contents 8 · in non-life insurance, we strengthened our position and were once again a significant...
TRANSCRIPT
Swiss Mobiliar Group Annual Report
1January to 31December 2000
Contents
The Group
Non-Life Insurance
(Swiss Mobiliar/Protekta)
Life Insurance
(Providentia)
Asset Management
(Asset Management AG)
Further information
Swiss Mobiliar
Cooperative Company
Foreword 2
Organization of the Group 4
Developments within the Group 6
The Swiss Mobiliar Group in
the market and in the public arena 8
Brief portrait 13
Key figures 14
Consolidated financial statements 17
Auditors’ report 38
Brief portrait 43
Executive Board and Senior Management 45
Key figures 46
Business report 47
Brief portrait 53
Executive Board and Senior Management 55
Key figures 56
Business report 57
Brief portrait 63
Executive Board and Senior Management
and business report 64
Offices and general agencies of Swiss Mobiliar 66
Providentia and Protekta 67
Alliance partners 68
In a separate report
Foreword
2
In 2000 the Swiss Mobiliar Group performed well in the market. However, thehigh consolidated profits recorded the previous year—due to the exceptionalsuccess of the investment business—could not be matched.The restructuring of the Group was successfully completed.
In non-life insurance, we strengthened our position and were once again a significant provider. We were able to extend our business within our existingcustomer base. Loyal customers who already had fire and property insurancepolicies with us trusted us enough to take out further cover. Thus we achievedgrowth in motor and liability insurance and in accident and health insurance. Werecorded successes with products tailored to specific groups, both for youngpeople and in the corporate sector—amongst small-scale industrial businessesand SMEs.
In the life sector, the emphasis has moved away from volatile single premiumbusiness to the more stable regular premium business. This trend is in line withour strategy, even though it results in somewhat more modest growth in premi-um income. New innovative products enabled Providentia to attract attention inthe market. It entered into another cooperative agreement with a bank—UBSthis time—thus establishing itself as a prominent bancassurance partner.
Once again, the past year was marked by relatively large natural catastrophesand losses. Added to this is the fact that claims expenditure is continuing to increase. This applies in particular to liability insurance and to policies coveringdamage to health, where the costs of daily sickness allowances, accident anddisability are rising.
The financial results were lower than the previous year. This is due to negativemovements in individual currencies, especially the euro, and on the foreign stockexchanges, which affect us to a significant extent. Swiss Mobiliar also invests inthese areas with a view to diversification of risk. We have seen in recent yearsthe extent to which a composite insurer’s operating results are shaped not justby underwriting factors but in particular by financial results. Whereas in 1999,high financial earnings enabled us to achieve record profits in absolute terms,earnings for 2000 correspond to our expectations for financial market perfor-mance.
In December 1999 our delegates approved and adopted plans to restructure theSwiss Mobiliar Group. This was completed according to plan in 2000 without in-cident or restriction, in accordance with company law. We see the full support ofour 1.2 million customers and their delegates as proof of their confidence thatthe Group will continue to focus primarily on customer benefit under its newstructure. The relevant authorities showed interest in and understanding of ourproject, and provided expert assistance with the many layers of work involved.We thank them for this. The Swiss Mobiliar Group is now a modern companywith a clear organizational structure.
Modern structures, a clear strategy and motivated staff provide the basis onwhich we will face the new challenges ahead. Our attention will continue to befocused mainly on satisfying our customers and their needs.
3
In the 2001 financial year we intend to strengthen the Swiss Mobiliar insurancebusiness further, and also to expand the life insurance business conductedthrough Providentia. The development of new pensions products, in particularthose linked with fund offerings, as well as comprehensive pension advice andfinancial planning, will be at the forefront.
2001 marks a very special anniversary in the history of our company. Founded in1826, Swiss Mobiliar has been serving its policyholders for 175 years. Thismakes it the oldest privately owned insurance company in Switzerland. Duringthis anniversary year, our customers will receive payments totalling over CHF 100 million from the surplus fund as an “anniversary gift”.
Even a healthy and innovative company can only remain successful if it works to-gether with its environment. We therefore thank our customers for their loyalty,our employees for their commitment, and our suppliers and service providers fortheir reliability.
Dr Ulrich Gadient Albert LauperChairman of the Board of Directors Group Chief Executive Officer
4
Board of Directors of Swiss Mobiliar Holding Ltd. (as at 1 January 2001)
Chairman
Dr Ulrich Gadient Attorney and notary public, Chur
Deputy Chairman
Jacques Saucy Attorney, Chairman of Wenger SA, Delémont
Dr Walter Bosshart General Manager (ret.), Swiss Mobiliar Insurance Company, Winterthur
Richard Burger Dipl. Ing. ETH, member of the Executive Board, Sulzer AG, Bottmingen
Martin Gétaz Chairman of the Board of Directors, Gétaz Romang SA, Aubonne (†)
Peter Giger lic. rer. pol., CEO, Hans Giger Holding AG, Ittigen
Albert Lauper Group Chief Executive Officer, Villars-sur-Glâne
Secretary of the Board of Directors
Andreas Dolf Attorney
The Board of Directors of the Swiss Mobiliar Cooperative Company is set out in that society’s report.
Auditors
PricewaterhouseCoopers AG, Zurich
Group Executive Board (as at 1 January 2001)
Albert Lauper Group CEO, International
Christian Wegmüller Non-Life Insurance
Daniel Greber, dipl. math. ETH Life Insurance
Roland Frey Asset Management
Organization of the Group
Group Structure
5
Non-Life InsuranceSwiss Mobiliar/Protekta
Life InsuranceProvidentia
Markets
Asset ManagementAsset Management (Ltd.)
InternationalEureko Alliance
Audit/Security
Actuarial/RiskManagement
Controlling Communi-cation
Group Management Support
Group Resource Management
Accounting IT Human Re-sources and Management Development
International/Reinsurance
Group Executive Board
Group Management Support and Group Resource Management (as at 1 January 2001)
Hans Ammeter, Dr phil. nat. Actuary/Risk ManagementOdilo Bürgy, lic. iur., Attorney LegalHeinz Buser Eureko/International/ReinsuranceAndreas Dolf, Attorney Corporate SecretaryErich Kaser Human Resources & Management DevelopmentWilhelm Heim Group ControllerBeat Odermatt AccountingDaniel Odermatt, Dr rer. pol. ITPaul Schmid Auditor/SecurityChristoph Stalder, Dr iur., Attorney Communication
CorporateSecretariat
Developments within the Group
6
Strategy
Once again, we built on our strengthsin non-life insurance and concentratedour activities in the Swiss market. Asone of Switzerland’s leading insurancegroups, we want our customers to seeus as a dependable partner, offering acomprehensive range of protection andpension products. This means that wealso want to become one of Switzer-land’s main providers of life insuranceand pensions.
As a mutual company, we give equalconsideration to customer value, busi-ness continuity and the interests of ouremployees. Both customers and staffparticipate in the company’s financialsuccess. The Group also wants to playits part in supporting the economy, so-ciety and the environment.
We see proximity to the customer andlocal expertise as essential to our suc-cess. This is why our dense network ofgeneral agencies is so important to us.But we also offer our services throughother business partners such as bro-kers, banks, associations and organiza-tions, or via other distribution channelssuch as the Internet, as long as theyenable us to meet our customers’needs effectively.
International strategy
Our markets are Switzerland and thePrincipality of Liechtenstein. At the in-ternational level, through our partner-ship Eureko Alliance, we have threeobjectives. First of all, we want to offerour Swiss customers a seamless, uni-versal service throughout Europe andthe major economic centres of theworld. Secondly, in a fiercely competi-tive environment, we need to be ableto exchange information, knowledgeand skills with our partner companies,and to run joint management develop-ment programmes. Finally, we want touse the partnership as a means for in-vesting sensibly in external markets.
Eureko Alliance
Over the course of the financial year,the Achmea (Netherlands) and BCP(Portugal) groups each transferred thewhole of their insurance business toEureko B.V. The other six Eureko part-ners, including Swiss Mobiliar, were infavour of this development, but did notwish to undertake similar steps to-wards integration themselves. So thatit would remain possible within thenew set-up to support the cooperation,the Eureko Alliance was restructured.Eureko B.V. is to become an indepen-dent international insurance companyoperating and investing in the Nether-lands, Portugal, Ireland, Slovakia andPoland. Eureko B.V.’s existing holdingsin the partner companies (Providentiain the case of Switzerland) have beencancelled. As a tool to facilitate capital-based cross-holdings between part-ners, and for the continued develop-ment of joint activities, a new organiza-tion has been set up under the nameof European Alliance Partners Compa-ny (EurAPCo), Amsterdam. EurAPCo’soperations are based in Zurich.
Following this restructuring, Swiss Mobiliar now holds a 11.4% share inEurAPCo, which in turn owns 4.8% ofour subsidiary company Providentia.Eureko’s former 22.3% holding in Prov-identia has been cancelled. The shareof Swiss Mobiliar Holding in EurekoB.V. is now 1.5%, which correspondsto our contribution to the increase inshare capital through financial invest-ment in 1999, and to the increase invalue which has occurred.
Other partnerships
Our strategy and practice to date hasbeen to seek cooperation where thisenables better results to be achievedthan would be possible if we wereworking alone. In the financial year un-der review, we entered into two impor-tant new partnerships with this aim.
Together with the Swiss Trades Asso-ciation, UBS, Swisscom and Valora, weestablished and launched plenaxx.com.This company provides members ofthe Swiss Trades Association with aplatform for their e-business activities. We expect Plenaxx to giveus a good exclusive position as a
We want to offer
a comprehensive range
of protection and pension
products.
Proximity to the customer
and local expertise are
essential to our success.
7
provider of protection and pension solutions to industrial and commercialenterprises.
We were also able to agree on a newpartnership with UBS in the field ofbancassurance: Providentia providesUBS Life term insurance and standardlife insurance products for sale via theUBS branch network. It will also helpUBS Life in assessing risk and settlingclaims. Having already been involved in similar cooperative arrangementswith regional and cantonal banks, Providentia has cemented its positionas the market leader in this field.
e-business
We are keeping up with developmentsin e-business. We want to maintain anInternet presence, and to make avail-able comprehensive information andservices. We want to make this simpleand efficient way of handling businessavailable to those customers who wantit. We also see the Internet as offeringextraordinary potential for simplifyingbusiness processes and improving effi-ciency. The e-business project is there-fore of central importance within theGroup.
Organization
The Swiss Mobiliar Group is run viafour divisions. The whole of the insur-ance business, under the brand namesSwiss Mobiliar, Protekta and Providen-tia, is covered by the Non-life and Lifedivisions. The portfolio of capital in-vestments and real estate across thegroup is administered by the AssetManagement division; foreign busi-ness—handled in association with theEureko Alliance—is the responsibilityof the International division.
One-stop shop
for asset management
For an insurance company, the admin-istration of investments is of vital im-portance. Not only are earnings fromcapital essential to the overall earningssituation, risks in investment businessare no less significant than those facedon the insurance side. Risk manage-ment, consistent asset/liability man-agement, and the expectation of ade-quate performance on the capital mar-
kets, require a high degree of profes-sionalism. By managing all capital in-vestments and real estate for theGroup and its pension funds within theAsset Management division, we havecreated the right conditions for suc-cessful and risk-aware financial opera-tions. The centralized asset manage-ment function is now fully on-streamsince 1 January 2001, with the transferof Providentia’s investments.
Younger management team
The former heads of the Asset Man-agement division, Gerhard Aebischer,and the Life division, Dr Conrad Rytz,have retired after many years of suc-cessful and commendable service. Asa result, new leadership was requiredfor two important parts of the Groupduring the year under review. On 1 May 2000, Roland Frey (44) tookover the running of the Asset Manage-ment division, and on 1July 2000,management of the Life divisionpassed to Daniel Greber (42). ChristianWegmüller (50) had already been ap-pointed as head of Non-life insurancethe year before. Thus the Swiss Mobiliar Group’s three main divisionsare now run by a younger manage-ment team who, along with Albert Lauper (58), share responsibilities onthe Group Executive Board.
We seek cooperation
where this enables better
results than would be
possible working alone.
How our customers see us
Providing benefit for our customers isour top priority. We therefore attachgreat importance to the investigationcarried out again by an independentmarket research institute in 2000 intothe insurance market, on behalf ofSwiss Mobiliar and other insurers. Thisrepresentative survey showed thatSwiss Mobiliar performs better than allits rivals in terms of 16 out of the 20image values asked about. These re-late, among other things, to expert ad-vice, sympathetic attitude, credibility,reliability and value for money. When itcomes to focusing on the future anddynamism, we did better than in previ-ous years and have also moved up intothe top rankings.
The evidence—when there’s a claim
When claims occur, we must keep ourpromises. We therefore issue cus-tomer questionnaires about how wesettle claims—80% of which are re-turned—and our customers give us ex-cellent marks, no matter what the agegroup or the class of insurance.
Becoming better known as a
composite insurer
The Group ranks once again third in the non-life market. We are becomingincreasingly well known as a compos-ite insurer, and we are one of the sixbiggest providers of group life insur-ance in Switzerland.
Local expertise is our strength
While insurance products are not iden-tical, they are interchangeable. In a sat-urated market, we want to positionourselves as a trustworthy, reliablepartner which provides expert adviceor help quickly. We do this througharound 100 largely independent gen-eral agencies. They have local con-tacts, provide advice and act in closeproximity to the customer, settlingmore than 90% of claims under theirown authority. We therefore concen-trate on customers who are interestedin local service and high quality.
In life insurance, we pursue a multi-channel distribution strategy which in-cludes the partnerships we expand in aconsistent manner.
Commitment to the public
The Swiss Mobiliar Group takes its re-sponsibilities to society seriously. Thisincludes its commitment to people inthe organization or the company itself,as reflected in the treatment of em-ployees and partners. As well as beingactive in sponsorship, we have a longtradition of involvement in many differ-ent aspects of Swiss society and thelife of the community. The generalagencies focus on associations, institu-tions and events at the local and re-gional levels, while the company di-rects its commitment to supraregionalor national causes. We encourage ourstaff to become involved in politics andassociations.
A new endowment for the Jubilee
Foundation
The Jubilee Foundation, established 25 years ago with capital of CHF 2 million, is once again being boostedin Swiss Mobiliar’s 175th year with afurther CHF 1 million. This promotesknowledge, the arts and other culturalactivities. The board of the JubileeFoundation is free to approve financialcontributions to institutions, organiza-tions, groups of people and individualsas it deems fit. In 2000 it disbursed donations to 15 projects amounting toCHF 250000.
Donations
The Swiss Mobiliar donation fund re-ceives a share of the profit each year.With an allocation of CHF 400000, thisfund enables the company to con-tribute to numerous causes. In particu-lar, support is given to national institu-tions and organizations for groups ofpatients and disabled persons whichprovide direct assistance to needy ordisadvantaged individuals or whichwork for an improvement in the condi-tions these people face. Projects arealso backed which offer solutions tocurrent social or public health prob-lems. In the cultural realm, support isgranted to events, museums and insti-tutions which improve the quality oflife and have national significance inSwitzerland.
The Swiss Mobiliar Group in the market and in the public arena
8
We set benchmarks with
respect to eleven rivals in
terms of, among other
things:
• expert advice
• credibility
• rapid, reliable service
• value for money
• fast, generous claims
settlement
We want to share
responsibility for
the economy and
the general public.
Donations to institutions working
for the public good
Each year, Swiss Mobiliar singles outan institution whose valuable and dedi-cated efforts deserve to be recognizedas a public service, and supports itwith a relatively large grant from thedonation fund. This year, the contribu-tion of CHF 100000 goes to the SwissHiking Federation (SHF).
Over the next few years, the SwissHiking Federation intends to establisha digital representation of the currenthiking network, and to make this avail-able to tourist information providers.The network includes 62000 km of hik-ing trails, and also forms the basis forother leisure activities such as cycling,mountain-biking, skating and watersports. Planning trips is made consid-erably easier with information aboutjourney time, longitudinal profile, thenature of the route and signpost infor-mation. We are pleased to be able tosupport this interesting project whichwill benefit the public at large.
Art collection
The Swiss Mobiliar Art Committee acquires several works each year byrecognized contemporary Swissartists, thus helping to support the creative activities of our own time. Artis selected that makes a fitting additionto the collection. The works in this collection are located in public areas ofthe company’s buildings and in its of-fices, so that the collection serves as a vehicle to expose people to newartistic ideas. At the start of 2001, theanniversary year, part of the collectionwas on public display in the Berne artmuseum.
Employees are the company’s assets
The success of our business is basedon the commitment and skills of ouremployees, who stand out throughtheir customer-focused and busi-nesslike attitude and behaviour.
Personnel development
On the basis of our corporate missionstatement and personnel policy, theGroup has worked out a managementmission statement and a leadership de-velopment programme for the man-agers of the future. Also in preparationis a management development pro-gramme for experienced managers, toguarantee and raise the quality of man-agement. All staff have permanent andequal access to the Swiss MobiliarGroup’s training resources via the in-tranet. The one-year Eureko manage-ment training programme has been en-thusiastically received by our youngstaff. Through training agreements, weoffer incentives and encourage staff onan individual basis. In 2000, for exam-ple, Swiss Mobiliar once again enabledaround 10 people to train as the IT spe-cialists of the future in special courses.And at its special hiring events, whichare to be extended into the future,Swiss Mobiliar informs college gradu-ates of the very good career prospectson offer.
Attractive employment conditions
The general terms and conditions forflexible working hours and holidayshave been improved. New pensionfund rules mean that early retirementis now possible from age 60. Employ-ees share in the economic success of the Group through an annual profit-sharing arrangement.
The Group offers staff the advantageof being able to take part in projectsand acquire experience in different di-visions within the company. Great usehas already been made of this opportu-nity. Group-wide project work at all lev-els encourages staff to identify withthe interests of the Group, adds to thecompany’s expertise and makes a ma-jor contribution to the development ofour staff’s skills.
9
The success of our business
is based on the commit-
ment and skills
of our employees.
Trainees
Sales force
Office staff
Employees of the Swiss Mobiliar Group in 2000
10
The Group
As one of the leading composite insurers in
Switzerland, the Swiss Mobiliar Group offers around 300 trainees
the opportunity to complete a professional training place-
ment. Training in both business studies and information
technology forms the basis for a successful career in
insurance and in the service sector in general. Right from
the start, our young people are integrated and looked after
as part of the team. In this way, they acquire the high levels
of technical and social skills which make Swiss Mobiliar
employees stand out from the crowd, as well as learning
how to focus their thinking and actions on the customer.
13
The Group
Brief portrait
The Swiss Mobiliar Insurance Com-
pany, founded in 1826 as a mutual
society, has evolved over the past
ten years into the Swiss Mobiliar
Group. The takeover of Protekta
Rechtsschutz-Versicherung AG, of
Berne, in 1989 and the founding of
Swiss Mobiliar International Ver-
sicherungsaktiengesellschaft in
Cologne (1990) allowed the Group to
meet ever-growing customer needs
for insurance cover. This was fol-
lowed in 1991 by the establishment
of Swiss Mobiliar Holding Ltd. in
Berne and, a year later, of Protekta
Risiko-Beratungs-AG, Berne. In 1993
Swiss Mobiliar acquired a majority
stake in Providentia Swiss Life Insur-
ance Company, Nyon, thereby gain-
ing an independent foothold in life
insurance. Mobi24 Call Service Cen-
ter was founded in 1997 to serve and
support customers around the clock.
For strategic reasons, the Swiss
Mobiliar Group joined the Eureko in-
ternational alliance of insurance and
financial services companies in 1998.
Swiss Mobiliar Holding Ltd. acquired
shares in Eureko B.V., and in return
ceded a minority holding in Provi-
dentia to Eureko. The rapid develop-
ment of the Eureko Alliance contin-
ued in 2000. Details of the new struc-
ture and ownership arrangements
can be found in the International
Strategy report on page 6 of this
Annual Report.
The restructuring of the Swiss Mobil-
iar Group came into force on 1 Janu-
ary 2000. Two new public limited
companies based in Berne, the Swiss
Mobiliar Insurance Company and
Swiss Mobiliar Asset Management,
are now wholly owned by the hold-
ing company. The insurance business
was transferred to the Swiss Mobil-
iar Insurance Company (now a public
limited company) in May 2000,
retroactive to 1 January 2000.
The former umbrella company, re-
named as Swiss Mobiliar Coopera-
tive Company, is purely a holding
company covering the whole Group,
and thus no longer included in the
consolidated accounts. Since 1998,
the consolidated accounts have been
prepared in accordance with the
Swiss Accounting and Reporting
Recommendations (ARR), and this
year for the first time they have been
prepared at holding company level.
14
The Group Key figures of the Group
Non-life and life
Gross premiums writtenNet premiums earnedNet claims incurred and claims paidNet technical provisionsInvestmentsInvestments held on behalf of life insurance policyholders who bear the investment riskExtraordinary expensesTaxesProfit/loss applicable to minority interestsProfit/loss for the year after minority interestsCapital and reserves before appropriation of profit
Number of employees (full-time employees, excluding trainees)Trainees
Non-life
Gross premiums writtenNet premiums earnedNet claims incurred and claims paidNet technical provisionsInvestment resultProfit/loss for the year before taxes/minority interestsNet loss ratioGross expense ratioNet combined ratio
Life
Gross premiums writtenNet premiums earnedNet benefits and claims paidNet technical provisionsInvestment result (excluding investment result from investments held on behalf of life insurance policyholders who bear the investment risk)Investment result from investments held on behalf of life insurance policyholders who bear the investment risk (loss/profit)Profit/loss for the year before taxes/minority interestsGross expense ratio
The change in % is based on the figures expressed in CHF thousands.
2000CHFmillion
2 3802 2621 7788 2378 694
1 5484
320
1601 604
3 456325
1 6501 5461 0823 320
275186
70.0%30.1%
105.8%
730716696
4 917
151
– 2011
12.6%
1999CHFmillion
2 3282 1941 9887 8568 703
1 2820
643
2401 746
3 346300
1 6191 5071 1533 286
461290
76.5%29.9%
111.3%
709687835
4 570
161
15717
11.5%
Changein %
+ 2.2+ 3.1
– 10.6+ 4.9– 0.1
+ 20.7
– 49.5
– 33,3– 8.2
+ 1.9+ 2.6– 6.2+ 1.1
– 40.3– 36.0
+ 2.9+ 4.4
– 16.7+ 7.6
– 6.1
– 112.9– 32.8
The Swiss Mobiliar Cooperative Com-pany—no longer active in insurancebusiness since the restructuring on 1 January 2000—is a pure holdingcompany covering the whole Group.The consolidated 2000 financial state-ments have therefore been prepared at the Swiss Mobiliar Holding Ltd. levelfor the first time. This is a whollyowned subsidiary of the Swiss MobiliarCooperative Company.
Non-life
Underwriting
In non-life, the Group recorded an in-crease of 1.9% in gross premiumswritten (previous year: + 0.1%) to CHF1.650 billion (previous year: CHF 1.619billion). While premium growth inSwitzerland was a satisfying 3.3%, theoverall result was reduced due to for-eign business (Limmat Italy) to a net in-crease of 1.9%. Net premiums earnedamounted to CHF 1.546 billion at theend of 2000 (previous year: CHF 1.507billion).
As a result of the disastrous storm atthe end of 1999, net claims paid in-creased from the previous year. Thenet loss ratio remains high at 70.0%,but showed a marked improvementcompared to its 1999 level (76.5%).
Technical expenses rose slightly, as expected, to CHF 496 million (previousyear: CHF 484 million). The moderateincrease was largely driven by two fac-tors: increased marketing activities—which proved to be successful—andthe implementation of major projects.The gross expense ratio was 30.1% in the financial year under review (previous year: 29.9%).
The net combined ratio amounted to105.8% (previous year: 111.3%), whichis made up of the loss ratio, the ex-pense ratio, and other underwriting expenses and revenue, as well as policyholder dividends.
15
Investment business
The investment result amounted toCHF 275 million. As expected, the exceptional result of the previous year could not be sustained (CHF 461 million).
Assets are invested in different invest-ment categories and in various mar-kets, as part of a Group-wide asset andliability management plan. Pursuantthereto, around 50% of funds were in-vested in fixed-interest securities andaround 25% in shares. The remaining25% of the portfolio is comprised ofother investments such as real estate,mortgages and loans to public institu-tions.
Income from investments totalled CHF 407 million (previous year: CHF504 million). This decline reflects valua-tion recoveries in the previous year re-sults, which arose from a restructuringof the portfolio. Both ordinary earningsand profits on sales were consistentwith the previous year’s results. Re-quired valuation adjustments on for-eign share holdings led to larger in-vestment expenses, which totalledCHF 147 million (previous year: CHF 91 million).
Other investment income increased to CHF 124 million (previous year: CHF 94 million). However, foreign currency revaluation, in particular fromeuro-denominated investments, drovean increase in other investment expense. Other investment expense totalled CHF 110 million (previous year:CHF 47 million).
The Group report
0
500
1000
1500
2000
2500
3000
1996 1997 1998 1999 2000
Gross premiums written
CHF million
Life
Non-life
16
Life
Underwriting
In life business, an increase in grosspremiums written of 2.9% over theprevious year could be achieved (previ-ous year: –37.3%), with gross premi-ums written totalling CHF 730 million(previous year: CHF 709 million). Netpremiums earned amounted to CHF716 million (previous year: CHF 687million). We were especially pleasedwith the 4.7% growth in annual premi-ums (regular receipts).
Net claims paid, on the other hand,were higher than in the previous year.This was the result of a greater num-ber of surrenders (portable benefits) bypolicyholders, and higher payments ofsurvival benefits. We experienced lessdemand on policy reserves than in theprevious year, especially in connectionwith provisions for investments heldon behalf of life insurance policyhold-ers who bear the investment risk. Thefigure for net claims paid fell by 16.7%.
The development of new products andservices drove technical expenses toCHF 92 million (previous year: CHF 82million). This investment led to an in-crease in the gross expense ratio from11.5% to 12.6%.
Investment business
The investment result totalled CHF151 million (previous year: CHF 161million). While income from invest-ments rose to CHF 222 million (previ-ous year: CHF 201 million), expensesalso increased, to CHF 85 million (pre-vious year: CHF 29 million), as a resultof necessary valuation adjustments forsecurity holdings.
The investment result from invest-ments held on behalf of life insurancepolicyholders who bear the investmentrisk was negative, reflecting the im-pact of stock market developments.
Overall result
Pre-tax profits amounted to CHF 185.8million for non-life business (previousyear: CHF 290.1 million) and CHF 11.1million for life (previous year: CHF 16.6million). The exceptional investmentresults achieved in 1999 could not bematched in the year under review, dueto trends in the financial markets.
After taxes of CHF 32.5 million (previ-ous year: CHF 64.2 million) and minori-ty interests in net profits of CHF 0.3million (previous year: CHF 2.6 million),our consolidated annual profit amount-ed to CHF 160.2 million (previous year:CHF 240.2 million).
Balance sheet
The consolidated balance sheet totalamounted to CHF 10.811 billion (pre-vious year: CHF 10.539 billion), rep-resenting an increase of CHF 272 million.
The largest asset position is invest-ments of CHF 10.293 billion (previousyear: CHF 10.018 billion).
The main position among liabilities, nettechnical provisions, was calculatedwith prudence by all divisions of theGroup. The total entered in the balancesheet amounted to CHF 8.237 billion(previous year: CHF 7.856 billion).
Consolidated capital and reserves fellfrom CHF 1.746 billion in the previousyear to CHF 1.604 billion. The excep-tional allocation of CHF 100 million tothe policyholders’ surplus fund, alongwith the restructuring of the Group, inparticular the removal of the SwissMobiliar Cooperative Company fromthe scope of consolidation, caused areduction in profit reserves of CHF149.5 million.
The consolidated financial statementsfor 2000 reflect that customers of theSwiss Mobiliar Group can continue torely on the partnership of a solvent andindependent insurance group, bothnow and in the future.
The Group
1998 1999 2000
0
50
100
150
200
250
Consolidated annual profitafter minority interests
CHF million
1998 1999 2000
0
500
1000
1500
2000
Consolidated capital and reservesbefore appropriation of profit
CHF million
17
Consolidated financial statements 1 January to 31 December 2000
18
The Group Scope of consolidation and holding structure
(as at 31 December 2000)
Swiss Mobiliar
Holding Ltd.
Providentia, Swiss LifeInsuranceCompany (Ltd.)95.24%
Swiss MobiliarInsurance Company (Ltd.)100%
LimmatInsuranceCompany100%
Mobi 24Call-Service-Center (Ltd.)74%
Swiss MobiliarAsset Management (Ltd.)100%
Swiss MobiliarInternationalVersicherungs-AG74.99%
ProtektaRechtsschutz-Versicherung AG100%
Consolidated companies
Switzerland
Swiss Mobiliar Holding Ltd., BerneSwiss Mobiliar Insurance Company, BerneMobi24 Call-Service-Center AG, BerneLimmat Insurance Company, ZurichProvidentia, Swiss Life Insurance Company, NyonProtekta Rechtsschutz-Versicherung AG, BerneSwiss Mobiliar Asset Management, Berne
Germany
Swiss Mobiliar International Versicherungsaktien-gesellschaft, Cologne
Share capital
CHF thousands
200 000148 000
20010 00025 0001 500
500
DEM thousands
10 000
Holding
%
100.00100.0074.00
100.0095.24
100.00100.00
%
74.99
Gross premiums
written
CHF thousands
1 630 242
1 941729 79917 340
DEM thousands
772
19
Comments relating to the Swiss Mobiliar Insurance Company and Protekta Rechtsschutz-VersicherungAG in Berne can be found from page47 onwards. The report on Providentia,Swiss Life Insurance Company in Nyoncan be found from page 57 onwards.
Swiss Mobiliar Holding Ltd. has beenthe strategic management organizationof the Swiss Mobiliar Group since 1 January 2000. It owns participationsin insurance subsidiaries as well asother holdings. As a result of this,Swiss Mobiliar Holding Ltd. has in-creased its share capital by CHF 150million to CHF 200 million.
The Swiss Mobiliar International Versicherungsaktiengesellschaft inCologne provides insurance coverageto Swiss customers abroad, in linewith its function. It does not write anylocal business.
Non-consolidated companies
Direct holdings of Swiss Mobiliar
Holding Ltd. (parent company)
Protekta Allgemeine Versicherungsgesellschaft, BerneProtekta Lebensversicherungsgesellschaft, Berne
Gothaer Rückversicherung AG, Cologne
Eureko Alliance Partners Company B.V. (EurAPCo), AmsterdamEureko B.V., Amsterdam
Holdings of subsidiaries
Protekta Risiko-Beratungs-AG, BernePlenaxx.com AG, BerneProviservice AG, NyonUnion Trust Company Ltd., ZurichTrees AG, Berne (until 31 December 2000)
The following real estate company is included
under land and buildings
Immo-Verwaltungs-AG, Vaduz
Share capital
CHF thousands
100100
DEM thousands50 000
EUR thousands
199188 955
CHF thousands
1005 000
10020080
250
Holding
%
100.00100.00
3.00
11.431.47
100.0024.75
100.00100.00100.00
100.00
20
The Group Consolidated profit and loss account
Non-life
Gross premiums writtenReinsurers’ share
Net premiums writtenChange in net reservesfor unearned premiums
Net premiums earned
Other technical income
Gross claims paidReinsurers’ share
Net claims paidChange in claims reserves
Net claims incurred
Share in surplus
Technical costsReinsurers’ share
Net technical costs
Other technical expenses
Underwriting result – non-life
Investment incomeInvestment expenseOther financial income Other financial expenses
Income before taxes – non-life
Note
1
2
4
2
3
4
5678
1999CHFthousands
1 618 697– 115 024
1 503 673
3 187
1 506 860
1 073 021– 80 494
992 527160 476
1 153 003
484 429– 29 682
454 747
CHFthousands
1 506 860
30 227
– 1 153 003
– 16 166
– 454 747
– 83 690
– 170 519
503 558– 90 844
94 476– 46 523
290 148
2000
CHF
thousands
1 650 125
– 104 142
1 545 983
– 299
1 545 684
1 152 130
– 101 956
1 050 174
31 316
1 081 490
496 125
– 25 094
471 031
CHF
thousands
1 545 684
698
– 1 081 490
– 16 430
– 471 031
– 66 838
– 89 407
407 381
– 146 593
124 242
– 109 848
185 775
21
Consolidated profit and loss account
Life
Gross premiums writtenReinsurers’ share
Net premiums writtenChange in net premium reserves
Net premiums earned
Gross claims paidReinsurers’ share
Net claims paidChange in net life insurance reservesChange in capital cover
Net claims paid
Surplus paid to policyholders
Technical costs
Other technical expenses
Investment incomeInvestment expenseGains/losses on investments for the benefit of life insurance policyholders who bear the investment riskOther financial incomeOther financial expense
Profit/loss for the year before taxes – life
Note
1
2
22
3
4
56
978
1999CHFthousands
708 953– 11 758
697 195– 10 563
686 632
252 307– 6 469
245 83859 388
530 049
835 275
CHFthousands
686 632
– 835 275
– 70 119
– 81 865
– 725
200 670– 28 888
157 2653 864
– 14 995
16 564
2000
CHF
thousands
729 798
– 9 163
720 635
– 4 028
716 607
363 950
– 4 984
358 966
45 499
291 676
696 141
CHF
thousands
716 607
– 696 141
– 46 520
– 91 799
– 1 539
221 686
– 85 169
– 20 274
20 926
– 6 641
11 136
22
The Group Consolidated profit and loss account
Recapitulation
Pre-tax profit/loss for the year – non-life Pre-tax profit/loss for the year – life
Total pre-tax profit/loss for the year
Extraordinary profit/loss
Total pre-tax profit/loss
Taxes
Profit/loss before minority interests
Minority interests
Consolidated profit/loss for the year
Note
10
1999CHFthousands
290 14816 564
306 712
CHFthousands
306 712
327
307 039
– 64 240
242 799
– 2 596
240 203
2000
CHF
thousands
185 775
11 136
196 911
CHF
thousands
196 911
– 3 928
192 983
– 32 473
160 510
– 339
160 171
Consolidated balance sheet as at 31 December
23
Assets
InvestmentsInvestments for the benefit of life insurance policyholderswho bear the investment riskTangible fixed assets
Fixed assets
Cash at bank and in handAccounts receivableOther assetsAccrued income
Current assets
Total
Liabilities
Technical provisions – non-lifeTechnical provisions – life
Net technical provisions
Deposits received from reinsurersFinancial reservesLong-term loans from affiliates
Long-term liabilities
LiabilitiesOther liabilitiesDeferred income
Short-term liabilities
Borrowings
Minority interests
Share capitalCapital reservesProfit reservesCurrency translation adjustmentsGroup profit
Capital and reserves
Total
2000
CHF
thousands
8 694 204
1 548 186
51 012
10 293 402
155 127
91 841
54 799
215 361
517 128
10 810 530
3 320 563
4 916 857
8 237 420
2 947
441 630
150 000
594 577
276 557
46 223
45 821
368 601
9 200 598
5 984
200 000
575 000
668 903
– 126
160 171
1 603 948
10 810 530
Note
11
12
13
14
15
16
17
1999CHFthousands
8 702 859
1 282 46332 787
10 018 109
201 400125 07151 137
142 795
520 403
10 538 512
3 285 5284 570 285
7 855 813
19 144544 999
0
564 143
245 73150 56953 778
350 078
8 770 034
22 197
00
1 506 099– 21
240 203
1 746 281
10 538 512
24
The Group Consolidated cash flow statement
Consolidated profit/loss for the year after minority interests Profit/loss for the year applicable to minority interestsAppreciation (–)/depreciation (+) onInvestmentsFixed assetsIntangible assetsNon-consolidated companiesLand and buildings
Increase of (+)/decrease in (–)Technical provisionsAccounts receivableOther assetsAccrued incomeLiabilitiesNon-technical reservesOther liabilitiesDeferred income
Cash flow from operating activities
Purchase (–)/sale (+) ofInvestmentsIntangible assetsFixed assetsNon-consolidated companiesLand and buildings
Cash flow from investing activities
Increase in share capitalIncrease in capital reservesNetting with profit reservesAllocations to staff pension schemes/Jubilee FoundationAllocations to the policyholders’ surplus fundDividend payment to minority shareholders
Cash flow from financing activities
Change in cash and cash equivalents
Total cash and cash equivalents – previous yearTotal cash and cash equivalents – current yearCurrency translation adjustments
Change in cash and cash equivalents
The restructuring and change in the scope of consolidation effective 1 January 2000 resulted in changes to the balance sheet brought forward (including a capital increase with additional paid-in capital, through non-cash contributions to Swiss Mobiliar Holding Ltd.) which slightly affected the cash flow presented.
1999CHFthousands
240 2032 596
– 109 53627 2852 047
24412 747
763 488– 33 318– 6 44547 291
– 73 32672 9786 7472 007
955 008
– 829 155– 2 047
– 14 220– 126 311
– 5 150
– 976 883
000
– 3 400– 45 000
– 668
– 49 068
– 70 943
272 345201 400
2
– 70 943
2000
CHF
thousands
160 171
339
203 138
30 494
22 150
1 236
5 444
381 613
– 32 536
– 3 946
– 72 549
70 151
– 77 191
– 3 009
– 5 627
679 878
– 911 438
– 13 231
– 49 093
– 291 443
– 19 181
– 1 284 386
150 000
575 000
– 13 126
– 2 900
– 150 000
– 668
558 306
– 46 202
201 400
155 127
71
– 46 202
25
Accounting principles
In accordance with Swiss law, the con-solidated financial statements arebased on generally accepted account-ing principles. They are in accordancewith the Accounting and ReportingRecommendations (ARR), and give atrue and fair view of the financial posi-tion, the results of operations and thecash flows.
Consolidation principles
Scope of consolidation
The consolidated financial statementsinclude companies in which Swiss Mo-biliar Holding Ltd. directly or indirectlyholds more than 50% of the share capital or voting rights. They do not in-clude the Cooperative Company, whichis the new overall holding company.
Non-operational and insignificant ma-jority holdings in the service and realestate sector are not included in theconsolidated financial statements. Thishas no material impact on the repre-sentation of the Group’s financial posi-tion, the results of operations and thecash flows. The non-consolidated ma-jority interests are included in invest-ments at their acquisition cost lessnecessary depreciation. The non-con-solidated real estate company isrecorded in land and buildings.
Companies in which the Swiss Mobil-iar Group has an interest of between20% and 50% are accounted for usingthe equity method. If the Swiss Mobil-iar Group has an interest of less than20% in a company to create a busi-ness relationship, this is recorded in in-vestments at acquisition cost less nec-essary depreciation.
An overview of the consolidated andnon-consolidated Group companiescan be found on pages 18 and 19 ofthis Annual Report.
Consolidation method
The assets and liabilities and incomeand expenses of Group companies areconsolidated using the full consolida-tion method after elimination of inter-company transactions. The shares ofminority shareholders in the profit/lossfor the year and capital and reservesare shown as separate items in theconsolidated financial statements.
Balance sheet date
The Group financial statements areclosed on 31 December and are basedon the audited financial statements ofthe Group companies as at that date.
Capital consolidation
Capital consolidation is based on thepurchase method used. The capital andreserves of Group companies, deter-mined using uniform guidelines, areoffset at book value on the basis of ini-
Group annex
Principles
tial consolidation as at 1 January 1998or at the time of acquisition. The ac-counting differences arising at the timeof initial consolidation are offsetagainst profit reserves. No theoreticalcapitalization is undertaken if Groupcompanies have been owned by theGroup for at least five years.
Currency translation
Foreign currency items in the financialstatements (balance sheet, profit andloss account and cash flow state-ments) of the individual Group compa-ny (Germany) are translated at year-end rates.
The resultant translation adjustmentsare taken to reserves.
The relevant exchange rates for con-solidation purposes (including valuationof securities) are:
2000 1999CHF CHF
Germany DEM 100 77.93 81.84EU EUR 1 1.52 1.60France FRF 100 23.24 24.40UK GBP 1 2.44 2.57Italy ITL 100 0.08 0.08Netherlands NLG 100 69.17 72.63Austria ATS 100 11.08 11.63USA USD 1 1.61 1.59
Inter-company profits
Inter-company profits have been elimi-nated.
26
The Group
Derivative financial instruments: Deriv-ative financial instruments include for-ward exchange contracts, as well asshare index futures certificates. For-ward exchange contracts are negotiat-ed on an individually OTC basis and areused to hedge exchange rate fluctua-tions. Standard option contracts andshare index futures certificates are ex-change traded and are used for invest-ment purposes. For details of the con-tract volume and replacement value,please see the notes to the balancesheet. Like the underlying business,derivatives are valued at the lower ofcost or market.
Capital investments for the account ofand under the risk of holders of life insurance policies: These are stated atmarket value.
Intangible assets: Intangible assets areonly capitalized in the balance sheet ifthey comply with the requirements un-der the ARR.
Fixed assets: These are depreciatedover their average useful life using thestraight-line method with respect tothe cost of acquisition. The useful lifeof the various fixed assets has beenfixed as follows:Furniture/equipment/vehicles 5 yearsComputer equipment 4 years
Technical reserves: These are valuedprudently on an individual basis, i.e.per insurance contract or claim on thebasis of the anticipated liabilities to pol-icyholders and claimants and/or on amathematical/actuarial basis using theprocedure approved by the supervisoryauthorities in the relevant countries.
The cost of acquiring new business ischarged to income as incurred.
Accounts receivable and otherassets/accounts payable and other lia-bilities: These items are based on therules applying to the annual state-ments in each country. Adequate ac-count is taken of credit risks. The nec-essary write-downs on accountspayable are undertaken as required,i.e. doubtful debts are written down in-dividually. A general reserve is madefor the remainder.
Taxes: Impacting the current year fi-nancial results are taxes paid, owedand deferred. Deferred taxes are calcu-lated for temporary differences, whichresult from different valuations for fi-nancial and for tax purposes. The ap-plied tax rate of 28% represents theexpected tax rate.
Deferred taxes are stated separatelyunder accounts receivable.
Valuation policies
Items are valued individually at thecost of acquisition. The main items arevalued as follows:
Cash and cash equivalents: Cash andcash equivalents comprise cash, bal-ances in postal and bank accounts andsight and deposit accounts with a max-imum residual term of 90 days. Theseare carried at nominal value.
Bonds: Bonds are valued using thestraight-line cost amortization method.The difference between the cost of ac-quisition and the redemption value isdistributed evenly over the residualterm.
Equities: Equities are valued at thelower of cost or market. Write-downsthat are no longer required are re-versed. Options that have not expiredare deducted from the correspondingunderlying business.
Loans/mortgages: These are stated atnominal value less accumulated depre-ciation.
Real estateReal estate property investments:These are posted at cost of acquisitionless the necessary depreciation or capitalized income value, whichever is lower.
Real estate required for business pur-poses (office buildings): This item sole-ly comprises the headquarters of theSwiss Mobiliar Insurance Company,Providentia Swiss Life Insurance Com-pany and Protekta Rechtsschutz-Ver-sicherung AG. These are stated at thecost of acquisition less the necessarydepreciation or the capitalized incomevalue, whichever is the lower, depreci-ated over their remaining useful life.
27
Group annex
Notes to the profit and loss account
Overview of premium income by sector
Direct business – non-life, grossFire and other property insuranceLiability insuranceMotor vehicle insuranceMarine, transport and aviation insuranceCredit and deposit insuranceAccident and health insuranceOther policies
Direct business – life, grossLifeLife policies where the policyholder bears the investment risk
Direct business, gross
Reinsurance accepted, grossNon-lifeLife
Total business, gross
Reinsurance ceded
Total business, net
1999CHFthousands
1 558 704741 170137 219401 142
5 2611 316
250 71621 880
708 953491 472
217 481
2 267 657
59 99359 993
0
2 327 650
– 126 782
2 200 868
Geographical breakdown of gross premium income from direct business
Switzerland/Principality of LiechtensteinGermanyRest of Europe
Direct business, gross
1999CHFthousands
2 246 222224
21 211
2 267 657
1
2000
CHF
thousands
1 589 827
725 751
135 766
431 514
6 435
1 431
265 017
23 913
729 798
535 523
194 275
2 319 625
60 298
60 298
0
2 379 923
– 113 305
2 266 618
2000
CHF
thousands
2 317 462
235
1 928
2 319 625
28
The Group
Technical provisions
Change in reserves for unearned premiums – non-lifeGrossReinsurers’ shareNet
Change in reserves for loss and loss adjustment expenses – non-lifeGrossReinsurers’ shareNet
Change in reserves for unearned premiums – lifeGrossReinsurers’ shareNet
Change in life insurance reserves – lifeGrossReinsurers’ shareNet
Change in future life policy benefits – lifeGrossReinsurers’ shareNet
1999CHFthousands
– 8 3135 126
– 3 187
271 528– 111 052
160 476
10 5630
10 563
49 7629 626
59 388
530 0490
530 049
Technical expenses
Technical expenses
Non-lifeLife
Technical expenses – non-lifeAgency and other selling expensesAdministrative expensesCommission payments for indirect businessStaff pension schemes
Technical expenses – lifeAgency and other selling expensesAdministrative expensesStaff pension schemes
Technical expenses consist of personnel expenses of CHF 184.3 million (previous year: CHF 162.0 million).This amount does not include personnel expenses for the legally independent general agencies of the Swiss Mobiliar Insurance Company.
1999CHFthousands
566 294484 42981 865
484 429293 912163 74220 2636 512
81 86534 20743 9073 751
2
3
2000
CHF
thousands
– 2 040
2 339
299
14 555
16 761
31 316
4 028
0
4 028
30 130
15 369
45 499
291 676
0
291 676
2000
CHF
thousands
587 924
496 125
91 799
496 125
300 758
168 834
18 933
7 600
91 799
37 700
49 668
4 431
29
Other technical income/expenses
Other technical income
Non-lifeLife
Other technical income – non-lifeWrite-ups of catastrophe reserveOther technical income
Other technical expenses
Non-lifeLife
Other technical expenses – non-lifeCantonal fire insurance charges and contributions for loss preventionChange in other technical reservesDepreciation of intangible assetsDepreciation of tangible fixed assetsOther technical expenses
Other technical expenses – lifeDepreciation of tangible fixed assets
In the previous year, the other technical expenses—non-life of CHF 17.8 million—included expenses forthe Italian branch of Limmat Insurance Company, which prepared an opening balance sheet in liquidation on 20 September 1999.
1999CHFthousands
30 22730 227
0
30 22730 000
227
84 41583 690
725
83 69014 94722 3552 047
26 56017 781
725725
4
2000
CHF
thousands
698
698
0
698
0
698
68 377
66 838
1 539
66 838
15 542
6 368
13 231
28 955
2 742
1 539
1 539
30
The Group
Investment income
Investment income
Non-lifeLife
Income from land and buildingsNon-lifeLife
Income from non-consolidated companiesNon-lifeLife
Income from securitiesNon-lifeLife
Profit from the sale of investmentsNon-lifeLife
Income from write-upsNon-lifeLife
Interest on funds deposited with reinsurersNon-lifeLife (bancassurance)
Other investment incomeNon-lifeLife
1999CHFthousands
704 228503 558200 670
59 59541 38018 215
2 4022 197
205
255 404186 66168 743
175 006138 71336 293
134 632105 25529 377
41 3191 440
39 879
35 87027 9127 958
5
2000
CHF
thousands
629 067
407 381
221 686
59 869
42 314
17 555
411
261
150
249 245
173 075
76 170
217 105
144 040
73 065
23 893
19 273
4 620
43 610
1 070
42 540
34 934
27 348
7 586
31
Investment expenses
Investment expenses
Non-lifeLife
Write-downs on investmentsNon-lifeLife
Losses on the sale of investmentsNon-lifeLife
Expenses relating to real estateNon-lifeLife
Other investment expensesNon-lifeLife
Asset management expensesNon-lifeLife
1999CHFthousands
119 73290 84428 888
70 66654 77015 896
19 98619 294
692
16 1598 3417 818
2413
238
12 6808 4364 244
6
2000
CHF
thousands
231 762
146 593
85 169
187 687
118 607
69 080
12 201
8 986
3 215
17 245
8 175
9 070
430
0
430
14 199
10 825
3 374
Other financial income
The other financial income includes realized/unrealized price gains on foreign currency positions as well as income from current accounts and lendings to non-consolidated companies.
Other financial expenses
The other financial expenses relate to realized/unrealized losses on foreign currency positions and other interest expenses.
7
8
32
The Group
Gains/losses on investments for the benefit of life insurance
policyholders who bear the investment risk
Gains/losses on investments for the benefit of life insurancepolicyholders who bear the investment riskIncome from fundsRealized gains from the sale of fundsUnrealized gains from the sale of fundsRealized losses from the sale of fundsUnrealized losses from the sale of funds
1999CHFthousands
157 26521 7824 346
131 596– 88
– 371
9
Extraordinary result
Extraordinary incomeExtraordinary expenseExtraordinary result
1999CHFthousands
327– 1 504
1 831
10
2000
CHF
thousands
– 20 274
25 536
9 359
5 540
– 240
– 60 469
2000
CHF
thousands
– 3 928
– 4 205
277
Group annex
Notes to the balance sheet
33
Investments
InvestmentsFixed-income securitiesBancassurance productsEquities Mortgages Loans Non-consolidated companiesLand and buildingsFunds deposited with ceding companiesFixed-term deposits and other investments
Current value of investments (market value)
Fixed-income securitiesBancassurance productsEquities Land and buildingsFixed-term deposits and other investments
2000
CHF
thousands
8 694 204
4 355 574
1 012 296
1 674 974
461 247
277 924
99 926
780 710
31 253
300
2000
CHF
thousands
4 350 802
1 012 295
1 977 206
928 809
300
1999CHFthousands
8 702 8594 263 9101 174 9031 608 901
432 719279 654134 316772 29535 861
300
1999CHFthousands
4 242 4801 174 9031 929 050
834 897300
11
Derivatives
Contract volumeHedging Trading Other purposes (investments)
Replacement
Positive replacement valueHedging Trading Other purposes (investments)
Negative replacement valueHedging Trading Other purposes (investments)
Derivative financial instruments at the balance sheet date consist of the following:– Forward exchange contracts (for hedging purposes)– Call options on equities and share index futures certificates (other purposes)At the previous balance sheet date, derivative financial instruments consisted solely of call options on equities.
2000
CHF
thousands
483 966
414 275
0
69 691
62 634
19 225
0
43 409
302
0
0
302
1999CHFthousands
65 60000
65 600
0000
8 35900
8 359
34
The Group
Fixed assets/non-consolidated companies
CHF thousands
Net book value at 31.12.1999
Cost
As at 31.12.1999AdditionsDisposalsChanges to the scope of consolidationReclassificationsAs at 31.12.2000
Accumulated depreciation
As at 31.12.1999Regular depreciationDisposalsChanges to the scope of consolidationReclassificationsAs at 31.12.2000
Net book value at 31.12.2000
For the first time, fixed assets are disclosed gross of accumulated depre-ciation. Intangible assets have no net book value at year end; additions are not capitalized. They are not recorded in this table. The table below presents the previous year’s fixed assets as well as non-consolidated companies at their net book values.
CHF thousands
Net book value at 31.12.1998
Purchases/reclassificationsChanges to the scope of consolidationDepreciation/appreciation
Net book value at 31.12.1999
Fire insurance value
Fire insurance value of fixed assets/real estate
Property
under
construction
3 513
3 5135 737
– 1 6870
– 1 4856 078
000000
6 078
Total land
and
buildings
772 295
1 028 06823 561– 4 475– 5 321
01 041 833
– 255 773– 6 101
75100
– 261 123
780 710
Investment
property
545 805
695 80017 579– 2 788– 5 321
1 244706 514
– 149 995– 2 844
75100
– 152 088
554 426
Own-used
property
222 977
328 755245
00
241329 241
– 105 778– 3 257
000
– 109 035
220 206
Non-
consolidated
companies
134 316
137 3870
– 23 890– 10 500
0102 997
– 3 0710000
– 3 071
99 926
Land and
buildings
782 331
5 150– 2 439
– 12 747
772 295
2000
CHF
thousands
1 139 071
Non-
consolidated
companies
9 509
125 0510
– 244
134 316
1999CHFthousands
1 122 542
35
Investments for the benefit of life insurance policyholders who bear
the investment risk
Funds
These securities are stated at market value.
Historical value of investments for the benefit of life insurance
policyholders who bear the investment risk
Funds
2000
CHF
thousands
1 548 186
2000
CHF
thousands
1 371 692
1999CHFthousands
1 282 463
1999CHFthousands
1 035 803
Accounts receivable
Accounts receivableDue from insurance companiesDue from reinsurance businessDue from policyholdersDue from agents/brokersDue from non-consolidated companiesDeferred taxes
2000
CHF
thousands
91 841
23 353
15 748
46 162
3 865
2 713
0
1999CHFthousands
125 07117 01724 60479 0982 9571 211
184
12
13
Technical provisions
Gross valueReinsurers’ shareNet value
Net technical provisions
Net technical provisions – non lifePremium reserveClaims reservesPayments to policyholdersCatastrophe reserveReserves for longevity risk (health insurance)Other technical reserves
Net technical reserves – lifeUnearned premium reserveClaims reservesCapital coverProvisions for future payment to policyholdersTechnical reserves for unit-linked life insurance policies
2000
CHF
thousands
8 496 013
– 258 593
8 237 420
8 237 420
3 320 563
658 974
2 274 758
35 453
170 000
47 623
133 755
4 916 857
45 461
757 699
2 241 488
90 000
1 782 209
1999CHFthousands
8 148 305– 292 4927 855 813
7 855 8133 285 528
658 6762 242 746
31 998170 00055 579
126 529
4 570 28541 433
696 8312 063 659
100 0001 668 362
14
36
The Group
17
Liabilities
LiabilitiesLiabilities relating to insurance businessLiabilities relating to reinsurance businessLiabilities to non-consolidated companies
Liabilities relating to insurance business include pre-paid premiums to the value of CHF 238.3 million (pre-vious year: CHF 205.8 million).
1999CHFthousands
245 731244 092
1 6390
2000
CHF
thousands
276 557
268 278
1 981
6 298
16
Capital and reserves
CHF thousands
As at 31.12.1998
Allocations to staff pension schemes, donations and other profit appropriationsAllocations to surplus fundCurrency translation adjustmentsConsolidated profit/loss for the year
As at 31.12.1999
Changes in the scope of consolidationAllocations to staff pension schemesAllocations to surplus fundCurrency translation adjustmentsConsolidated profit/loss for the year
As at 31.12.2000
The share capital of Swiss Mobiliar Holding Ltd. consists of registered shares with a nominal value of CHF 100 which are wholly owned by the Swiss Mobiliar Cooperative Company. For details we refer to the Annual Report of the Swiss Mobiliar Cooperative Company, published separately, which is enclosed with the Annual Report of the Swiss Mobiliar Group.
The capital reserves correspond to the additional paid-in capital from Swiss Mobiliar Holding Ltd.
Profit
reserves
1 554 499
– 3 400– 45 000
240 203
1 746 302
– 924 499
– 2 900
– 150 000
160 171
829 074
Currency
translation
adjustments
59
– 80
– 21
– 105
– 126
Share
capital
200 000
200 000
Capital
reserves
575 000
575 000
Capital
and
reserves
1 554 558
– 3 400– 45 000
– 80240 203
1 746 281
– 149 499
– 2 900
– 150 000
– 105
160 171
1 603 948
Non-technical (financial) reserves
Non-technical (financial) reservesTaxesDeferred taxesPolicyholders’ surplus fund Other
In the previous year, other reserves included foreign currency reserves of CHF 110.3 million.
2000
CHF
thousands
441 630
17 603
130 900
156 511
136 616
1999CHFthousands
544 99938 695
121 33396 001
288 970
15
37
Changes in the scope of consolidation
Swiss Mobiliar Cooperative CompanyThe former parent company, now called Swiss Mobiliar Cooperative Company, ceased insurance operations effective 1 January 2000. For this reason, consolidated accounts were not prepared at the Swiss MobiliarCooperative Company level for 2000. The Group’s parent company is now Swiss Mobiliar Holding Ltd.
Swiss Mobiliar Insurance CompanyShare capital in CHF thousands% of share capital held
The new company, Neue Schweizerische Mobiliar Versicherungsgesellschaft AG, founded on 26 Octo-ber 1999, completed its first financial year at 31 December 1999. The Swiss Mobiliar Insurance Com-pany did not commence activities under that name until the insurance business was transferred on 1 Jan-uary 2000. The Swiss Mobiliar Insurance Company is included in the consolidated financial statements for the first time in 2000.
Swiss Mobiliar Asset ManagementShare capital in CHF thousands% of share capital held
Swiss Mobiliar Asset Management, founded on 29 December 1999, completed its first extended finan-cial year at 31 December 2000. Swiss Mobiliar Asset Management is included in the consolidated finan-cial statements for the first time in 2000.
1999CHFthousands
8 000100%
1999CHFthousands
500100%
2000
CHF
thousands
148 000100%
2000
CHF
thousands
500100%
Other details
Off-balance-sheet items
Contingent liabilitiesOther liabilities not stated on the balance sheet
The contingent liabilities are underlying shares on option transactions at their book value. The previous year’s figures have been adjusted accordingly.
Transactions with related parties
Interest on a loan of CHF 150 million from the Swiss Mobiliar Cooperative Com-pany to Swiss Mobiliar Holding Ltd.
Events after the balance sheet date
No events that have a material impact on the 2000 financial statements have occurred since the balance sheet date.
1999CHFthousands
44 00034 480
in scope ofconsolidation
2000
CHF
thousands
35 760
9 673
9 375
Report of the group auditorsto the general meeting ofSwiss Mobiliar Holding Ltd.Berne
As auditors of the group, we have audited the consolidated financial statements(balance sheet, income statement, statement of cash flows and notes, pages 17to 37) of Swiss Mobiliar Holding Ltd. for the year ended 31 December 2000. Theprior year corresponding figures were audited by other group auditors.
These consolidated financial statements are the responsibility of the board of directors. Our responsibility is to express an opinion on these consolidated finan-cial statements based on our audit. We confirm that we meet the legal require-ments concerning professional qualification and independence.
Our audit was conducted in accordance with auditing standards promulgated bythe Swiss profession, which require that an audit be planned and performed toobtain reasonable assurance about whether the consolidated financial state-ments are free from material misstatement. We have examined on a test basisevidence supporting the amounts and disclosures in the consolidated financialstatements. We have also assessed the accounting principles used, significantestimates made and the overall consolidated financial statement presentation.We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements give a true and fair view ofthe financial position, the results of operations and the cash flows in accordancewith the Accounting and Reporting Recommendations (ARR) and comply withthe Swiss law.
We recommend that the consolidated financial statements submitted to you beapproved.
Berne, 20 March 2001
PricewaterhouseCoopers Ltd.
Lukas Marbacher Jürg Reber
38
Group Auditors’ report
40
Non-Life Insurance
Our nationwide distribution network means
that the Swiss Mobiliar Group is able to offer trainee positions not
only at its head office, but all over Switzerland. The majority
of trainees learn their skills in more than a hundred general
agencies and eighty principal agencies operated by the
Swiss Mobiliar Group. An apprenticeship in a general
agency covers the whole spectrum of the insurance
business. Working in daily contact with customers, trainees
gain practical knowledge of the things which make us
successful: expert advice and customer care, a great
willingness to serve, and human relationships based
on trust.
Insurance & Pensions Legal protection insurance
Swiss Mobiliar is one of Switzer-
land’s largest non-life insurers and
has been the leader in property insur-
ance for decades. Founded in 1826, it
was the first privately owned Swiss
insurance company. The company
takes the form of a mutual, and this
is at the root of its independent busi-
ness philosophy: Swiss Mobiliar
strikes a balance between benefit for
the customer, continuity of the busi-
ness and the interests of its employ-
ees, while taking account of the
economy at large, the public good
and the environment.
Brief portrait
Non-Life Insurance
43
As a leading provider of protection
and pension-related services, it offers
comprehensive solutions to cover all
security needs. These complete solu-
tions are characterized by high quali-
ty and good value for money. With a
network of about a hundred general
agencies, spread over all parts of the
country, Swiss Mobiliar focuses on
personal contact with the customer:
it builds on professionalism and
grants its agents and advisors maxi-
mum authority, ensuring that they
are close to their customers for both
sales and claims settlement. Swiss
Mobiliar’s head office in Berne is
where all the different elements of
this far-flung network come together.
About 1000 people work in this
service centre, linked directly to the
agencies by state-of-the-art commu-
nications technology.
Protekta Rechtsschutz-Versicherung
AG is run by the Non-Life Insurance
division. It is a well-known and suc-
cessful specialist on the Swiss mar-
ket for comprehensive legal protec-
tion for individuals and companies.
44
Non-Life Insurance
Actuarial BusinessDevelopment
Structure
Products
Claims Service
Manage-ment
SalesMarketingandServices
Markets
IT HumanResources
PersonnelDevelop-ment
Interna-tional/Reinsurance
Executive Board and Senior Management (as at 1 January 2001)
45
Swiss Mobiliar
Chief Executive Officer
Christian Wegmüller, Member of the Group Executive Board
Members of the Executive Board
Hans Ammeter, Dr phil. nat. Chief ActuaryAndré Blanchard, lic. iur. SalesPeter Hasler, Attorney ClaimsBruno Kuhn, Attorney ProductsDaniel Odermatt, Dr rer. pol. ITRené Rippstein, lic. rer. pol. Marketing and ServicesMarkus Sievers, dipl. math. ETH Business Development
Members of Senior Management
Hanspeter AebischerChristoph Aisslinger, Dr iur.Albert AndristRaphael ArnWerner BösigerWalter BühlmannDieter Buser, lic. iur.Heinz BuserBruno Ehrler, Dr oec. HSGPeter Galliker, AttorneyRoland GrossriederHanspeter Gschwind, AttorneyClaude HelferIvano KoppMartin Kurz, Dr oec.Silvan MeierGaspare Nadig, lic. iur.Konrad Reif, AttorneyHans SahliUrs Schär, lic. rer. pol.Peter SchärerAndreas Scheurer, AttorneyChristian SchindlerMartin SedlmayerBruno SpicherErich StreitUrs WiederkehrHeinz R. Wittwer
Protekta
Chairman of Senior Management
Rolf Günter, Attorney
46
Non-Life Insurance Key figures
Swiss Mobiliar
Gross premiums writtenNet premiums earnedNet claims incurredNet claims ratio Gross cost ratioNet combined ratio Net technical provisionsUnderwriting result (loss)Investment result
2000CHF million
1 630.81 523.01 072.770.4%29.9%
106.7%3 249.7– 102.0
255.5
1999CHF million
1 581.51 478.31 131.876.6%
**
3 201.1**
Change in %
+ 3.1+ 3.0– 5.2
+ 1.5
* Following the restructuring, the figures for 1999 are not or only partially com-parable.
Protekta
Gross premiums writtenNet premiums earnedNet claims incurredNet claims ratio Gross cost ratioNet combined ratioNet technical provisions Underwriting resultInvestment result
2000CHF million
17.316.69.4
56.6%37.0%96.4%
38.10.64.4
1999CHF million
15.915.39.6
62.7%32.7%97.4%
35.70.43.8
Changein %
+ 8.8+ 8.5– 2.1
+ 6.7+ 50.0+ 15.8
20
0
40
60
80
100
120
1997 1998 1999 2000
Development of allocationsto the policyholders’ surplus fund
CHF million
regular annual allocations
special allocation for anniversaryyear 2001
47
Strategy implementation
Swiss Mobiliar—the market leader inproperty insurance—is expanding itsbusiness, based in particular on its customer relations. We are concentrat-ing our attention on providing our cus-tomers with comprehensive advice, including advice on provision for the future. With our 100 or so generalagencies providing proximity to thecustomer, we are seen in the market asa company which offers products tomeet new or changing needs, and di-rect personalized customer care. Weare establishing an image as a companywhich settles claims fairly and locally.
As well as providing security throughour products, we also offer additionalranges and services. We see ourselvesas advisors, analyzing the risks andperils that shape the customer’s envi-ronment and offering solutions. Wehave therefore launched a householdinsurance policy with extra protectionfor private individuals (MobiCasa Plus):the insurance cover is supplementedby alarm installations, other loss pre-vention products, and a 24-hour call-out service provided by our subsidiaryMobi24. Risk advice for industrial,commercial and service companies isprovided by our subsidiary ProtektaRisiko-Beratungs-AG, which special-izes in risk management. These ser-vices are likely to gain in importance.
As a founding partner of plenaxx.com(alongside UBS, Valora and Swisscom,and in collaboration with the SwissTrades Association) we helped tolaunch this business portal in 2000. It went online nationally in February2001, and provides a modern infra-structure for the professional linking of companies, clubs, associations,schools, freelancers and projectgroups. Thus, once again, we are posi-tioning ourselves as the partner ofSMEs.
We are pleased to note how well ourmarket strategy has been received bycustomers: we again improved on pre-vious years’ good results in an inde-pendent market survey. In most of theareas covered by the questionnaire,we set the benchmark. More detailscan be found on page 8 of this report.
Market and environment
The Swiss non-life insurance marketshowed very modest growth in 2000and can only be described as virtuallystagnant. Nevertheless, it was pos-sible to recover from the negativegrowth of 1999.
Insurance business was affected bythe fact that favourable economictrends resulted in renewed investmentand therefore in an increased need forinsurance. Moreover, we saw a greaterdemand for risk protection, which facil-itated further growth, albeit slight.
Market saturation and the associateddisplacement process give rise to in-tense competitive pressure. Thus pre-mium levels continued to fall. It is truethat most insurers increased their mo-tor insurance rates since there was nolonger sufficient coverage for costs,but despite this adjustment, the SwissInsurance Association predicts that, atbest, the market expanded by only oneper cent in 2000.
Claims payments were considerable:once again in 2000, the industry had tobear the costs of major natural losses;private insurers paid out around CHF550 million to policyholders (previousyear: CHF 760 million). Another strikingfeature is the fact that claims costs arerising in various classes, such as motorvehicle damage, liability and bodily in-jury. On the costs side, continuingrapid growth in IT expenditure and thecost of maintaining a presence in thecompetitive market left their mark. Given these conditions, it was ex-tremely difficult to achieve any reduc-tion in costs. Insurers recorded under-writing losses in many sectors.
Business report
We provide security
with services that go
beyond insurance.
48
Non-Life Insurance
Premiums and portfolios
Overall, premiums rose by 3.1% in2000, placing us considerably higherthan the market as a whole, whichrose by an estimated 1%. We alsorecorded positive growth once again inthe number of policies, especially involume business.
Premium volumes for property and en-gineering insurance remained at theprevious year’s level. While it has beenpossible to maintain the premium levelfor household insurance, prices forbusiness insurance are still falling. Thelast five years have seen a reductionof almost 20%, and prices have asmuch as halved in the last 15 years—despite an extension of the risks in-sured. In this unsatisfactory environ-ment, we must accept some losses.
In motor insurance we achieved a sat-isfactory 8% growth in our portfolio,corresponding to a premium increaseof 6%. This enabled Swiss Mobiliar toextend its position further. Sincederegulation in 1996 the liability port-folio has grown by 46%, while premi-ums have risen by 13%.
Claims
Net claims expenditure was high.While overall we were CHF 59 millionor 5.2% below the 1999 level, wewere however a good 10% above theaverage for previous years.
In the property and engineering insur-ance classes the loss ratio was alsobelow that of the previous year. As fornatural hazards, 70% of claims costswere due to flood and inundation, 17% to hail and 8% to windstorms. In fire insurance, 4% of fire incidentswere due to unknown causes, butthese were responsible for 30% ofclaims costs.
Rising medical costs and major lossesin excess of CHF 100 000 affected themotor insurance result. Along with thefact that insureds were involved inmore accidents, this led to an increasein the loss ratio in 2000. 50% of claimsoutlay under comprehensive policieswas the result of collisions, and 16%was caused by natural hazards (hail).Under partially comprehensive policies,natural hazards accounted for almost50%.
Indirect business
Swiss Mobiliar continues to write al-most exclusively reciprocal business,that is, taking on business which is off-set by part of its reinsurance cession.As a result of the reduction in this ced-ed business, there has been an in-evitable decline in net premiumsearned from indirect business, fromCHF 65.1 million to CHF 60.7 million.Various natural catastrophes in Europeresulted in high claims expenditure.This result is not satisfactory.
Legal protection
Protekta Rechtsschutz-VersicherungAG was able to increase its premiumincome by over 8%. In 1999 and 2000,there was heavy investment in updat-ing products, skills and structures andin service. The success of these mea-sures can already be seen in the port-folio growth in 2000. The underwritingresult was better than the previousyear.
Innovations,
security from a single source
Paying for losses is our core business,but we also try to fulfill a more com-prehensive function as a securityprovider. Our first priority is the avoid-ance of losses in the interests of ourcustomers. We therefore offer preven-tion and security in the form of – advice modules to recognize risks
and perils– a service providing advice from
engineers (Protekta Risiko-Beratungs-AG)
– legal information– security products combined with
services such as MobiCasaPlus
0
5
10
15
20
25
30
1996 1997 1998 1999 2000
Catastrophe insurance
Number of claims (in thousands)
Falling rock, landslides and stones
Avalanches and snow damage
Hail
Storms
Flooding
5
4
3
2
1
0
1996 1997 1998 1999 2000
Portfolio developmentDirect businessGross premiums written
Growth in percent
49
Over the last year, our Mobi24 callcentre received more than 125 000calls, of which around 100 000 werefrom Swiss Mobiliar customers. Thenumber of assistance cases rose by42%, with a recognizable increase indemand during periods of bad weath-er. Mobi24 provides a significant partof the service included as part of thenew MobiCasaPlus product, with itsservice centre registering alarms, clari-fying the circumstances, and arranginga call-out if necessary.
Costs, investment
We extended our pensions and life in-surance advice function in 2000, aswell as broadening and reinforcing ouremployees’ knowledge of projects andprocesses. Added to this was invest-ment in the renewal of infrastructures(IT platform, network, operating sys-tems, e-business) and investment inskills and the development of loss pre-vention systems.
Customer-friendly distribution
network—at home and abroad
About a hundred local general agen-cies function as service centres. Theyhave well-trained insurance adviserssupported by in-house specialists inpensions/life and commercial/SMEs,and claims specialists who are able todeal expertly with more than 90% ofclaims at local level. The agency ser-vice is supplemented by the Mobi24round-the-clock call centre.
Swiss Mobiliar also offers insurancecover for its Swiss customers with ac-tivities or property abroad, via compe-tent locally-based partners. This busi-ness is not shown separately in the ac-counts, since it is mainly conductedvia our partners in the Eureko Alliance.
Payments from the surplus fund
Our mutual basis allows us to pay outsurpluses to our customers as a spe-cial benefit. About CHF 50 millionwere paid out to commercial cus-tomers in 2000. The main emphasis ofour anniversary year in 2001 will be aparticularly high distribution of CHF100 million: everyone with a MobiCasahousehold contents policy and/or a MobiCar motor policy will receive a 10% reduction in their annual premium.
Investment business
As expected, the previous year’s ex-ceptionally high investment result wasnot matched. Reductions in book val-ues due to movements in the foreignstock markets, and the weakness ofthe euro, led to the writing down of investments. On the other hand, wewere able to take advantage of thefavourable movements in the Swissstock market, so that earnings fromcapital investments were in line withour budget.
Personnel
The number of people employed full-time by Swiss Mobiliar (incl. Protekta,Mobi24 and Broker Management) was3232 at the end of the year under re-view. This figure includes 317 trainees.
Outlook/projects
Swiss Mobiliar intends to play an ac-tive role in shaping the rapid changestaking place in the market and the busi-ness environment. We are thereforeinvesting in products, skills and ser-vice, as well as in updating our IT infra-structures and simplifying procedures,and in e-business.
0
20
40
60
80
100
Payments from the surplus fund
CHF million
1993/94 MobiCasa customers
1995/96/97 MobiCar customers
1998/99 MobiCasa customers
2000 Commercial customers
2001 Across-the-board payment to MobiCasa and MobiCar on the occasion of the 175th anniversaryof Swiss Mobiliar
Assistance provided toSwiss Mobiliar customers
Technical/breakdown assistance in Switzerland
Technical/breakdown assistanceabroad
Personal assistance in Switzerland
Personal assistance abroad
Life Insurance
There they are, the good young risks, as they
tend to be known in the life sector. They are not yet thinking about
old age, but soon they will be right in the middle of their
professional life, with all the social responsibilities this
entails. Providentia, the Group’s specialist life insurance
arm, positions itself in the market with its young, innova-
tive insurance products. “Always on the ball” is our motto
when it comes to the life insurance market, with its high
demands in terms of advice and customer care. Because,
as society and personal circumstances change, so
too do risks, and with them the protection needs of our
customers.
50
Brief portrait
53
Life insurance
Providentia was founded in 1946 and
pioneered the introduction of term
insurance. This proved to be a wise
move: today this type of insurance
accounts for about 60% of all life in-
surance in Switzerland—and Provi-
dentia is still one of the leading
providers.
Providentia pioneered the develop-
ment of employee benefits plans,
i.e. the combination of an in-compa-
ny savings fund and reinsurance to
cover death and disability. Providen-
tia has traditionally been a leading
player in the field of collective insur-
ance in Switzerland.
With its wide-ranging experience and
professionalism, the company is a
strong partner for group foundations,
banks, pension funds and associa-
tions. By setting up its own group
foundations for compulsory and sup-
plementary retirement pensions,
Providentia has created an attractive
alternative for all small and medium-
sized companies. With the extensive
range of services offered by its sub-
sidiary Union Trust Company Ltd.,
Providentia can fully satisfy cus-
tomer-specific pension fund needs.
Since the early 1990s, working to-
gether with cantonal and regional
banks in Switzerland, Providentia has
successfully launched bancassurance
products to cater for personal pen-
sion (3rd tier) requirements. Providen-
tia’s position in the market as a part-
ner for the banking industry resulted
in 2000 in a major new cooperative
venture with UBS, serving private
customers.
Since 1997, Providentia has been the
exclusive partner of Swiss Mobiliar in
the life insurance sector. Since then,
under the MobiLife brand name, it
has developed flexible and cost-effec-
tive insurance solutions for sale via
the Swiss Mobiliar agency network,
mainly for individuals and small and
medium-sized enterprises.
Life Insurance
Life Insurance
54
CorporateDevelopment
Actuarial
Structure
Private Pensions
Corporate Business
Manage-ment
SalesServices Markets
PersonnelandTraining
IT Finances
55
Executive Board and Senior Management (as at 1January 2001)
Providentia
Chief Executive Officer
Daniel Greber, dipl. math. ETH, Member of the Group Executive Board
Members of the Executive Board
Gottfried Rey, Dr phil. nat. Deputy General Manager, Corporate Development and Chief ActuaryJean-Michel Hainard, lic. phil. nat. Corporate BusinessErich Kaser Personnel and TrainingClaude Kuhne SalesMartin Meyer, lic. iur. (from 1July 2001) Corporate BusinessRobert Müller Private PensionsRudolf Noser Finance and Services
Members of Senior Management
Jean BoppeRené DettwilerNicole Flach, Dr phil. nat.Heinz GeiserAlfredo GoldhornRobert Hochstrasser, lic. iur.Stefan Koch, lic. oec. publ.Bernhard MaederJean-Gabriel Reichlin, dipl. math.Christian SchnellBernard SinzUrs SuterHeinrich Türler, Dr phil. nat.Hans VoserAndreas Wortmann, dipl. Ing. ETH
Key figuresLife Insurance
56
Providentia
Annual premiums (regular premiums)Single premiums (one-off capital deposits)
Gross premiums writtenNet premiums earnedBenefits paidSurplus distributed to policyholdersGross cost ratioNet technical provisions, of which – net value of policies– reserves for unit-linked life policies– reserves for future surplus
distributions to policyholders
Capital investments, of which– capital investments held on behalf of
and at the risk of life policy holders
2000CHF million
351.8
378.0
729.8716.6363.956.5
12.5%4 916.92 241.51 782.2
90.0
4 911.7
1 548.2
1999CHF million
336.0
373.0
709.0686.6252.368.1
11.5%4 570.32 063.71 668.4
100.0
4 588.0
1 282.5
Changein %
+ 4.7
+ 1.3
+ 2.9+ 4.4
+ 44.2– 17.0
+ 7.6+ 8.6+ 6.8
– 10.0
+ 7.1
+ 20.7
strategy is the establishment of finan-cial advice centres. Providentia hopesto use these to make its comprehen-sive expertise available to high-incomecustomers of the Swiss MobiliarGroup.
Premiums
Gross premiums written rose by 2.9%.Both annual premiums and single pre-miums have increased overall. We arepleased with the 26% rise in annualpremiums from MobiLife individual in-surance. On the commercial side, pre-mium income rose by 7%, with the in-crease for full-service 2nd tier pen-sions reaching 42%. In bancassuranceon the other hand, premium incomefell overall by 11% due to a decline insingle premiums.
48% of total premium income camefrom annual premiums and 52% fromsingle premiums. The annual premi-ums are divided into premiums forwhole-life insurance (26%) and thosefor incapacity insurance (22%). Singlepremiums were collected in particularfor the bancassurance products and forportable policies, retirement pensionsand surviving spouses’ pensions.
Benefits paid to policyholders
Total benefits paid came to CHF 363.9million as compared with CHF 252.3million in the previous year. This large44.2% increase is attributable to a dou-bling of surrenders (portable benefits)and to the growth in benefits paid onsurvival (+87.2%).
The surplus distribution is dependenton risk experience, investment incomeand costs. In 2000 we were able topay out CHF 56.5 million in surplus dis-tributions to policyholders. The 17% reduction on the previous year reflectsthe poor risk experience in incapacityinsurance, especially on the commer-cial side.
Business report
57
Market and environment
The deregulation of the Swiss life in-surance market has led to growingpressure on insurers. As a result, thepositioning of the company is becom-ing increasingly important. As a qualityinsurer, Providentia wants to becomeone of the main providers in the Swissmarket. At the same time, its activitiesare clearly focused on providing addedvalue for its customers as comparedwith its competitors.
Strategy implementation
Providentia’s core areas of expertisearise out of the way in which– its marketing is aimed at specific tar-
get groups (preferred risk approach)and it develops its own innovativeproducts and services
– it seeks out and builds on workingpartnerships with various distribu-tion channels
– it takes advantage of its size, whichenables it to introduce new productsquickly in response to changing cus-tomer behaviour
– its flexibility allows it to understandthe needs of its partners quickly.
The new partnership with UBS for per-sonal customers, which began in 2000,is very important. It provides new evi-dence of our expertise as a partner forbanks, a market in which we are takingthe lead. Providentia’s strategy tendsto be geared towards target groups.Solutions are developed to meet theneeds of specific customer segmentsand age groups. This also applies to incapacity insurance (ProviIncome Preferred) in the personal pensionsfield: for the first time, rates have beenbased on occupations as well ashealth-related risk factors. New invest-ment products with risk protectionhave been added to the existing rangeand correspond to the growing needsof individual customers. With the fixed-term ProviInvest Plus, we have de-signed a product for those aged be-tween 50 and 65, with high interestrates and attractive net returns of3.7%. This has been very well re-ceived. A cornerstone of our corporate
0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1996 1997 1998 1999 2000
Development of premium income
CHF million
Unit-linked life insurance
Individual insurance
Collective insurance
Insurance benefits paid
Whole-life insurance
Incapacity
Survival
Bancassurance
Surrenders
58
The Providentia range of products andservices offers companies of any sizepensions solutions to suit their needs.As well as its core business of reinsur-ance for semi-autonomous pensionfunds, Providentia also offers SMEsvarious collective foundations with afull range of services and attractive in-terest on policyholders’ pension as-sets.
Individual insurance
In the personal pensions sector, newterm insurance business to coverdeath and incapacity grew once again.All our distribution partners contributedto this result, in particular the SwissMobiliar sales force with its MobiLiferange. In bancassurance, we were verypleased with the consistent growth insales of fund-linked life insurance prod-ucts by Swiss Mobiliar specialists.
Innovations
In accordance with its target group-based strategy, Providentia launchedseveral new products, both for person-al pension provision and for compa-nies. A real innovation was the intro-duction of retirement pension insur-ance (ProviAge Preferred) forindividuals. This takes into account theinsured’s state of health at the time ofinception: people whose statistical lifeexpectancy is reduced as a result of aserious illness benefit from a higherannuity rate, starting immediately. Thedeferred retirement pension (ProviAgeFlexi) is suitable for people planningearly retirement. Other innovationswhich were well received were the incapacity insurance product (Provi-Income Preferred) and especially thelife insurance product (ProviInvestPlus). New products (ProviRe Pre-ferred and ProviRe Experience) on the commercial side are attracting agreat deal of attention in the trade and service sectors.
Costs
The increase in costs is attributable,among other things, to the introductionof new products, the expansion of theMobiLife and bancassurance divisions,and the creation of new service units.
Risk experience
Once again, risk experience in whole-life insurance was better than account-ing principles led us to expect. The cor-responding loss ratio rose slightly incomparison with the exceptionallygood figure for the previous year.
In incapacity insurance, the overall lossratio rose by 21%, despite the eco-nomic recovery. While the increasewas 16% for collective insurance, itwas 51% for individual insurance. Thisresulted in a surprise increase in theloss ratio to 90% (previous year 79%).
Portfolio growth
In individual insurance, the whole-lifeinsurance portfolio grew by 2.5% toCHF 14.2 billion, and incapacity insur-ance saw an increase of 11.4% to CHF8.1 billion. This increase in portfoliosize is gratifying, given the decline insingle premium business.
Although new business in whole-lifeinsurance and incapacity insurance fellin comparison with the previous year,the number of collective insurancepolicies has grown thanks to customerloyalty. Thus the whole-life insuranceportfolio grew by 11.0% and the inca-pacity insurance portfolio by 13.4%. Inthe year under review, 1284 new col-lective policies were incepted for em-ployee and management pensions(previous year 1705). The total numberof such policies is now 17 970.
Collective insurance
For years, the number of incapacity insurance claims has been rising. TheFederal Office for Private Insurancetherefore recommended a revised rat-ing structure, and Providentia has alsomade use of this. Rating incapacity in-surance according to the business sec-tor corresponds not only to corporatestrategy but also to market trends.Commercial customers in particular areincreasingly demanding premiumscommensurate with the risk. A com-parison of premiums charged by thesix major providers, carried out by anindependent consulting firm, showedProvidentia to be ahead of the rest.
Life Insurance
0
10
20
30
40
50
60
1996 1997 1998 1999 2000
Development of insured benefits(collective insurance)
CHF billion
Incapacity insurance(12 times the annual pension)
Whole-life insurance
70
0
5
10
15
20
25
1996 1997 1998 1999 2000
Development of insuredbenefits (individual insurance)
CHF billion
Incapacity insurance(10 times the annual pension)
Whole-life insurance
59
Sales
Thanks to our multi-channel sales strat-egy, we are able to get close to ourcustomers via various expert distribu-tion partners who guarantee all-roundadvice and customer care. The 100 orso Swiss Mobiliar general agencies of-fer an extended range of products un-der the MobiLife brand name, mainlyto personal customers and companiesemploying up to 10 people. Providen-tia’s own general agencies are mainlyresponsible for commercial business,providing comprehensive second-tierpension services. Income-oriented andfund-linked life insurance products, stillvery much in fashion, are sold via can-tonal and regional banks. Independentbrokers have gained in importance, andthey make high demands on the prod-ucts and service quality of their part-ners. We met these expectations byincreasing staffing levels at our brokerdepartment in Zurich and by setting upa new broker department in Nyon.Pensions solutions designed specifical-ly for high-income personal customersare sold via our own financial advicecentres in Berne and Zurich.
Investment business
Although income rose as compared tothe previous year, the investment re-sult was adversely affected by themassive writing down of book values.This was mainly a consequence of theweakness of the euro and of move-ments in the foreign stock markets. Onthe other hand, we were able to bene-fit from the favourable Swiss stockmarket situation.
Personnel
The number of people employed inter-nally and in the sales force was 420 atthe end of the year under review (full-time posts). This figure includes 8trainees.
Outlook/projects
Based on the partial successesachieved in 2000, Providentia will con-tinue its consistent pursuit of a pre-ferred risk strategy. We intend to raisethe service quality of all divisions, andof the subsidiary company Union TrustCompany Ltd. even further, in line withtargets and customer expectations.
One of our main objectives is to rein-force our relationships with distributionpartners. We also need to make use ofthe cross-selling potential which existswithin the Swiss Mobiliar Group. Fur-thermore, Providentia hopes to use themajor new partnership with UBS to es-tablish itself as the market leader inbancassurance. We expect the expan-sion of services for brokers to producemore new business via this distributionchannel.
The newly created conditions shouldlead to a significant increase in premi-um income.
New individual policiesby sales channel
Banks
Brokers
Swiss Mobiliar
Providentia
Gross premiums written for collective policies by saleschannel
Providentia
Brokers
Swiss Mobiliar
Asset Management
To work one day in asset management, to
deal online with stock exchanges and the world of banks and
brokers, is probably the dream of many a young person.
But asset management is not yet for our golden boys and
girls; this is a job for highly qualified professionals who
manage assets earned within the insurance business so as
to produce returns, and thus make a major contribution to
the overall results achieved by the Group. They also ensure
that Swiss Mobiliar remains a safe and reliable partner.
60
63
Brief portrait
The Asset Management division
was established at the end of 1999 as
a legally autonomous public limited
company, as part of the restructuring
of the Swiss Mobiliar Group. It is a
wholly owned subsidiary of Swiss
Mobiliar Holding Ltd. Since 1 January
2001, it administers and manages the
capital investments and real estate
owned by all the Group companies
and their pension funds. The neces-
sary preconditions were put in place
during the transitional year 2000.
Asset Management thus manages
assets worth around 10 billion Swiss
francs, held in traditional types of in-
vestment.The Group’s investment
policy encourages the maintenance
of high standards of security, and the
investment strategies to be followed
are determined for the whole Group
according to the characteristics of
the sectors concerned and the over-
all risk situation.They form part of a
modern asset/liability management
approach.
The division’s activities are focused
on sustained investment gains, and
are designed to make a substantial
contribution to the financial success
of the Group as a whole. The neces-
sary service quality is also provided
at the Nyon and Zurich locations
for real estate and credit business.
The Berne location also takes care
of logistics for all of Swiss Mobiliar’s
management properties.
Asset Management
Executive Board and Senior Management (as at 1 January 2001)and business report
64
Asset Management
Roland Frey Chief Executive Officer, Member of Group Executive Board
Beat Kunz InvestmentsUrs Wirth Real EstateDaniel Luder, lic.rer.pol. Risk Management and Controlling
New division within the Group
In 2000 the Asset Management division adapted its structures andprocesses in line with the new way in which the Group is organized, andgradually developed an understandingof its new role as an independent com-pany. Structured management and in-vestment processes have been estab-lished, to ensure that day-to-day busi-ness is conducted in a professionalmanner. Further progress was madewith system support mechanisms, andprocesses were made more efficient.There has been a marked improve-ment in transparency when measuringperformance, which in turn helps thequality and usefulness of reports. Theconditions were put in place to enablethe tasks newly allocated to AssetManagement to be carried out in fullfrom 1 January 2001.
Investment policy
Actions are based to a large extent onthe Group’s investment policy. Thissets out general investment principles,as well as principles for the use of financial derivatives. Investment busi-ness is based on an asset/liability man-agement concept which is controlledcentrally. Money is invested with aview to the long term, taking particularaccount of an effective distribution between various types of investmentsuch as shares, bonds, mortgages andreal estate. Less traditional investmentvehicles play a secondary role. Financial derivatives are used within a clearly defined system of limits, aimed at protection, income creation, or improved earnings.
Market environment
and investment strategy
Investment strategy is determinedmainly by the strategic allocation of resources. It is set annually, and optimized every quarter in connectionwith macroeconomic market analyses,through appropriate tactical position-ing.
In the year under review, Asset Management continued with its strate-gy to internationalize the share port-folio, which had already begun previ-ously. Thus the diversification withinthis investment category was furtheroptimized. At the international level,the stock markets suffered as a resultof the cooling of the US economy,which had previously been drivinggrowth, and through strong correctivemovements in the technology sector. In bonds, which benefited from a relaxation of interest rates, we paid in-creased attention to the foreign curren-cy risk; individual sectors were protect-ed against the influence of the Swissfranc. In the real estate sector, now be-coming more attractive again, we wereable to carry out a few adjustments tothe portfolio, but we also acquired newbuildings, and carried out building workon property used by the business.
Asset Management
Centralized management
of the assets of the entire
Group
Assets by investment category
Bonds
Equities
Real estate
Mortgages
Loans
Liquidity
65
Risk management
Risk management independent of theportfolio guarantees that high stan-dards of safety can be maintained.With the help of modern aids based onthe latest knowledge, tried and testedexperts are responsible for profession-al risk assessment and for structuredinvestment processes within our in-vestment policy. The risks taken on inthe form of financial derivatives areidentified and monitored constantly. In addition, risk management ensuresregular reporting to the Board of Direc-tors and Board of Trustees, who rep-resent the client, and measures thequality of investment activities by international standards.
Client structure,
assets under management
On 1 January 2001 we were looking after assets for nine clients, i.e. fouroperational companies and five staffpension funds. Total assets under ourcontrol amount to CHF 9.7 billion, heldin traditional types of investment.Thediagram shows the strong concentra-tion of holdings in our own currency.Among other things, this reflects thedesire for consistency with the compa-ny’s underwriting liabilities, which arealmost exclusively in Swiss francs. Euros and US dollars play an importantrole in terms of diversification.Towardsthe middle of the year, we will take ona major new client, as we start manag-ing the money in the Providentia groupfoundation. However, we also have direct contact with the customer in thecase of some thousand or so tenants,who we take care of in the propertieswe manage, and also with large numbers of mortgage holders and borrowers.
Staff
At the end of the year, 77 employees(69 full-time) filled a wide variety ofposts in Berne, Nyon and Zurich. Port-folio managers, investment and loanspecialists, building specialists, proper-ty managers and others work in thevarious disciplines which form part ofthe Asset Management division.
Outlook/projects
After a year of transitions and arrange-ments, we are now starting a consoli-dation and expansion phase. We nowneed to forge ahead with our indepen-dent profile.
Assets of almost
10 billion Swiss francs
Assets by currency
CHF
EUR
USD
Others
66
Offices and general agencies of Swiss Mobiliar,
Providentia and Protekta
Swiss Mobiliar
Head Office
Swiss Mobiliar Insurance CompanyHead OfficeBundesgasse 35P.O. Box 87263001 BerneTelephone 031/389 61 11Fax 031/389 68 52
General agencies
Aargau
AarauDaniel Probst
BadenMarc Périllard
Lenzburg Markus Fisler
MuriMartin Egli
ReinachAndreas Huber
RheinfeldenWerner Schneider
ZofingenBeat Herzog
Appenzell A.-Rh.
Herisau Ueli Fischer
TrogenAdrian Künzli
Appenzell I.-Rh.
AppenzellHans Fritsche
Basel-Town
BaselHans-Ulrich Flückiger
Basel-Country
AeschRoland Hohl
LiestalAlfred Guggenbühl
Berne
BelpChristoph Schmutz
Ostermundigen (Berne-East)Beat Klossner
Berne (Berne-City)Bruno M. Aellig
Berne (Berne-West)Heinz Etter
Biel/BienneDaniel Tschannen
BurgdorfReto Pedrett
FraubrunnenUrs Sonderegger
FrutigenPeter von Känel
HerzogenbuchseeMaxime Borgeaud
HuttwilMarkus Leuenberger
InsBernhard Hubacher
Interlaken (Interlaken-Oberhasli)André Mischler
LangenthalBernhard Meyer
LaupenMax Baumgartner
LyssUlrich Hadorn
MoutierEric Veya
SpiezErnst Sigrist
St-ImierEric Veya
ThunHerbert Sonderegger
Worb (Emmental)Ulrich Brechbühl
Zweisimmen(Saanenland-Obersimmental)Thomas Trachsler
Fribourg
BulleGérard Ecoffey
DüdingenAldo Del Monico
Estavayer-le-Lac (de la Broye)Dominique Torche
FribourgRobert Dupont
MurtenPaul Scherzinger
Geneva
GenevaRené Magnin
Glarus
GlarusFranz Alberti
Grisons
ChurValentin C. Spescha
St. MoritzPius Deflorin
Jura
DelémontDenis Hostettler
PorrentruyMarianne Chapuis
Lucerne
HochdorfChristoph Blum, lic. iur.
LucerneDominic Frosio
SurseeHerbert Heini
WillisauPius Meyer-Engeler
Neuchâtel
La Chaux-de-FondsMarc Monnat
FleurierDaniel Hugli
Le LocleDaniel Hugli
NeuchâtelPierre-André Praz
Nid- and Obwalden
SarnenAlfred Tschanz
Schaffhausen
SchaffhausenGerhard Schwyn
Schwyz
LachenRoland Egli , lic. oec.
SchwyzStephan Annen-Holdener,lic. iur.
Solothurn
BalsthalMarc Bloch, lic. iur.
OltenFabian Aebi-Marbach
SolothurnKlaus Bamert, lic. oec.
St. Gallen
AltstättenWerner Engler
BuchsRainer Kostezer
FlawilRuedi Germann
RapperswilRolf Landis, lic. oec.
RheineckJakob Engler
RorschachHanspeter Scholl
SargansMartin Zünd
St. GallenGian Bazzi
WilThomas Broger
Thurgau
ArbonBruno Erismann
BischofszellEdwin Hugelshofer
Further information
67
FrauenfeldEugen Haag, Dr oec.
KreuzlingenRoland Haselbach
SirnachErnst Nüesch
WeinfeldenFredy Lüthy
Ticino
BellinzonaFranco R. Ferrari
LuganoMarco Ferrari
Uri
AltdorfRichard Zgraggen
Valais
Brig Herbert Dirren
MartignyMaurice Deslarzes
MontheyPierrot Udry
SionPascal Rey
Vaud
LausannePierre-Alain Wyer(from 1.7. 2001)
NyonEtienne Desarzens
VeveyYves Rupp
Yverdon-les-BainsCarlo Fracheboud
Zug
ZugKlaus Willimann
Zurich
Affoltern a. A.Robert Marty
BülachVirgil Schmid
DielsdorfPeter Tobler
Dietikon (Limmattal) Urs Misteli
Horgen Peter Trümpler
MeilenDario Landis, lic. oec.
PfäffikonUeli Müller
UsterJean-Jacques Gueissaz
WetzikonUrs J. Fischer
WinterthurErwin Kurmann
ZurichArthur H. Bär
Principality of Liechtenstein
Vaduz Erich Vorburger
Branch office
Schweizerische Mobiliar VersicherungsgesellschaftDirektion MaklergeschäftGenferstrasse 118027 ZurichTelephone 01/286 11 11Fax 01/201 41 34
Office for French-speaking
Switzerland
Mobilière Suisse Sociétéd’assurancesDirection affaires de courtiersRue de la Cité 1P.O. Box 34511211 Geneva 3Telephone 022/317 73 50Fax 022/317 73 59
Providentia
General Management
ProvidentiaSwiss Life InsuranceCompanyChemin de la Redoute 541260 Nyon 1Telephone 022/363 94 94Fax 022/36178 28
Subsidiaries
ProviserviceChemin de la Redoute 541260 Nyon 1Telephone 022/363 96 40Fax 022/363 96 64
Union Trust Company Ltd.Zeltweg 448032 ZurichTelephone 01/254 37 00Fax 01/254 37 01
General agencies
of Providentia
Aarau
Hans Gloor
Basel
Jürg Kündig
Berne
Thomas Kulli
Chur
Luzi Gees
Geneva
vacant
Lausanne
Arpad Soos
Lugano
Régis Dubied
Lucerne
Peter Egli
Neuchâtel
Jean-Marc Jaquet
Solothurn
Kurt Küng
St. Gallen
Ernst Bélat (until 31. 3. 2001)Kurt Oesch (from 1. 4. 2001)
Zurich
Willy MüllerGino Reposo
Protekta
General Management
Protekta Rechtsschutz-Versicherung AGSeftigenstrasse 7P.O. Box3001 BerneTelephone 031/370 82 00Fax 031/372 03 78
General agencies
of Protekta
Protekta Zurich agency Genferstrasse 11P.O. Box8027 Zurich
Protekta Lausanne agency Avenue du Théâtre 7P.O. Box1002 Lausanne
Protekta St.Gallen agency St. Leonhardstrasse 329001 St. Gallen
68
ParionKaiser-Wilhelm-Ring 23–25D-50672 CologneTelephone +49 221 30800Fax +49 221 308 103/113
TopdanmarkBorupvang 4DK-2750 BallerupTelephone +45 44 683311Fax +45 44 651242
Partners in Switzerland
Sanitas, Schweizerische Kranken-versicherungLagerstrasse 1078021 ZurichTelephone +41 1 298 63 00Fax +41 1 298 63 98
Other partners abroad
Grazer WechselseitigeVersicherung AktiengesellschaftHerrengasse 18–20A-8011 GrazTelephone +43 316 8037 0Fax +43 316 8037 455
Groupe AzurAssurances Mutuelles de France7, Av. Marcel-ProustF-28932 Chartres Cédex 9Telephone +33 2 3733 8000Fax +33 2 3733 8070
Further informationen
The Eureko partners
Eureko N.V.Entrada 501NL-1096 EH AmsterdamTelephone +31 20 6607654Fax +31 20 6607655
EurAPCoEuropean Alliance Partners Company B.V.Genferstrasse 11CH-8027 ZurichTelephone +41 1 287 95 00Fax +41 1 287 95 01
AchmeaHandelsweg 2NL-3707 NH ZeistTelephone +31 30 6937000Fax +31 30 6937225
BCP/Atlântico GroupRua Augusta 62 - 4°P-1100 LisbonTelephone +351 21 3211000/706Fax +351 21 3211759
Friends ProvidentPixham EndGB-DorkingSurrey RH4 1QATelephone +44 8706 083678Fax +44 1306 740150
LänsförsäkringarHemvärnsgatan 9SolnaS-17381 StockholmTelephone +46 8 588 400 00Fax +46 8 562 833 99
Maaf AssurancesChaurayF-79036 Niort Cedex 9Telephone +33 5 49 34 35 36Fax +33 5 49 34 38 26
Alliance partners
Design by: Brigitte and Thomas Carrel, IffwilPrinted by: Stämpfli Ltd., BernePhotos: Andreas Greber, BernePhotolithography: Prolith AG, Köniz