Fiscal Year 2016 Updated: 15 March 2017 1
Content 1 Our company 2 Our strategy 3 Our brand 4 Our customers 5 Our people 6 Our financial results 7 Our peers 8 Our share 2
Our company We want to be the most trusted financial services provider 3
As Allianz we are acompany with over 140,000 trusted partner for more than 86 million among the top 3 Property and Casualty insurers globally employees present in over 70 countries in business for over 125 years customers Europe s largest insurer based on market value global leader in travel insurance, assistance services, and credit insurance among the top 5 in the Life/Health business globally among the top 5 asset managers globally gold rated in the Dow Jones Sustainability Index All figures as per December 31, 2016 Rankings insurance business based on revenues; asset management based on assets under management; sources: company reports 4
We are much more than just an insurer Did you know that? the Allianz Center for Technology has conducted thousands of crash test since 1980 to improve road safety Allianz insures major Hollywood and Bollywood movies including all 24 James Bond productions Allianz is the leading specialist in space insurance and celebrated its 100 th birthday as aviation insurer in 2015 Allianz insured the last three buildings to hold the title of world s tallest : Petronas Towers, Taipei 101, Burj Khalifa Allianz offers a wide range of green solutions Allianz was one of the insurers of the Titanic Allianz offers financial solutions to over 50 million low-income people in Africa, Asia and Latin America Allianz offers drone insurance products for private and commercial operators, manufacturers, repairers, flight schools and training facilities All figures as per December 31, 2016 5
Our strategy What does it take to strengthen our leadership position? 6
Our Renewal Agenda Five mutually reinforcing levers True Customer Centricity Make superior customer experience the top priority for all our actions Digital by Default Move from selected leading assets to become Digital by Default everywhere Inclusive Meritocracy Digital by Digital by Default Default Technical Excellence Growth Engines Create superior margins, innovation, and growth through best talents and state-of-the-art skills Systematically exploit new sources for profitable growth Growth Engines True Customer Centricity Technical Excellence Inclusive Meritocracy Reinforce a culture where both people and performance matter 7
to strengthen Allianz leadership position Content True Customer Centricity Digital by Default Technical Excellence Growth Engines Inclusive Meritocracy Superior customer experience 75% of our businesses aim to be Loyalty Leader or above market Expand our common Group platforms Achieve productivity gains to finance our digital transformation Rigorous management of underperforming portfolios In-force management and a strong move into capital-light products Consolidate leadership in mature markets Reinforce our presence in growth markets Reinforce a culture where people and performance matter Strengthen leadership bench and employee engagement Impact Accelerated customer retention, growth and margins Globalization of new digital products and processes EUR 1bn of recurring productivity gains by 2018 Ambitious financial targets: -P/C CR 94% -L/H RoE 10% for each OE; NBM 3% Improve margins and scale Fortify growth Secure our future potential Faster, more successful change execution 8
Renewal Agenda on track selected examples 55% of measured segments with NPS above market or loyalty leader (2015: 50%) Global cultural change in implementation Leadership index further improved 1 Inclusive Meritocracy Digital by Default Global Digital Factory launched Planned productivity gains 2 under implementation PIMCO with positive net flows in 3Q and 4Q 2016 Insurance underperformers turning around or exited Growth pipeline filling up Growth Engines True Customer Centricity Technical Excellence P/C initiatives on track L/H product shift ahead of plan, Korea sold 1) IMIX 2015: 68%, 2016: 70%, target 2018: 72% 2) EUR 1bn in 2018e 9
Our brand What is the Allianz brand worth? 10
Our strong global brand helps to accelerate the renewal agenda In 2016, 86% of our total revenues (2015: 84%) were generated under the Allianz brand. Our brand value in Interbrand s 100 Best Global Brands ranking 2016 increased by 12% to USD 9.5 bn (2015: USD 8.5 bn). Brand likability helps us to attract new customers, emotionally engage with our products and services and to maintain customer loyalty in the long term. Our brand communication is well-grounded on our positioning as a Trusted Partner to accompany and ensure peoples next steps. Allianz now ranks 51 st among the world s top 100 brands. 11
Our Sports and Culture Partnerships support our brand Football Family of stadiums Golf Paralympic Movement Football is the most popular sport in the world. Allianz supports the huge segments of society for whom football is an essential part of life. With our family of stadiums established in six countries on three continents we support local communities by helping develop magnets for global industry and tourism worldwide. St Andrews Links, The Solheim Cup, BMW International Opens. These are just a few of the partnerships and initiatives through which Allianz supports golf at both the professional and amateur levels. Allianz is committed to promoting inclusion, diversity, and excellence, both in the workplace and in the world of competitive sports. For more information, visit: www.allianz.com/en/about_us/sports-culture/partnerships/
and help us expanding our reach into new segments of society Arts & Culture Lang Lang Arts & Culture Museum of Modern Art Drone Racing League (DRL) Mercedes-AMG Petronas Motorsport Allianz partners with worldrenowned pianist Lang Lang to harness the power of classical music, to enrich lives and to strengthen community and family bonds worldwide. In 2016, Allianz entered a partnership with the Museum of Modern Art (MoMA), based on the same values of embracing change, taking risks and having the courage to try something new. New for 2017, Allianz will become title sponsor of DRL s premier racing series which will see talented drone pilots from all over the world competing in the Allianz World Championship. Fans can catch all the action on ESPN, Sky Sports & ProSieben starting in the US and Germany with additional markets to come. Allianz has been a partner of Mercedes-AMG Petronas Motorsport Formula 1 team since 2011. Mercedes, who clinched their third consecutive World Championship title in 2016, provides Allianz with strong hospitality opportunities across the 21 global races. For more information, visit: www.allianz.com/en/about_us/sports-culture/partnerships/
Our customers How many customers does Allianz serve? 14
We serve more than 86 million customers in over 70 countries Customers by region/country 1 Rest of Europe & Latin America 33.9% Germany 24.0% Rest of German Speaking Countries 2.6% Growth Market 15.2% USA 1.2% France 6.5% Italy 8.3% Global Insurance Lines & Anglo Market 8.4% 1) Customer figures exclude clients in microinsurance, pension funds and all Global Lines; as of 31 December 2016. 15
With our knowledge, global reach and capital strength we help our customers to realize their goals in life House & Home Protecting Businesses Protection on the Road Protecting Families Green Solutions Allianz offers a comprehensive range of insurance and asset management products and services Managing Global Business Risks Optimizing Investments Employee Benefits Solutions Old-age Provisions 16
We continuously measure and benchmark our performance on customer centricity, by using key feedback tools such as the Net Promoter Score (NPS) NPS measures our customers willingness to recommend Allianz and is broadly established as our key global metric for customer loyalty. Top-down NPS is conducted regularly according to global cross-industry standards and allows benchmarking against competitors in the respective markets. Superior customer experience is our top priority In 2016, 55% of the business segments measuring NPS*, significantly performed above market average or even achieved loyalty leadership in their market. Our aim is for at least 75% of our segments measured to outperform their competitors in terms of the NPS. With our Customer Experience Management Program, we systematically measure customer experience, identify key areas for improvement and holistically enhance drivers of satisfaction along the entire customer journey. 1) Focus on retail business 17
Our people How many different nationalities are represented in executive positions at Allianz? 18
Allianz stands for trust based on integrity, resilience and the dedication of more than 140,000 employees Our people by region/country South America 2% North America 6% Asia Pacific 11% Eastern Europe 8% Middle East & Africa 2% Germany 30% Rest of Europe 41 % More than 60 nationalities are represented in executive positions worldwide. All figures as per December 31, 2016 19
We aim to attract, retain and nurture talent 37% 21,863 71% of management employees are female new employees were hired in 2016 of our employees participated in a continuing education program in 2016 690 40.6 72% on average was invested in continuing education programs per employee in 2016 is the average age of an Allianz employee is our score in the Employee Engagement Index (EEI) All figures as per December 31, 2016 20
Our diversity presents us with multiple opportunities we embrace and support employees from different backgrounds Age Sexual Orientation Disability Diverse age groups in teams provide knowledge exchange and a better customer understanding. Women in Leadership Psychological safety in the workplace is about awareness of sexual orientation and giving employees a safe place for coming out. Having accessible work environment and buildings enables to include people with disabilities. Identifying and removing barriers for women in leadership is a strategic commitment for meritocracy. Ethnicity Having diverse nationalities in leadership teams and projects provides various perspectives and understanding of global businesses. Individual Needs Different work time models give our employees flexibility in planning their work and leisure time and promote well-being. A diverse and inclusive workforce strengthens our business. Diversity and inclusion at all levels of Allianz are crucial for an innovative and customer-centric company. 21
Our financial results What were our financial highlights in 2016? 22
Strong performance in a challenging year Difficult environment Strong performance Brexit vote Ultra-low rates Market volatility Italian referendum Operating profit EUR 10.8bn near upper end of target range Shareholders net income EUR 6.9bn (+4.0%) Solvency II capitalization 218% RoE 2 12.0% Regulation Political tensions Dividend per share 1 EUR 7.60 (+4.1%) Earnings per share EUR 15.1 (+4.0%) 1) Proposal 2) Excluding unrealized gains/losses on bonds, net of shadow accounting
All segments deliver Revenue 2016: EUR 122.4 bn Operating profit 2016: EUR 10.8 bn by segments Property/Casualty 42% by segments 4 Property/Casualty 46% Life/Health 53% Life/Health 35% Asset Management 5% Corporate & Other <1% Asset Management 19% by regions Germany 26% Western & Southern Europe 32% USA 13% Growth Markets 1 9% Broker Markets 2 5% by regions 4 Germany 25% Western & Southern Europe 30% USA 23% Growth Market 5% Broker Markets 2 4% Specialty Insurance 3 16% Specialty Insurance 3 13% Property and Casualty insurance 2016 internal growth stays strong: 3.1 percent Combined ratio for the full year improved by 0.3 points to 94.3 percent Life and Health insurance 2016 investment margin drives rise in operating profit Shift toward capital-efficient products was reflected in the rise of the new business margin to 2.7 percent Asset Management PIMCO flows stay positive in 4Q; efficiency improves Full Year 2016 sees better costincome ratio 1) Asia-Pacific, Central and Eastern Europe, Latin America, Middle East and North Africa 2) Australia, Ireland, UK 3) Allianz Global Corporate & Specialty, Euler Hermes, Allianz Worldwide Partners, Allianz Re 4) Relation of positive parts of operating profit. By segments: without Corporate & Other; All figures as per December 31, 2016 24
All stakeholders benefit from our success Benefits 2016 Customers 106.0 bn Shareholders 3.4 bn Distributors 13.9 bn Others 7.1 bn Employees 11.7 bn 25
Our key figures 2016 Allianz Group 2016 Change from prev. year Total revenues EUR bn 122.4-2.2% 125.2 Operating profit EUR bn 10.8 0.9% 10.7 Net income attributable to shareholders EUR bn 6.9 4.0% 6.6 2015 Basic earnings per share EUR 15.14 4.0% 14.56 Diluted earnings per share EUR 15.00 3.1% 14.55 Dividend per share EUR 7.60 1 4.1% 7.30 Return on equity 2,3 % 12.0-0.5%-p 12.5 Shareholders equity 2 EUR bn 67.3 6.6% 63.1 Solvency II capitalization ratio 4 (as of Dec. 31) Third-party assets under Management (as of Dec. 31) % 218 18%-p 200 EUR bn 1,361 6.7% 1,276 1) Proposal 2) Excluding non-controlling interests 3) Excluding unrealized gains/losses on bonds net of shadow accounting 4) Risk capital figures are group diversified at 99.5% confidence level. Allianz Life US included based on third country equivalence with 150% of RBC CAL since September 30, 2015. Changed regulatory tax treatment of German life sector reduced year-end SII capitalization ratio from 200% to 196% on January 1, 2016. 26
Our peers Where do we stand among our peers? 27
Our peers Compared with major international competitors: operating profit 1 (In bn) 2012 2013 2014 2015 3 2016 1. Allianz 9.5 1. Allianz 10.1 1. Allianz 10.4 1. Ping An 13.5 1. Ping An 11.2 2. AIG 7.2 2. AXA 7.3 2. AIG 7.9 2. Allianz 10.7 2. Allianz 8.0 3. AXA 6.3 3. AIG 6.8 3. Ping An 7.6 3. AXA 8.2 3. Zurich 4.0 4. Generali 4.2 4. Ping An 5.5 4. AXA 7.5 4. Chubb 2 5.6 4. Chubb 2 3.7 5. Ping An 3.9 5. Generali 4.2 5. Zurich 4.9 5. Generali 4.8 5. Generali 3.6 6. Prudential 3.5 6. Zurich 3.4 6. Generali 4.5 6. Prudential 4.5 6. AIG 3.0 7. Zurich 3.2 7. ACE 3.1 7. Prudential 3.2 7. Zurich 4.4 7. AXA n.a. 8. ACE 2.3 8. Prudential 2.0 8. ACE 2.9 8. AIG 3.0 8. Prudential n.a. 1) Limited comparability among peers and years. KPI definitions aligned with AZ Definitions to the extent possible. All figures as originally reported to Supervisory Board. Definition changes are not reflected in the OP figures retrospectively. PY values not restated for changes in FX. 2) Chubb = legacy ACE + legacy Chubb 3) 9 months results source: company reports, GPC Peer Review 28
Our peers and market capitalization 1 (In bn) 2012 2013 2014 2015 2016 1. Allianz 47.8 1. Allianz 59.5 1. Ping An 82.8 1. Ping An 93.3 1. Ping An 87.8 2. Ping An 46.3 2. AIG 54.5 2. AIG 64.8 2. Allianz 74.7 2. Allianz 71.7 3. AIG 39.5 3. AXA 48.8 3. Allianz 62.8 3. AIG 70.5 3. AIG 63.6 4. AXA 31.9 4. Ping An 44.3 4. Prudential 49.3 4. AXA 61.2 4. Chubb 2 58.3 5. Zurich 29.7 5. Prudential 41.2 5. AXA 46.9 5. Prudential 53.4 5. AXA 58.1 6. Prudential 27.3 6. Zurich 31.3 6. Zurich 38.8 6. Zurich 36.0 6. Prudential 49.2 7. Generali 21.4 7. Generali 26.6 7. ACE 31.5 7. ACE 34.9 7. Zurich 39.3 8. ACE 20.6 8. ACE 25.6 8. Generali 26.5 8. Generali 26.3 8. Generali 22.0 1) Market capitalization as at respective year-end and based on exchange rates as at respective year-end 2) Chubb = legacy ACE + legacy Chubb; source: Investor Relations Report December 2016 29
Our share How did the Allianz share price develop in 2016? 30
Our share price performance Allianz stock draws a positive balance Development of the Allianz share price versus STOXX EUROPE 600 Insurance and EURO STOXX 50 (indexed on the Allianz share price in ) 170 160 150 163.55 1/1/2016 157.00 12/31/2016 140 130 120 Allianz EURO STOXX 50 STOXX Europe 600 Insurance 110 100 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Q1 Q2 Q3 Q4 Source: Thomson Reuters Datastream 31
Our shareholders Allianz is one of the most widely held, publicly owned corporations in Europe Shareholder structure by region (in % of issued capital) Shareholder structure (in % of issued capital) North and South America: 19.3% Rest of Europe 41.2% Private Investors: 17.4% Institutional Investors: 82.6% Australia, Asia, Africa: 5.7% Germany 33.8% Allianz shareholders 520,875 shareholders Apart from 0.5% of Allianz shares held in treasury, all our shares continued to be held in free float 1) In % of issued capital. All figures as per December 31, 2016; source: Allianz SE share register 32
Our dividend history We strive to offer attractive dividends to our shareholders Dividend proposal 7.60: increase of 4.1 percent over 2015 Dividend yield: 4.8% 1 (as of December 31, 2016) Total dividend and dividend per share Dividend per share in EUR 7,60 Total dividend in EUR mn 1 6.85 7,30 3.80 5.50 2,472 3.50 4.10 4.50 4.50 4.50 5.30 2,405 3,112 3,320 3.459 1,2 1.75 2.00 1,642 1,580 1,850 2,032 2,037 2,039 674 811 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1) Proposal 2) Total dividend reflects the treasury shares held at the time of the publication of the convocation of the Annual General Meeting in the Federal Gazette. Such treasury shares are not entitled to the dividend pursuant to 71b of the German Stock Corporation Act (AktG). Should there be any change in the number of treasury shares by the date of the Annual General Meeting, the total dividend will be amended accordingly. 33
Disclaimer These assessments are, as always, subject to the disclaimer provided below. Forward-looking statements The statements contained herein may include prospects, statements of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such forwardlooking statements. Such deviations may arise due to, without limitation, (i) changes of the general economic conditions and competitive situation, particularly in the Allianz Group's core business and core markets, (ii) performance of financial markets (particularly market volatility, liquidity and credit events) (iii) frequency and severity of insured loss events, including from natural catastrophes, and the development of loss expenses, (iv) mortality and morbidity levels and trends, (v) persistency levels, (vi) particularly in the banking business, the extent of credit defaults, (vii) interest rate levels, (viii) currency exchange rates including the Euro/U.S. Dollar exchange rate, (ix) changes in laws and regulations, including tax regulations, (x) the impact of acquisitions, including related integration issues, and reorganization measures, and (xi) general competitive factors, in each case on alocal, regional, national and/or global basis. Many of these factors may be more likely to occur, or more pronounced, as a result of terrorist activities and their consequences. No duty to update The company assumes no obligation to update any information or forwardlooking statement contained herein, save for any information required to be disclosed by law. 34