target achieved (LTC, results-based component), as calculated by the Nomination and Compensation Committee of the BoD, is multiplied by the respective target figure (percentage of the fixed compensation ). The results-based component calculated in this way and the result of the individual target achievement together comprise the total variable compensation of the employees and the EM. These variable compensation components (individual, results -based and LTC for the EM) are an important feature of Helvetia’s performance culture, under which every individual employee is compensated according to the quality and quantity of his or her work as well as his or her responsibility and workload and also the result achieved by the company as a whole. The variable compensation components are paid out in cash and only the LTC is paid in the form of deferred shares after three years or in the equivalent amount in cash, if desired.
Total compensation of Executive Management 14 169 471 12 701 190 1 Total bonus amount based on personal and results-based target achievement 2 Comprises the value of the deferred shares allocated as part of the LTC; A. Keller received CHF 200,000.00 in deferred shares on taking up his position.
Total fixed compensation Executive Management for the period 1.7. – 30.6. Prospective
Outlook – December 2019, 5.12.2019 4 Versicherungswirtschaft heute (Insurance Studies Today), https:// versicherungswirtschaft-heute.de/ unternehmen-und-management/ 2020-01-29/gdv-versicherer- verzeichnen-2019-hohes- beitragswachstum-in-der -lebensversicherung/
The unresolved political risks such as the trade conflict between the US and China and the Brexit process were increasingly pushed into the background and were unable to dampen the positive underlying mood on the markets.
The investment volume increased sharply by CHF 2.5 billion compared with the previous year and amounted to around CHF 54.5 billion at the end of 2019. The positive equity markets, lower interest rates and narrowing credit spreads caused unrealised gains in shareholders’ equity to grow by CHF 1,432 million. In addition, there were book and realised gains of CHF 456 million.
– Successful launch of the “Helvetia Payment Plan” with periodic premium payment
Also in the life business, Helvetia recorded a higher IFRS net income after tax for the year under review than in the previous year of CHF 195.6 million (2018: CHF 118.9 million).
One-time positive effect from the revaluation of deferred tax provisions as a result of the federal tax reform and related cantonal tax reductionsgen
Investment-linked insurance solutions CHF 549.2 million + 9.3 % in OC
The net combined ratio declined slightly in 2019 to 94.8 % (2018: 95.1 %). The improvement is due to a lower administration cost ratio.
Unrealised gains and losses on investments in associates – 3.2 – 0.2
Cash and cash equivalents as of 1 January 1 238.4 1 260.3
2.5.5 Impairment of goodwill Capitalised goodwill is tested annually for impairment. The method is described in section 2.10 (page 83). The calculation of the recoverable amount is based on a number of assumptions, which are detailed in section 6 (from page 106).
The following rates of depreciation apply to owner-occupied property: Land is not depreciated. Useful life is adjusted if the pattern of consumption of the economic benefit has changed. Value-adding investments are added to the current book value in the period and are depreciated over the entire term if an increase in the economic benefit is expected from the investment and reliable estimates exist for the cost. Depreciation is recognised in the income statement under “Operating and administrative expenses”. Repairs and maintenance are charged to the income statement as incurred. Tangible assets are regularly tested for impairment (see section 2.10, page 83).
Financial report Summary of siginificant accounting policies and dealer margins. Upon initial recognition, financial investments are irrevocably classified as “designated as at fair value” only if they are a component of a particular group of financial assets that, according to a documented investment strategy, are managed on a fair value basis, or their recognition as at fair value serves to compensate for market value fluctuations of liabilities due to policyholders.
Loss reserves are set aside for all claims incurred by the end of the accounting period. The reserves also include provisions for claims incurred but not yet reported. Actuarial methods that take account of uncertainties are applied to determine the amount of reserves. Reserves are not discounted, except for those provisions for claims for which there are payment arrangements.
The segment “Switzerland” comprises the Swiss country market and the financial intermediaries MoneyPark and Finovo. The “Europe” segment comprises the country markets of Germany, Italy, Spain and Austria. The “Specialty Markets” segment includes transport, art and engineering insurance policies in the Switzerland / International and France market units, as well as the global active reinsurance business. The segment “Corporate” includes all Group activities, the Group’s own fund companies, Group reinsurance and Helvetia Holding AG.
Income investments with market risk for the policyholder 101.5 – 50.1 368.0 – 170.5 – – – 0.1 4.9 – – 469.4 – 215.7
Net benefits to policyholders and claims – 4 871.2 – 4 298.8 – 2 432.5 – 1 794.5 – 633.6 – 569.7 – 110.8 – 68.8 – 2.5 – 2.9 – 8 050.6 – 6 734.7
Current income on Group investments (net) 825.6 851.0 140.2 138.2 6.7 23.3 – 25.4 – 25.2 947.1 987.3
Total derivatives for hedge accounting 1 366.5 – – 1 366.5 383.4 6.4 13.8
Reserves for life insurance contracts 37 401.7 35 924.2 55.7 63.9 37 346.0 35 860.3
Due from / due to insurance companies 664.6 626.7 340.9 266.9
The purchase of Helvetia Holding AG registered shares is not subject to any restrictions. Shareholders who purchase the shares in their own name and on their own behalf are entered in the share register with voting rights for a maximum of 5 % of the issued registered sh37ares. Individuals who do not explicitly certify in the registration application that they acquired the shares on their own behalf are entered in the share register for a maximum of 3 %.
Valuation reserves for contracts with participation features in 'Equity' (gross) 11.2.5 – 955.3 – 472.5
Valuation reserves for contracts with participation features as of 31 December 1 736.2 1 220.0
Total personnel costs 976.8 933.4 13.2 Employee benefit receivables and obligations
These types of potential risks are monitored throughout the Group and hedged in a coordinated manner by means of treaty reinsurance contracts. Facultative reinsurance contracts are taken out for individual large risks not covered under the treaty reinsurance contract. Treaty reinsurance contracts are coordinated by the Group reinsurance business unit as part of Helvetia Schweizerische Versicherungsgesellschaft AG and usually centrally placed in the reinsurance market. In its role as Group reinsurer, Group Reinsurance ensures that the individual primary insurance units have the appropriate treaty reinsurance protection and transfers the risks assumed, taking account of diversification, in the reinsurance market. This centralisation leads to the application of uniform Group-wide reinsurance standards, particularly in relation to the hedging level, as well as synergies in the reinsurance process. Based on the Group’s risk appetite and the state of the reinsurance markets, Group reinsurance ensures efficient use of existing risk capacity at Group level and provides optimum management of the purchase of reinsurance protection.
Total reserves for insurance and investment contracts (net) 6 910.2 12 608.6 8 799.7 15 811.0 2 064.7 46 194.2 as of 31.12.2018 < 1 year 1–5 years 5–10 years > 10 years Without maturity Total in CHF million
Fair Value Maturity of non-discounted flows of funds as of 31.12.2019 < 3 months 3–6 months 6–12 months > 1 year in CHF million
1 measured by the cretit risk exposure shown in the tables “Credit quality of debt instruments” and “Credit risk from ceded reinsurance”.
On 11 February 2020, Helvetia placed a dual-tranche hybrid bond totalling CHF 400 million via its subsidiary Helvetia Schweizerische Versicherungsgesellschaft AG.
Smart Insurance & IT Solutions GmbH, Vienna Other 100.00 full EUR 0.0 protecta.at Finanz- und Versicherungsservice GmbH, Vienna Other 100.00 full EUR 0.0
Assumptions on mortality, disability, reactivation, lapse rates, interest rates and costs are particularly relevant for the technical reserves established for such events. These assumptions are made on the basis of statistics provided by industry associations and observations from own portfolios, and take into account expected future developments. The definition of such assumptions involves uncertainties, which are mitigated with additional security margins.
 Conclude on the appropriateness of the Board of Directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability
Helvetia Group Susanne Tengler P. O. Box, CH-9001 St Gallen Phone +41 58 280 57 79 www.helvetia.com investor.relations@helvetia.ch
The Financial Report 2019 of Helvetia Group is available in English and German.