Q4 2018 results Investor presentation Follow us on Twitter: @TrygIR - Tryg.com
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Q4 2018 results Investor presentation Follow us on Twitter: @TrygIR
Contents Highlights Q4 2018 3 Premiums and portfolio 10 Claims and expenses 14 Investment, capital and targets 18 Roadshows & Conferences 25 Background material 26 Appendix 45 Disclaimer Certain statements in this presentation are based on the beliefs of our management as well as assumptions made by and information currently available to the management. Forward- looking statements (other than statements of historical fact) regarding our future results of operations, financial condition, cash flows, business strategy, plans and future objectives can generally be identified by terminology such as “targets”, “believes”, “expects”, “aims”, “intends”, “plans”, “seeks”, “will”, “may”, ”anticipates”, “continues” or similar expressions. A number of different factors may cause the actual performance to deviate significantly from the forward-looking statements in this presentation including but not limited to general economic developments, changes in the competitive environment, developments in the financial markets, extraordinary events such as natural disasters or terrorist attacks, changes in legislation or case law and reinsurance. We urge you to read our annual report available on tryg.com for a discussion of some of the factors that could affect our future performance and the industry in which we operate. Should one or more of these risks or uncertainties materialise or should any underlying assumptions prove to be incorrect, our actual financial condition or results of operations could materially differ from that described herein as anticipated, believed, estimated or expected. We are not under any duty to update any of the forward-looking statements or to conform such statements to actual results, except as may be required by law. 2
Financial highlights Q4 2018
- Improved technical result before Alka, lower investment income driven by a sharp fall in equities
- Q4 dividend of DKK 1.65 per share and solvency ratio of 165
Technical result (DKKm)
• Technical result of DKK 656m before Alka (DKK 596m reported)
• Technical result of DKK 656m before Alka (DKK 596m reported)
• Alka impacts the technical result with DKK 124m one offs and DKK 63m technical
result contribution (November & December)
• Large & weather claims below normal, run-offs also relatively low
• Steady improvement of the underlying claims ratio (before Alka), Private improved
50 bps, Group improved 40 bps
• Expense ratio of 14.4% before Alka (15.6% reported)
Expense ratio
• Investment income of DKK -330m (DKK 86m)
• Highly negative development in equity markets impact free portfolio return
• Match portfolio reported a negative result driven by widening credit spreads
• Properties revaluation of DKK 75m in Q4
• No changes to asset mix
• Pre-tax DKK 285m before Alka (DKK 149m reported)
• Other income/costs include a DKK 76m one off and DKK19m depreciation of Combined ratio
customer relations and brand related to Alka
• Pre-tax result weighed down by Alka one-offs and negative capital markets
developments in Q4
• Q4 DPS 1.65, FY DPS 6.60, Solvency ratio of 165
• Seventh year with an increased ordinary dividend (since 2012)
• Solvency ratio of 165 impacted by longer (than initially estimated) period to obtain
the Alka approval and higher interest payments to the seller and non equities related
investment losses in Q4.
3
Customer highlights Q4 2018
TNPS
• Transactional Net Promoter Score (TNPS) of 67 (62)
• Retention improved in all business areas
• Strong development in number of products per
customer Number of products per customer
• Awareness of Customer Bonus improved especially
for Non-customers
25% 13% 40%
4
Improved technical result primarily driven by Private & Commercial
Group (DKKm) Private, DK & NO (DKKm) Commercial, DK & NO (DKKm)
Corporate (DKKm) Sweden (DKKm)
• The DKK 124m one-offs on the technical result are not impacting the Business
segments but only Group figures
5
Shareholders’ remuneration
Shareholder remuneration since 2012 Strong focus on shareholders’ remuneration
DKK
• Q4 DPS 1.65, FY DPS 6.6
• Aiming for a nominal and stable
increase in ordinary dividend (annual)
• No extraordinary dividend for the FY
2018 following the Alka acquisition
• High proftibility and low growth implies
limited increase in capital requirement
Share price performance since IPO Value of Tryg since IPO (DKKbn)
600
500
400
300
200
100
0
-100
Tryg equity Euro insurance index
6
Strategic initiatives
Claims Excellence Product & Service Innovation
(DKK 600m in 2020) – DKK 150 in 2018 (+DKK 1bn in 2020+) – DKK 275m in 2018
~DKK 100m: Savings from further leverage of Trygs 57 new products and services across DK, NO and SE.
procurement power and ensuring a higher utilization of
our supplier contracts. New market demands addressed through a balanced mix
between re-bundling, new products and prevention.
~DKK 35m: Improvement of the claims handling ~DKK 145m: New products (e.g. Cyber, Undo:, Pet,
process through several initiatives, e.g.: using data NOKAS)
and speech analytics, more accurate assessment and ~DKK 110m: Bundling (e.g. Health, Child, Group
better recourse management. accident)
~DKK 20m: Prevention (e.g. Tryg Drive, Alarm, Rat
~DKK 15m: Increased fraud detection expertise, which blocker)
has been driving an approximately 25% higher level of
fraud discovery. The profitable credit and surety business, Tryg Garanti, has
introduced the product in countries outside the Nordics.
Digital Empowerment of Customers Distribution Efficiency
(DKK 100m in 2020) – DKK 20m in 2018 (DKK 150m in 2020) – DK 30m in 2018
Private business: ~DKK 15m
~DKK 10m: Based on increased use of robots in the claims
handling process. More than 17,000 claims were processed as STP In DK independent sales agents selling exclusively for
in DK. Tryg have been engaged thus lowering sales costs
NO has established a franchise set-up, and focused on
~DKK 5m: The number of digital self-service interactions selling through the customer service centre.
surpassed the number of ‘analogue’ interactions. Achieved by
introducing more possibilities for customers to digitally perform
self-service.
Commercial business: ~DKK 15m
~DKK 5m: From other initiatives related to Digital Empowerment.
In DK a new type of sales agent that combines the
traditional sales agent and customer service centre sales
Specifically in Norway Tryg’s digital focus led to the launch of the has been introduced
first online sales solution in the market for the commercial NO has increased their marked analytics and improved
segment. processes related to UW and improved hitrate
7
Alka: Strong financial track record
• Alka reported a FY 2018 technical result of DKK 342m driven by a Combined
ratio of 84 and run-off gains of 5%
• Premiums growth was 4% driven by a good customer growth driven also by
an increase in on-line sales
DKKm 2013 2014 2015 2016 2017 2018
Non-life
Technical result 368 335 357 191 331 342
Combined ratio 82% 84% 83% 91% 85% 84%
Run-off gains* (%) 11% 10% 12% 7% 10% 5%
• Relative run-off (%) calculated as Run-off result / Claims reserves as per Danish FSA definition
8
Danske bank Nordic bancassurance agreement
Strategic objectives
1 2
Growth and to develop a
Strong value proposition
profitable, long-term cooperation
• Tryg and Danske Bank have entered into a
new strategic partnership in Denmark, 3 4
Agreement with high focus on
Norway and Sweden innovation and digital solutions
Match on value and branding
6
• Danske Bank is one of the largest banks in 5 Strong
Largest on
each market - stronger
the Nordics with approximately 3 million strategic Nordic partnership
distribution power
customers and strong local routes
7
Bank customers a particularly
attractive
• ~ 1 May referral of customers from Danske segment
Bank
• Ultimo 2019 Nordea agreement ends Expected Portfolio Development (Index)
• 1 January 2020 Go Live
9
Premiums and portfolio
Group premiums up 13.0% in Q4, 4.5% excl Alka
• Group premiums were up 13.0% in local currencies, or 4.5% before Alka
• Private lines reported a 6.1% growth excluding Alka, positive trends in both Denmark and Norway
• Commercial growth was 6.8% helped by portfolio acquisitions and positive underlying development
• Corporate growth driven by price increases and good growth of Tryg Garanti
• Sweden increased by 7.7% primarily driven by a strong growth in pet insurance and accident business
• Premiums growth (local currency) expected to be between 0 and 2% in 2019 in line with previous years
Gross earned premiums development
Local currencies Local currencies
(Local currencies) DKKm Q4 2018 Q4 2017
Q4 2018 Q4 2017
Private 2,679 2,203 21.2% 1.1%
Commercial 1,044 977 6.8% 2.3%
Corporate 987 965 2.9% 3.0%
Sweden 361 355 7.7% 5.1%
Group 5,053 4,488 13.0% 1.9%
11Private - average prices
House insurance – average price (index 2011 = 100)
Average price development Y/Y
1.1% 3.0%
• DK: 1.1% positive development
(Q3 1.3%) (Q3 3.0%) reflects both price increases and
conversion
Average price:
5,000 6,100 • NO: 3.0% positive development
reflects primarily price increases
Motor insurance – average price (index 2011 = 100) • DK: 1.9% positive development
Average price development Y/Y reflects both price increases and
conversion
1.9% 1.9%
(Q3 2.4%) (Q3 1.4%)
• NO: 1.9% positive development
Average price reflects underlying price
4,400 5,900 increases. Average motor price is
higher in Norway reflecting
primarily different type of cars
12Customer retention improving
Private
DK
• DK: customer retention at 91.2%
(90.2%) highest level in five
years
• NO: customer retention up to
86.7% (85.8%) showing an
improved trend
Commercial
• DK: customer retention at 88.0%
(87.7%) remains at a high level
• NO: customer retention at 87.7%
(86.9%) showing an improved
trend
13Claims and expenses
Underlying claims ratio improving
Claims ratio, net (Commercial DK & NO)
Group underlying claims ratio (before Alka) at 73.2, 40bps better than Q4 2017
Private underlying claims ratio (before Alka) at 67.8, 50bps better than Q4 2017
Corporate profitability remains under pressure
“Expected FY 2019 underlying claims ratio better than FY 2018”
Tryg & Alka together underlying claims figures to be provided ahead of Q1 2019
Group
Claims ratio, net (Corporate)
Underlying development is adjusted for run-off, large claims, weather claims and interest.
Private (DK & NO) Claims ratio, net (Sweden)
Underlying development is adjusted for large claims, weather claims, run-off and interest.
15Large claims, weather claims and run-off
Large claims, net DKKm Weather claims, net DKKm
Expected annual level 2019: DKK 600m
Expected annual level 2019: DKK 550m Expected annual level 2018: DKK 500m
Claims reserves discounting rate (%) Run-off net, effect on combined ratio (%)
• Q4 run-offs at 4.1% of the COR, FY run-offs at 6.5% of COR
• Corporate segment in Q4 reported a run-off loss of DKK54m or 5.5%
of COR
• Key driver of Corporate run-off loss was adverse development of few
prior years large claims
• Guidance is for 2020 run-offs between 3% and 5%
16Expense ratio of 14.4 before Alka
Expense ratio
• Efficiency initiatives in 2017 reduced overall
costs
• Investments in digitalisation will somewhat
offset further efficiency gains 15.7
15.3
15.6
14.6
14.4 14.4
• Expense ratio target for 2020 around 14%, Q4 14 13.7
2018 at 14.4% before Alka reflecting volatility 14.1
between quarters. FY 2018 Expense ratio before
Alka 14.1%
2014 2015 2016 2017 2018 Q4 2017 Q4 2018 Q4 2018
(Before
• Higher number of employees driven primarily by Alka)
Adjusted for one-offs As reported
the inclusion of Alka
Expense ratio by business areas FTE - Development
17Investment, capital and targets
Investments – Split in Match & Free portfolio
Total investments
DKK 40bn
Splitting up the portfolio
Match portfolio ‘risk-wise’ Free portfolio
DKK 29bn DKK 11bn
Sweden
DKK 5 bn
Norway
DKK 8 bn
Denmark
DKK 16 bn
19Investment return – low risk remains key
Key figures - Investments Different asset classes Geographical exposure (%)
DKKm Q4 2018 Q4 2017 2018 2017
Free portfolio -198 138 -33 598
Match portfolio -42 13 -2 227
Other financial income and
-90 -65 -297 -298
expenses
Total investment return -330 86 -332 527
Group fixed income portfolio rating split Corporate bonds portfolio (DKK 2.2bn) rating split
20Solvency position Q4 2018
• Solvency ratio based on the Partial Internal Model
Own funds walk is 165 (Q3 2018: 291).
• Own Funds (OF) is primarily impacted by
16,500
110 -499
14,500 -5.437
• Result Q4 2018 of DKK 110m
12,500
• Dividends of DKK 499m
10,500
13,797 87 • Intangibles of DKK 5,437m
8,500
6,500 8,058
SCR is primarily impacted by
4,500
Intangible
Cash dividend
Subordinated
Own Funds
Results
Own Funds
assets
Q4 '18
• Inclusion of Alka in the model
Q3 '18
Q4 '18
debt
• Reduced ”equities” charge following Q4
highly negative markets, ”dampener”
Solvency capital requirement walk
effect
• Based on Solvency II Standard Formula the
5,200 solvency ratio is 135 (Q3 2018: 236).
5,000 396
-243 • Standard Formula SCR DKK 5,980m
4,800
4,600 -9
4,892
• Solvency ratio at 165 is slightly below previous
4,748 estimates driven by a longer (than initally
4,400
estimated) period for the Alka approval (higher
4,200 interest payments to the seller) and negative
markets in Q4 (non equities related).
Q3 '18
Market
Q4 '18
Alka
Other
SCR
SCR
21Capital and solvency ratio development
Capital Tiers as % of SCR • Tier 2 cap means some DKK 140m of subordinated
loan not included in Own Funds
2,446 50% • Tier 1 capacity for practical purposes fully utilized
(DKK 20m potential)
1,107 23%
CETier 1
• The Danish FSA has explained that a ratio lower than
ATier 1 125 would result in increased surveillance.
4,505 92%
Tier 2
• Solvency ratio development mostly a function of net
profits (+) and dividends (-). Underlying development
Q4 '18 Q4 '18 should remain pretty stable.
DKKm % of SCR
Solvency ratio development
22Solvency ratio sensitivities
190%
179%
180%
171%
167% 167% 167% 167%
170% 165% 163% 164% 166% 164% 166% 162% 163%
161%
158%
160%
151%
150%
140%
130%
2018 Equity Property Interest Spread Spread Spread NOK/DKK SEK/DKK
(Covered) (Corporate) (Government)
• The Solvency II ratio shows the highest sensitivity to spread risk for covered bonds
• Assumption is for a 100bps widening/narrowing of our entire fixed income book (Danish government bonds, Danish
mortgage bonds, Norwegian government bonds, high yield etc.)
• Biggest spreads sensitivity (by far) in the fixed income area is towards covered bonds. Corporate and Government
bonds sensitivities are low as exposure to these assets classes is low
• The Solvency II ratio is not highly sensitive to equity markets movements as most of the ‘Own
funds’ hit from a sharp fall in equity markets would be offset by a lower capital requirement (lower
market values combined with the effect of a reduced charge due to equity-dampener)
• Interest rate risk is very low as function of our matching strategy
23Targets and outlook
New financial Targets announced at 2017 CMD 2018 underlying topline growth between 0-2%
Member bonus of 8% in June 2018 2019 expected tax rate around 22-23%
Alka acquisition will result in annual depreciation of
Price increases to offset claims inflation customer relations of DKK 127m within a 5 to 7 years
period. Solvency position (hence dividend capacity) not
impacted by the P&L charge
Targets post Alka acquisition
Financial targets, 2020
ROE after tax (%)
Technical result DKK 3.3bn
60
Combined ratio ≤ 86
50
Expense ratio ~ 14
40
ROE after tax ≥ 21%
30
Customer targets, 2020 20 21.0
TNPS 70 10
No. of products per customer +10 % 0
24It is important to know your investment case
”Do you know the only thing that gives me pleasure?
It’s to see my dividends coming in.”
John D. Rockefeller
25Q4 roadshows & conferences
Date Place Participants from Tryg Arranged by
Morten Hübbe, CEO
22/01/2019 Copenhagen Johan Kirstein Brammer, CCO Carnegie
Investor Relations
Morten Hübbe, CEO
23/01/2019 London DnB
Gianandrea Roberti, IRO
Espen Opedal, Head of Tryg Norway
25/01/2019 Oslo DnB
Peter Brondt IR Manager
Lars Bonde, COO
19/02/2019 Geneva Danske Bank
Peter Brondt, IR Manager
Lars Bonde, COO
20/02/2019 Zürich Carnegie
Peter Brondt, IR Manager
19-21/03/2019 London Peter Brondt, IR Manager Morgan Stanley Conference
Supervisory Board
Morten Hübbe, CEO
16/03/2019 Ballerup Johan Kirstein Brammer, CCO Tryg’s AGM
Lars Bonde, COO
Investor Relations
20/03/2019 Milan Gianandrea Roberti, IRO Carnegie
26Background material
Tryg’s equity story – a leading Scandinavian non-life insurer
Tryg 2018 – 2020:
Strengthening the core, while embracing the future Product & Service
Claims Excellence
Innovation
DKK 600m in claims
cost reduction +DKK 1bn in new
Financial targets 2020 Customer targets 2020 products by 2020+
• Technical result: DKK 3.3bn • TNPS: 70
• Combined ratio: ≤86 • Number of products per customer:
+10%
• Expense ratio: ~14
• ROE: ≥21%
Dividend policy
• Targeting a nominal, stable and increasing dividend
• Extraordinary dividend to further adjust the capital structure
Alka acquisition
Digital Empowerment DKK 300m in synergies with full run-rate impact in 2021
of Customers Distribution Efficiency
DKK 100m DKK 150m in technical
STP on claims: 50% result impact
Self-service: 70%
Long term profitable growth and attractive
shareholder value creation
28Why invest in Tryg?
Pre-tax result by division (YE 2017 data) High insurance penetration in the Nordics
Premiums per capita (USD), 2016
Motor combined ratios Nordics vs international Tryg is a dividend stock
DKK
Total yield (dividend and buy backs / market cap) at year end
29Tryg at a glance
Gross premium split by products 2018
• Tryg goes back to 18th century.
• Very strong brand position especially in Denmark.
• Non-life insurance in Denmark, Norway and Sweden.
Percentage
• Approx. 80% retail business.
Norway
Market position: #3
Retention rate - Private Market share: 13.2%
CR in 2018: 87.7 %
DK
Sweden
Market position: #5
Market share: 3.0%
CR in 2018: 95.2%
Denmark
Retention rate - Commercial Market position: #1
Market share: 21.8%
CR in 2018: 80.6%
Business split 2018
Percentage
30Premiums and reserves by lines of business
Gross premium by products 2018 Gross claims reserve by products 2018
Percentage Percentage
Run-off net by products Q4 2018 Run-off net by products Q4 2017
Percentage Percentage
31Gross premium split by geography
DK: Gross premium by products 2018 SE: Gross premium by products 2018
Percentage Percentage
NO: Gross premium by products 2018 Run-off net by products 2018
Percentage Percentage
32Claims inflation differs from core CPI
Annual Danish insurance gross claims increase vs CPI
• Danish non-life insurance gross claims
development 2009-2015
• Cloudburst hitting Copenhagen in 2011
explains jump and fall of figures in 2011-2012
•
Figures not adjusted for changes in number of
insured objects
Source: Danish FSA and Danmarks statistik
Construction index cost – YoY % change, Denmark Construction index cost – YoY % change, Norway
5.7% 4.5%
4.0%
4.7%
3.5%
3.7% 3.0%
2.5%
2.7%
2.0%
1.7% 1.5%
1.0%
0.7%
0.5%
-0.3% 0.0%
Total Material Labour cost Total Materials Labour cost
33The run-off cycle
We assessed the claim
at DKK 18,000 but
reserve for DKK 20,000
Run-off development
Run-off:
3 years
Claims estimate:
Claims buffer:
• Initial assessment of the claims was DKK 18,000 but Tryg reserved for
DKK 20,000 adding some conservatism to best estimate.
• At the time of setting up the claims reserves and booking the claims in the P&L the
Loss ratio (hence the combined ratio) is worse than what should be if our initial
assessment is correct.
• After three years (approx. and using average for Tryg group) the DKK 2,000 added
for conservatism comes back in the P&L as a positive run-off gain or reserves
releases. All the above assumes that initial assessment was correct and nothing
has changed in the three years period.
• Figures in the example above are purely illustrative.
34Combined ratio development
2011-2012 price increases will improve underlying combined ratio.
2012-2015 operational focus with target to cut expenses and claims costs by DKK 1bn in total.
2015-2017 New efficiency programme of DKK 750m launched.
*IFRS from 2004. Previous years are Danish GAAP.
Data before 2009 is not corrected for the sale of Marine Hull business, and Finland before 2008.
35Structure of the Nordic insurance market
Nordic Denmark
EUR 25.9 bn (as at Q4 2017) DKK 54.1 bn/EUR 7.3bn (as at Q4 2017)
Percentage Percentage
Norway Sweden
NOK 58,4 bn/EUR 6,1bn (as at Q3-2018) SEK 83.6 bn/EUR 8.2bn (as at Q3-2018)
Percentage Percentage
36Distribution of new sales 2018
Private
DK NO SE
Commercial
DK NO
Corporate DK NO SE
37Things that you may not know
• Motor insurance prices relatively similar in DK and the UK but cost of the insured good
(the car) substantially higher in DK driven by the registration tax for passenger cars
(100%-150% of taxable value on new vehicles approx.).
• Motor insurance remains a highly attractive business in Scandinavia unlike many
European countries.
• In Oslo, it costs approx. NOK 5,000 per month to hire a dog walker for 5 weekly walks,
each walk is minimum 60 minutes.
• In Sweden it is illegal to leave a dog home alone more than six hours, the dog has to be
out at least every six hours during the day.
• Pet insurance premiums totalled SEK 3.3bn at the end of September 2015 in Sweden
but that includes horses as well.
• Tryg believes that Pet insurance remains an attractive growth segment.
• Child insurance is an important product in Sweden with total market premiums above
SEK 2.5bn, the same product is virtually non-existent in Denmark and Norway. We
believe this will gradually change and plan to leverage on our Skandia child insurance
acquisition.
• In 2014, Tryg bought Securator reinforcing its leading position in the Nordic market for
product and extended warranty insurance, a market which is estimated at more than
DKK 2bn.
38Things that you may not remember
• Our maximum annual net exposure to a single large Property claim is
DKK 100m which falls to DKK 75m in case of a second event and
DKK 50m in case of a third/fourth event, maximum exposure is DKK
25m thereafter. This is based on our general reinsurance programme.
• Our maximum net exposure for weather claims is DKK 150m per
event. The upper limit of the programme is DKK 5.75bn, which is
statistically sufficient to cover at least a 250-year event.
• We have bought an additional ‘horizontal’ reinsurance programme
which will cover any weather claims in excess of DKK 300m up to DKK
600m. Weather claims have to be at least DKK 20m to end in the
‘horizontal’ agreement.
• Local accounting rules driven by Danish FSA means that all assets are
marked to market. This is different from Nordic/International peers
where many fixed income portfolios are hold to maturity and/or the
marked to market hits the NAV and not the P&L. The unrealised gains
and losses item does not show up in the P&L of some of our Nordic
peers (as most bonds are hold to maturity) or hits the NAV as
opposed to the P&L.
39IBM study from 2007, probably little has changed
Danish customers completely and strongly agree
• Overall I am very satisfied with the
services of my insurance company
• My insurance agent only sold me
insurance coverage that I really needed
• My present insurance coverage offers
me enough flexibility
• Claims: my insurance company in
uncomplicated and helpful way
• I have full confidence in my personal
insurance agent
• My insurance is more cost effective than
most other insurances
Source: IBM Institute for Business Value and I.VW University of St. Gallen 2007 Insurance Study
40Population growth (2000-2016)
Population development in Denmark in ‘1,000
DK 7% Growth 2000-2016:
0-17 years 1.9%
18+ years 8.5%
Total 7.1%
Population development in Norway in ‘1,000
NO 16% Growth 2000-2016:
0-17 years 7.1%
18+ years 19.3%
Total 16.4%
41TryghedsGruppen and its members’ bonus
Denmark's ‘biggest’ family Bonus positive effect on retention
‘I expect to be in Tryg next year’
Have heard about Customer bonus 93%
Have not heard about Customer Bonus 81%
Retention rate increase by 1% gives approx.
DKK 50-150m reduction in expenses on group level
TryghedsGruppen’s highest govern body is the Board of
> DKK 440m > DKK 150m > DKK 130m for
representatives. The Board composes 70 representatives
to Private costumers commercial customers corporate costumers
chosen by and among Tryg’s Dansih customers. Every year,
there is an election in one of the five geographocal regions in
Denmark.
Every 5th Dane receives a bonus!
8% in 2018
42Organisational and remuneration structure
Organisation chart Remuneration structure
The Executive Board are remunerated according to Tryg’s
remuneration policy:
• Base salary
• Pension
o 25% of the base salary
• Variable pay
o Up to 50% of the base salary including pension
o The variable pay element is a Matching Shares
Programme:
The Executive Board may buy Tryg shares (so-called
investment shares) at market price for a predefined
amount. Four years after the purchase, Tryg will grant
one matching share per investment share free of charge.
Download Tryg’s statutory corporate governance report and remuneration policy on tryg.com
43Corporate Responsibility in Tryg
Our Corporate Responsibility contributes to long-term value creation
Tryg’s Corporate Responsibility 2020 strategy is aligned with our corporate strategy and
purpose; as the world changes, we make it easier to be tryg*.
In 2018, Tryg launched an independent Corporate Responsibility report with extended
Environmental, Social and Governance (ESG) data. Please see the report on tryg.com.
Our three strategic focus areas are
Peace of mind in society Responsible workplace Customer relations
Initiatives which increase peace of Ensure compliance and have the We want our customers to
mind in society. necessary policies and processes experience the best and most
in place. competent service.
• Running the Nightravens
secretariat and contributing to • Regulatory compliance • Sustaining good customer
safety along Norwegian coasts relations
and harbours through the • Employee responsibility
lifebuoy initiative • Offer relevant products to match
• ESG data customer expectations and needs
• Minimise and reduce the number
of claims by integrating • UN Sustainable Development • Protecting customer data
prevention initiatives into our Goals (SDGs)
products
• Responsible Investments
* Tryg means feeling protected and cared for.
44Corporate Responsibility
UN Sustainable Development Goals
Highlights 2018
• A UN Sustainable Development Goal (SDG) assessment was completed.
Conclusion SDG prioritised list
• Tryg has a direct and indirect impact on the 17 SDGs The SDGs on which Tryg has the most direct impact
and 196 targets. However, we have focused on SDGs through our core business include:
where we have a direct impact and pinpointed two
specific goals for which we have defined Key
Performance Indicators (KPIs) to track performance.
The SDGs on which Tryg has a medium direct impact include:
41% 2%
women in reduction in
The SDGs on which Tryg has a low direct impact include:
management carbon emissions
positions in in 2020
2020
In the coming year, we will work to potentially include more goals from the high-impact SDGs to achieve greater impact
through our business activities.
45Key figures 2017 and Consensus 2018-2020
Consensus
DKKm 2018A 2018 2019 2020
Gross premium income 18,740 18,656 20,870 21,331
Technical result 2,766 2,777 3,143 3,307
Investment income, net -332 -245 158 161
Pre-tax profit 2,262 2,336 3,061 3,295
Net income 1,731 1,752 2,414 2,543
Combined ratio 85.1% 85.1% 84.9% 84.5%
Expense ratio 14.4% 14.4% 14.0% 13.9%
Ordinary dividend per share 6.6 6.6 6.8 7.0
Extraordinary dividend per share 0 0 1.5 1.7
Consensus is based on 15 estimates ahead of Q4 2018
46Appendix
Follow us on Twitter: @TrygIRGroup
Gross premiums Combined ratio
DKKm GEP (LHS) Local currency (RHS) % %
Claims ratio, net of reinsurance Expense ratio
% %
48Private
Gross premiums Combined ratio
DKKm
%
GEP (LHS) Local currency (RHS)
Claims ratio, net of reinsurance Expense ratio
49Commercial*
Gross premiums Combined ratio
DKKm
GEP (LHS) Local currency (RHS) %
Claims ratio, net of reinsurance Expense ratio
* Less than 100 employees or less than DKK 100m turnover
50Corporate*
Gross premiums Combined ratio
DKKm %
GEP (LHS) Local currency (RHS)
Claims ratio, net of reinsurance Expense ratio
* More than 100 employees and more than DKK 100m turnover
51Sweden
Gross premiums Combined ratio
DKKm %
GEP (LHS) Local currency (RHS)
Claims ratio, net of reinsurance Expense ratio
52Geographical combined ratio
Denmark Sweden
Norway
53Corporate history
• 1728, Copenhagen experienced what was later to be known as the Copenhagen Fire of 1728. The fire heightened public
awareness of the need for insurance
• 1731, The oldest component of Tryg’s history was the Danish insurance company Kjøbenhavns Brand was established by
Royal Decree as a result of the Copenhagen Fire of 1728
• 1880, The Norwegian insurance company Vesta was established. The name Vesta derives from Roman mythology, Vesta is
the goddess of hearth, home and family
• 1911, The name Tryg emerged (Tryg means peace of mind in Danish)
• 1990, The mutual company Tryg demutualised and the ownership of the new limited company was placed in Tryg I
Danmark
• 1994, Tryg acquired the Danish insurance operations of Winterthur
• 1995, Tryg acquired Baltica and continued operations under the name Tryg-Baltica
• 1996, Tryg-Baltica was listed on Copenhagen Stock Exchange. Tryg I Danmark retained a 60% ownership
• 1999, Tryg-Baltica merged with Denmark’s second largest banking group, Unidanmark whose general insurance activities
were integrated with Tryg. Tryg-Baltica de-listed
• At the end of 1999 the Norwegian insurance company Vesta was acquired from Skandia
• 2000, Tryg, Vesta and Unibank contributed to the formation of Nordea. Tryg I Danmark holds at this point a 6% stake in
the Nordic banking group
• 2001, Tryg established a branch in Finland
• 2002, Tryg I Danmark acquired Nordea’s non life activities and forms TrygVesta
• 2005, TrygVesta was listed on the OMX Nordic Stock Exchange in Copenhagen on October 14
• 2006, TrygVesta launched a Swedish branch in June
• 2009, The acquisition of the Swedish insurance company, Moderna, was completed in April
• 2012, Tryg sells its Finnish business to Sampo/If….
• 2015, Tryg split its share 1:5, meaning each share with a nominal value of DKK 25 was replaced by 5 shares with a
nominal value of DKK 5
• 2018, Tryg received the final approval of the Alka acquisition from the Danish authorities
54Economic key figures
Denmark Sweden
% 2018E 2019E % 2018E 2019E
GDP Growth 1.0 1.8 GDP Growth 2.8 2.1
Inflation 1.0 1.5 Inflation 2.2 2.0
Unemployment 3.9 3.6 Unemployment 6.3 6.3
Current account balance in Current account balance in
6.4 6.5 4.0 4.6
% of GDP % of GDP
Budget balance in % of GDP 0.1 0.2 Budget balance in % of GDP 0.6 0.3
Public debt in % of GDP 35.0 33.9 Public debt in % of GDP 37.0 35.1
Norway
% 2017 2018
GDP Growth (mainland) 2.4 2.7
Inflation 1.3 1.5
Unemployment 3.8 3.2
Current account balance in
9.6 8.7
% of GDP
Budget balance in % of GDP 6.3 5.8
Public debt in % of GDP 0.0 0.0
Source: Economic Outlook, Nordea Markets, September 2018
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