The FINANCIAL — Allianz in Central and Eastern Europe (CEE)1 reported solid results in 2013. As a result of the persistently difficult environment, total revenues of 3.5 billion euros were 4.6 percent lower than the 3.7 billion euros of the previous year, according to Allianz, an international financial services provider.Â
Strong performances in the Property and Casualty insurance business as well as the Asset Management and Pension Fund business could not offset the decline of premiums in the Life and Health insurance business. This segment was affected by regulatory restrictions in Poland which led to an elimination of premiums from life deposits. Operating profit of 252 million euros represented a decline of 13.4 percent. This development was mainly attributable to accelerating motor claims costs in the Russian market, according to Allianz.
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“Considering the uneven economic environment and the changing political landscape in some of the CEE markets, results from the majority of our entities are in line with our expectations. Most important for us as an organization is that our underlying business remains solid,”said Manuel Bauer, Member of the Board of Management of Allianz SE responsible for growth markets.
Gross premiums written in the Property and Casualty insurance business in CEE for 2013 reached 2,477 million euros compared to 2,393 million euros in 2012. This corresponds to an increase of 3.5 percent (6.3 percent on an internal basis), according to Allianz.
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The development in the Property and Casualty business was driven by Russia where premiums grew by 130 million euros or 19.2 percent (26.4 percent on an internal basis), primarily in motor, personal accident and health insurance. This growth far outweighed a decline of industrial and motor business in Hungary, and lower volumes of motor business in Slovakia, driven by selective underwriting and adverse market conditions.
Operating profit for the Property and Casualty business in CEE amounted to 127 million euros, a decline of 25.7 percent (20.7 percent on an internal basis), with the vast majority of this adverse development stemming from accelerating motor claims costs in Russia. The combined ratio for 2013 stood at 99.5 percent, after 96.9 percent in the previous year, according to Allianz.
Total premiums in the Life and Health business for 2013 amounted to 913 million euros, compared to 1,176 million euros in the previous year; this represents a decline of 22.4 percent (21.0 percent on an internal basis). This development was largely caused by a regulatory change in Poland at the beginning of 2013 which led to a 210 million euros decrease in deposit business, partly compensated by successful campaigns of single premium investment-oriented products in Hungary, according to Allianz.
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Allianz continues its growth in the pension fund business in CEE, where the company is well diversified across seven markets. The client base increased to 4.7 million clients in 2013 from 4.6 million clients in 2012. Assets under management jumped in the full year 2013 by 12.6 percent to 9.8 billion euros, compared to 8.7 billion euros in 2012. All pension funds contributed to this development with positive net inflows. The Czech Republic, Croatia and Romania recorded the strongest net inflows, according to Allianz.
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Revenues in the Pension Fund and the Asset Management businesses combined rose by 11.3 percent (11.9 percent on an internal basis) to 79 million euros, from 71 million euros in 2012. Operating profit increased by 12.1 percent to 37 million euros as a result. The cost-income ratio for 2013 remained stable at 52.9 percent compared to 53.0 percent in the prior year, according to Allianz.
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