UNIQA: Strong growth, consistent results despite floods

21.11.2024 | 2 Images

Andreas Brandstetter, CEO UNIQA Insurance Group AG, UNIQA Österreich © UNIQA/Natascha Unkart & Isabelle Köhler

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• Premiums written increased by 9.2 per cent to around €6.0 billion
• Earnings before taxes up slightly by 1 per cent to €340 million
• Severe damage caused by September floods largely offset by good performance in other business lines
• Steadily high solvency ratio of 262 per cent
• Retreat from Albania, Kosovo and North Macedonia

Vienna, 21 November 2024 - UNIQA Insurance Group AG presents good figures for the first nine months of the 2024 financial year: premiums rose by 9.2 per cent to around €6.0 billion and earnings before taxes increased slightly by 1 per cent to €340 million. Premium revenues increased in all business lines: by +11.2 per cent in property and casualty insurance, +10.5 per cent in health insurance and +2.6 per cent in life insurance.

The results for the first three quarters were notably impacted by the storm "Boris" in September. It alone was responsible for gross claims payments of €184 million and, even after the contribution of international reinsurance partners, a net amount of €82 million. UNIQA is currently assuming the total damage caused by this flood will amount to an estimated €230 million in gross terms and around €86 million in net terms by the end of the year.

These severe storm damages also had an impact on the gross combined ratio (gross loss-cost ratio) in property and casualty insurance. The ratio of total insurance service expenses to insurance revenue rose by 2.3 percentage points to 93.3 per cent in the first three quarters.

Andreas Brandstetter, CEO UNIQA Insurance Group AG: "Once again, our business in recent months has been shaped by climate change and the noticeable deterioration of our planet's vital signs. The massive flood damage in Austria, Poland, Czechia, Slovakia, Hungary and Romania in September is the worst we have seen in the past 20 years. Nevertheless, we managed to generate a solid result." This is primarily due to the company's consistent strategy, which has enabled UNIQA's strong position in its core markets and significantly enhanced the resilience of its technical result against negative influences. Key aspects are the profitable growth of business in Central and Eastern Europe and a strong sales performance throughout the Group.

With the focus on "UNIQA 3.0 - Growing Impact", a continuation and further development of the previous strategic programme will begin in 2025. "Our currency is trust - and has been since 1811. This is more important than ever in uncertain times and is our mission at the same time: we want to make our brand promise 'living better together' tangible with even better customer orientation", says Brandstetter. "By 'Growing Impact', we mean that we are working on our relevance in the daily lives of our approximately 17 million customers and translating this into greater customer satisfaction, growth and improved earnings. We will achieve these goals through the further digitalisation of our offers and processes, new business models in health and sustainability as well as intensified, even more focused Group-wide collaboration."

Further details on the Group's strategy for 2025 and beyond will be presented at the UNIQA Capital Markets Day on 11 December 2024 in London.

Retreat from Albania, Kosovo and North Macedonia

In line with the objectives of the new strategy, UNIQA announces its retreat from Albania, Kosovo and North Macedonia. The company is thereby clearly focusing on its existing core markets in Central and Eastern Europe. Albania, Kosovo and North Macedonia are among the smallest markets in the Western Balkans, and their share of the UNIQA Group's premiums written was recently 1.5 per cent.

Following a successful start-up phase, the companies in Albania, Kosovo and North Macedonia are transferred back to the long-standing co-shareholder and founder thus ensuring continuity for customers, partners and employees. Current customer contracts will continue to be fulfilled, and cooperation with international corporate customers will remain in place.

The sale is subject to the granting of necessary official authorisations. The transaction is expected to close in the second quarter of 2025.

Key figures for 1 - 9/2024

UNIQA Insurance Group AG prepares its financial statements in accordance with the new accounting standards IFRS 9 and IFRS 17, which have been applied since 1 January 2023. The comparative values for 2023 are also stated in accordance with IFRS 9 and 17. Even though the premiums written are not part of the IFRS 9/17 reporting, they are still stated.

Premiums written at UNIQA Insurance Group AG, including savings portions from unit-linked and index-linked life insurance, rose by 9.2 per cent to €5,963.0 million in the first nine months of 2024 compared with the same period of the previous year (1 - 9/2023: €5,460.3 million). Above all, health insurance as well as property and casualty insurance contributed to this very pleasing growth. The life insurance business line also recorded a positive result.

Insurance revenue - in accordance with IFRS 17 - at the UNIQA Group rose in the first three quarters of 2024 by 10.3 per cent to €4,888.3 million (1 - 9/2023: €4,430.4 million). All business lines and segments contributed towards this: property and casualty insurance grew by 10.7 per cent, health insurance by 10.5 per cent and life insurance by 8.3 per cent. Insurance revenue in Austria rose by 7.0 per cent, and gained 13.0 per cent in the international companies.

The UNIQA Group's technical result amounted to €391.2 million (1 - 9/2023: €428.9 million).

Net investment income rose in the first nine months of 2024 to €618.7 million (1 - 9/2023: €440.7 million), primarily thanks to higher current income. The financial result amounted to €182.0 million (1 - 9/2023: €110.9 million) in the reporting period.

The UNIQA Group's earnings before taxes improved by 1.4 per cent to €340.3 million (1 - 9/2023: €335.6 million). Consolidated profit/(loss) (the proportion of net profit/(loss) for the period attributable to the shareholders of UNIQA Insurance Group AG) increased by 6.4 per cent to €264.0 million (1 - 9/2023: €248.2 million).

The solvency capital requirement (SCR) ratio according to Solvency II - considered to be an indicator for capitalisation - was at a high level of 262 per cent at UNIQA as of the key reporting date of 30 September 2024.

Results in the business lines

Property and casualty insurance

Premiums written in property and casualty insurance rose by 11.2 per cent to €3,598.8 million in the first nine months of 2024 (1 - 9/2023: €3,236.8 million).

The gross combined ratio in property and casualty insurance rose to 93.3 per cent (1 - 9/2023: €90.9 per cent). This is attributable to the very high claims from severe weather and flood damage, above all in Austria, Czechia and Poland.

Health and life insurance

In health insurance, growth of 10.5 per cent to €1,151.4 million was recorded in premiums written in the first three quarters of 2024 (1 - 9/2023: €1,041.7 million).

In life insurance, premiums written (including savings portions from unit-linked and index-linked life insurance) increased in the reporting period by 2.6 per cent to €1,212.8 million (1 - 9/2023: 1.181.8 million); above all the international business line developed very positively with an increase of 11.3 per cent.

New business in health and life insurance remained at a healthy level in the first nine months of 2024. Based on the contractual service margin, the new business margin was 9.9 per cent with a new business value of €174 million.

The contractual service margin (CSM) increased to €5,413.3 million as at 30 September 2024 (1 January 2024: €5,266.3 million). This balance sheet item - which has been new since IFRS 17 - represents the profits expected from insurance contracts in future.

Outlook

For the 2024 financial year, UNIQA continues to strive for continuous improvement in the core technical business in the two home markets of Austria and CEE. Expectations of strong growth in property and health insurance are based on both targeted sales activities and restatements in connection with inflation and index developments.

However, UNIQA continues to expect pressure on earnings in 2024 from rising insurance service expenses (particularly in the areas of property and health insurance) and in the area of costs (primarily due to inflation). Strict cost discipline and continuous optimisation in cost management therefore remain of crucial importance.

On the basis of a solvency ratio of at least 170 per cent, UNIQA strives to allow shareholders to participate in the company's success with annually increasing dividend payments. The payout ratio remains unchanged at up to 60 per cent.

These forecasts are subject to possible negative influences on the consolidated profit, which could result from geopolitical upheavals and the associated uncertainties for the global capital markets, from a volatile interest rate environment, the general inflation trend or from increased claims payments as a result of possible natural catastrophes in the further course of the year. In connection with this, UNIQA expects target profitability to remain at the 2023 level.

Clause regarding predictions about the future

This press release contains statements which refer to the future development of UNIQA. These statements present estimations which were reached on the basis of all of the information available to us at the present time. If the assumptions on which they are based do not occur, the actual results may vary from the results currently expected. As a result, no guarantee can be provided for the information given.

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UNIQA Group
The UNIQA Group is one of the leading insurance companies in its core markets of Austria and Central and Eastern Europe (CEE). More than 21,000 employees and exclusive sales partners serve more than 17 million customers across 17 countries. UNIQA is the second largest insurance group in Austria with a market share of about 21 per cent. In the CEE growth region, UNIQA is present in 14 markets: Albania, Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Hungary, Kosovo, Montenegro, North Macedonia, Poland, Romania, Serbia, Slovakia and Ukraine. In addition, insurance companies in Switzerland and Liechtenstein are also part of the UNIQA Group.