Hannover Re: the somewhat different reinsurer. March 2019

Transcription

1 Hannover Re: the somewhat different reinsurer March 2019

2 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

3 1 Hannover Re Group Key facts about Hannover Re 1966 Founded by HDI (P&C reinsurance only) 4 th Largest reinsurer in the world 1990 Start of L&H reinsurance as strategic growth segment 2018: ~3,300 Total staff of employees 1994 HR share 2018: >100 Initial Public Offering of Hannover Re % Majority shareholder, held by Talanx AG 2013 Hannover Rück SE Societas Europaea Subsidiaries, branches / representative offices worldwide 3 Hannover Re: the somewhat different reinsurer

4 1 Hannover Re Group Growth and international expansion mainly organically driven M&A activity not accompanied by high integration cost and complexity Hamburger Internationale RV (L&H incl. US) E+S Rück (Germany) Acquisitions Foundations Hollandia South Africa Inter Hannover (P&C), Insurance Corporation of Hannover (US P&C) Italy P&C: Australia, Canada Skandia (portfolios, incl. L&H UK, P&C facultative, aviation) Clarendon (US P&C) ING/Scottish Re portfolio (US L&H) France, Ireland, Japan, Sweden P&C: Malaysia L&H: Australia, Hong Kong, Taiwan Bahrain, Brazil, China P&C: Bermuda, Colombia, Mexico, Spain, Taiwan L&H: Bermuda, Korea, Malaysia Argenta (Lloyd s P&C) India, L&H: Canada Limited appetite for larger M&A results in lean and efficient structures Overview of main/material transactions (and main parts of acquisitions) without e.g. minority shareholdings P&C and L&H if not otherwise stated; italic = (at least in part) sold 4 Hannover Re: the somewhat different reinsurer

5 1 Hannover Re Group Group structure supports our business model Free float 49.8% 50.2% Talanx AG 1) 64.8% 8 German primary insurers 35.1% Domestic business >100 subsidiaries, branch/rep. offices worldwide International business 1) Majority shareholder HDI V.a.G. 5 Hannover Re: the somewhat different reinsurer

6 1 Hannover Re Group We are among the top reinsurers in the world Premium ranking 2017 in m. USD Rank Group Country GWP NPW 1 Munich Re DE 37,821 36,378 2 Swiss Re CH 34,775 32,316 3 Berkshire Hathaway Inc. US 22,740 22,740 4 Hannover Re DE 21,314 18,727 2) 5 SCOR FR 17,718 16,130 6 Lloyd's 1) UK 14,250 10,726 7 RGA US 10,704 9,841 8 China Re CN 10,435 9,974 9 Great West Lifeco CA 7,924 7, Korean Re KR 6,775 4, General Insurance Corporation of India IN 6,497 5, PartnerRe BM 5,588 5, Everest Re BM 5,115 4, XL Group IE 4,916 3, Transatlantic Holdings US 4,211 3,810 For further information please see A. M. Best Best s Special Report (September 2018) 1) Reinsurance only 2) Net premium earned 6 Hannover Re: the somewhat different reinsurer

7 1 Hannover Re Group Reinsurance has the character of a specialty market With a share of 6% of the overall insurance market Market size primary insurance vs. reinsurance Global insurance premiums ~ EUR 4.3 trillion Global reinsurance premiums ~ EUR 243 billion Source: own research (global market size based on estimate of total ceded premiums by primary insurers) as at May Hannover Re: the somewhat different reinsurer

8 1 Hannover Re Group Growing Property and Casualty reinsurance market Hannover Re outperforms the market Market size and concentration 2017 in bn. EUR 4-year CAGR 142 1) 143 1) Market +2.3% Other 46% Top 10 54% 46% 46% Other +2.1% Top % 48% 47% HR 7% 6% 7% HR +6.7% Source: Own research as at May 2018 Top 10 in 2017: Munich Re, Swiss Re, Lloyd s, Hannover Re, Berkshire Hathaway (excl. AIG deal), SCOR, Everest Re, XL Catlin, GIC India, Alleghany Top 10 ranking for each year 1) F/x adjusted (2015 rates) 8 Hannover Re: the somewhat different reinsurer

9 1 Hannover Re Group Life and Health reinsurance in a global perspective Concentrated market due to high entry barriers Market size and concentration 2017 in bn. EUR 4-year CAGR 65 1) 68 1) Market +4.9% Other 33% Top 5 67% 27% 24% Other +10.7% HR 9% Top % 62% 67% HR +0.4% Source: own research as at May 2018 Top 10 in 2017: Munich Re, Swiss Re, RGA, Great-West Lifeco, SCOR, Hannover Re, China Re, Berkshire Hathaway, Korean Re, Pacific Life Top 10 ranking for each year 1) F/x adjusted (2015 rates) 11% % 9 Hannover Re: the somewhat different reinsurer

10 237% 233% 229% 225% 221% 217% 213% 209% 205% 201% 197% 193% 189% 185% 181% 177% 173% 169% 165% 161% 157% 153% 149% 145% 141% 137% 133% 129% 125% 121% 117% 113% 109% 105% 101% 97% 93% 89% 85% 81% 77% 73% 69% 65% 61% 57% 53% 49% 45% 41% 37% 33% 29% 25% 21% 17% 13% 9% 5% 1% -3% -7% -11% -15% Hannover Re Group Reinsurance market conditions will improve when the RoE becomes sufficiently low Development of return on equity and Guy Carpenter Global Property Cat RoL index 17.0% 14.0% 13.7% 10.8% 12.8% 12.5% 11.4% 9.4% 9.6% 3.8% 3.4% 5.2% 0.5% (1.2%) Return on equity GC Global Property Cat RoL Index Source: Guy Carpenter Return on equity based on company data (Top 10 of the Global Reinsurance Index (GloRe) with more than 50% reinsurance business ), own calculation 10 Hannover Re: the somewhat different reinsurer

11 Demand for reinsurance 1 Hannover Re Group Reinsurance is and will be an attractive product Drivers for reinsurance demand Drivers Impact on insurance Value proposition R/I Global trends Value concentration Protection gap Demographic change New products/markets Emerging markets Digitalisation/Cyber Emerging risks Capital requirement Regulatory changes Risk-based capital models Ratings, local GAAP, IFRS Volatile earnings Expectations of shareholders, regulators and rating agencies Increasing demand for insurance of non-diversifying risks New risks lead to higher volatility and need for additional know-how High cost of capital/ need for capital management Strong capital base Diversification Expertise in risk management Support and expertise in product development and pricing Optimising capital requirements Reducing cost of capital Managing earnings volatility Support in distributing products in new markets 11 Hannover Re: the somewhat different reinsurer

12 1 Hannover Re Group Premium development in line with mid-term growth target 10-year CAGR: +9.0% Gross written premium in m. EUR 19,176 17,069 16,354 17,791 10,275 44% 11,429 45% 12,096 44% 13,774 13,963 14,362 44% 44% 45% 45% 44% 40% 38% 56% 55% 56% 56% 56% 55% 55% 56% 60% 62% Property & Casualty reinsurance Life & Health reinsurance 12 Hannover Re: the somewhat different reinsurer

13 1 Hannover Re Group Well balanced international portfolio growth Gross written premium in m. EUR Africa Australia 17,069 16,354 17,791 19,176 3% 7% 5% Latin America 13,774 13,963 14,362 15% Asia Other European countries Germany 10,275 11,429 12,096 17% 6% 13% United Kingdom 34% North America Hannover Re: the somewhat different reinsurer

14 1 Hannover Re Group Strong earnings track record Good result in a challenging environment Operating profit (EBIT) in m. EUR 1,142 1,178 1,394 1,229 1,466 1,755 1,689 1,364 1, Earnings per share (EPS) in EUR Hannover Re: the somewhat different reinsurer

15 1 Hannover Re Group Increased ordinary dividend reflects strong earnings power Payout: EUR 3.75 ordinary dividend + EUR 1.50 special dividend per share Dividend per share 63% 60% in EUR 52% 50% 51% 43% 42% 40% Payout ratio ordinary dividend: 35-45% 44% 43% 37% 35% 40% 37% 37% 36% 34% ) Ordinary dividend per share Special dividend per share Payout ratio ordinary dividend per share Total payout ratio dividend per share EPS 1) Dividend proposal; subject to consent of AGM 15 Hannover Re: the somewhat different reinsurer

16 1 Hannover Re Group Return on Equity exceeds target by a clear margin over past 10 years 2018 shows the 10 th consecutive year with double-digit RoE Return on Equity: yearly Return on Equity: average 6,720 7,810 8,533 8,763 8, % 14.7% 13.7% 4.0% 4.5% 3.8% 10.9% 10.7% 10.2% 9.9% 1.1% 9.8% 12.2% 2.7% 9.4% 13.3% 10.0% 15.0% 11.0% 13.4% 11.7% year Ø year Ø year Ø ) Actual Minimum target Average shareholders' equity Spread over minimum target 1) After tax; target: 900 bps above 5-year rolling average of 10-year German government bond rate ("risk free") 16 Hannover Re: the somewhat different reinsurer

17 1 Hannover Re Group Hannover Re is one of the most profitable reinsurers No. 1 position in 2018 and on 5-year average RoE Company RoE Rank RoE Rank RoE Rank RoE Rank RoE Rank avg. RoE Rank Hannover Re 14.7% % % % % % 1 Peer 3, US, Life & Health 10.6% 6 7.5% % % 1 7.9% % 2 Peer 6, Bermuda, Property & Casualty 16.6% % % 2 5.7% 5 1.3% 7 9.9% 3 Peer 9, China, Composite 10.9% % 4 7.2% 9 7.2% 3 List shows the Top 10 of the Global Reinsurance Index (GloRe) Data based on company data, own calculation not yet reported - 9.4% 4 Peer 1, Germany, Composite 11.3% % 6 8.3% 7 1.3% 7 8.5% 2 7.9% 5 Peer 7, France, Composite 9.6% % 5 9.3% 6 4.4% 6 5.4% 4 7.9% 6 Peer 10, Korea, Composite 7.1% % 7 7.8% 8 6.2% 4 not yet reported - 7.7% 7 Peer 2, Switzerland, Composite 10.5% % % 3 1.0% 9 1.4% 6 7.4% 8 Peer 8, Bermuda, Property & Casualty 13.7% 3 9.5% % 5-5.3% % 5 6.4% 9 Peer 4, US, Property & Casualty 9.4% 9 7.5% % % 8 0.5% 8 4.9% 10 Average 11.4% 10.9% 9.6% 5.7% 5.2% 8.7% 17 Hannover Re: the somewhat different reinsurer

18 1 Hannover Re Group Continuous increase of value creation 10-year CAGR: +12.7% Book value and accumulated paid dividends in EUR Book value per share Paid dividends (cumulative since 1994) 18 Hannover Re: the somewhat different reinsurer

19 1 Hannover Re Group Shareholders' equity increased by 2.9% Dividend payment more than covered by earnings Policyholders' surplus in m. EUR Change in shareholders' equity in m. EUR 10,239 10,267 1,490 1, ,231 1, ,779 1, ,035 1, ,528 1,059 (603) (472) 265 8,777 7,551 8,068 8,997 8,528 8, Shareholders' equity Non-controlling interests Hybrid Shareholders' equity Net income Dividend payment Change in unrealised gains/losses Currency translation and other Shareholders' equity Hannover Re: the somewhat different reinsurer

20 1 Hannover Re Group Our somewhat different approach and strong market position makes us a superior and highly profitable reinsurer Top rating (S&P: AA-) ensures attractive new business Our business model Increasing profitability of our noncyclical Life & Health business Generates noticeably higher profitability on 5-year average in comparison with our peer competitors Lean structures which lead to the lowest administrative expense ratio compared to our peer group De-risking and diversification measures taken to lower earnings volatility aiming to consistently produce attractive dividends Effective cycle management, selective and disciplined underwriting in Property & Casualty reinsurance 20 Hannover Re: the somewhat different reinsurer

21 Profit and value creation 1 Hannover Re Group Our strategy: value creation through reinsurance Our overriding target: profit and value creation Lower management expenses Cost leadership Profitable growth Competitive advantage compared to peers Deliver a profit that is above average for the sector Providing our clients with competitive terms Premium growth on a long-term basis above market average Minimum return on equity of at least 900 bps above risk free 1) Achieve a profit in excess of the cost of capital (IVC, based on our ECM 2) ) Capital management Capital management in the light of distributable excess capital to achieve attractive RoE A sufficient equity buffer enables us to act on available and profitable business at all times Shareholder value Share price to outperform weighted Global Reinsurance Index (ISIN: DE 000 SLA 1GR 2) over a 3-year rolling period Consistently paying a dividend that is attractive to our shareholders 1) After tax; target: 900 bps above 5-year average return of 10-year German government bonds 2) Economic Capital Model 21 Hannover Re: the somewhat different reinsurer

22 1 Hannover Re Group Sustainability at Hannover Re Strategic approach: We are committed to sustainability, integrity and compliance Commitment to a responsible and transparent corporate governances geared to lasting success Development and expansion of sustainable insurance products Continuous refining of our efficiently functioning compliance management Maintaining an open and ongoing dialogue with our stakeholders Continuous refinement of our environmental management system Ongoing evaluation of suppliers according to environmental and social standards Engagement in environmental and social projects across all locations Governance and Dialog Environment and Society Sustainability Strategy Product responsibility Employees Refinement of the sustainability approach within our asset management Intensifying the sharing of knowledge about emerging risks with our customers and business partners Promoting, preserving and restoring the physical and mental well-being of employees Promoting diversity and equal opportunities 22 Hannover Re: the somewhat different reinsurer

23 1 Hannover Re Group Sustainability at Hannover Re Broad range of activities to support our strategic goals Sustainability Report since 2011 Non-financial statement since 2018 Prime Rating of oekom research and regular participation in CDP rating Member of the FTSE4Good Index and MSCI Participation in various initiatives Sustainability strategy: Implementation and regular revision since 2011 Governance and Dialog Product responsibility Development of sustainable insurance solutions (i. e. microinsurance, energy savings warranties) Responsible investment policy since 2012; Best-in- Class approach implemented since 2016 ~ 90% of assets under own management are screened according to ESG criteria according to UN Global Compact Member of different initiatives like Geneva- Asssociation and InsuResilience Company daycare center for infants up to the age of 3 Mentoring programme for women Implementation of an Employee Assistance Programme (EAP) Participation in the initiative Fair company Environment and Society Employees Carbon neutrality achieved for the Hannoverbased business in 2016 Environmental management system: certified according to DIN EN ISO since 2012 and EMAS Standard since 2015 Worldwide social engagement for decades 23 Hannover Re: the somewhat different reinsurer

24 1 Hannover Re Group Present on all continents The Americas Toronto Charlotte Chicago Denver New York Orlando Hamilton Mexico City Europe Madrid Dublin London Paris Hannover Milan Stockholm Asia Manama Seoul Tokyo Taipei Shanghai Hong Kong Bogotá Rio de Janeiro Africa Abidjan Johannesburg Australia Sydney Mumbai Kuala Lumpur Property & Casualty reinsurance Life & Health reinsurance Property & Casualty and Life & Health reinsurance 24 Hannover Re: the somewhat different reinsurer

25 1 Hannover Re Group HR share outperforms indices over a 3-year rolling period Performance vs. indices Performance comparison (incl. reinvested dividends) 150% 130% 110% +28% +14% +1% 90% 70% Hannover Re HDAX GloRe 25 Hannover Re: the somewhat different reinsurer

26 1 Hannover Re Group Yearly Total Shareholder Return (TSR) of 12.2% Value creation since IPO % in m. EUR Market capitalisation as of date 12,651 14,194 - Market capitalisation at IPO (Nov 1994) 1,084 1,084 + Dividend payments (cumulative) 4,941 4,941 1) - Capital increases (1996, 1997, 2001, 2003) Value creation since IPO 15,697 17,240 1) Dividend payment for 2018 not yet included 26 Hannover Re: the somewhat different reinsurer

27 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

28 1 2 Property & Casualty reinsurance We are a preferred business partner Property & Casualty reinsurance Distribution Distribution channels Flexible cost base due to relatively higher share of business written via brokers (~2/3) Reserving Conservative reserve policy led to build-up of reserve redundancies since 2009 Reduction of P&C earnings volatility Protection against inflation risk Our strategic contribution from P&C Cycle Management Effective cycle management and focus on profitability Selective growth: increase market share in hard markets only No pressure to grow due to low administrative expense ratio Above-average profitability due to stringent underwriting approach with focus on bottom line Central U/W Central underwriting with local talent is key to our success Secures consistent underwriting decisions 28 Hannover Re: the somewhat different reinsurer

29 1 2 Property & Casualty reinsurance Strategy contribution of the P&C business group Be among world's most profitable R/I & steer volatility in line with our profit targets Our value proposition to our customers Our profit contribution Tailor-made solutions Comprehensive range of products which can be tailored to our customers needs Solution driven Constant monitoring of markets to identify trends and classes of business that show specific potential for the future xroca 1) 2% EBIT margin 10% Combined ratio 97% Flexible organisation Utilisation of all distribution channels, i.e. direct as well as via intermediaries Fair and available Short lines of communication towards customers enabling speedy delivery of solutions 1) xroca= excess Return on Capital Allocated 29 Hannover Re: the somewhat different reinsurer

30 1 2 Property & Casualty reinsurance Our Property & Casualty reinsurance business divisions Target markets North America 1) Continental Europe 1) Target markets 29% Specialty lines worldwide Marine Aviation Credit, surety and political risks UK, Ireland, London market and direct Global R/I 47% GWP split 2018 EUR 11,976 m. Facultative R/I Global R/I Worldwide Treaty R/I 1) Cat XL Structured R/I and ILS Specialty lines worldwide 24% 1) All lines of Property & Casualty reinsurance except those stated separately 30 Hannover Re: the somewhat different reinsurer

31 1 2 Property & Casualty reinsurance More than 2/3 of our business is written via brokers More than 1/3 of our business is non-proportional Breakdown of treaties by volume Breakdown of business written Non-proportional 32% Direct business 31% Proportional 68% Broker business 69% GWP 2018: EUR 11,976 m. (2017: EUR 10,711 m.) 31 Hannover Re: the somewhat different reinsurer

32 1 2 Property & Casualty reinsurance Property & Casualty reinsurance: diversified growth 5-year CAGR: +8.9% GWP split by line of business in m. EUR Gross written premium split by regions Cat XL Structured R/I and ILS Worldwide treaty 1) Marine Aviation UK, IR, London market & direct Credit, surety and pol. risks Facultative R/I 1) Continental Europe 1) North America 7,903 4% 12% 19% 3% 5% 5% 7% 12% 18% 15% 9,338 4% 14% 19% 4% 3% 6% 7% 12% 15% 16% 9,205 4% 14% 20% 5% 3% 3% 7% 11% 15% 18% 4% 10,711 3% 24% 17% 2% 3% 7% 6% 8% 14% 16% 11,976 3% 24% 19% 2% 2% 8% 6% 6% 13% 16% Germany 8% United Kingdom 9% Asia 13% Latin America Australia 4% 5% 9% 10% 13% Africa 2% 6% 2% 3% 20% 38% Rest of Europe 20% North America 39% ) All lines of business except those stated separately 32 Hannover Re: the somewhat different reinsurer

33 1 2 Property & Casualty reinsurance Margin-oriented U/W approach leads to profitable growth EBIT margin exceeds target of 10% Gross written premium in m. EUR EBIT/EBIT margin in m. EUR 17.0% 16.6% 16.8% 7,903 CAGR: 8.9% 9,338 9,205 10,711 11,976 1,191 1,341 1, % 1,120 1, % EBIT EBIT margin 33 Hannover Re: the somewhat different reinsurer

34 1 2 Property & Casualty reinsurance High loss burden pushes Combined Ratio slightly above target 2018: Combined Ratio vs. Target Combined Ratio EBIT margin Target markets North America Continental Europe 1) 1) 102.5% 97.1% 12.8% 12.7% Marine 9.9% 104.9% Specialty lines worldwide Aviation Credit, surety and political risks UK, Ireland, London market and direct 84.4% 85.8% 111.8% 28.3% 21.3% 2.6% Facultative R/I 101.9% 6.1% Worldwide Treaty R/I 1) 93.0% 15.0% Global R/I Cat XL 88.3% 26.2% Structured R/I and ILS 97.7% 4.8% Total 96.5% 12.2% Combined Ratio Target Combined Ratio 0% 20% 40% 60% 80% 100% 120% 1) All lines of Property & Casualty reinsurance except those stated separately 34 Hannover Re: the somewhat different reinsurer

35 1 2 Property & Casualty reinsurance Stable redundancy despite challenging environment Reserve study review by WillisTowers Watson confirms reserving level in m. EUR Year end 1) Redundancy 2) Increase redundancy Effect on loss ratio P&C premium (net earned) % 5, % 5, , % 5, , % 6, , % 6, , % 7, , % 8, , % 7, , % 9, total 1,223 62, average % 6,951 Average impact on loss ratio: 2% in the past 9 years (not f/x-adjusted) 1) Figures in m. EUR and unadjusted for changes in foreign exchange rate, i.e. based on actual exchange rates at respective year end. 2) Redundancy of loss and loss adjustment expense reserve for its non-life insurance business against held IFRS reserves, before tax and minority participations. Willis Towers Watson reviewed these estimates - more details shown in appendix 35 Hannover Re: the somewhat different reinsurer

36 1 2 Property & Casualty reinsurance The risk is manageable Stress tests for natural catastrophes after retrocessions Effect on forecast net income in m. EUR Winter storm Europe Hurricane US/Carribean Typhoon Japan Earthquake Japan Earthquake US West Coast Earthquake Australia 100-year loss (378.2) (312.0) 250-year loss (542.5) (526.0) 100-year loss (921.0) (1,033.2) 250-year loss (1,274.8) (1,471.6) 100-year loss (183.1) (216.4) 250-year loss (256.6) (294.0) 100-year loss (282.2) (344.3) 250-year loss (522.0) (664.3) 100-year loss (420.2) (634.8) 250-year loss (921.7) (1,194.7) 100-year loss (154.4) (191.9) 250-year loss (445.5) (499.8) in m. EUR Limit 2018 Threshold 2018 All natural catastrophe risks 1) Actual utilisation (July 2018) 200-year aggregate annual loss 1,873 1,686 1,446 1) Loss relative to the underwriting result 36 Hannover Re: the somewhat different reinsurer

37 1 2 Property & Casualty reinsurance Low expense ratio is an important competitive advantage Administrative expense ratio 6.0% 5.6% 6.0% 5.8% 5.4% 2.7% 2.9% 2.7% 2.8% 2.6% Hannover Re Peer Average 1) 1) Peers: Munich Re, Swiss Re, Scor, Everest Re, RGA; own calculation 37 Hannover Re: the somewhat different reinsurer

38 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

39 1 2 3 Life & Health reinsurance We are somewhat different Life & Health reinsurance Undogmatic We have an undogmatic approach Strong entrepreneurial spirit Appetite to innovate industry solutions Efficient We foster an efficient organisational set-up 900 experts in 25 offices on all continents Highly empowered and qualified staff Our strategic contribution from L&H Flexible We are a highly flexible business partner Tailor-made services and solutions Ability to anticipate market and client demands Responsive We are committed to time to market & responsiveness Rapid decision-making processes In-depth knowledge of local markets 39 Hannover Re: the somewhat different reinsurer

40 1 2 3 Life & Health reinsurance Strategy contribution of the L&H business group We have ambitious profit and growth targets Our value proposition to our customers Our profit contribution Financial solutions Tailored reinsurance structures for efficient capital or liquidity management Risk solutions Competitive terms, capacity and reinsurance solutions for all types of technical risks VNB 1) EUR 220 m. EBIT growth 5% xroca 2) 2% Reinsurance services Improvement of sales and underwriting processes 1) Based on Solvency II principles and pre-tax reporting 2) xroca= excess Return on Capital Allocated 40 Hannover Re: the somewhat different reinsurer

41 1 2 3 Life & Health reinsurance Writing attractive traditional life & health business Whilst positioning ourselves for sustainable growth with a clear strategic focus Risk Solutions Provide terms and capacity for all types of technical risks Financial Solutions Achieve financial objectives for our clients Reinsurance Services Meet the individual needs of our clients Our strategic focus 1 High growth markets 2 Companies in transition 3 Alternative distribution channels 4 Underserved consumers Hard-to-quantify risks Reinsurance universe Positive economic value expected 41 Hannover Re: the somewhat different reinsurer

42 1 2 3 Life & Health reinsurance Our clients are served in the markets by our network of offices and by our solution-orientated expert networks Automated U/W systems Biometric research Expert networks Financial solutions Longevity solutions R&D technology Health (re-) insurance Risk assessment 42 Hannover Re: the somewhat different reinsurer

43 1 2 3 Life & Health reinsurance Complete offerings Risk and financial solutions & services Risk Solutions Competitive terms and appropriate capacity for technical risks Financial Solutions Structured agreements to achieve certain financial objectives Reinsurance Services Comprehensive range geared towards individual needs Mortality Longevity New Business Financing Products Processes Health Morbidity Disability Reserve & Solvency Relief Biometrics Risk Assessment Long Term Care Critical Illness Embedded Value Transaction Underwriting Systems Profitability depends largely on the underlying biometric risks Profitability is less likely to be affected by the underlying biometric risks Only in combination with risk solutions and/ or financial solutions 43 Hannover Re: the somewhat different reinsurer

44 1 2 3 Life & Health reinsurance Life & Health reinsurance: worldwide portfolio 5-year CAGR: +3.2% GWP split by reporting categories in m. EUR Gross written premium split by regions Morbidity 6,459 18% 7,731 18% 7,149 7,080 23% 24% 7,200 27% Australia 10% Latin America 5% Germany Africa 3% 3% 5% 3% 3% North America 28% Mortality 10% 29% Longevity Financial solutions 46% 16% 20% 46% 19% 17% 43% 21% 13% 45% 18% 13% 42% 18% 13% Rest of Europe 12% 12% Asia 19% 17% 21% United Kingdom 20% Hannover Re: the somewhat different reinsurer

45 1 2 3 Life & Health reinsurance Good underlying profitability in Life & Health reinsurance Recent results affected by legacy US mortality business Gross written premium in m. EUR EBIT/EBIT margin in m. EUR 6.2% CAGR: 3.2% 4.9% 5.3% 6,459 7,731 7,149 7,080 7, % 4.3% EBIT EBIT margin 45 Hannover Re: the somewhat different reinsurer

46 1 2 3 Life & Health reinsurance Value of New Business well above target Value of New Business development in m. EUR Target EUR 220 m ) 1) 1) 2) 2) 2) ) Based on MCEV principles and post-tax reporting (in 2015 cost of capital already increased from 4.5% to 6% in line with Solvency II) 2) Based on Solvency II principles and pre-tax reporting 46 Hannover Re: the somewhat different reinsurer

47 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

48 Investment management Continued positive operating cash flow AuM +5.3%; strengthening of USD offsets decrease in valuation reserves Operating cash flow in m. EUR Assets under own management (AuM) in m. EUR 39,347 41,793 40,057 42,197 3,105 36,228 1,305 2,331 2,225 1, , Q1 Q2 Q3 Q Hannover Re: the somewhat different reinsurer

49 Investment management Very pleasing net investment income Total investments in m. EUR Investment income in m. EUR 52,146 53,337 53,637 50,960 53,062 15,918 13,990 11,844 10,903 10,865 1,472 1,665 1,550 1, , ,228 39,347 41,793 40,057 42,197 1,096 1,270 1,218 1,539 1, Assets under own management Funds withheld and contract deposits Income and expenses on funds withheld and contract deposits Net income from assets under own management 49 Hannover Re: the somewhat different reinsurer

50 Investment management Ordinary income again supported by alternative asset classes Contribution from Government bonds slightly recovering due to higher US rates Asset allocation 1) Investment category Fixed-income securities 90% 87% 87% 87% 87% - Governments 21% 26% 28% 30% 35% - Semi-governments 19% 17% 18% 17% 16% - Corporates 36% 34% 33% 32% 29% Investment grade 33% 30% 28% 27% 25% Non-investment grade 3% 4% 4% 5% 4% - Pfandbriefe, Covered bonds, ABS 14% 10% 9% 8% 7% Equities 2% 3% 4% 2% 2% - Listed equity <1% 1% 2% <1% <1% - Private equity 2% 2% 2% 2% 2% Real estate/real estate funds 4% 4% 5% 5% 6% Others 1% 1% 1% 1% 1% Short-term investments & cash 4% 5% 4% 4% 4% Total market values in bn. EUR ) Ordinary income split Private Equity 11% Pfandbriefe, Covered Bonds, ABS 9% Real estate 3) 13% Others 0% Short-term investments & cash 2% EUR 1,327 m. Corporates 32% Governments 21% Semigovernments 12% 1) Economic view based on market values without outstanding commitments for Private Equity and Alternative Real Estate as well as fixed-income investments of EUR 1,326.4 m. (EUR 1,201.9 m.) as at 31 December 2018 (incl. assets from discontinued operations (e.g. Inter Hannover)) 2) Of which Pfandbriefe and Covered Bonds = 70.1% 3) Before real estate-specific costs. Economic view based on market values as at 31 December 2018 (incl. assets from discontinued operations (e.g. Inter Hannover)) 50 Hannover Re: the somewhat different reinsurer

51 Investment management High quality fixed-income book well balanced Geographical allocation mainly in accordance with our broad business diversification IFRS figures as at 31 December 2018 (incl. assets from discontinued operations (e.g. Inter Hannover)) 51 Hannover Re: the somewhat different reinsurer Governments Semigovernments Corporates Pfandbriefe, Covered bonds, ABS Short-term investments, cash AAA 77% 61% 1% 61% - 48% AA 13% 25% 14% 24% - 16% A 5% 6% 30% 11% - 14% BBB 3% 1% 46% 3% - 17% <BBB 2% 7% 9% 1% - 5% Total 100% 100% 100% 100% - 100% Germany 21% 42% 4% 20% 16% 19% UK 8% 3% 8% 11% 12% 7% France 1% 1% 7% 5% 1% 3% GIIPS 1% 1% 4% 4% 0% 2% Rest of Europe 2% 13% 15% 22% 5% 10% USA 51% 9% 34% 14% 19% 34% Australia 4% 10% 8% 13% 9% 7% Asia 9% 8% 7% 1% 26% 8% Rest of World 4% 12% 13% 12% 14% 9% Total 100% 100% 100% 100% 100% 100% Total b/s values in m. EUR 14,933 6,635 11,850 3,031 1,495 37,943 Total

52 Investment management Currency allocation matches liability profile of balance sheet Duration-neutral strategy continued Currency split of investments GBP 8% AUD 6% CAD 3% Others 8% Modified duration of portfolio 5.7 EUR 30% Modified duration of fixed-income mainly congruent with liabilities and currencies GBP s higher modified duration predominantly due to life business Modified duration USD 46% Hannover Re: the somewhat different reinsurer

53 Investment management Stress tests on assets under own management Unchanged focus on yields and credit spreads; reduced relevance of equities Portfolio Scenario Change in market value in m. EUR Change in OCI before tax in m. EUR Equity (listed and private equity) -10% % Fixed-income securities +50 bps bps -1,769-1,632 Credit spreads +50% Real estate -10% As at 31 December Hannover Re: the somewhat different reinsurer

54 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

55 Capital management 6 7 Our capital structure consists not only of equity Use of hybrids, securitisations etc. lowers cost of capital and levers RoE Equity capital is by far the most expensive. Therefore, we make optimal use of equity substitutes: Conventional reinsurance/retrocession on an opportunistic basis (i. e. use of other reinsurers capital) alternative capital market transactions e. g. hybrid capital. Type Nominal amount Issue date First call date Maturity Coupon rate Senior unsecured bond ISIN: XS Undated subordinated bond Format: PerpNC10,8 ISIN: XS Dated subordinated bond Format: 30,6NC10,6 ISIN: XS Dated subordinated bond Format: 30NC10 ISIN: XS EUR 750 m Annually on every April 18 (commencing April 18, 2019): 1.125% p. a. EUR 500 m Perpetual Until first call date: 3.375% p. a. and thereafter 3.25% p. a. above 3 months EURIBOR EUR 500 m Until first call date: 5.00% p. a. and thereafter 4.30% p. a. above 3 months EURIBOR EUR 500 m First 10 years: 5.75% p. a. and thereafter 4.235% p. a. above 3 months EURIBOR Competitive advantage through low cost of capital (WACC) 55 Hannover Re: the somewhat different reinsurer

56 Capital management 6 7 Several levels of protection provide more NatCat capacity... and thus create additional earnings at a defined risk appetite Agg. XL ~ EUR 155 m. Div. cat swaps max. ~ EUR 90 m. ~ EUR 2.7 bn. Whole Account ~ EUR 300 m. K-Cession securitisation ~ USD 643 m. + expected premium Group EBIT EUR 1,597 m. As at March 2019 Policyholders' surplus (shareholders' equity, non-controlling interest, hybrid capital) 2018: EUR 11,035 m. 56 Hannover Re: the somewhat different reinsurer

57 Capital management 6 7 Financial strength ratings Group S&P A.M. Best General Reinsurance Corp. AA+ A++ Hannover Re AA- A+ Munich Re AA- A+ Swiss Re AA- A+ SCOR AA- A+ Everest Re A+ A+ Transatlantic Re A+ A+ Lloyd's A+ 1) A XL Bermuda AA- A+ PartnerRe A+ A 2) As at 1 March ) Negative outlook 2) Positive outlook 57 Hannover Re: the somewhat different reinsurer

58 Capital management 6 7 An above-average rating has numerous benefits although we might not (yet) get paid for it We have a better showing of business than the average player Access to all lines of business We enjoy a highly diversified, high quality book of business We are on virtually all broker lists, with cedents often demanding specific R/Is We get very high allocations when we quote for business >90% vs. some 50% for a Bermuda start-up We create lower capital charges for our cedents "AA" range S&P capital charge on reinsurance recoverables = 0.8% ("A" = 1.4%, BBB = 3.1%) As an above-average rated R/I, we "minimise" our cedents' cost of capital Our cost of financing in the capital markets is lower Hybrid bonds trade at tighter spreads Better conditions for LoCs and credit lines 58 Hannover Re: the somewhat different reinsurer

59 Capital management 6 7 We cope with a challenging regulatory environment Recent developments Data protection EU General data protection regulation (GDPR) International data protection regulation (e.g. PIPA in South Africa) IT and cyber security Requirements on IT security in (re-) insurance (VAIT) EIOPA cyber risk initiative Solvency II review Level 2 review in 2018 Review of the Solvency II directive (level 1) in 2020 IAIS common framework for insurance regulation (ComFrame) International capital standards (ICS) Monitoring phase until 2025 Conduct and sustainability regulation Disruption Internal model regulation Major changes in accounting standards Insurance distribution directive Sustainability reporting Brexit US tax reform (Base erosion and abuse tax on affiliate premium) Market risk benchmark study EIOPA initiative of further involvement in internal model review IFRS 17 IFRS 9 59 Hannover Re: the somewhat different reinsurer

60 Capital management 6 7 Group capital position remains comfortable Capital adequacy ratio well above targets in m. EUR Solvency II 1) Solvency II 2) Internal Metrics Available Economic Capital / Eligible Own Funds 3) 12,296 12,616 13,323 Confidence Level 99.5% 99.5% 99.5% Required Capital / Solvency Capital Requirements 4,729 5,135 5,135 Excess Capital 7,581 7,481 8,188 Capital Adequacy Ratio (CAR) 4) 260% 246% 259% Minimum Target Ratio (Limit) 180% 180% 180% Minimum Target Ratio (Threshold) 200% 200% 200% 1) Regulatory view (Solvency II): full internal model incl. operational risk (starting Q3/2017), confidence level at 99.5%; small deviations compared to annual report 2017 since the amounts are based on final Solvency II year-end reporting as presented in the SFCR. 2) Regulatory view (Solvency II): full internal model incl. operational risk (starting Q3/2017), confidence level at 99.5%; own funds based on the Solvency II reporting as of 31 December 2018, the related audits are at present not fully completed. 3) Including haircut (EUR 707m.) for minority interests which mostly consist of non-controlling interests in E+S Rückversicherung AG 4) First-time application of volatility adjustment in Q4/ Hannover Re: the somewhat different reinsurer

61 Capital management 6 7 Solvency II capital sufficiency remains above target Despite significant changes in economic environment Development of the capital adequacy ratio (regulatory view) 260% 246% 230% 221% 2017: Increase in solvency ratio due to application of full internal model (including OpRisk), f/x-induced reduction in funds and capital requirements. Threshold 200% Limit 180% 11,983 12,835 12,296 12, : Decrease in solvency ratio mainly due to higher capital requirements as a result of growing business and widening of credit spreads, with offsetting effects from first-time application of volatility adjustment in Q4/ ,433 5,586 4,729 5,135 Q4/2015 Q4/2016 Q4/2017 Q4/2018 Eligible Capital Solvency Capital Requirements (SCR) 61 Hannover Re: the somewhat different reinsurer

62 Capital management 6 7 High-quality capital base Own funds largely dominated by Tier 1 capital supplemented by hybrid capital Reconciliation (IFRS Shareholders equity/solvency II own funds) in m. EUR as at 31 Dec 18 9, ,055 1, , ,412 12,616 1% 1,079 9% 538 4% Unutilised Tier 2 capacity Tier 3 capital 10,922 Tier 2 capital 87% Tier 1 hybrid capital Tier 1 unrestricted capital Shareholders' equity incl. minorities (IFRS) Adjustments for assets under own management Adjustments for technical provisions Adjustments due to tax effects and others Foreseeable dividends 1) The related audits are at present not fully completed 1) Foreseeable dividends and distributions refer to Hannover Rück SE dividend including non-controlling interests 2) Net deferred tax assets Minority haircut Tier 1 unrestricted / Tier 3 capital 2) Hybrid capital Basic own funds 62 Hannover Re: the somewhat different reinsurer

63 Capital management 6 7 Capital efficiency supported by high diversification Details of Solvency II capital requirements Risk capital for the 99.5% VaR (according to internal economic capital model) in m. EUR Property & Casualty 3,819 Life & Health 2,212 Market 3,833 Counterparty default 313 Operational 575 Required capital before tax 7,105 3,648 10,753 Deferred taxes 1,970 34% diversification 32% 18% 45% 1% 3% Required capital after tax 5,135 Eligible own funds 12,616 As at 31 December Hannover Re: the somewhat different reinsurer

64 Capital management 6 7 Hannover Re is well diversified within each risk category and has a well balanced risk profile Risk capital for the 99.5% VaR (according to economic capital model) in m. EUR Underwriting risk property and casualty Underwriting risk life and health Market risk Counterparty default risk Operational risk As at 31 December 2018 Capital requirement Premium (incl. catastrophe) Reserve Underwriting risk property and casualty Diversification Mortality (incl. catastrophe) Longevity Morbidity and disability Lapse Expense Underwriting risk life and health Credit and spread Interest rate Foreign exchange Equity Real estate Market risk Counterparty default risk Operational risk 2,862 2,276 3,819 1,319 5,138 26% 1,668 1, ,212 2,147 49% 2,689 4, , ,286 6,120 37% ,000 3,000 4,000 5,000 6,000 7, Hannover Re: the somewhat different reinsurer

65 Capital management 6 7 Individual risks with limited impact on own funds Solvency ratio above targets for all sensitivities Sensitivities and stress tests Available capital 13,041 Solvency II ratio 260% 1) 250-year US/Car hurricane 250-year EU winter storm 250-year US Earthquake Extended power outage 2) 3) Denial of service attack Terror attack, major city 1, % 250% 241% 247% 252% 244% Non-affirmative (silent) cyber scenario Affirmative cyber scenario Interest rates +50 bps Credit spreads +50 bps F/x rates -10% % 261% 263% Mortality rate +5% Longevity rate +5% Lapse rate +10% % 252% 257% As at 31 December 2017, in m. EUR; post-tax 1) A return period of 250 years is equivalent to an occurrence probability of 0.4%; based on the aggregate annual loss. Car Caribbean 2) Approx. 3 week of power outage in a larger area of a developed country 3) Distributed denial of service attack on main DNS provider 65 Hannover Re: the somewhat different reinsurer

66 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

67 Annual results Favourable results enable increased dividend per share proposal of EUR 5.25 RoE well above target, despite impact from recaptures in L&H GWP F/x-adj % NPE F/x-adj % EBIT Group net income 17,791 19,176 15,632 17,289 1,364 1, , % +10.6% +17.0% +10.5% Growth driven by increased demand for reinsurance Supported by improved technical result and favourable investment income 12.2% Return on Equity Well above minimum target of 9.4% EUR Book value per share +2.9% despite dividend payment and interest rates + spread increases 246% Solvency II ratio 2018 P&C R/I EBIT: 1,323 m. L&H R/I EBIT: 276 m. Investments Satisfying EBIT margin (12.2%) supported by investment result C/R of 96.5% slightly inflated due to growth in Structured R/I and large losses exceeding budget Strong premium growth (f/x-adj %) broadly based and supported by all lines of business Figures in EUR millions, unless otherwise stated EBIT growth target achieved due to favourable underlying profitability from non-us business and financial solutions business Negative impact from recaptures in US mortality partly mitigated by release of expense reserve Premium growth (f/x-adj. +4.6%) in line with growth target RoI from AuM: 3.2%, significantly exceeds target ( 2.7%) Increased ordinary income AuM increased by +5.3% NII: 1,322 m. 67 Hannover Re: the somewhat different reinsurer

68 Annual results Double-digit growth in net income outperforming favourable top line growth Group figures in m. EUR Q4/2017 Q4/2018 Δ Δ Gross written premium 4,307 4, % 17,791 19, % Net premium earned 4,090 4, % 15,632 17, % Net underwriting result % (489) (51) -89.5% - Incl. funds withheld % (254) Net investment income % 1,774 1, % - From assets under own mgmt % 1,539 1, % - From funds withheld % % Other income and expenses (13) % Operating profit/loss (EBIT) % 1,364 1, % Financing costs (18) (20) +13.0% (72) (78) +9.1% Net income before taxes % 1,293 1, % Taxes (105) (63) -40.5% (248) (373) +50.3% Net income % 1,045 1, % - Non-controlling interests % % Group net income % 959 1, % Retention 91.6% 90.4% 90.5% 90.7% EBIT margin (EBIT/Net premium earned) 13.6% 9.7% 8.7% 9.2% Tax ratio 19.5% 14.9% 19.2% 24.6% Earnings per share (in EUR) Hannover Re: the somewhat different reinsurer

69 Annual results Good profitability supported by underwriting and investment result Strong growth from tailor-made Structured R/I Property & Casualty R/I in m. EUR Q4/2017 Q4/ Gross written premium 2,512 2,318 10,711 11,976 Net premium earned 2,406 2,787 9,159 10,804 Net underwriting result incl. funds withheld Combined ratio incl. interest on funds withheld Net investment income from assets under own management % 95.9% 99.8% 96.5% , Other income and expenses (51) (37) (87) (50) Operating profit/loss (EBIT) ,120 1,323 Tax ratio 20.5% 12.6% 18.1% 23.4% Group net income YTD GWP f/x-adjusted +16.2%, growth from Structured R/I (+16.7%) as well as traditional reinsurance (+16.0%) NPE f/x-adjusted +22.5% Major losses of EUR 850 m. (7.9% of NPE) slightly above budget of EUR 825 m. Positive run-off result and (unchanged) initial conservative reserving; slightly reduced confidence level of loss reserves Favourable ordinary investment income despite absence of extraordinary impact from equities sale in 2017 Other income and expenses mainly improved due to positive currency effects EBIT margin of 12.2% above target of 10% Tax ratio at normal level; increase due to tax-reduced disposal gains and dividends in previous year Earnings per share (in EUR) Hannover Re: the somewhat different reinsurer

70 Annual results Large losses incurred slightly above budget Natural and man-made catastrophe losses 1) 1,730 Gross Net Large loss budget (net) 1,790 in m. EUR 1, , Natural and man-made catastrophe losses in % of Property & Casualty premium 5% 5% 14% 12% 25% 16% 9% 7% 9% 8% 7% 6% 8% 7% 9% 8% 17% 12% 14% 8% Large loss budget (net) in m. EUR ) Up to 2011 claims over EUR 5 m. gross, from 2012 onwards claims over EUR 10 m. gross 70 Hannover Re: the somewhat different reinsurer

71 Annual results Accumulation of events led to significant large-loss burden both from natural catastrophes Catastrophe losses 1) in m. EUR Date Gross Net Storm "Friederike", Europe Jan Earthquake, Papua New Guinea Feb Heavy rain, Columbia 28 Apr - 11 Jun Cyclone "Mekunu", Oman May Typhoon "Prapiroon", Japan 29 Jun - 06 Jul Tornados, USA Jul "Carr" Wildfire, USA 23 Jul - 30 Aug Typhoon "Jebi", Japan 04. Sep Typhoon "Mangkhut", Guam, Philippines, China Sep Hurricane "Florence", USA Sep Typhoon "Trami", Japan 28 Sep - 01 Oct Hurricane "Michael", USA Oct Storm, Europe Oct "Woolsey" Wildfire, USA Nov "Camp" Wildfire, USA 08 Nov - 03 Dec Hail storm, Australia 20 Dec Natural catastrophes 1, ) Natural catastrophes and other large losses in excess of EUR 10 m. gross 71 Hannover Re: the somewhat different reinsurer

72 Annual results and large man-made losses Catastrophe losses 1) in m. EUR Date Gross Net 16 Natural catastrophes 1, Property claims Marine claim Casualty claim Credit claims Man-made losses Large losses 1, ) Natural catastrophes and other large losses in excess of EUR 10 m. gross 72 Hannover Re: the somewhat different reinsurer

73 Annual results EBIT growth target achieved due to favourable underlying profitability Negative impact from recapture charges partly offset by release of expense reserve Life & Health R/I in m. EUR Q4/2017 Q4/ Gross written premium 1,795 1,865 7,080 7,200 Net premium earned 1,684 1,728 6,473 6,485 YTD GWP f/x-adjusted +4.6%, mainly from China and UK Longevity NPE f/x-adjusted growth +3.2% Net underwriting result incl. funds withheld Net investment income from assets under own management (76) (16) (269) (216) Technical result impacted by recaptures of EUR -272 m. and release of expense reserve of EUR +87 m.; positive underlying development Favourable ordinary investment income Other income and expenses Operating profit/loss (EBIT) EBIT margin 2.3% 7.0% 3.8% 4.3% Tax ratio 1.5% 22.6% 27.0% 32.0% Group net income Other income and expenses mainly the result of strong contribution from deposit accounted treaties (2018: EUR 198 m.; 2017: EUR 184 m.) EBIT growth of 12.5% outperforms target of 5% EBIT growth target Tax ratio above long-term average due to one-time charges in deferred taxes associated with change in business set-up linked to the US tax reform in Q1/2018 Earnings per share (in EUR) Hannover Re: the somewhat different reinsurer

74 Annual results Strategy implementation supports outperformance of ROI target Realised gains down but still contribute to yield in m. EUR Q4/2017 Q4/ RoI Ordinary investment income 1) ,305 1, % Realised gains/losses % Impairments/appreciations & depreciations Change in fair value of financial instruments (through P&L) (37) (12) (71) (49) -0.1% % Investment expenses (29) (29) (111) (114) -0.3% NII from assets under own mgmt ,539 1, % NII from funds withheld Total net investment income ,774 1,530 Unrealised gains/losses of investments 31 Dec Dec 18 YTD Rise in ordinary income from FIS compensates for lack of dividends from liquidated portfolio of listed equities; income from real estate stable, ordinary income yield stable (2017: 3.2%) Realised gains supported by high-yield fixed-income securities; decrease due to liquidation of listed equities in previous year Small impairments on private equity and real estate funds; majority portion from ordinary depreciation on direct real estate Decrease in valuation reserves due to higher USD and GBP yields as well as increasing credit spreads on corporates On-balance sheet 1, thereof Fixed income AFS Off-balance sheet thereof Fixed income HTM, L&R Total 1, ) Incl. results from associated companies Excl. assets from discontinued operations (e.g. Inter Hannover) 74 Hannover Re: the somewhat different reinsurer

75 Annual results Target Matrix 2018 All group targets achieved Business group Key figures Targets for 2018 Actual Group Return on investment 1) 2.7% 3.2% Return on equity 2) 9.4% 12.2% Earnings per share growth (y-o-y) 5% 10.5% Economic value creation 3) 6.4% 8.1% Solvency ratio 4) 200% 245.7% Property & Casualty R/I Gross premium growth 5) 3% - 5% 16.2% Combined ratio 6) 96% 96.5% EBIT margin 7) 10% 12.2% xroca 8) 2% 9.0% Life & Health R/I Gross premium growth 9) 3% - 5% 4.6% Value of New Business (VNB) 10) EUR 220 m. EUR 290 m. EBIT growth 12) 5% 11) 12.5% xroca 8) 2% -2.4% 1) Excl. effects from ModCo derivatives 2) After tax; target: 900 bps above 5-year average return of 10-year German government bonds 3) Growth in economic equity + paid dividend; target: 600 bps above 5-year average return of 10-year German government bonds 4) According to our internal capital model and Solvency II requirements 5) On average throughout the R/I cycle at constant f/x rates 6) Incl. large loss budget of EUR 825 m. 7) EBIT/net premium earned 8) Excess return on allocated economic capital 9) Organic growth only; target: annual average growth over a 3-year period, at constant f/x rates 10) Based on Solvency II principles; pre-tax reporting 11) Annual average growth over a 3-year-period 12) Strategic target since financial year Hannover Re: the somewhat different reinsurer

76 Annual results Our strategic business groups at a glance 2018 vs Property & Casualty R/I Life & Health R/I Total in m. EUR Δ Δ Δ Gross written premium 10,711 11, % 7,080 7, % 17,791 19, % Net premium earned 9,159 10, % 6,473 6, % 15,632 17, % Net underwriting result (2) (486) (388) -20.2% (489) (51) -89.5% Net underwriting result incl. funds withheld (269) (216) -19.7% (254) Net investment income 1,209 1, % % 1,774 1, % From assets under own management 1, % % 1, % From funds withheld % % % Other income and expenses (87) (50) -42.9% % % Operating profit/loss (EBIT) 1,120 1, % % 1,364 1, % Financing costs (72) (78) +9.1% Net income before taxes 1,120 1, % % 1,293 1, % Taxes (203) (309) +52.2% (66) (88) +33.3% (248) (373) +50.3% Net income 917 1, % % 1,045 1, % Non-controlling interest % % % Group net income % % 959 1, % Retention 89.7% 90.7% 91.7% 90.7% 90.5% 90.7% Combined ratio (incl. interest on funds withheld) 99.8% 96.5% 104.2% 103.3% 101.6% 99.1% EBIT margin (EBIT / Net premium earned) 12.2% 12.2% 3.8% 4.3% 8.7% 9.2% Tax ratio 18.1% 23.4% 27.0% 32.0% 19.2% 24.6% Earnings per share (in EUR) Hannover Re: the somewhat different reinsurer

77 Annual results Our strategic business groups at a glance Q4/2018 vs. Q4/2017 Property & Casualty R/I Life & Health R/I Total in m. EUR Q4/2017 Q4/2018 Δ Q4/2017 Q4/2018 Δ Q4/2017 Q4/2018 Δ Gross written premium 2,512 2, % 1,795 1, % 4,307 4, % Net premium earned 2,406 2, % 1,684 1, % 4,090 4, % Net underwriting result % (126) (52) -58.9% % Net underwriting result incl. funds withheld % (76) (16) -78.4% % Net investment income % % % From assets under own management % % % From funds withheld % % % Other income and expenses (51) % % (13) 12 - Operating profit/loss (EBIT) % % Financing costs (0) (18) (20) +13.0% Net income before taxes % % Taxes (106) (40) -62.3% (1) (27) - (105) (63) -40.5% Net income % % % Non-controlling interest % % % Group net income % % % Retention 91.1% 90.0% 92.3% 91.0% 91.6% 90.4% Combined ratio (incl. interest on funds withheld) 87.1% 95.9% 104.5% 101.0% 94.3% 97.8% EBIT margin (EBIT / Net premium earned) 21.5% 11.4% 2.3% 7.0% 13.6% 9.7% Tax ratio 20.5% 12.6% 1.5% 22.6% 19.5% 14.9% Earnings per share (in EUR) Hannover Re: the somewhat different reinsurer

78 Annual results Guidance for 2019 Hannover Re Group Gross written premium 1) growth within a single-digit percentage range Return on investment 2) 3) at least 2.8% Group net income 2) in the region of EUR 1.1 bn. Ordinary dividend payout ratio 4) 35% - 45% Special dividend additional payout if profit target is reached and capitalisation remains comfortable 1) At unchanged f/x rates 2) Subject to no major distortions in capital markets and/or major losses in 2019 not exceeding the large loss budget of EUR 875 m. 3) Excluding effects from ModCo derivatives 4) Relative to group net income according to IFRS 78 Hannover Re: the somewhat different reinsurer

79 Annual results Creating value through reinsurance is our strategic driver P&C reinsurance Market growth in line with or slightly below primary P&C market Structurally competitive due to low entrance hurdle resulting in a supply and demand imbalance; however, competition is rational because participants are disciplined We are confident of growing our market share top and bottom line based on our competitive advantages L&H reinsurance We enjoy excellent profitability on our US Financial Solutions business and good profitability on business outside the US US mortality had masked the positive underlying profitability in previous years We expect significantly increased EBIT growth from 2019 onwards as the negative impact from US mortality legacy book has diminished significantly Investments AuM are expected to rise further due to continued positive cash flow from operations Return on investment should achieve targets in the medium term; further rise in US interest rates will depress our ability to realise gains from valuation reserves Rising interest rates will contribute to increasing ordinary investment income in the medium to long term due to higher reinvestment yields Positioned to outperform Growing EBIT contribution Stable Net Investment Income 79 Hannover Re: the somewhat different reinsurer

80 Agenda Hannover Re Group Property & Casualty reinsurance Life & Health reinsurance Investment management Capital management Annual results 2018 Appendix Hannover Re: the somewhat different reinsurer

81 Appendix Financial calender and our Investor Relations contacts 7 May 2019 Quarterly Statement as at 31 March May 2019 Annual General Meeting 8 August 2019 Half-yearly report as at 30. June 2019 Karl Steinle General Manager Phone: karl.steinle@hannover-re.com Julia Hartmann Senior Investor Relations Manager Phone: julia.hartmann@hannover-re.com 23 October 2019 Investor s Day November 2019 Quarterly Statement as at 30 September 2019 Axel Bock Investor Relations Manager Phone: axel.bock@hannover-re.com Hannover Rück SE Karl-Wiechert-Allee Hannover, Germany 81 Hannover Re: the somewhat different reinsurer