Handelsbanken Nordic Mid/ Small Cap Seminar

8 June 2017

Johan Kirstein Brammer, SVP Private Denmark Download presentation at tryg.com

2

Agenda

1. Tryg at a glance

2. Current performance

3. Current initiatives in Private Lines

4. Wrap up

Tryg – at a glance I

3

• Tryg goes back to 18th century

• Very strong brand position especially in Denmark

• Non-life insurance in Denmark, Norway and Sweden

• Approx. 80% retail business

82%

84%

86%

88%

90%

92%

Retention rate - Private

DK

NO

82%

84%

86%

88%

90%

92%

Retention rate - Commercial

DK

NO

NorwayMarket position: #3

Market share: 13.3%CR for Q1 17: 90.8 %

SwedenMarket position: #5Market share: 2.8%CR for Q1 17: 85.7%

DenmarkMarket position: #1

Market share: 17.9%CR for Q1 17: 85.2%

56

22

22

Private

Commercial

Corporate

Business split 2016

30

5

12

6

24

14

9

Motor

Workers' comp

Health & accident

Liability

Fire & property - private

Fire & property - comm.

Other

Gross premium split by products 2016

Percentage

Percentage

60

12

15

13

Danishinstitutional

Non-Danishinstitutional

Smallershareholders

Tryg – at a glance II

4

Shareholder breakdown 2016Shareholder remuneration since 2012

DKK

Percentage

5.2 5.4 5.8 6.0 6.2

1.6

2.63.2

3.43.5

0

1

2

3

4

5

6

7

8

9

10

2012 2013 2014 2015 2016 Q1 2017

Ordinary dividend Extraordinary buy back

Extraordinary dividend

3.5

Share price performance since IPO

0

50

100

150

200

250

300

350

400

450

500

5

TryghedsGruppen and its members’ bonus

Denmark's ‘biggest’ family

Every 5th Dane receives a bonus!8% in 2017

> DKK 400mto Private costumers

> DKK 200mcommercial customers

> DKK 95m for corporate costumers

‘I expect to be in Tryg next year’

93%

81%

Bonus positive effect on retention

Have heard about Customer bonus

Have not heard about Customer Bonus

Retention rate increase by 1% gives approx. DKK 50-150m reduction in expenses on group level

Tryg’s equity story

6

Long term profitable growth and attractive shareholder value creation

Financial targets 2017

• ROE: ≥21%

• Combined ratio: ≤87%

• Expense ratio: ≤14%

Customer targets 2017

• NPS +100%

• Retention rate +1 pp

• ≥ 3 products +5 pp

Dividend policy

• Aiming for a nominal stable increasing dividend

• Pay-out ratio of 60% to 90% (secondary)

• Extraordinary dividend to further adjust the capital structure

• 90% first contact resolution

• Annual coverage check

• 25% of tariffs better than peers in 2017

• Differentiated product offering

• Efficiency programme of DKK 750m

• Claims procurement

• Reducing expense level

• Matching assets and liabilities

• Low risk investment portfolio

Low risk and high returns

Leading in efficiency

Leading Scandinavian insurer with strong

track record

Customer care worth recommending

Next level pricing

7

Agenda

1. Tryg at a glance

2. Current performance

3. Current initiatives in Private Lines

4. Wrap up

Gross earned premiums development

(Local currencies)

Q1 2017 Q1 2016

-0.5 %

1.6 %

Group premiums up 1.6% in Q1

8

DKKm Q1 2017 Q1 2016Local currencies

Q1 2017Local currencies

Q1 2016

Private 2,206 2,137 0.6% 0.8%

Commercial 965 967 -1.8% -1.5%

Corporate 970 920 3.5% -2.1%

Sweden 329 289 17.0% -1.4%

Group 4,458 4,310 1.6% -0.5%

• Group premiums were up 1.6% in local currencies, Private lines DK and of Skandia child book key drivers

• Danish premiums up more than 2% while Norwegian premiums still declining

• Private lines increased 0.6% in particular driven by a positive development in Private Denmark (2.8%)

• Sweden increased 17.0% primarily driven by the full inclusion of the Skandia child insurance portfolio.

50

60

70

80

90

100

50

60

70

80

90

100

75.5

55

60

65

70

75

80

Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17

Underlying Claims ratio, net

50

55

60

65

70

75

Underlying claims ratio at same level as Q1 2016

9

Claims ratio, net (Commercial DK & NO)

Claims ratio, net (Sweden)

Group

Claims ratio, net (Corporate)

Private (DK & NO)

Underlying development is adjusted for large claims, weather claims, run-off and interest.

Q1-16: 76.4+3.4-0.0-4.5+0.2=75.5 Q1-17: 73.7+4.5-0.0-3.0+0.3=75.5

77.0

60

65

70

75

80

Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17

Underlying Claims ratio, net

77.0

• Group underlying Claims ratio at 77.0% in line with Q1 2016

• Private underlying Claims ratio at 75.5% also in line with Q1 2016

• Corporate & Sweden underlying claims ratio developed favourably

• “Expected FY 2017 underlying claims ratio better than FY 2016”

Underlying development is adjusted for run-off, large claims, weather claims and interest.

Q1-16: 72.0+8.6-1.0-3.3+0.7=77.0 Q1-17 72.9+6.4-1.1-2.3+1.1=77.0

75.5

Motor, comprehensive Top 10 sold cars in DK, Jan.-dec. 2016 Top 10 sold cars in NO, Jan. - dec. 2016

Motor insurance, not all claims are coming down

10

Number of accidents Jan-Feb. Bumpers, price increases in % from 2011-2016

90

95

100

105

110

115

2014 2015 2016

Frequency Average claims

0

5000

10000

15000

20000

2011 2016

Ford Focus

Bumper Bumper incl. Radar (10157 ex. VAT)

6,682DKK

5,668DKK

19,378DKK

0

2000

4000

6000

8000

10000

12000

2011 2016

Nissan Qashqai

Bumper Bumper incl. Radar (4043 ex. VAT)

116%

17%

242%

15%

53,95354,634 54,850

58,437 58,136

35,000

40,000

45,000

50,000

55,000

60,000

65,000

Jan.-Feb.

2013

Jan.-Feb.

2014

Jan.-Feb.

2015

Jan.-Feb.

2016

Jan.-Feb.

2017

4,449

4,471

4,718

5,041

5,375

5,483

5,857

6,135

7,361

9.381

Volkswagen Golf

Ford Fiesta

Renault ny Clio

Opel Astra

Toyota Aygo

Toyota Yaris

Volkswagen Polo

Peugeot 308

Volkswagen UP!

Peugeot 208

3,233

3,795

3,953

4,162

4,247

4,419

4,813

4,955

5,687

13.148

Volkswagen Tiguan

Skoda Octavia

BMWi3

Nissan Leaf

Toyota Yaris

Toyota Auris

Volkswagen Passat

Toyota Rav4

Mitsubishi Outlander

Volkswagen Golf

90

95

100

105

110

115

120

125

DK

NO

90

95

100

105

110

115

DK

NO

11

Private - average prices in positive development

Average price

4,400 5,700

• DK: 1.0% positive developmentreflects both price increases and conversion

• NO: 0.6% positive developmentreflects underlying priceincreases. Avg Motor price in Norway higher reflecting primarilydifferent type of cars

Average price:

5,000 5,700

Motor insurance – average price (index 2011 = 100)

House insurance – average price (index 2011 = 100)

Average price development Y/Y

1.0% 0.6%

(Q4 -0.6 %) (Q4 0.7 %)

Average price development Y/Y

1.2% 1.6%

(Q4 0.4%) (Q4 0.7%) • DK: 1.2% positive developmentreflects both price increases and conversion

• NO: 1.6% positive developmentreflects primarily price increases

4,076

3,913

3,703

3,599

3,3593,264 3,281

2011 2012 2013 2014 2015 2016 Q1 2017

313

171

9861

305

169107

61

Private Commercial Corporate Sweden

Q1 2017 Q1 2016

On track to meet the 2017 expense ratio target

12

FTE - Development

15.1

14.4

15.6 15.3

14.9

14.8

14.6

15.315.7

2013 2014 2015 2016 Q1 2016 Q1 2017

Expense ratio

Nominal costs in business areas

As reported Adjusted for one-offs

Efficiency programme up until 2017 (DKKm)

100 105150 145

250

45

175

388395

5060

7565

125

25

2012 2013 2014 Target2015

2015 Target2016

2016 Target2017

2017

Expense Claims

13

Agenda

1. Tryg at a glance

2. Current performance

3. Current initiatives in Private Lines

4. Wrap up

Claims – new costumer experience model designed

Neworganisation

Economy of scale

High customer satisfaction

Easy & simple accessfor customers

Moving across claims areas

New sales channel

Simple & transparent customer process

14

Claims division

Car claimsContents claims

Travel claims

Sales division

Inbound OutboundCustomer service

Win-/holdback

Customer front-end

Inbound

Car claims

Outbound

Contents claims

Customer service

Travel claims

Win-/holdback

Two new packages launched

• DKK 920 in average premium compared to DKK 713 on child accident insurance

• +50% has bought the largest package incl. healthcare. Before only 6% bought healthcare for their children

3+ share among new customers

Before After

Sales agent >95% >95%

Inbound 25% 26%

Outbound 25% 42%

+20%+10%

+17%

OutboundInboundSales agent

Number of products sold/customer

15

Child insurance ‘Peace-of-mind’ package

111

132

151

100

110

120

130

140

150

160

January February March

Progress on customer adaptation of Digital Universes

Digital claim forms

• In March 2017, 23.5% of all claims forms were digital

Logins ‘My page’

• Index 98 on target: 1 million logins in 2017.

2017 ift. 2016 index

20.6

22.6

21.6

22.4

21

22.4

23.5

20

21

22

23

24

Sept 16 Oct 16 Nov 16 Dec 16 Jan 17 Feb 17 Mar 17

16

17

Agenda

1. Tryg at a glance

2. Current performance

3. Current initiatives in Private Lines

4. Wrap up

1,401 1,330 1,380

1,129 1,067

612

0

1,000

2,000

60%

70%

80%

90%

100%

110%

120%

2010 2011 2012 2013 2014 2015

UK Germany Italy Denmark Norway

-50%

-20%

10%

40%

70%

100%

130%

Non-life Life Banking Other

Why invest in Tryg?

18

Pre-tax result by division (YE 2016 data) High insurance penetration in the Nordics

Motor combined ratios Nordics vs international

Premiums per capita (USD), 2015

Shareholder remuneration since 2012

DKK

5.2 5.4 5.8 6.0 6.2

1.6

2.63.2

3.43.5

0

1

2

3

4

5

6

7

8

9

10

2012 2013 2014 2015 2016 Q1 2017

Ordinary dividend Extraordinary buy back

Extraordinary dividend

3.5

19

Questions?