01 Gothaer Konzern_E_09_Umschl - Gothaer Allgemeine ...

Management Report
In the property insurance lines, the earnings situation as a whole continued to improve.
Premium income increased by 2.2 % (PY: 4 %) to €14.9 billion and losses incurred – after
a marked decrease in the prior year (–9.5 %) – fell by another 1.3 % to €10.2 million.
Accordingly, the combined ratio after run-off moved down to 93 % (PY: 95.4 %). In the
private property lines in particular, the premium adjustment clause had a positive
impact, boosting premium income from householder’s and homeowner’s insurance by
3 % to a total of €7.8 billion. The main driver was homeowner’s insurance, where losses
incurred decreased by 4 % to €3.6 billion in the financial year 2009. Because premium
revenues rose at the same time – up 5 % at €4.7 billion – the loss ratio for the financial
year fell from 85 % to 78 %. Nevertheless, with the combined ratio at 102.0 % (PY:
109.5 %), the underwriting account showed a loss of around €100 million.
In general, liability insurance, premium income has stagnated at around €6.8 billion
since 2007. However, losses incurred in the financial year increased by 1.5 % to around
€4.6 billion, pushing up the loss ratio for the financial year to 68 % (PY: 67 %).
With a combined ratio of 90 % (PY: 89.1 %), an underwriting profit of approximately
€700 million is anticipated.
In personal accident insurance, a moderate rise in premium volume (+ 1 % to €6.4 billion)
is expected alongside a marked increase in losses incurred in the financial year (+ 6 %
to €3 billion). The combined ratio is forecast to move up from 77.4 % to 84.0 %.
Apart from finding themselves exposed to sustained high pressure of competition,
marine insurers also felt the impacts of the financial crisis in the year under review.
Set against a further fall in premium revenues (–2 % to €1.7 billion) was a sharp rise in
losses incurred in the financial year, which increased by 10.0 % (PY: 7.6 %) to €1.3 billion.
Consequently, the loss ratio for the financial year is expected to move up to 76.0 %
(PY: 68.1 %) and the combined ratio after run-off to 104 % (PY: 95.7 %).
In the wake of the economic and financial crisis, credit, surety and fidelity insurance
registered another steep increase in the volume of losses incurred, which grew by 25.0 %
(PY: 37.2 %) to €1.2 billion in the financial year 2009. Combined with a –2.0 % fall in premium
income to €1.4 billion, this pushed up the loss ratio for the financial year from
70.9 % to 90.0 %. With the combined ratio after run-off at 104.0 % (PY: 95.7 %), these
lines of insurance produced a negative underwriting result for the first time since 2002.
Given the considerable uncertainties facing the economy as a whole, growth prospects
for 2010 remain hard to assess. In industrial and commercial insurance in particular –
where the premiums of many policies are based on turnover and payroll – the consequences
of the economic and financial crisis are expected to have a continued negative
impact. On balance, property/casualty insurers anticipate a moderate premium downturn
of 0.5 % in the financial year 2010.
Gothaer Group Annual Report 2009 33