Munich Re Group. Changing Gear

Transcription

1 Annual Press Conference Preliminary figures Changing Gear Nikolaus von Bomhard Jörg Schneider February 008

2 Agenda Overview 4th record result in a row Preliminary results Munich Re Group in total segment Primary insurance segment Strategy and outlook Backup Munich Re Group Annual financial statements as at 3.. February 008 Overview 4th record result in a row Changing Gear Success confirms strategy Fourth record result in a row 3.9bn Earnings per share 7.90 Primary insurance profit 984m Return on risk-adjusted capital (RORAC) 0. profit 3.3bn Dividend distribution.bn Munich Re Group Annual financial statements as at 3.. February 008 Based on risk capital as at... 3

3 Overview 4th record result in a row Successful business model Building a track record Consolidated result One-off due to change in German tax legislation Primary insurance Payout ratio 3 Dividend Share buy-back CAGR 8 3,937 3,9,7, Munich Re Group Annual financial statements as at 3.. February 008 Adjusted due to first-time application of IAS 9 (rev. 004). Adjusted owing to IAS 8. 3 Dividend and share buy-back divided by consolidated result excl. minority interests. 4 bn buy-back programme partially concluded in February. bn buy-back programme partially concluded in January Agenda Overview 4th record result in a row Preliminary results Munich Re Group in total segment Primary insurance segment Strategy and outlook Backup Munich Re Group Annual financial statements as at 3.. February 008

4 Preliminary results Munich Re Group in total Group Overview GROUP Gross premiums written REINSURANCE Combined ratio property-casualty PRIMARY INSURANCE Combined ratio property-casualty 37, ,6 Adjusted for currency. growth GROUP Investment result 8,97 9,7 RoI with strong. above expectations bn Below 97 guidance despite Kyrill GROUP Equity 6.3. Only slight decrease despite share buy-back GROUP Group result 93.4 Again well below 9 guidance 3,9 3,937 Increased guidance of 3.3.8bn exceeded Munich Re Group Annual financial statements as at 3.. February 008 Adjusted due to IAS 8. 6 Preliminary results Munich Re Group in total Premium development Adjusted for currency effects. growth Gross premiums written Foreign exchange effects Divestment/ Investment Organic change Gross premiums written Breakdown by segment (consolidated) 37, ,6 Property-casualty 3,400 (36) (.8) Life:,493 () ( 6.0) Health:,0 (3) ( 3.0) Primary insurance Property-casualty,6 () ( +9.7) Primary insurance Life: 6,39 (7) (.7) Health:,37 (4) ( +4.) Munich Re Group Annual financial statements as at 3.. February 008 7

5 Preliminary results Munich Re Group in total Fixed-income exposure Reflects conservative investment policy Fixed-interest portfolio Structured products 4 Government/ Semi-Government 47 Structured products ABS ~.bn Loans to policyholders 4 Corporates 7 Banks 3 Pfandbriefe/ Covered Bonds Incl. loans, parts of other securities and cash positions. Economic view not fully comparable with IFRS figures. Ratings: AAA 84.3, AA 6.6, A.7, BBB 0.8, Sub-investment grade.6. See backup for detailed split. CDO & CLO MBS Total Total ~ 0.bn ~ 3.8bn.bn Thereof subprime exposure 0.34bn Munich Re Group Annual financial statements as at 3.. February Preliminary results Munich Re Group in total Return on investment RoI with strong. above expectation Regular income Other income/expenses 8,09 68 return Gains/losses on the disposal of investments,803 Write-downs/write-ups of investments,0 Investment result 9,7 Interest-rate development (yield on ten-year German government bonds) Return on quarterly weighted investments (market values) in p.a. On- and off-balance-sheet reserves Including variation in reserves: Change in total reserves : 4,06 (.3) Total income:, (.9) Munich Re Group Annual financial statements as at 3.. February 008 9

6 Preliminary results Munich Re Group in total Equity Over 3bn repatriated to shareholders in Equity 3.. 6,30 Consolidated result Changes Dividend Unrealised gains/losses Exchange rates Share buy-backs Other Equity 3.. Adjusted due to IAS 8. On other securities. 3, ,76 3,30 0,48 Munich Re Group Annual financial statements as at 3.. February Preliminary results Munich Re Group in total Consolidated result All segments contribute to record result Q Q3 life and health property-casualty Primary insurance life and health Primary insurance property-casualty Asset management Consolidation Consolidated result , , ,34,89 3,9 3,937 Munich Re Group Annual financial statements as at 3.. February 008 Adjusted due to IAS 8.

7 Agenda Overview 4th record result in a row Preliminary results Munich Re Group in total segment Primary insurance segment Strategy and outlook Backup Munich Re Group Annual financial statements as at 3.. February 008 Preliminary results segment Executive summary Net profit increased to 3.3bn Gross premiums written Combined ratio property-casualty Investment result, , ,3 Adjusted for currency. growth European Embedded Value life,96 6,66 Increase driven by 89m embedded value earnings 96.4 Solid combined ratio despite high NatCat losses Operating EEV Earnings life 70.8 operating embedded value return.3 RoI Net profit 4,37,69 3,34 Strong improvement in both P-C and L&H Munich Re Group Annual financial statements as at 3.. February 008 Adjusted due to IAS 8. 3

8 Preliminary results segment Premium development Adjusted for currency. growth Gross premiums written,6 Foreign-exchange effects,0 Divestment/ Investment Organic change Gross premiums written Breakdown by segment (segmental, not consolidated) 36 96,3 Property-casualty 4,4 (66) (.) Life,99 (8) ( 6.) Health,340 (6) (.4) Munich Re Group Annual financial statements as at 3.. February Preliminary results segment Property-casualty reinsurance performance On profitable level Net result Major losses Man-made Natural catastrophes,34 003, ,89 Combined ratio Loss ratio thereof NatCat Expense ratio Q Q3 Q Q Incl. run-off-profits. Kyrill:.-pts year average Q, 3,7,340,69 7 Q , Q Q3 9.7 Munich Re Group Annual financial statements as at 3.. February 008

9 Agenda Overview 4th record result in a row Preliminary results Munich Re Group in total segment Primary insurance segment Strategy and outlook Backup Munich Re Group Annual financial statements as at 3.. February Preliminary results Primary insurance segment Executive summary Primary insurance contributes nearly bn net profit Gross premiums written Combined ratio property-casualty Investment result 6, , ,86 Driven by international business European Embedded Value 4,4,406 Increase also supported by lower tax rate and capital markets Incl. legal Expenses. Adjusted due to IAS Very good level despite Kyrill Operating EEV Earnings operating embedded value return Net profit,6 Driven by regular income and disposals, Again on excellent level Munich Re Group Annual financial statements as at 3.. February 008 7

10 Preliminary results Primary insurance segment Premium development Driven by international business Gross premiums written Foreign-exchange effects Divestment/ Investment Organic change Gross premiums written Breakdown by segment (segmental, not consolidated) Incl. legal expenses. 6, ,86 Property-casualty,639 (33) ( 9.6) Life 6,330 (36) (.7) Health,37 (3) ( 4.) Munich Re Group Annual financial statements as at 3.. February Preliminary results Primary insurance segment Performance property-casualty Very profitable portfolio Combined ratio Net profit property-casualty Loss ratio Expense ratio Combined ratio Q Q Incl. legal expenses. Adjusted due to first-time application of IAS 9 (rev. 004) Q Q Q Q Q Q Munich Re Group Annual financial statements as at 3.. February Kyrill:.-pts. 9

11 Agenda Overview 4th record result in a row Preliminary results Munich Re Group in total segment Primary insurance segment Strategy and outlook Backup Munich Re Group Annual financial statements as at 3.. February Strategy and outlook Changing Gear A programme for profitable growth Most profitable among Top global reinsurers: Expansion in life re VANB CAGR: A Execution of defined growth A initiatives Munich Re Group initiatives A mbitious growth targets B est in class C apital efficiency International health Primary insurance B Efficiency programme B Cycle management with combined C ratio 97 over the cycle Market leadership with integrated approach: Global health strategy with profit A growth above 0 IH-wide skills and knowledge B management initiative EPS-target of CAGR >0 ( 00) Expand into PI growth markets/segments: Increase P-C profits with A sustainable CR <9 Foreign profit CAGR until A 00: A Distribution initiative Integrated back- and B front-office initiative B German PI cost targets C Optimise ERGO capital structure Munich Re Group Annual financial statements as at 3.. February 008

12 Strategy and Outlook Changing Gear Selective M&A as consistent execution of strategy Segment Target Country Share in Price Remarks Bell & Clements Group UK 00 49m Managing General Agent (MGA) International Health Primary insurance The Midland Company MSP Underwriting Ltd. Allfinanz Cairnstone Inc. Sterling Life Insurance Company HDFC General Insurance Ltd. Daum Direct Auto Insurance USA UK Ireland USA USA India South Korea of MSP, 47.3 of Lloyd syndicate From to USD.3bn ( 0.9bn) 74.m 48m 8m USD 3m ( 43m) INR 3m Crores ( 43m) 79.m US specialty insurance Lloyd syndicate focused on international property business Leading provider of software for life insurance companies Industry leader in US employer stop loss insurance Leading provider of health benefits to US senior market Non-life insurance joint venture Second largest direct motor insurer in South Korea Munich Re Group Annual financial statements as at 3.. February 008 Strategy and outlook Changing Gear Execution of defined growth initiatives reinsurance MGA portfolio shows high growth and attractive mix MGA business development CAGR,33 Portfolio by line of business Agricultural 3 Property Prof. liability 4 Marine Aviation 7 AVERAGE COMBINED RATIO <90 Casualty 6 Munich Re Group Annual financial statements as at 3.. February 008 Managing general agency. Excluding NatCat losses Katrina, Rita, Wilma (KRW); incl. KRW: <94. 3

13 Strategy and outlook Changing Gear Execution of defined growth initiatives reinsurance Special-Enterprise-Risk and Microinsurance Special enterprise risk (SER) solutions Increasing implementation of Enterprise Risk Management systems at corporate clients reveals more off-strategy risks In addition, company-specific triggers drive actual demand (e.g. debt, M&A) Significant white space for expansion of business through tailor-made products Comprehensive worldwide Munich Re network can be leveraged to originate business Due to tailor-made nature and limited supply, SER business is so far not subject to insurance cycle Microinsurance Colombia Microinsurance property product Microinsurance life product Further markets South Africa, Indonesia, Philippines Portfolio level credit insurance for Micro-finance Institutions (MFIs) Primary underlying risks: Catastrophe and political risks Reduction of earnings volatility ensures business continuity Munich Re Group Annual financial statements as at 3.. February Strategy and outlook ERGO International Business: Annual profit growth of p.a. until 00 Increase of international business from / to /3 in 00 M&A or greenfield to enter emerging markets Focus region Europe Incl. ERGO's international health activities. Focus region Asia Regional approach and line-ofbusiness focus Partner approach in distribution Transfer of technical and administrative know-how Munich Re Group Annual financial statements as at 3.. February 008

14 Strategy and outlook ERGO Distribution initiative Sales channels Growth in all sales channels Tied agents Multi-level sales Brokers Direct sales Bancassurance Develop new sales channels SALES +0 Value-based sales steering + + and customer focus Optimise ERGO-wide value-based sales steering and controlling Implement ERGO-wide customer view and Customer Relationship Management Enforce strict cost management Market orientation Optimise team play between sales and product development customer-oriented processes IT ERGO CUSTOMER BASE + million Munich Re Group Annual financial statements as at 3.. February Key takeaways and outlook Key takeaways Excellent operating performance in all segments Dividend increased to.0 per share Clear focus on insurance risks Outlook 008 Outlook 00 NET PROFIT REINSURANCE.7.9bn COMBINED RATIO P-C REINSURANCE 98 NET PROFIT PRIMARY INSURANCE bn COMBINED RATIO P-C PRIMARY INSURANCE <9 Strong commitment to at least RoRaC over the cycle CONSOLIDATED RESULT bn RETURN ON INVESTMENTS 4. Share buy-back > 3bn plus at least bn dividend per year generating EPS of > 8 in 00 Munich Re Group Annual financial statements as at 3.. February 008 7

15 Agenda Overview 4th record result in a row Preliminary results Munich Re Group in total segment Primary insurance segment Strategy and outlook Backup Munich Re Group Annual financial statements as at 3.. February Backup: Preliminary results Target and assumption set 008 RoRaC target: Primary insurance Gross premiums written Currency environment Normal major losses Combined ratio property-casualty European Embedded Value Earnings Return on investment Tax environment Net profit Consolidated net profit for the Group..bn stable NatCat stable.7.9bn bn 7.8.0bn NatCat n.a. below bn Munich Re Group Annual financial statements as at 3.. February 008 9

16 Backup: Preliminary results Munich Re Group Quarterly figures Q Q3 Q Q3 '07 / '06 in Gross premiums written 0,036 9,07 9,07 9,36 0,00 8,908 9,48 9,86.8 Investment result Total income Total expenses Operating result Finance costs Taxes on income Consolidated result Equity (balance-sheet date),9,438 9,960, ,973,674,970 0,8, ,4 3,68,7,406 0,099, ,49,9,66 0, ,30 3,6,367,04, ,34,48,93 0,48, ,8,330,990,3 0,79, ,6 4,87,636,69 0,83, , Munich Re Group Annual financial statements as at 3.. February 008 Adjusted due to IAS Backup: Preliminary results segment Life and health Quarterly figures Q Q3 Q Q3 '07 / '06 in Gross premiums written,94,94,94,8,79,867,866,77. Investment result Total income Total expenses Operating result Finance costs Taxes on income Consolidated result 466,3, ,34, ,30, ,97, ,0, ,307, ,37, ,93, Munich Re Group Annual financial statements as at 3.. February 008 3

17 Backup: Preliminary results segment Property-casualty Quarterly figures Q Q3 Q Q3 '07 / '06 in Gross premiums written 4,04 3,389 3,9 3,8 4,09 3,306 3,60 3, Investment result Total income Total expenses Operating result Finance costs Taxes on income Consolidated result Combined ratio (in ) 669 4,86 3, ,399 3,344, ,48 3, ,74 3, ,03 3, ,477 3,47, ,930 3, ,09 3, / in - pts. 4.8 Munich Re Group Annual financial statements as at 3.. February Backup: Preliminary results Primary insurance segment Life and health Quarterly figures Q Q3 Q Q3 '07 / '06 in Gross premiums written Investment result Total income Total expenses Operating result Finance costs Taxes on income Consolidated result, ,707 3,64 6 9,83,33 4,79 3, ,78,80 3,93 3, ,7 96 4, 4, ,8,668 4,483 4, ,80,6 4,74 4, ,76,00 3,986 3, , ,78 4, Munich Re Group Annual financial statements as at 3.. February 008 Adjusted due to IAS 8. 33

18 Backup: Preliminary results Primary insurance segment Property-casualty Quarterly figures Q Q3 Q Q3 '07 / '06 in Gross premiums written,78,9,093,07,903,4,8,0 0. Investment result Total income Total expenses Operating result Finance costs Taxes on income Consolidated result Combined ratio (in ) 00,34, ,368, ,7, ,44, ,478, ,36, ,364, ,7, / in -pts. 4. Munich Re Group Annual financial statements as at 3.. February 008 Incl. legal expenses. 34 Backup: Preliminary results Consolidated financial statements Balance sheet as at 3 December Assets (/) Assets 3.. Prev. yr. Change A. Intangible assets I. Goodwill 3,3 3, II. Other intangible assets,4, B. Investments I. Land and buildings, including buildings on third party-land II. Investments in affiliated companies and associates III. Loans IV. Other securities. Held to maturity. Available for sale 3. Held for trading V. Deposits retained on assumed reinsurance VI. Other investments 00 9,034,80 3,73,68 3,0 0,4 8,06 4,833 4,77 73,976 4,84 4,70,303 9,8,9,343 4,0,93 3,060 7, , Munich Re Group Annual financial statements as at 3.. February 008 Adjusted owing to IAS 8. 3

19 Backup: Preliminary results Consolidated financial statements Balance sheet as at 3 December Assets (/) Assets 3.. Prev. Yr. Change C. Investments for the benefit of life insurance policyholders who bear the investment risk,78, D. Ceded share of underwriting provisions,66 6, E. Receivables I. Current tax assets II. Other receivables F. Cash with banks, cheques and cash in hand G. Deferred acquisition costs Gross Ceded Net H. Deferred tax assets I. Other assets Total assets 7 8,636 8, ,387,0 8,30 4,69 3,383 4,3 70 8, 8,8,7 8, ,90,368 3,4, , Munich Re Group Annual financial statements as at 3.. February 008 Adjusted owing to IAS Backup: Preliminary results Consolidated financial statements Balance sheet as at 3 December Equity & liabilities (/) Equity & Liabilities 3.. Prev. year Change A. Equity I. Issued capital and capital reserve 7,388 7,388 II. Retained earnings 9,78 9, III. Other reserves IV. Consolidated result atrributable to Munich Re equity holders V. Minority interests B. Subordinated liabilities C. Gross technical provisions I. Unearned premiums II. Provision for future policy benefits III. Provision for outstanding claims IV. Other technical provisions 3,934 3,84 0,79 94,93 44,64 0,36,48 4,877,74,69 3, ,30 3,49,870 94,660 47,076 0,99 8,3, ,48 7, 393, Munich Re Group Annual financial statements as at 3.. February 008 Adjusted owing to IAS 8. 37

20 Backup: Preliminary results Consolidated financial statements Balance sheet as at 3 December Equity & liabilities (/) Equity & Liabilities 3.. Prev. year Change D. Gross underwriting provisions for life insurance policies where the investment risk is borne by the policyholders,308, E. Other accrued liabilities,793,8 8.0 F. Liabilities I. Notes and debentures II. Deposits retained on ceded business III. Current tax liabilities IV. Other liabilities G. Deferred tax liabilities Total equity & liabilities 34,3,634 0,76,968 7,09 4,3 378,4,4 9,80 4,678 8,4, ,90,047, Munich Re Group Annual financial statements as at 3.. February 008 Adjusted owing to IAS Backup: Preliminary results Consolidated financial statements Income statement Grosspremiumswritten. Earned premiums Gross Ceded Net. Investment result thereof: income from associates 3. Other income Total income (. bis 3.) 4. Expenses for claims and benefits Gross Ceded Net. Operating expenses Gross Ceded Net 6. Other expenses Total expenses (4. bis 6.) 7. Result before impairment losses of goodwill 8. Impairment losses of goddwill 9. Operating result 0. Finance costs. Taxes on income. Consolidated result Thereof: attributable to Munich Re equity holders attributable to minority interests Earnings per share 37,6 37,87, 3, , ,67 9,7 64,376 30,474 8,878,88 47,33 4,34,089, ,937 3, ,436 37,63,899 3,74 8,97 44,784 46,470 30,8,03 9,780 9, ,834,37 40,989,48 4,477 30,648 3,9 3, Change , Munich Re Group Annual financial statements as at 3.. February 008 Adjusted owing to IAS 8. 39

21 Backup: Preliminary results Consolidated financial statements Consolidated income statement / Grosspremiumswritten. Earned premiums Gross Ceded Net. Investment result Thereof: Income from associates 3. Other income Total income (-3) 4. Expenses for claims and benefits Gross Ceded Net. Operating expenses Gross Ceded Net 6. Other expenses Total expenses (4-6) 7. Result before amortisation and impairment losses of goodwill 8. amortisation and impairment losses of goodwill 9. Operating result 0. Finance costs. Taxes on income. Consolidated result Thereof: Attributable to Munich Re equity holders Attributable to minority interests Earnings per share 9,86 9, ,47 69, ,, ,03,38 998,69 0,83,09, ,36 9, ,3,9 3 3,66 7, ,9,6 7, , Change Munich Re Group Annual financial statements as at 3.. February 008 Adjusted according to IAS 8 40 Backup: Preliminary results Segment reporting Assets A. Intangible Assets B. Investments I. Land and buildings. including buildings on thirdparty land II. Investments in affiliated companies and associates III. Loans IV. Other securities. Held to maturity. Available for sale 3. Held for trading V. Deposits retained on assumed reinsurance VI. Other investments C. Investments for the benefit of life insurance policyholders who bear the investment risk D. Ceded share of underwriting provisions E. Other assets Total assets 338 4, ,46 0,93 48,009 48,339 3,6 7, ,0,049 48,03 48,934 4,7 7,969,08 4,79,74, ,06 70,346, ,08 9,48,807,73 9,04 93,78,073,8 7 8,3 8 Adjusted owing to IAS 8. Changed compared with earlier announcement. Primary insurance Life and health Property-casualty Life and health Property-casualty, ,47 308, ,8 9,063 3,30 9,36,666,0,78,730 3,89,80,04 3,3,70 8 6, , ,04 3,87 6,6 6,37,489,8,833 6,36 8,394 8,4,0,86 4,87 3,847 33,043 36,73 68,46 69,9 7,08 4,9 8,873 8,7 94,08 4 3,90,8 0 6,4 87 6, Asset management ,9 8,990,68,303 04,898,99 3,0 9, ,886-4,76 8,06, ,833 3, ,699 6,078 73,976 7,0 Consolidation Prev.yr Prev.yr Prev.yr Prev.yr Prev.yr Prev.yr Prev.yr ,034,9,80, ,4 4,0,78,80 6,63 6,007,66 6,93 44,447,967 8,96 8, ,4 4,067 4,3,84 4,77 3,73 Total 4,84 4,70 Munich Re Group Annual financial statements as at 3.. February 008 4

22 Backup: Preliminary results Segment reporting Equity & liabilities Primary Insurance Life/Health Property-Casualty Life/Health Property-Casualty A. Subordinated liabilities,90,349,84, B. Gross technical provisions I. Unearned premiums ,080 4, ,63,468 II. Provision for future policy benefits 4,668 6, ,98 8, III. Provision for outstanding claims 3,63 4,489 34,783 36,48,86,4 4,97 4,737 IV. Other technical provisions 80, ,4 9, ,37,04 39,88 4,84 9,80 93,697 6,96 6,8 C. Gross technical provisions for life insurcance policies where the investment risk is borne by the policyholders,308,930 D. Other accrued liabilities ,87,366 E. Other segment liabilities,8,0 8,004 7,37 4,38 4,9 4,4 4,33 Total segment liabilities Prev. yr Prev. yr Prev. yr Prev. yr Prev. yr Prev. yr Prev. yr. 6,7 9,76 0,90,9 3,8 0,484 3,063,70 Asset Management 44 6 Consolidation ,749 4,6 94,93 94, ,64 47, ,36 0,99 6, 6,06,74 8,3,308, ,793,8 34 9,437 8,846 3,063,80 7,783,000 88,79 89, Equity Total 47 4,877,79 Total 3,49,870,48 6,30 4,3,84 Munich Re Group Annual financial statements as at 3.. February 008 Adjusted owing to IAS 8. 4 Backup: Preliminary results Segment reporting Income statement Gross premiums written from insurance transactions with other segments from insurance transactions with external third parties. Earned premiums Gross Ceded Net. Investment result Income from associates 3. Other income Total income (3) 4. Expenses for claims and benefits Gross Ceded Net. Operating expenses Gross Ceded Net 6. Other expenses Total expenses (4-6) 7. Result before amortisation and impairment losses of goodwill 8. Amortisation and impairment losses of goodwill 9. Operating result 0. Finance costs. Taxes on income.consolidated result attributable to MR equity holders attributable to minority interests Adjusted owing to IAS 8. Primary insurance Asset Life and health Prop.-casualty Life and health Prop.-casualty management 7,99 7,66 4,4 4,,647,606,639, ,9 7,9 68 7,04, ,939,6 78,433,09 6, ,84,094 3, ,94 3,400 3,79,646,60 7,667 4,8 4,80,64, , ,76 3,07 3,79 0,764 0,668,633,79,769 4,83 4, ,06 7,00 7, 6,9,969,93 90,74,34 4,08 4,07,774, ,6 3,83 3,846,37, ,40,04 8,84 3,937 3,63 6,34, , ,87 3,068 3, ,89, ,6 3,969 3, ,973 3,403 3,00 3,486 3,486 6,9,34, ,6,484,04 4, ,7 3,63 64,639,88 308,0 9, ,6,060,08 3, ,399,864 8,8,686 96, , Total Consolidation ,00,47,33 37,6 37,436,,9 37,87 37,63,,9,,899 3,67 3, ,7 8, ,038,376,784,733,608 47,33 46,470,44,00 3,37 30, , ,474 9, ,7 9, ,878 8,834,3,8,88,37,30,336 4,34 40, ,089, ,078, , ,937 3, ,84 3, Munich Re Group Annual financial statements as at 3.. February

23 Backup: Preliminary results Explanations to Group income statement Investment income and expenses by segment Property-Casualty Primary Insurance Life/Health Property-Casualty Life/Health Regular income,4,83,030,96 4,379 4, Income from write-ups Gains on the disposal of investments ,86,60,37, Other income Total,006,703,430 3,78 6,874 6, Write-downs of investments Losses on the disposal of investments Management expenses, interest charges and other expenses Total ,93,49, , , , Asset Management Total 8,09 7,834, 76,67 3, ,07,38,37,44,868, ,799 3,40 Munich Re Group Annual financial statements as at 3.. February 008 After elimination of intra-group transactions across segments. 44 Backup: Preliminary results Explanations of consolidated income statement Expenses for claims and benefits (gross and ceded share) Primary Insurance Total Life/Health Property-casualty Life/Health Property-casualty in Gross Claims and benefits paid Change in technical provisions,4,7 8,87 8,340 0,07 9,38,986,87 7,370 6,0 Provision for future policy benefits Provision for outstanding claims Provision for premium refunds Other underwriting result Gross expenses for claims and benefits Ceded Share Claims and benefits paid Change in technical provisions Provision for future policy benefits Provision for outstanding claims Provision for premium refunds Other underwriting result Ceded share of expenses for claims and benefits , , ,3, , ,77 66, , ,44 46,69 0 3, , , ,40 74, ,37, ,74 64, ,8, ,03 Munich Re Group Annual financial statements as at 3.. February 008 After elimination of intra-group transactions across segments. Adjusted owing to IAS 8. 4

24 Backup: Preliminary results Explanation of consolidated income statement Expenses for claims and benefits (net) Primary Insurance Life/Health Property-casualty Life/Health Property-casualty Total in Net Claims and benefits paid,7.63 7,867 7,786 9,988 9,477,79,3,69,448 Change in technical provisions Provision for future policy benefits Provision for outstanding claims Provision for premium refunds Other underwriting result Net expenes for claims and benefits , , ,67,676 69, ,896,34 3,69 6 3, , ,688,8 66, ,474,93,93 3 9,780 Munich Re Group Annual financial statements as at 3.. February 008 After elimination of intra-group transactions across segments. Adjusted owing to IAS Backup: Preliminary results Explanations to the consolidated income statement Operating expenses Primary insurance Life and health Property-casualty Life and health Prpoerty-casualty Total Acquisition costs ,30,3,3,030,44,383 Administration expenses Amortization of acquired insurance portfolios commission and profit commission Gross operating expenses Ceded share of acquisition costs Commission received on ceded business Operating expenses Ceded share Net operating expenses 0,6,8 9 6,7 6.79, , ,04 3, ,9 83 -,98 3, , ,78 0, , , , , ,680 -,68,77 7 4,66 9, ,878, 6 4,779 9, ,834 Munich Re Group Annual financial statements as at 3.. February 008 After elimination of intra-group transactions across segments. 47

25 Disclaimer This presentation contains forward-looking statements that are based on current assumptions and forecasts of the management of Munich Re. Known and unknown risks, uncertainties and other factors could lead to material differences between the forward-looking statements given here and the actual development, in particular the results, financial situation and performance of our company. The Company assumes no liability to update these forward-looking statements or to conform them to future events or developments. Munich Re Group Annual financial statements as at 3.. February