SIGNAL IDUNA Group 2007

The operating performance of  816.5m euros, achieved by the SIGNAL IDUNA Group in 2007, is still at a record level.

An initiative for more service and innovation was started. SIGNAL IDUNA Romania is launching its business operations.

Dortmund / Hamburg. The SIGNAL IDUNA Group, one of the largest bancassurance groups in Germany, revealed its earnings power in 2007 once again. The company has managed to keep up its previous year's operating performance of 816.5m euros at a record level. The equity return amounted to 21.5%. In order to further improve its market position, the Group has successfully started an initiative for more service and innovation. "SIGNAL Krankenversicherung, Conrad Hinrich Donner Bank and SIGNAL IDUNA Bausparkasse ranked high in the competition for German'y most customer-oriented service provider 2008, co-organised by St. Gallan University's Institute of Insurance Economics" said Reinhold Schulte, the SIGNAL IDUNA Group's CEO during this year's press conference on 26 June in Hamburg.

The Group's expansion in Eastern Europe is another main pillar of SIGNAL IDUNA's  future development. The premium volume in the region has been growing annually on average by 25% since 2000. The SIGNAL IDUNA Group has been present in the Hungarian market since 1993 and in the Polish market since 2001. SIGNAL IDUNA is one of the most successful leaders in private health insurance in Poland, one of the largest health care markets within the European Union. SIGNAL IDUNA was granted a Romanian insurance licence  in June 2008 and will probably be launching its operations there in July.

SIGNAL IDUNA is satisfied with its business development in 2007. The operating performance of 816.5m euros is only slightly below the record performance of 2006 (minus 0.5%).

Taking into account the increased allocation within the Non-Life insurance business to the claims equalization fund of 29.4m euros (last year 6.9m euros), the result came out to be even more favourable than the one of 2006.

The gross expenditure of insured events increased last year by 42.3m euros (plus 1.1%) to approximately 3.8 bn euros for all insurance companies within the SIGNAL IDUNA Group. As in previous years there was a significant reduction of total costs in 2007 by approximately35m euros. By 2010, the cost level is expected to decrease by 200m euros per annum.

However, as a result of the activities aimed at cost reduction, premium growth was restricted in 2007. Our premium income was 2.8% under that of 2006 by approximately  4.5bn euros.

Further reasons for the restricted premium growth in 2007 are to be seen in our conscious withdrawal from the large-volume but weak-margin sales of single-premium life assurance products, the intense competition in the motor insurance business and the sales-barriers in the full private health insurance business caused by the three-year waiting period for blue- and white-collar workers.

On the other hand, our insurance portfolio rose by just under 460,000 or 4.4% up to nearly 11 million contracts/ persons.

The SIGNAL IDUNA Group's fixed assets, including those of its subsidiaries, increased in 2007 by 1.4bn euros to 39.6bn euros. The  net return for all our insurance companies was therefore 4.6%.

SIGNAL IDUNA has not been directly affected by the subprime crisis. "In line with our security-oriented investment policy, we have not made any investments in the U.S. mortgage-backed securities," said Reinhold Schulte, CEO.

The number of employees in 2007 (including self-employed sales agents and trainees) within the SIGNAL IDUNA Group was 11,734  on average, which meant a staff reduction of 491 (or approx. 4%) compared to the previous year.

"The insurance industry is currently experiencing a time of fundamental upheavals and changes. These are, on the one hand, initiated by political directives and on the other hand are affected by increased globalisation and the demographic change. We  continue to see excellent growth prospects for SIGNAL IDUNA in the home market. As a result of capitalisation, the Group's consolidated equity base has been  increased by 21%, we are also poised for external growth despite the strict Solvency II requirements regarding equity. Nevertheless, we are concentrating on the expansion of our business in the emerging markets of Eastern Europe and have been highly successful to date" said Reinhold Schulte, CEO.

Foreign markets:
SIGNAL Versicherung AG, Budapest, Hungary
SIGNAL IDUNA Polen Versicherung AG, Warsaw
SIGNAL IDUNA Polen Lebensversicherung AG, Warsaw
SIGNAL IDUNA Versicherung AG, Bucharest, Romania
SIGNAL IDUNA Rückversicherungs AG, Zug, Switzerland

"Our sales have been showing a double-digit growth in foreign markets for years now, which is why we intend to continue to intensify our operations in Central and Eastern Europe," explained Reinhold Schulte, SIGNAL IDUNA's CEO.

SIGNAL Versicherung AG, Budapest, Hungary

The SIGNAL Versicherung AG, Budapest, established in 1993, reported a premium growth of 24.9% in 2007, which is twice as high as the average growth in hungarian insurance market. Premium volume was 49.3m euros.

The above-average growth was basically due to unit-linked life assurancefollowed by motor insurance, which was introduced to the market in the same year and won almost 60,000 new clients. The trend of high growth in 2007 has continued into the 1st quarter of 2008 in all lines of the insurance business.

SIGNAL IDUNA Polen Versicherung AG, Warsaw
SIGNAL IDUNA Polen Lebensversicherung AG, Warsaw

The subsidiaries of the SIGNAL IDUNA Group in Poland reported a premium growth of 16.9% in 2007, that is a total premium volume of 21.7m euros. Thus, the growth of our Polish companies was almost twice as high as the average market growth in Poland.

The premium volume in the health insurance business was 4.7m euros, so that more than 60.000 people have their  health insurance  with SIGNAL IDUNA Polska. As the fourth largest German private insurer with a hundred years of market experience, SIGNAL IDUNA is willing to profit from the business opportunities created by the reformed Polish health care system. The company has already built up a network of physicians and hospitals available to its Polish clients in the case of illness. 

Two million Polish citizens have SIGNAL IDUNA travel insurance. The premium income in this line rose by 19% to a total of approx. 12m euros.

SIGNAL IDUNA Polen has therefore got closer to the company's objectives by expanding its market leadership in the line of travel insurance and by gaining a leading position in the health insurance market.

SIGNAL IDUNA Versicherung AG, Bucharest, Romania

In June this year, SIGNAL IDUNA was granted a Romanian insurance licence and will probably be launching its operations there in July.
The highly successful business model used by SIGNAL IDUNA in the Polish health insurance market will be adopted to the Romanian market. Furthermore, accident insurance and life assurance will be offered as well.

SIGNAL IDUNA Rückversicherungs AG, Zug, Switzerland

In its fourth business year, SIGNAL IDUNA Rückversicherungs AG reported sales of 66.3m euros. "Our intention is to heavily develop the reinsurance business. We can see excellent market potential for the  SIGNAL IDUNA Rückversicherungs AG" said Reinhold Schulte, SIGNAL IDUNA's CEO.

Dortmund / Hamburg, 26 June 2008

Press and Public Relations Department

Edzard Bennmann
Tel.:  +49 231 135 3539
Fax:  +49 231 135 13 3539
E-mail: edzard.bennmann@signal-iduna.de

Priska Flinzer-Frömmling
Tel.:  +49 40 4124-3834
Fax:  +49 40 4124-4026
E-mail: priska.flinzer-froemmling@signal-iduna.de

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