Annual Report 1997/1998 - Munich Re

Munich Re Report of the Board of Management
Economic development in
the Netherlands (in %)
10
8
6
4
2
0
1994 1995 1996 1997
Economic growth
Inflation rate
Unemployment rate
Growth in insurance
Economic development in
France (in %)
15
12
9
6
3
0
1994 1995 1996 1997
Economic growth
Inflation rate
Unemployment rate
Growth in insurance
The Netherlands
The growth in the Dutch economy continued in 1997, with only
moderate upward price movement and a further fall in the
unemployment rate. Direct insurers again recorded significant
premium growth.
In the year under review we took advantage of the opportunities
presented by the advancing privatization of social insurance in the
Netherlands. Despite the intense price competition and the continuing
consolidation in this market, too, we succeeded in increasing our
market share. The result was again positive, albeit not as good as in
the previous year.
Our clients’ retentions are getting bigger and the trend towards nonproportional
covers is unbroken. For 1998 we therefore expect a slight
decrease in our premium income. We are supporting innovative
developments, such as integrated environmental insurance and new
employee benefit covers; these offer us new business opportunities.
The result of our Dutch business will probably deteriorate, however,
owing to the effects of competition.
France
In France GDP grew somewhat more strongly than in the previous
year, with prices remaining very stable. Nevertheless, the unemployment
rate increased further. The premium growth achieved
by direct insurers was again considerable.
Despite this, we recorded a slight decrease in premium income from
our French business, also owing to the keen competition. As our
portfolio was largely spared claims costs for natural catastrophes and
other very large losses, the result improved on the previous year,
when it had been adversely affected by the fire in the Channel Tunnel.
In order to serve the needs of our clients even better, we upgraded
our liaison office in France to a service company with effect from
1st January 1998. We are reckoning with premium growth for 1998, but
the result probably will not reach last year’s level owing to the effects
of competition.
Switzerland
In Switzerland, the first signs of an economic recovery gradually
became apparent after years of economic stagnation. The unemployment
rate increased, however. Inflation remained at a very low
level.
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