Annual Report 2013

Transcription

Annual Report 2013

Helvetia Group
Helvetia Group
Annual
Report
2013
Contact
Helvetia Group
Susanne Tengler
Head of Investor Relations
P.O. Box, CH -9001 St Gall
Phone +41 58 280 57 79
Fax +41 58 280 55 89
www.helvetia.com
susanne.tengler@helvetia.ch
Annual Report 2013
Our experts have opportunities and risks firmly in view.
Your Swiss insurer.
Opportunities and risks firmly in view
Opportunity and risk have long been a part of our everyday lives. What this odd pair has in
common is their reliance on the future. Every day we are faced with many decisions regarding
what risks we want to take and how much security we need. Accepting a risk means having
a chance to succeed but also running the risk of failure. Before we take a risk we try to assess
the implications of our decision and to limit the possibility of danger or loss, but not even
the best foresight can protect us from every threat. One sure way to limit risk is to work with
a strong partner.
Helvetia Insurance has been a strong partner to its customers for over 150 years. You may ask
how we, as an insurance company, deal with our own opportunities and risks. Risk awareness
and systematic risk management are part of an insurance company’s core responsibilities. Before a risk can be properly insured, it must be recognised and evaluated and a decision made
as to how it should be handled.
There are many people at Helvetia who are involved in managing opportunities and risks every
day. Our underwriters work with our customers to identify risks. Our actuaries calculate probability of occurrence and analyse what the consequences would be if the unexpected were to
happen. In this Annual Report we profile selected experts and their approach to dealing with
opportunities and risks as a demonstration of the dialogue that takes place within the Company.
Their expert involvement enables us to offer appropriate security solutions to our customers and
to present our shareholders with a consistently strong financial performance. Ultimately, we cannot predict the future. We can only be prepared for it in the best possible way.
Profile
Helvetia Group has its registered offices in Switzerland. In over 150 years, it has
grown to become a successful international insurance group. Alongside its domestic
market of Switzerland, its core geographic markets include Germany, Austria, Spain,
Italy and France. Helvetia is active in the life, non-life and reinsurance sectors, and
approximately 5,200 employees provide services to more than 2.7 million customers.
Business volume in financial year 2013 was nearly CHF 7.5 billion. The registered
shares of Helvetia Holding AG are traded on the SIX Swiss Exchange.
Ambition
Helvetia Group’s ambition is to sustainably strengthen its attractive business portfolio
in its current markets. We want to be one of the leading providers in our domestic market of Switzerland. We aim to gradually strengthen our position in the country markets
of Italy, Germany, Spain, Austria and France and continuously increase our market
share. In doing so, we place great value on a practical geographic diversification a
s
well as achieving a harmonious balance between the profitable non-life business,
the high-potential pensions business and the cyclical reinsurance business.
Imprint
The Annual Report 2013 of Helvetia Group is
available in English, German and French.
Published by
Helvetia Group, St Gall
Design implementation
YJOO Communications AG, St Gall
Translation
RR Donnelley, Frankfurt / Main
Photos
Board of Directors, Executive Management and
individual portraits: Klaus Andorfer, Zürich
Production (offset printing)
Schwabe AG, Basel
Copyright © 2014 by Helvetia Group, St Gall
The German version of the Annual Report is legally
binding.
2013
2012 2
Change
More details
on page
Key share data Helvetia Holding AG
Group profit for the period per share
Consolidated equity per share
in CHF
in CHF
Price of Helvetia registered shares at the reporting date
Market capitalisation at the reporting date
in CHF
in CHF million
Number of shares issued
40.9
37.1
10.3 %
163
445.0
435.4
2.2 %
96
447.5
346.5
29.1 %
35
3 872.2
2 998.2
29.1 %
53
8 652 875
8 652 875
in CHF million
159
in Group currency
Business volume
Gross premiums life
4 547.5
4 201.4
8.2 %
76
183.6
149.8
22.6 %
76
2 550.9
2 412.4
5.7 %
76
194.8
214.9
– 9.4 %
88
7 476.8
6 978.5
7.1 %
76
Result life
152.9
138.2
10.7 %
77
Result non-life
191.7
172.9
10.9 %
77
19.2
22.0
– 13.1 %
77
363.8
333.1
9.2 %
76
Investment result
1 332.2
1 315.3
1.3 %
132
of which investment result from Group financial assets and investment property
1 212.3
1 177.8
2.9 %
81
Deposits received life
Gross premiums non-life
Assumed reinsurance
Business volume
Key performance figures
Result other activities
Group profit for the period after tax
Key balance sheet figures
Consolidated equity (without preferred securities)
3 831.2
3 750.2
2.2 %
97
Provisions for insurance and investment contracts (net)
34 518.7
32 765.7
5.4 %
149
Investments
39 576.1
37 733.2
4.9 %
81
of which Group financial assets and investment property
37 449.4
35 729.2
4.8 %
–
Ratios
Return on equity1
9.3 %
9.1 %
16
142.3 %
142.0 %
–
Combined ratio (gross)
91.6 %
91.1 %
–
Combined ratio (net)
93.6 %
93.7 %
80
Direct yield
2.7 %
2.8 %
82
Investment performance
1.9 %
5.5 %
82
218 %
227 %
77
Helvetia Group
5 204
5 215
– 0.2 %
25
of which Switzerland
2 487
2 500
– 0.5 %
25
Reserve to premium ratio non-life
Solvency I
Employees
1
Based on the earnings per share (including interest on preferred securities through profit and loss) divided by the average shareholder capital
(equity before preferred securities). / 2 Adjustments of prior-year figures, see section 2.3 on page 102.
Business volume
Profit
Equity
Solvency i
in CHF million
in CHF million
in CHF million
in %
7 500
375
4 000
250
6 000
300
3 200
200
4 500
225
2 400
150
3 000
150
1 600
100
1 500
75
800
50
0
0
0
0
31.12.2013
31.12.2012
Helvetia Annual Report 2013
3
Contents
5 Key messages
Business development
74 Market environment
6 Letter to Shareholders
76 Helvetia Group’s performance
78 Development of business activities
8 Business model
80 Investments
82 Business units
10 Management of risks
Financial report
Company profile
12 Group strategy
19 The Helvetia brand
Consolidated financial statements
92 Helvetia Group
205 Financial statements of Helvetia Holding AG
20 Business activities
22 Country markets
214 Embedded value
23 Group structure
24 Employees
Service
26 Customers and sales
218 Glossary
30 New products and innovations
221 Important addresses
32 Corporate responsibility
223 Multi-year overview
35 Investor information
224 Financial calendar
38 Risk and investment management
224 Disclaimer
44 Board of Directors
225 Imprint
48 Executive Management
52 Corporate governance
67 Compensation report
4
Financial year 2013
Profit
Business volume
+9.2 %
+6.3 %
Helvetia Group generated a profit of CHF 363.8 million in
financial year 2013. While the home market of Switzerland
remained strong, foreign markets also managed to impress
with increased contributions to profit. The very good annual
results once again reflect the successful development of the
Group.
Helvetia Group was able to increase business volume significantly to CHF 7,476.8 million. The increase was due mainly to
growth momentum in the life business in the Swiss, German and
Austrian country markets. In the non-life segment, growth was
driven by the transport insurance sector – as a result of the
acquisition of the Gan Eurocourtage portfolio in France.
Direct yield
Combined ratio
2.7 %
93.6 %
Helvetia’s investment portfolio is broadly diversified and continued to generate stable current income in financial year 2013.
The direct yield remained stable at 2.7 %, despite low interest
rates. It was possible to invest the new funds at an average
return of 2.5 %.
The combined ratio improved slightly from an already good level – despite severe weather events in some country markets. At
93.6 %, the combined ratio again beats the range set out in the
Group’s targets of between 94 % and 96 % .
Capital base
Dividends
218 %
CHF 17.50
The capital base remains solid with a Solvency I ratio of
218 %. Our capital strength is also reflected in the fact that
rating agency S&P upgraded our rating from “A–” to “A”.
Our SST ratio (first half of 2013) was 150 – 200 %.
At CHF 17.50 per share, Helvetia is again paying an attractive
dividend. At 43 %, the payout ratio is again within the defined
target range of 30 to 50 %.
5
Unternehmensprofil Letter to Shareholders
Verwaltungsrat
Erich Walser Chairman of the Board of Directors
Stefan Loacker Chief Executive Officer
Ladies and Gentlemen
Helvetia Group’s results were once again very satisfying. In financial year 2013, we increased our
profit by 9.2 % to CHF 363.8 million. Our business volume also increased in the same period by
6.3 % (in original currency) to CHF 7,476.8 million.
Both life insurance with CHF 152.9 million (+10.7 %) and non-life insurance with CHF 191.7 million
(+10.9 %) contributed to the convincing annual result of CHF 363.8 million. Our earnings power
is also broadly based in geographic terms. In addition to our robust home market of Switzerland,
nearly all the foreign markets performed well and increased their contribution to the result. In the
non-life business we were once again able to reduce the combined ratio at Group level slightly to
93.6 %. The fact that all the country markets now have a combined ratio of below 100 % is also encouraging. Despite severe storms in some countries, our claims ratio is significantly below the previous year. This reflects not only our strong portfolio quality, it also shows we are on the right path
with our optimisation measures in Italy and Germany. In the life business, the new business margin
was a satisfying 1.6 % (previous year 0.9 %). Even if this increase can be attributed mainly to higher interest rates on new investments, the ongoing low interest rate environment continues to present
us with challenges.
Our life business once again proved to be a solid growth driver for the Group, with an increase of
8 % over the previous year and a business volume of CHF 4,731.1 million. A significant contribution
to this positive development was made by the Swiss group life business. In the individual life busi-
6
Unternehmensprofil Letter to Shareholders
Verwaltungsrat
ness we were particularly successful in marketing unit-linked life insurance. This is in line with our
strategic aim of growth through these capital-efficient products. Their proportion of total premium
volume in individual life rose to 28 % in 2013 (previous year 21 %).
In the non-life business, we achieved premium volume of CHF 2,550.9 million, an increase of 4.3 %
(in original currency) over the previous year. The transport portfolio of Gan Eurocourtage, acquired
in France, provided a strong contribution to growth. The Swiss and Austrian country markets also
continued to grow. In contrast, the volumes in Italy and Spain declined due to the difficult economic situation, although the decline was less steep than in the previous year. In addition, portfolio optimisations had the expected impact on premium volumes in Germany and Italy.
Excellent progress has been made on the integration of the companies acquired in recent months.
In Switzerland, we have already successfully incorporated Alba, Phenix and SEV Versicherungen
into the Company and their premiums contributed to our growth in Switzerland. The projects for
the integration of the transport portfolios of Gan Eurocourtage in France and of Chiara Vita and
Chiara Assicurazioni in Italy are close to completion.
With earnings of CHF 1,212.3 million (previous year: CHF 1,177.8 million), financial assets and investment property again made a valuable contribution to the overall result in the reporting year.
Despite continued low interest rates, the direct yield fell by only 0.1 percentage points and is now
2.7 %.
Helvetia was able to further improve its strong capital position with this encouraging business performance. This continues to be seen in our outstanding Solvency I ratio of 218 %. Equity rose by
2.0 % to CHF 4,131.2 million and return on equity increased from 9.1 % to 9.3 % due to increased
earnings power. Due to the strong capitalisation and the Group’s solid financial performance, Standard & Poor’s upgraded Helvetia’s rating from “A–” to “A” in May 2013. We will propose to the
Shareholders’ Meeting an increase in the dividend to CHF 17.50 per share, thus maintaining our
attractive dividend policy.
The impressive annual results with broad-based growth, a rise in profits and continued solid capitalisation underscores the successful and sustainable performance of Helvetia Group. We can face
the challenges to come with confidence. Our products and services allow us to provide our customers with tailor-made insurance and pension solutions. Strong customer orientation is also exemplified by our employees. This was confirmed by the survey conducted last year. The vast majority of
employees report a close connection to the Company and feel personally responsible for the satisfaction of our customers. Our employees emphatically agreed with the statement “The success of
Helvetia means a lot to me”. We thank our employees, our customers and you – our valued shareholders – for your loyalty to our company.
Yours sincerely,
Erich Walser
Stefan Loacker
Chairman of the Board of Directors
Chief Executive Officer
7
Your Swiss insurer
OUR EMPLOYEES
p. 24
Helvetia is active in life insurance, non-life insurance and reinsurance
and its approximately 5,200 employees provide services for more
than 2.7 million customers. In addition to its main market of Switzerland, Helvetia also has branch offices and subsidiaries in Germany,
Austria, Spain, Italy and France. With a business volume of approximately CHF 7.5 billion, Helvetia generated a net profit of CHF 364
million in financial year 2013.
Our investors
Helvetia reduces risks for investors and customers through
its long-term business focus and the use of efficient risk and
investment management, while growing consistently, maintaining sustainable profitability and minimising earnings volatility. Helvetia pursues a sustainable dividend policy and
aims to pay out a stable share of earnings in a range of
30 to 50 %. Read more about this on pages 12 and 35.
Our employees
Helvetia considers well-trained, committed and well-informed
employees to be the most important source of success. Read
more about this on page 24.
Our sales channels / our partners
Helvetia’s sales structures are optimised for specific countries and it has numerous strong sales partnerships which it
has been able to continuously expand in recent years. The
multi-channelling approach will be further expanded in all
country markets in the coming years. Read more about this
on page 26.
Our customers
We see every customer relationship as a personal partnership, sustained by professionalism, understanding and
mutual trust. Read more about this on page 26.
Our services / product portfolio
Helvetia is a quality-oriented all-lines insurer with over 150
years of experience. Whether private or occupational pension,
whether non-life insurance or mortgage, with an extensive
product range, Helvetia is a one-stop shop for private individuals and SMEs. Read more about this on page 30.
Our environment
Helvetia’s voluntary involvement in the areas of culture, society,
education, recreation, the environment and the economy is
broadly diversified. Read more about this on page 32.
Our risk management
Risk management ensures that sufficient risk-bearing capital
is available at all times to cover the risks assumed. Read
more about this on page 38.
Our investment management
Using a sustainable investment policy tailored to its liabilities, Helvetia generates attractive investment returns with
limited risk. Read more about this on page 43.
Our corporate governance principles
Helvetia considers good corporate governance very important.
It is systematically geared to the Group’s strategy and positioning and integrated into day-to-day work. Read more about this
on page 52.
OUR INVESTORS
OUR
CORPORATE
GOVERNANCE
PRINCIPLES
p. 52
p. 12 / 35
OUR
INVESTMENT
MANAGEMENT
p. 43
OUR SALES
CHANNELS / OUR
PARTNERS
p. 26
OUR RISK
MANAGEMENT
p. 38
OUR
SERVICES / PRODUCT
PORTFOLIO
p. 30
OUR CUSTOMERS
p. 26
OUR
Environment
p. 32
“The identification, measurement and management of risk forms the very foundation of
the insurance business. The more similar risks
are analysed together, the more predictable
later claims become. This is made possible
by our experts’ daily analysis of opportunities
and risks in an extremely wide range of
areas, which allows us to offer our customers
the right level of security at all times and to
guarantee sound progress by the Company
for our shareholders.”
Erich Walser
10
Company profile
12
Group strategy
19
Brand
20
Business activities
22
Country markets
23
Group structure
24
Employees
26
Customers and sales
30
New products and
innovations
32
Corporate responsibility
35
Investor information
38
Risk and
investment management
44
Board of Directors
48
Executive Management
52
Corporate governance
67
Compensation report
Company profile Group strategy
Group strategy
Helvetia Group has stood for reliable insurance
services for more than 150 years. The cornerstones of our success are based on the combination of selected markets, attractive insurance
solutions and aiming for sustainable growth, accompanied by technical discipline, high awareness of costs and a prudent investment strategy.
This is supported by a solid capital base. Our
achievements in 2013 show that we are well on
course with our Helvetia 2015+ strategy in what
continues to be a challenging environment in
many respects. We are convinced that in future
we will continue to be able to create the greatest
added value for our customers, employees and
shareholders by continuing our profitable growth
strategy.
Strategic ambition
Helvetia Group’s ambition is to grow dynamically and sustainably in selected regions of Central
and Southern Europe while preserving our attractive business portfolio. We want to be a leading
provider in our home market of Switzerland and
systematically further improve our position in our
foreign markets. We value meaningful geographic diversification and an appropriate balance between the profitable non-life business, the
high-potential pension business and the cyclical
reinsurance business.
Our ambition will be implemented on the basis of organic growth through innovative products and constantly further developing our sales
reach and our productivity. In our markets, we
actively and systematically seek targeted acquisitions and strategic partnerships. We consider
the satisfaction of our customers and the strengthening of profitability to be what is most important
here. Our objective is therefore to constantly increase the productivity of our operating processes in the country markets through strengthened
processes and systems at a group wide level.
12
Despite what remains in some respects a challenging economic environment, the Helvetia
2015+ strategy proved itself again in 2013.
Helvetia was able to achieve respectable successes in all three strategic fields of growth, profitability and customer loyalty.
2013 strategy update
Our strategy is examined annually in light of
changing market conditions. This ensures that
current and impending circumstances influence
strategic planning. Despite the continuing challenging economic environment in 2013, we have
kept to our medium- and long-term objectives at
the Group level in the strategy update. Individu al
strategic measures were adjusted to the environment accordingly, others were newly initiated.
Growth
We want to dynamically expand our market positions. The insurance markets have not been
able to escape the continuing economic crisis in
the southern European countries and the low-interest environment. In view of these circumstances, sustained profitable growth is difficult to
achieve. Nevertheless, last year Helvetia again
succeeded in achieving organic growth in most
of its markets, predominantly at the level of the
market average or above. The growth of 4.3 %
(in local currency) in non-life business at the
Group level is to a certain extent due to the firsttime full consolidation of the transport insurance
portfolio acquired in France in 2012. Life business at the Group level increased by a pleasing
8.2 % (in local currency) despite difficult market
conditions.
In France, 2013 was characterised by the integration and consolidation of the acquisitions in
2012. The acquisition of the French transport insurance portfolio from Groupama meant we
were able to report a significant premium increase of 77.8 % in the transport insurance business. This means that Helvetia has now risen to
number two in the French transport insurance
market. In Italy, our priority was consolidating
our top 20 position following the acquisitions
made the previous year. In non-life business, the
acquisition of Chiara Assicurazioni, which specialises in the sale of non-life insurance solutions
via bank branches, led to further growth stimulus.
Overall, the consequences of recession in Italy –
particularly in motor vehicle insurance – are still
clearly noticeable. In life business, we intentionally sacrificed volume in favour of profitability
with the renewal of the distribution agreement
with Banco di Desio and a focus on portfolio
quality. In Germany too, Helvetia intentionally
abstained from writing low-profit non-life business and thus reduced the premium volume as
planned. By contrast, Helvetia was able to
achieve very pleasing growth rates in Switzerland and Austria. In life business, we have stimulated further growth through attractive product
innovations. Details on the new products
launched in financial year 2013 can be found in
the “New products and innovations” chapter on
p. 30.
The still challenging economic environment
will continue to offer us opportunities to sustainably improve our market positioning through targeted acquisitions. Helvetia has an extremely
solid capital base and experience which allows
it to identify interesting opportunities quickly.
Various growth initiatives which were launched
in the past will take their full effect in the coming
years, meaning that we again expect attractive
organic growth in the future.
Profitability
We want to sustainably increase our profitability. Despite a difficult economic environment,
Helvetia has been able to achieve satisfying
growth in earnings. In the current macro-economic environment, the very low risk-free interest
rates present a challenge for life insurance, although the strong equity markets have had a
compensatory effect. Helvetia was able to
achieve a total increase in profit of 10.7 % in life
business. Helvetia successfully adapted itself to
the capital market environment by adjusting interest rate guarantees and policyholder dividends.
Active product portfolio management allows us
to have an influence on securing the new business margin. In Helvetia’s high-volume life business in Switzerland, the proportion of capital efficient, non-traditional new business is already
over 40 % in the non-life area.
Helvetia Group was also able to further increase its profit in non-life business. It is pleasing
here that the combined ratio improved slightly
compared to the previous year in the Group as a
whole, despite severe weather events in some
country markets. This success shows that the systematically implemented earnings improvement
measures are now yielding the anticipated results. However, because the restructuring programmes in Germany and Italy also resulted in
reductions in premiums, the net cost ratios for
these companies have increased in the short
term. Some of the newly acquired companies
a lso operated with higher cost ratios than our
existing units. We are convinced that we will further improve our cost base by means of the measures introduced and thus reduce the cost ratios
again.
In the future, we will systematically continue
the local measures for further increasing profitability. In life business, we will focus more on the
further development of modern life insurance
products. In France, we expect to be able to
gradually generate cost synergies after completing the integration work for the transport insurance business.
Business volume
in CHF million
2013
2012
2011
7477
6979
7172
2010
6755
2009
6711
13
Customer loyalty
We want to increase customer value in a way
that meets customers’ needs. In view of the continuing difficult economic environment in southern Europe in particular and in view of constantly intensifying competition, customer loyalty is
particularly important. For example, numerous
measures have been implemented which target
customer loyalty, the acquisition of new customers and increasing customer value.
The “Customer Relationship Management”
(CRM) centre of excellence which was established at the Group level was able to further drive
the group approach to CRM. The CRM system is
active not only in Switzerland and Spain, but
now also in Italy and Germany.
In 2013 Helvetia again occupied various top
positions for its insurance products in customer or
broker surveys. In Germany, Helvetia was one of
the best non-life and life insurers according to
brokers, as shown by a study by CHARTA in collaboration with a opinion research institute. In a
survey of 1,500 brokers by ServiceValue and
Versicherungsmagazin, Helvetia came out as the
best life insurer for the third time in a row.
Helvetia’s unit-linked life insurance in Austria
took first place in the “Goldmünze” competition.
Helvetia Austria took second place in the special
category “Most innovative insurer”. Helvetia was
also given similarly good ratings in its other
country markets. We see the top rankings as recognition of our efforts to provide our customers
with products suitable for their needs and with
corresponding service.
In order to further increase brand awareness,
Helvetia puts particular emphasis on its involvement in skiing. To this end, Helvetia comprehensively renewed and expanded its skiing sponsorship at the end of 2013.
14
Group strategy Helvetia 2015+
Our strategic priorities
Further expand market positions
We are convinced of our portfolio’s geographic configuration
and growth potential. Innovative products, the systematic expansion of the sales network and targeted acquisitions and
partnerships in existing markets form the pillars of our growth
ambition. In particular, we want to grow through the expansion
of our sales reach. For this reason, interaction with customers
through a wide range of channels is very important. The expansion of the life and pensions business in foreign markets will be
driven further forward in the process.
Sustainably increase profitability
Increases in efficiency are the basis for a sustainable rise
in productivity. The productive interaction between local
and Group-wide measures are very important in this context. We are doing our utmost in both the life and non-life
segments to define and exploit synergy potential throughout the Group. In addition, financial optimisation is extremely important in a changing regulatory environment
in order to protect our shareholders’ interests.
Increase customer value in a way that meets needs
Helvetia understands customer relationship management to
mean extensive knowledge about the needs of its policyholders
and partners. It aims to offer the highest quality and to earn a
high level of customer loyalty. This requires a focus on all the
customer’s concerns and life stages. This enables high efficiency in sales activities and a targeted approach to customers. This
is supported by strengthening the Helvetia brand.
Our strategic initiatives
Achievement of targets in 2013
Outlook for 2014
–Expansion of the multi-channelling approach in
all country markets
–Increase profitability of life through local measures with the support of Group specialists
– Pursuing an active M&A strategy
–Organic growth at the level of the market average
or above
–Increasing market share of life and non-life business
in almost all country markets
–Stimulation of growth through attractive product innovations in all markets
–Marked increase in transport insurance premiums
through first-time full consolidation of the Groupama
transport insurance portfolio (new number two in
transport insurance)
–Successful placement of tranche products in several
country markets (Switzerland, Italy, Spain)
–Completion of the acquisition of a majority stake in
Chiara Assicurazioni
– Successful integration of Alba / Phenix
–Extension of the partnership of many years with
Bank Vontobel until at least the end of 2018
–Further expansion of non-life speciality transport;
internationalisation
–Gradual expansion of the niche-oriented reinsurance business
–Stepping up our sales activities in Italy through
Chiara Assicurazioni’s network of partner banks
–Further capital expenditure on sales capacity and
broadening sales
–Increased development of capital-efficient life
products with (external) guarantees
–Increased efforts to seek growth; use of M&A opportunities in existing country markets
–Industrialisation of business processes and
stepping up Group-wide bundling of IT activities
–Optimising the financial structure along the regulatory requirements (Swiss Solvency Test / Solvency II)
Improvement of profitability through earnings im–
provement programme in Germany
–Portfolio optimisations also implemented in Italy to
further improve profitability
–Net NL combined ratio satisfyingly stable at 93.6 %
–Streamlining the operating model in Italy; process-related integration of the units acquired in 2012
– Integration in France on course
–Harmonisation of the product range in France
–Adjustments of the interest rate guarantees and policyholder dividends in life insurance to the capital
market environment
–Ensuring the new business margin through active
product portfolio management
–Proportion of equity-efficient new life business already over 40 % in Switzerland
–Consistent implementation of local measures to
ensure volume and profitability
–Intensified local activities to reduce selling costs
–Further focus on modern life products to increase
the profitability of new life business
–Completion of the integration work for the French
transport insurance business
–Structural and operational merger of Helvetia
Vita and Chiara Vita in Italy with an efficient /
need-based product range
–Further development of IT; systematic implementation of a cross-border IT target architecture
–Optimisation of the CRM approach to managing
sales processes
–Quality management of business processes
(EFQM)
–Brand offensive and Group-wide branding concept
–Group approach to CRM also productive in Italy
–Accentuation of product design tailored even
and Germany in addition to Switzerland and Spain
more to needs – increased efforts to improve ser–Helvetia blog established in all country markets exvice quality and diversify sales to make it “easier”
cept France
for the customer
–Going fully live with the Group approach to CRM
–Blog awarded multiple prizes
–Various top results achieved in customer / broker
in the remaining foreign markets
surveys (see “Customer loyalty” section in this
–Exploiting the potential of partnerships through
chapter for details)
the Helvetia blog to achieve additional linking of
–Noticeable increase in customer loyalty as a result
content
of newly launched process management in Austria
–Renewal and expansion of skiing sponsorship to
further increase brand awareness
15
Our financial objectives
One of the ways we measure the success of our
strategy is with medium-term financial objectives.
The continuing challenging economic environment has made it harder to achieve the objectives for some of the Helvetia 2015+ strategy criteria. This already caused us to slightly adjust our
short-term expectations for return on equity in the
previous year because of the interest rate envir
onment. The return on equity achieved in 2013
is thus within the range of expectations. At a
S olvency I ratio of 218 %, Helvetia continues to
have very good capital strength. In combination
with the equally satisfying rise in earnings, an increase in the dividend to CHF 17.50 per share
will be proposed to the Shareholders’ Meeting.
At a payout ratio of 43 % and a dividend yield of
3.9 %, Helvetia is sustainably continuing its
shareholder-friendly distribution policy.
Financial objectives
Objectives 2015+
Achievement 2013
Combined ratio (non-life)
94 % – 96 %
93.6 %
New business margin (life)
1.2 % – 1.5 %
1.6 %
Solvency I
> 175 %
218 %
Rating class
A
A
Return on equity (ROE) temporarily
slightly below 10 % due to low
interest environment
10 % – 12 %
9.3 %
Payout ratio1
30 % – 50 %
43 %
Organic growth above the market
Improved cost efficiency
1
16
Proposal to the Shareholders’ Meeting.
People are living longer now and there has been a particular improvement in the life expectancy of over-70s.
As a result, one’s income needs to last for an increasingly longer period of time. The fact that we are specialised in
developing sustainable risk models to account for these changes makes us a reliable partner for pensions.
Joana Torres, Market Development Life
“Modern people want to have everything under control. Uncertainty frightens them. We can support them here because
we can deal with risk. Instead of closing our eyes to it, we have a great deal of experience in managing it. For instance,
at Helvetia we develop private pension solutions that give our customers financial security so that they can pursue their
goals at every stage of life without needing to worry.”
Company profile The Helvetia brand The Helvetia brand
“Personality and partnership”
shape the profile of the Helvetia brand
Helvetia pursues a single brand strategy. We use
unified brand positioning to address all stakeholders, making it possible to present the company and its offering in a more plausible and consistent way. The terms “personality” and
“partnership” are the focal point. Customer
needs and collaboration based on trust are the
most important factors. Our brand promise of
“accuracy of fit”, “reliability” and “fairness” give
the brand life. A flexible advertising concept
makes locally adaptable market cultivation tailored to customer needs possible for the country
markets. The heart of our advertising campaign
is dialogue with our customers and supporting
their individual and varied plans with our products: “Whatever your plans, we’re there for you.”
This brand presence was rolled out in the other
European countries in 2012 and the changeover
in Switzerland took place during 2013. Brand
awareness and its perception throughout the
Group is surveyed in regular surveys of retail customers and brokers. Our updated image in combination with increased involvement in skiing
across Europe and the launch of a Helvetia blog
has allowed Helvetia to make progress with all
target groups. Brand awareness has been increased and Helvetia’s profile as “your Swiss insurer” has been strengthened.
Helvetia is present at numerous world-class
events in skiing as principal sponsor. The two
most important contracts – premium sponsor of
the FIS Cross-Country World Cup including Tour
de Ski and official partner of the FIS Alpine
World Cup – have been extended until 2017.
Helvetia is the principal sponsor of the Helvetia
Nordic Trophy, the biggest Swiss competition for
young skiers in cross-country skiing, ski jumping
and Nordic combined. The contract with the
Swiss-Ski Federation has also been extended until the end of the 2016 / 2017 season. This continuity in skiing sponsorship means we are laying
the basis for successful sportsmen and sportswomen to strengthen identification with the
Helvetia brand through their dynamism and
enthusiasm.
Helvetia blog improves the brand
profile and cultivates a dialogue
The Helvetia blog, which was launched in
Switzerland in 2012, was also rolled out in our
European markets of Germany, Austria, Spain
and Italy during 2013. The blog provides a
simple, emotional introduction to the topic of
insurance, thus providing needs-based access to
Helvetia, its products and services. It focuses on
dialogue with customers and is thus embedded
in the brand strategy. The conversation builds
trust and interest and creates the foundation for
a solid partnership.
Skiing sponsorship strengthens brand
awareness and identification
Our many years of involvement in skiing has
been renewed and expanded in recent months.
Helvetia is committed to a long-term and reliable
partnership with the International Ski Federation
FIS and with Swiss-Ski, event organisers and
a thletes in various disciplines. Helvetia Group
backs 25 individual athletes from Switzerland,
Germany, Italy and Austria – including four
Olympic champions: Victoria Rebensburg, Dario
Cologna, Simon Ammann and Sandro Viletta.
19
Company profile Business activities
Business activities
Insurance is primarily a matter of trust. That is why
our focus is on the concerns of our customers.
These especially include private individuals and
small and medium-sized businesses. Their needs
are shaped both by their various life stages and,
particularly in life insurance, changes in the economic environment. Our product development and
sales activities are consistently guided by the customer life cycle. As a quality provider, however,
we also differentiate ourselves by being highly service oriented, with the focus on the personality of
each customer and a partnership based on trust.
That is why efficient claims handling is also one of
the reasons for our success. We achieve a high
level of customer loyalty through quick, personal
and competent customer care. Our long-term-oriented business model requires prudent handling of
premium income. Sound investment and risk management ensure that we can cover our customers’
insurance coverage at all times.
Life insurance
At 76 %, our home market of Switzerland is the
most important market in life business. Helvetia also provides life insurance in Italy, Germany, Spain
and Austria through its branch offices and subsidiaries, where we have developing life portfolios
with corresponding growth potential. These market positions will be expanded more rapidly in future both organically and through targeted acquisitions and partnerships.
Product portfolio
In the current investment environment, we see a
strong need for products with guarantees, but
which at the same time have greater flexibility and
participate in returns. Helvetia’s product portfolio
in individual life business therefore includes corresponding traditional products such as risk insurance and traditional savings, financial and pension solutions which cover the needs of
safety-conscious customers. In addition, Helvetia
also provides unit-linked or index-linked products
20
and modern insurance solutions which target participation in returns and most of which have dynamic, individual guarantee concepts. The guarantees included in the traditional products are
mostly provided by Helvetia directly, the guarantees in modern insurance solutions are partly assumed by renowned third-party providers. Lowrisk financial products are managed in the form of
deposits for policyholders.
Occupational pensions for SMEs represent one
of the most important insurance business lines at
around 57 % (of total volume / of the Group’s total
life volume). At 97 %, this business is generated almost exclusively in Switzerland, where Helvetia
has become the third largest provider of BVG insurance solutions. We primarily focus on the socalled full insurance model here. In this context,
Helvetia assumes the complete administration of
occupational pensions for its customers and
guarantees performance at all times. In addition,
we a
lso provide modern products with return
opportunities and individual solutions for occupational pension foundations in the occupational
pensions business. Here Helvetia works together
with renowned partners to manage and invest
retirement assets.
Profitability and efficiency
The profitability of the life business is determined
by the development of technical risk and events on
the financial markets. Share price and interest rate
trends influence insurance demand and determine
the achievable investment returns and policy bene
fits guaranteed over the long term. The continuing
low level of interest rates poses the greatest
macroeconomic challenge for asset management.
In the past, Helvetia has always succeeded in
achieving attractive returns with the capital employed. Despite continuing low interest rates, in
2013, we again managed to achieve stable interest margins between current income and the guarantees given, from which customers and shareholders benefit.
Company profile Business activities
Non-life insurance
Reinsurance business
The emphasis in non-life business is on service
quality, sustainable pricing and opening up new
access to sales. In the last financial year, we also
opened up the banking channel for the non-life
business in Italy through the acquisition of Chiara
Assicurazioni. The still recessionary economic
environment is one of the greatest challenges,
particularly in Spain and Italy.
Helvetia is one of the oldest reinsurers in the world.
As a niche provider, it stands out because of its excellent business relationships, strict underwriting
policy and high sector diversification. The focus of
activities is on OECD markets. Reinsurance does
not pursue any volume goals, but is instead primarily guided by the profitability of the business
written.
Product portfolio
In addition to traditional property insurance, such
as motor vehicle, contents and liability, our product portfolio also includes special insurance, such
as photovoltaic or our agricultural products insurance in Spain. The acquisition of the transport
portfolio from Groupama France in 2012 means
that the transport and marine insurance business
has increased in importance. Our home market
has the largest share of non-life business. Germany
accounts for around 21 % today, followed by Italy
with 19 % and Spain with 11 %. The sales focus is
on property, transport, liability and motor vehicle
insurance. The traditional strength in stable property insurance stands out for its comparatively low
claims ratios, but has higher acquisition costs than
other business lines. The proportion of motor
vehicle insurance has been kept intentionally low
compared to the market. This additionally s upports
the non-life portfolio’s profitability.
Business volume life 2013
Share in % | in CHF million
4 % | 183.6
6 % | 286.3
Deposits
Unit-linked
57 % | 2 705.4
Group life
33 % | 1 555.8
Individual life
Profitability and efficiency
Helvetia Group pursues a disciplined underwriting
strategy in order to ensure portfolio quality and
only underwrites larger business risks selectively.
We work together with renowned reinsurers in order to hedge against major loss events. Profitability also depends on portfolio composition, pre
mium and cost development and claims.
Profitability can be measured with the combined
ratio, which has on average been below 95 % at
Helvetia in recent years. In financial year 2013,
the net combined ratio was 93.6 %, which is a
reflection of portfolio quality.
Total 100 % | 4 731.1
Business volume non-life 2013
6 % | 146.0
Accident / health
10 % | 257.6
37 % | 937.7
Property
Liability
35 % | 897.1
Motor vehicle
12 % | 312.5
Transport
Total 100 % | 2 550.9
21
Company profile Country markets
Country markets
22
Switzerland Helvetia is a quality-oriented all-lines insurer with over 150 years of experience. It is one of the
leading insurance companies in Switzerland. We primarily offer our insurance services to retail customers and
small and medium-sized business customers through our
own sales force. This important sales channel is supplemented by renowned sales partners, such as Raiffeisen,
the cantonal banks, brokers and our “direct and new media” channel.
Germany In the German market, Helvetia offers its retail and business customers a broad range of products in
property, accident and life insurance. Our most important
sales channels include around 300 tied agents and several thousand independent brokers. Broker sales account
for almost two thirds of new business. The brokers are
supported on site by eight branch offices throughout Ger-
many. Helvetia Group has implemented a professional
and central claims service at the Frankfurt head office for
streamlined and rapid claims handling.
Italy In Italy, Helvetia is primarily represented in the
economically interesting regions in the north of the country and focuses on retail customers and small and me
dium-sized businesses. Using the multi-channelling approach, Group companies sell life and non-life products
through more than 400 non-exclusive agents, bank partners and exclusively through Insurance Corners in the
premises of its cooperation partners such as ENI Group.
Following the acquisition of a majority stake in Chiara
A ssicurazioni, Helvetia also has access to a banking
d istribution network which now comprises more than

1,000 branches.
Spain Helvetia offers its customers in Spain a diverse
range of life and non-life insurance products. Helvetia
a lso uses the multi-channelling approach in Spain, i.e.
customers are served through various sales channels, but
primarily by intermediaries such as brokers or tied
agents. Helvetia has business throughout Spain, but its
core regions are Andalusia and Navarre. The plan is to
further expand to three more affluent core regions –
atalonia, the Basque region and the metropolitan area
C
of Madrid – in the current strategy period of “2015+”.
Austria Helvetia is active in all business lines of life and
property / accident business in Austria. It is also a specialist transport insurer through its Austrian branch. New
business is primarily generated by our own sales force
and independent intermediaries. A total of around 400
sales employees work in customer care in this region.
Since 2010, the sales network has been strengthened by
intermediaries who are also independent, but work exclusively for Helvetia. In addition, the new “banking and
partnerships” sales channel was also established at the
start of 2012.
France Helvetia has been very successfully focusing on
transport insurance through its French branch office for
more than 20 years. In 2012, Helvetia Group acquired
the French transport insurance portfolio of Gan Eurocourtage, a subsidiary of Groupama SA. This made
H elvetia Group number two in the French transport insurance business. Following the acquisition of L’Européenne
d’Assurance Transport (CEAT) in 2009, this was H elvetia’s
second step in quick succession towards expansion in the
French market. In addition to damage to goods, road
haulier’s liability and damage to vehicle insurance, the
products we offer are enhanced by hull insurance products typical in marine insurance ranging from commercial
ships, fishing vessels, river vessels, yachts and ports.
Whilst the support functions are shared between two
one
c entral hubs in Paris and Le Havre, the business is d
through these hubs as well five regional branches.
Company profile Group structure
Group structure
Helvetia
Holding AG
St Gall
Helvetia
Versicherungen
1
St Gall 100 %
Helvetia
Beteiligungen AG
2
St Gall 100 %
Helvetia Holding
Suizo
3
Helvetia
Leben
Madrid 100 %
Helvetia
Compañía Suiza
3
Helvetia
Europe
2
Basel 100 %
Luxembourg 100 %
Helvetia
Finance
Seville 99 %
3
Helvetia
Versicherungen
3
Vienna 100 %
3
Helvetia
Vita
St Helier (Jersey)
100 %
Milan 100 %
3
2
Helvetia
Rückversicherung
St Gall
Chiara
Vita
4
Helvetia
Headquarters
Germany
Milan 70 %
3
Helvetia
Leben
Frankfurt 100 %
3
Frankfurt4
Helvetia
International
Frankfurt 100 %
3
Helvetia
Headquarters
Austria
Vienna4
Helvetia
Headquarters
Italy
Padana
Assicurazioni
Milan 100 %
3
Milan4
Chiara
Assicurazioni
Milan 51 %
Helvetia
Headquarters
France
3
Helvetia Assurances
S.A.
Paris 100 %
3
Paris4
1 Helvetia Holding AG, listed on the SIX Swiss Exchange
2 Direct subsidiaries of Helvetia Holding AG
3 Indirect subsidiaries of Helvetia Holding AG
4 Operational facilities of Helvetia Versicherungen, St Gall
23
Company profile Employees
Employees
Management culture – trust and partnership
The corporate culture of Helvetia is based on performance and trust. Mutual respect, acting as a role model
and close cooperation are firmly anchored in the principles of Helvetia Group. Helvetia aims to provide its
employees with an environment that promotes their
well-being and allows them to maximise their performance. Helvetia has a positive, value-based corporate
and management culture, a transparent and target-
orientated compensation system that rewards perform
ance and personal responsibility. A standardised target setting system is used throughout the Group to help
us accomplish this. In 2013, formal employee meetings
were held to assess the performance of 86 % of the employees and to discuss with them their opportunities for
development. Helvetia attaches great importance to
giving its employees individualised, equal opportunities. Work-life balance is supported by flexible working
time models, the granting of parental leave and, in
some cases, in-house company childcare facilities.
Helvetia also ensures equal pay for men and women.
Helvetia believes firmly in a culture of cooperation,
and the company encourages regular feedback, which
is the key to maximising the potential of the individual
and ensuring the success of the company. The dialogue
between employees and Helvetia is supported by national committees which also represent the interests and
rights of the employees. As an international Group,
Helvetia also encourages regular cross-border dialogue between the Group Executive Management and
the national employee representatives, which promotes
mutual understanding and solidarity.
Employee satisfaction – the opinion of all employees is important to Helvetia
In the financial year 2013, Helvetia conducted an extensive employee satisfaction survey. The previous survey took place in 2010. The “Commit 2013” survey,
which was conducted by an independent institute,
gave around 5,000 employees of Helvetia Group another opportunity to anonymously express their
thoughts concerning their working environment. 85 %
(2010: 84 %) of employees participated in the survey.
24
The high level of participation shows that open, constructive feedback is a significant component in
Helvetia’s corporate culture. The survey focused on the
commitment, satisfaction and customer-focused behaviour of our employees. The results, with 78 out of
100 achievable points (2010: 77 points), showed a
strong connection with Helvetia and, when compared
with the benchmark for other financial service providers, remains well above the average. Well-educated,
dedicated and competent employees are the most important drivers of our success. As a financial services
provider, the strong customer orientation of our employees is a decisive factor in the company’s success.
This reached a peak in the survey at 83 points (2010:
82 points). The assessment of the employees was confirmed by responses gleaned from the independent
survey of customers and agents in the country markets.
Helvetia employees were given good grades for their
focus on service and quality. The results of the employee survey were impressive in all the country markets.
Even in the French businesses, where, despite the
considerable changes resulting from the recent

acquisition of the transport insurance portfolio from
Gan Eurocourtage, high customer orientation was
maintained during the integration period. In total,
employees gave more positive answers to the majority of the topics than they did in the 2010 survey.
The results show not only which factors employees
assessed as being particularly positive, but also indicated potential for improvement. The survey results will
be used to take measures which will further increase
the willingness of employees to work for Helvetia, their
job satisfaction and their customer-orientated behaviour. Helvetia also makes use of Group-wide employer branding to increase its appeal as an employer; this branding effort forms the strategic framework
for all personnel marketing actions.
Company profile Employees
oration by means of an inpat / expat programme for
specialists and managers. In addition, the annual
management forum provides a platform for managers
from all country markets to exchange information
about a current, strategically-relevant management
issue within the Group.
Number of full-time employees according to GRI 3
CH
As at 31.12.2012
CH
2487
2500
D
769
765
I 2
483
448
E
513
526
A
640
644
F
312
332
5204
5215
I
496
E
516
612
F
284
1407
1128
1604
314
3 419
1 951
Men
Women
8.4
Average training days per employee
under 30
31– 40
1
3
41– 50
51– 60
over 60
Average age
4 849
Full-time employment
4 131
Office work
2
Total
802
A
Employees1
As at 31.12.2013
2 630
D
947
Personnel development – Helvetia challenges
and supports its employees
Helvetia operates in a demanding, intensely competitive market environment which varies considerably
due to globalisation and regulation. Helvetia’s systematic and proactive personnel planning and development programme addresses these changes as well as
future demographic challenges. Personnel planning is
concentrated on acquiring new employees and on the
systematic definition and development of their potential. In the financial year 2013, the Company’s well
established potential management programme was
enhanced to make it possible to gradually gain a
comprehensive, systematic overview of the Com

pany’s employees, both in Switzerland and abroad.
This supports the succession planning for key positions
and enables the placement and promotion of talent
within the Group.
Our strategy for senior managers includes expanding on existing knowledge and conveying the necessity for lifelong learning. Employees have a wide
range of options for further education and for improving their capabilities at national and Group level.
Helvetia also provides financial support and gives employees time to take advantage of external training
and further education aimed at current or future activities at Helvetia. The Group’s modular international
management training programme, in which the top
200 managers regularly participate, focuses on a
changing slate of strategic issues. In this programme,
Helvetia works closely with renowned educational institutions such as the London Business School and the
University of St Gall. Helvetia also fosters the international transfer of knowledge and Group-wide collab-
521
Part-time employment
1 239
Field service
The information is based on regular employees with permanent employment contracts.
The increase in employee numbers results from the acquisition of Chiara Assicurazioni.
D efinition in accordance with the Global Reporting Initiative. The key figures take all
e mployees into account (permanent and temporary contracts).
25
Company profile Customers and sales
Customers and sales
Sales structures optimised for specific
countries
Helvetia Group concentrates on the needs of retail customers and small and medium-sized businesses. Our product development and sales activities are consistently guided by customer
needs. Our decentralised organisation means
that we are able to quickly recognise and react
to shifts in demand. Helvetia has optimised sales
structures which are focused on the special features of the individual country markets. We gen-
erally pursue the so-called multi-channelling approach, i.e. appealing to customers through
various sales channels. In addition, Helvetia
works with renowned distribution partners such
as Raiffeisen Switzerland, the Swiss cantonal
banks and Vontobel Group, Banco di Desio, ENI
Group and the daily newspaper “Der Standard”
in Austria. Collaboration with these partners increases our sales reach and at the same time enables us to concentrate on our core competencies. The distribution partnership with Vontobel,
Overview of the sales channels by country
Own field
service
Switzerland
Agents
Broker
X
Partner
X
Raiffeisen, Vontobel,
Association of Swiss Cantonal Banks
Direct sales / new media
X
Helsana / innova and Solida
Affinity groups (SEV)
Germany
(exclusive and
non-exclusive)
X
ARAG (legal protection)
Alte Leipziger (home loan and savings)
Hallesche (health)
Italy
(based on legal
s pecifications not
a cting e xclusively)
X
Banking partners, Banco di Desio (life),
Chiara Assicurazioni network (non-life)
with many further partner banks
Worksite Marketing Partners (ENI, Agusta)
Spain
Austria
France
26
X
X
X
Product-specific partnerships (e.g. Carrefour
for household and funeral costs insurance,
household, Corte Ingles for funeral costs
insurance)
X
“Der Standard” daily newspaper
X
Yacht insurance with Société Générale,
bank partner with Caisses Regionales and
access to the Gan Eurocourtage agents
n etwork for transport insurance
Product-specific
f uneral provisions
Managing risks within an insurance company’s investment strategy is always a matter of balancing opposing tensions.
On the one hand, the strategy needs to be structured such that Helvetia can always meet its obligations to the insured.
On the other hand, it should also generate returns. With regard to our ongoing investment activity, these facts require us
to monitor risks and update our strategy to account for new developments.
John Noorlander, Head of Group Portfolio Strategy
“As Head of Portfolio Strategy, it is my task to draft strategies that will ensure the optimal development of our portfolio. In
addition, we also monitor the financial and equity markets and invest in bonds, shares and real estate. An experienced
portfolio manager not only has a good intuitive feeling for the capital markets but can also recognise investment risks
and manage them by, for example, diversifying the portfolio across different investment classes. This, however, means
that at Helvetia, we need to be able to react quickly to changes in circumstances and be constantly prepared to revise
our expectations. The instruments we use at Helvetia enable us to act quickly and decisively.”
Company profile Customers and sales
which was established in 1996, was just extended for another five years during the past financial
year.
Focus on customer needs
Our customers are at the centre of our activities.
Trust in our company, high levels of satisfaction
with our products and services, recommendations and long-term business relationships form
the basis of our business success. Helvetia primarily differentiates itself as a quality provider by
being very highly service oriented, with the focus
on the personality of each customer and a partnership based on trust. It achieves a high level of
customer loyalty through quick, personal and
competent customer care. Our customers’ feedback is important to us. Depending on the sales
focus in the individual countries, feedback is
gathered via a Helvetia hotline, the sales force,
the broker channel or our distribution partners.
We receive important information from our workshops about how we can make our processes,
correspondence and product information simple
and comprehensible. Customer questionnaires
add an extra level to this feedback and make it
possible to make a detailed assessment of our
products and advice quality. An independent
market research institute surveys our retail customers every two years. These surveys are coordinated at the Group level and take place at the
same time for all the individual country companies and product areas. Following the surveys,
benchmark studies are prepared which serve to
assess the location with regard to our image and
the satisfaction and loyalty of various customer
target groups. We collect information separately
for the product areas of non-life, group life and
private pension provision. In addition, we carry
out regular broker surveys and participate in external surveys.
In the past financial year, external surveys were
carried out of customers and brokers in Germany
and Italy. Helvetia achieved very good results
in terms of service orientation and customer
satisfaction. The details can be found in the table
below:
Our awards
Survey
Germany
Italy
Affected
products and
services
Survey results
Source
Broker
champions
2013
Service quality for life
insurance broker
1st place
Versicherungs
magazin / ServiceValue
GmbH, 2013
Broker
champions
2013
Service quality for
property insurance
brokers
6th place
Versicherungs
magazin / ServiceValue
GmbH, 2013
CHARTA
quality
b arometer
Overall broker satisfaction / individual
s atisfaction values
from nine areas
Non-life quality index
10th place
Life quality index
6th place
CHARTA Börse
für Versicherungen AG / YouGov opinion
research institute
Ricerca
Customer
Satisfaction
Awards
Vehicle insurance,
c ust omer relationship
satisfaction and
claims settlement for
end customers
1st place
Databank
(Detailed information about awards in Germany at:
www.helvetia.com/de/content/de/ueber-uns/presse/
pressemeldungen-inhalt/2013/service
www.helvetia.com/de/content/de/ueber-uns/presse/
pressemeldungen-inhalt/2013/charta-2013)
(Detailed information on Italy on: www.helvetia.com/
it/content/dam/helvetia/it/content/it/Allegati/
Comunicati-Stampa/risultati-ricerca-CSA.pdf)
29
Company profile New products and innovations
New products and innovations
New products in financial year 2013
The continual ageing of the population, fewer
people working in future and social security systems which are coming under increasing pressure
– demographic change is both a challenge and
an opportunity for Helvetia. The foreseeable add
itional cuts in statutory pension schemes are further stimulating demand for private pension solutions. At the same time, turbulence on the financial
markets is increasing the demand for products
with financial guarantees. This has resulted in many customers wanting to link their coverage with
a return-oriented cash investment. At Helvetia, we
are therefore continually enhancing our product
range and regularly launch new products that
cover our customers’ requirements even better.
This is done in line with our strategy of focusing
more on further developing modern capital-efficient life insurance products in the life business.
These products are intended to comprise 50 % of
new business in the medium term.
The following overview shows the new products launched in financial year 2013. These were
entirely in the life business.
Innovations
Helvetia has been involved in social networks
since 2010. Since then, social media has also become firmly established in the professional envir
onment as a new communication channel. It not
only offers the functionality of direct information
and contact platforms, but is also a crucial marketing instrument.
Helvetia blog
Helvetia launched its own online dialogue platform, the “Helvetia blog” at the end of 2012. This
supplements the insurance group’s existing Internet presence through informative and surprising
stories from Helvetia’s world. The company blog
lends itself to acting as a dialogue platform, particularly through the opportunities of social media
interconnectedness. The first blog went online in
30
the country market of Switzerland in November
2012. The country market of Austria has had an
active blog since February 2013, Germany’s blog
was launched in August 2013 and Spain and
Italy’s blogs have been online since December
2013.
The Helvetia blog is one of the best new developments of social media in the German-speaking
part of Europe and won two prizes in financial
year 2013: The renowned Corporate Publishing
panel awarded the blog a silver in the “Best of
Corporate Publishing” (BCP) competition in June
2013. With over 650 publications submitted, BCP
is the largest competition for corporate communication in Europe. In October 2013 the Helvetia
blog also won silver at the 2013 Econ Awards in
Berlin in the “Digital Media” category.
Mobile technologies have never been so popular and are continuing to gain influence rapidly.
Helvetia shows how insurers too can use these
technologies to improve their claims processes
while customers benefit from additional services.
Motor vehicle claim application
In Austria, Helvetia has made a new, free motor
vehicle claim app for iPhone available to Helvetia
motor vehicle customers since financial year
2013. It offers car drivers convenient immediate
support in motor vehicle claims and walks them
through reporting the claim. The motor vehicle
app has already been successfully used at
Helvetia Germany for two years. Helvetia also already has an emergency app in Switzerland with
national and international emergency phone
numbers, detailed accident check lists, first aid
and other useful features.
Company profile New products and innovations
New products
Product name
Switzerland
Significant product characteristics
−
−
−
−
Further information
Guarantee plan
F inance with single premiums or ongoing premium payments
Capital protection: guaranteed capital at the end of the contract
P rofit potential through diversified investment strategy
Two guarantee profiles to choose from: “conserv ative” with higher capital
p rotection and “dynamic” with higher potential profit
− Partner for the guarantee: Leonteq Securities AG, Raiffeisen Schweiz
G enossenschaft
www.helvetia.com/ch/content/de/
privatkunden/private-vorsorge/
garantieplan
Payment plan
−
−
−
−
auszahlungsplan
Value trend
− F inancing with single premium
− G uaranteed capital at the end of the contract
− P rospect of additional profits thanks to an attractive index strategy
helvetia-value-trend
Spain
“Helvetia Inversion
Flexible”
− F inancing with single premium
− G uaranteed capital at the end of the contract
− P roduct partner: Leonteq Securities AG
www.helvetia.es/conocenos/
noticias/lanzamiento-del-nuevo-
producto-de-ahorro-inversionhelvetia-inversion-flexible
Germany
“Risiko+”
−R
isk life insurance
− Contribution reduction for non-smoker status and healthy body mass index (BMI)
− D ifferentiation based on level of education and family situation (“children”)
www.helvetia.com/de/content/de/
ueber-uns/presse/pressemeldungeninhalt/2013/risk-insurence
Austria
“Helvetia Clever
Protect”
−R
isk life insurance
− Contribution reduction for non-smoker status and healthy body mass index (BMI)
− D ifferentiation based on level of education and family situation (“children”)
www.helvetia.com/at/content/de/
privatkunden/lebensversicherungvorsorge/ablebensversicherung
F inancing with single premium
No biometric risk
Partner for the guarantee: Raiffeisen Schweiz G enossenschaft
P roduct partner: Leonteq Securities AG
31
Company profile Corporate responsibility
Helvetia takes its corporate responsibility as a
successful business enterprise very seriously and
has done so for many years. Corporate responsibility (CR) is a topic which Helvetia puts into practice in its approach to environmental and social
issues, but particularly in the core business.
After comprehensively evaluating the situation
in 2012, Helvetia has expanded its sustainability
management with improved organisational structures and stronger integration in corporate
governance.
Helvetia is thus firmly focused on the guiding
principle of good corporate governance. It is
clearly committed to sustainable economic activity, protecting natural resources and fulfilling its
social responsibilities. This is based on a Groupwide sustainability strategy which Executive Management authorised in February 2013.
Corporate responsibility approach
The corporate responsibility strategy is based on
our corporate guiding principles and central
values. With its three dimensions of core business,
environment and society, it is part of Group strategy, supports this strategy and gives it fresh impetus through specific fields of action in the area of
sustainability.
Helvetia’s business activities affect the interests
of large numbers of people in different countries.
The focal points are therefore primarily employees’ attitudes to changes in the company and the
relationship to stakeholders outside the company.
A systematic management process supports the
transparency and verifiability of the corporate
responsibility strategy. More information is available at: www.helvetia.com/corporate/content/
en/about-us/commitment/corporate-responsibility/
strategy.
Our corporate responsibility approach
Normative framework: corporate guiding principles, values and
corporate strategy of Helvetia Group
Customers
Employees
Responsibility for core
business
Responsibility for the
environment
Integration of ecological,
environmental, social and
governance topics in:
Expansion of environmental management
Targeted assistance of
social and cultural projects
adapted to core business
Insurance business
Shareholders
Distribution partners
Investment management
(financial and property
investments)
Supervisory authorities
Procurement
management
elvetia forest protection
H
initiative
Helvetia Patria Jeunesse
Foundation
Helvetia as an employer
Society
Corporate responsibility organisation, management system,
communication, GRI reporting
32
Materiality analysis
Current and future corporate responsibility opportunities and risks were assessed for the first
time in 2013 in a comprehensive evaluation of
the situation. The Global Reporting Initiative
(GRI), specific challenges in the core business
and the concerns of our most important stakeholders provided guidelines for topic selection.
The result is a materiality matrix with twelve
topics that will gradually be underpinned with
specific objectives and measures.
For example, Helvetia intensified the dialogue
about environmentally friendly insurance products in 2013. The risk-controlled investment
a pproach aimed at long-term performance has
also been evaluated with regard to sustainability
aspects for the first time. As far as the most im-
portant project for local involvement, Helvetia’s
commitment to protecting forests is concerned,
trees have been planted not just in Switzerland,
but also in Germany and Austria. Moreover, principles were defined for taking account of sustainability criteria in procurement management.
Implementation
The corporate responsibility organisation introduced in 2012 helps to organise successful implementation of the strategy and to expand our
own “best practices” ever further. Institutionalised cross-border communication through the
Corporate Responsibility Advisory Board in particular helps to monitor relevant management
processes and review whether objectives set
have been reached.
Materiality matrix
Very high
Customer satisfaction and customer loyalty
Sustainable investments
Responsibility:
Core business
Significance for Stakeholders
Fair business activity
Sustainable insurance products
Sustainable procurement
Corporate Governance, risk
management and compliance
Employee commitment
Environmental impact from
operations (Helvetia carbon
footprint)
Connection to the local site
Increasing regulation
Extreme weather
Securing qualified workers
Environment
Society
Helvetia as an employer
High
Significance for Helvetia
Very high
33
Organisational anchoring of CR management
Executive Management of the Helvetia Group
Corporate Responsibility Management Team
Corporate Responsibility Competence Centre
Country markets
Helvetia Group
Development and implementation of the CR strategy on behalf of Executive Management
Corporate Responsibility Advisory Board
Consultation and consensus on ongoing and planned CR measures
Switzerland
Germany
Italy
Spain
Austria
France
Persons responsible for corporate responsibility in the
Helvetia Business Units (Executive Management)
www.helvetia.com/corporate/content/de/ueber-uns/engagement/
corporate-responsibility/organisatorische-verankerung
Structure and responsibilities at a glance
In addition, corporate responsibility depends on
small, but deliberate steps. Right from the start,
the action days which were run in all country
markets have proved how much this topic moves
our employees. The events include discussion
forums on operational energy management, on
the topic of organ donation, on commitment to
protecting forests and numerous films and talks
which spelled out the diversity and dynamics in
all three areas of sustainability.
Reporting
Helvetia also systematically follows the path of
making sustainable corporate governance meas
urable and manageable in its reporting. In 2013,
Switzerland was the first country in Helvetia
Group to publish a sustainability report using the
Global Reporting Initiative’s latest guidelines.
Helvetia Group won an award from the Carbon
Disclosure Project for the transparency of its
c limate reporting in the reporting year.
www.helvetia.com/corporate/content/en/about-us/
commitment/corporate-responsibility/news
Our carbon footprint
Metric tons
230 | Electricity
1 515 | Heating
1 631 | Business travel
358 | Paper
57 | Water
66 | Waste
0 | Coolants and fire-extinguishing agents
34
Company profile Investor information
Investor information
Driven by the expansionary monetary policy pursued by the central banks and economies that
are gaining momentum, the equity markets recorded an extraordinarily strong performance in
the reporting year. Insurance stocks in particular
not only achieved attractive price gains because
of the solid business performance but also because they paid attractive dividends, thereby
achieving an excellent overall performance.
With a performance of 34.8 %, which comprises
a price rise of 29.2 % and a dividend payout of
5.6 %, Helvetia shares performed very well compared to the competition, leaving the key benchmark indices far behind. This holds true not only
when applied to the Swiss market, both as a
whole (+23.0 %) and in the insurance segment
(+26.9 %), but also when compared to the European insurance index (+37.9 %).
This shows that the equity market recognises the
value of our robust business model and our sustainable, reliable business results.
Stable shareholder base
There was no change in the core shareholder
base compared to the end of 2012 and the freefloat is unchanged at 61.9 %. As at 31 December
2013, the following important shareholders were
registered in the share register of Helvetia
Holding AG:
Helvetia share
Symbol
Nominal value
HELN
CHF 0.10
Security number 1 227 168
Listing
SIX
Shareholder base as of 31 December
2013
–– Patria Genossenschaft
30.1 %
–– Vontobel Gruppe
4.0 %
–– Raiffeisen Schweiz
4.0 %
In keeping with the trend set by recent years, the
number of registered shareholders increased by
around 5 % to 10,021 on 31 December 2013.
Market trend 1.1.2011 – 28.2.2014
Helvetia Holding AG
SMI
in CHF
Swiss Insurance Index
600
DJ EuroStoxx Insurance Index
550
Dividend payment
CHF 17.00
500
Dividend payment
CHF 16.00
450
Dividend payment
CHF 16.00
400
350
300
250
01/14
09/13
05/13
01/13
09/12
05/12
01/12
09/11
05/11
01/11
200
35
At the end of 2013, the employees held 1.4 % of
the share capital, around 0.1 % of which was
held by members of the Board of Directors and
Executive Management of Helvetia Group.
The majority of registered shareholders are
based in Switzerland. Of the institutional shareholders – excluding the above core sharehold65.0 % have their registered office in
ers –
Switzerland (previous year: 68.5 %) and 35.0 %
%).
are based abroad (previous year: 31.5 Shares pending registration fell slightly year-onyear, ending the year at 20.2 %.
The average number of Helvetia shares traded in
2013 was nearly 13,700 per day, representing
a year-on-year increase of nearly 10 %. This represents a higher than average increase in comparison with the respective trading volume on the
Swiss Exchange.
Investor groups (excluding core shareholder base)
in %
25.3 %
Private individuals
57.7 %
Other institutional
investors
17.0 %
Banks / Insurance
Dividend history
Dividend per share (in CHF) | Dividend yield at year-end price | Payout ratio
2013*
2012
36
17.00 | 4.9% | 46%
2011
16.00 | 5.4% | 49%
2010
16.00 | 4.5% | 41%
2009
*
17.50 | 3.9% | 43%
Proposal to the Shareholders’ Meeting
14.50 | 4.5% | 39%
The structure of the types of investors has shifted
slightly since the previous year to include more
banks and insurers and fewer other institutional
investors. The structure as of 31 December 2013
is shown in table below.
Successful Shareholders’ Meeting 2013
Helvetia Group once again presented a particularly solid annual result to the 1,591 shareholders
with voting rights attending the Shareholders’
Meeting. The Shareholders’ Meeting took note of
the strong operating performance in challenging
market conditions and approved the annual report, financial statements and consolidated financial statements for 2012. The terms of office of
members of the Board of Directors Christoph
Lechner, Herbert J. Scheidt and Erich Walser expired and they were reappointed for a further
term in office of three years.
Dividend policy
Helvetia strives to generate an attractive return
on invested capital for its shareholders, and pursues an income-oriented, sustainable distribution
policy that allows the company to maintain its
solid capital base. In the context of the “Helvetia
2015+” strategy, we aim to pay out a stable proportion of profits ranging between 30 and 50 %.
As a result of the strong 2013 annual results, the
Board of Directors is proposing to raise the dividend to CHF 17.50 per share (previous year:
CHF 17.00).
Bonds in circulation
In the 2013 financial year, Helvetia Group issued
a new bond with a volume of CHF 150 million,
an annually payable coupon of 1.125 % and a
term of six years. With this issuance, Helvetia refinanced an expired bond whilst exploiting favourable market conditions.
In addition, the Group has a CHF 300 million subordinated perpetual bond issued by Helvetia
S chweizerische Versicherungsgesellschaft in

issue, which pays an annual interest of 4.75 % for
the first five years. The first termination date on
which Helvetia has the right, but not the duty, to
redeem the bond is 30 November 2015. Further
information on our bonds can be downloaded
from our website under “Investors / Debt information”.
shareholders, analysts and media representatives are available online in the “Investors”
s ection at www.helvetia.com.
Active capital market communication
Helvetia communicates with shareholders, potential investors, financial analysts and the general
public comprehensively and on a regular basis.
We communicate financial results at analysts’,
media and telephone conferences. All publications are made publicly available at the same
time. We engage in regular dialogue with our investors and visit them in the most important financial centres. In the 2013 reporting year, our road
shows took us to Zurich, Geneva, Frankfurt, Paris,
London, Edinburgh, Dublin and Scandinavia. In
addition, we held group and individual discussions with investors and take part in selected conferences hosted by financial institutions. All regis
tered shareholders receive a shareholders’ letter
with a brief overview of business operations
every six months. The annual report and fi
nancial
report are sent to shareholders on request. All
publications and a wealth of information for
Key share data Helvetia Holding AG
2013
2012
44 255
40 436
8 608 620
8 612 439
8 652 875
8 652 875
Year-end
447.5
346.5
High for the year
450.0
350.0
Low for the year
352.0
259.0
3 872.2
2 998.2
445.0
435.4
Treasury shares
Shares in circulation
Price of Helvetia registered shares
Market capitalisation
in CHF
in CHF million
Consolidated equity per share
in CHF
Price / book ratio (P / B) 1
Profit for the period per share
in CHF
Price / earnings ratio (P / E) 1
Dividend per share 2
Payout ratio 2
Dividend yield 1, 2
1
2
1.0
0.8
40.9
37.1
10.9
9.3
17.50
17.00
43 %
46 %
3.9 %
4.9 %
Based on year-end price.
Proposal to the Shareholders’ meeting.
37
Company profile Risk and investment management
Risk and
investment management
Risk management
Given the continuing challenging economic en
vironment, a comprehensive risk management
function is a top priority and is integral to the
way Helvetia Group manages its business. One
of the primary objectives of risk management is
the sustained safeguarding of the capital base as
well as the reputation of Helvetia Group and its
Group businesses.
Risk management organisation
The organisational structure of Helvetia Group
ensures a standardised application of the Groupwide risk management standard. In doing so,
roles and responsibilities in the business units
comply with the risk management organisation of
Risk management organisation
Risk owners
Board of Directors
(Investment and Risk, Audit, Strategy and
Governance committees)
Risk observers
Risk Committee
Risk and Capital Management
Specialised risk controlling units
(e.g. Group Actuarial Departments Life / Non-Life, Asset Management)
Risk takers
Risk management at the company
units and processes
38
Internal Audit
the Group. This is based on a governance model
that differentiates between the three basic roles
of risk owner, risk observer and risk taker.
The supreme risk owner is the Board of
Helvetia Holding (particularly the Investment and
Risk Committee, Audit Committee and the Strat
egy and Governance Committee) as well as the
Group Executive Management. As the central
bodies responsible for this function, they bear the
ultimate responsibility for risk and define the risk
strategy and the risk appetite for the Group.
Various risk observers assess the risks entered
into by Helvetia Group irrespective of an operational responsibility. The Risk Committee
c oordinates the collaboration between the risk
observers and the risk takers and advises the
Board of Directors and Executive Management in
their decisions. The central risk controlling role
“Risk & Capital Management” is responsible for
the growth and development of the risk management system as well as for monitoring risks and
controlling measures, and serves as a competence centre for the Group’s risk management. It
is supported by specialised risk controlling functions, such as the Group actuarial office and
a sset management. The internal auditor independently monitors the efficiency of the risk
management system.
The risk takers control and manage risks in an
operational context. They are responsible for risk
management in the different business areas and
processes.
Risk management process and
risk environment
The key components of the Helvetia Group risk
management process include the identification,
analysis and management of risks, the monitoring of the success, effectiveness and appropriateness of the risk management measures, and
reporting and communication. The risk management process ensures that sufficient risk-bearing
capital is available at any time to cover the risks
assumed in accordance with the chosen risk tolerance.
The numerous risks to which Helvetia Group is
exposed in its business activities are included in
the risk management process of the Group. Market risks arise, in particular, from interest rate
changes, fluctuations in share prices, real estate
prices, or exchange rates which influence the
value of the Group’s investments. Liquidity risk
generally refers to the risk of being unable to provide an unexpected cash outflow in a timely
manner. Counterparty or credit risk is the risk of a
contractual counterparty being unable to pay or
of a change in the counterparty’s creditworthiness. The insurance technical risks of life and nonlife belong to the traditional risks of an insurance
company and are consciously entered into as part
of the chosen business strategy. Operational risk
represents the risk of losses due to errors or the
failure of internal processes, employees or s ystems,
or as a result of external events whereby operat
ional risks are taken also into consideration.
Strategic risks include the risk of not achieving
business targets due to the inadequate alignment
of a company’s business activities on the market
and in the market environment. Emerging risks are
risks that have not yet been realised as actual
risks, but are already in existence and have a high
potential for large claims. A detailed portrayal of
the risks resulting from financial instruments and
insurance contracts is provided in Note 17 (from
page 176) of the Financial Report.
Methods for risk analysis and control
The diverse risk environment requires the use of
differing methods of risk analysis. Helvetia Group
uses the Swiss Solvency Test from the Swiss supervisory authorities as a primary instrument for ana
lysing and quantifying market, counterparty and
technical risks. The company uses internal models here, including for the areas of market risk
and technical risk. Risks are controlled and limited by means of hedging instruments, specific
product design, reinsurance protection, limit systems (including exposure control and loss limits),
diversification strategies, process optimisations
and other measures.
Risk environment
Market risks
Share price risk
Interest rate risk
Exchange rate risk
Real estate
investment risk
Liquidity risks
Medium-term
and short-term
liquidity risks
Counterparty
risks
Reinsurance
Investments
Other receivables
Actuarial risks
Life (mortality, long
evity, disability, costs,
exercising of options)
Non-life (natural
h azards, major claims,
base volatility, reserve
risk)
Operational
risks
Strategic risks
Emerging risks
Long-term liquidity risks
Other
39
Capital management
Capital management is an essential pillar for
achieving Helvetia Group’s long-term growth targets aimed at profitability. The optimisation of the
capital allocation and income flows has the following objectives:
–ensuring compliance with regulatory capital requirements at all times;
–securing the capital required to underwrite new
business;
–optimising the earning power of its equity;
–supporting strategic growth;
–optimising financial flexibility.
These objectives will be defined whilst taking into
consideration the risk-bearing capacity and costbenefit considerations. Furthermore, as part of its
capital management, Helvetia Group pursues the
goal of an interactive financial strength rating of at
least “A–”.
Methods for measuring capital
The measurement of capitalisation is carried out
both at Group level and at local level, i.e. at the
level of the individual legal entities. At a local
level, the country-specific regulatory and commercial law requirements are key. At Group
l evel, capital is measured on the basis of the consolidated balance sheet. In doing so, the capital
requirements are measured by the capital models
which are relevant to Helvetia Group: Solvency I,
Swiss Solvency Test and Standard & Poor’s.
In these capital models, the IFRS equity forms
the basis for establishing the available capital.
Additional capital is added depending on the
model and other components, such as the deduction of planned dividend payments and intan
gible assets are deducted. Under the Swiss
S olvency Test, all assets and liabilities are

measured at market prices for the calculation of
the available capital.
While the amount of capital required under
Solvency I is basically calculated as a function of
business volume, a risk-based calculation m
ethod
is applied to calculate the capital required under
Standard & Poor’s and under the Swiss Solvency
Test. In the Swiss Solvency Test, the effects of
risks on the available capital are determined by
means of scenario simulations and statistical
40
methods, and quantified taking into consideration dependencies and diversification effects in
the form of a risk-based capital requirement.
Capital management process
Helvetia applies an integrated approach to capital
management. At the strategic level, the capitalisation and the risk profile of business units are managed in terms of profitability and growth potential
and therefore of the strategic Group targets. Capital
is managed integrally in accordance with a defined
capitalisation target under the Swiss Solvency Test,
Solvency I and Standard & Poor’s, and is aligned
with the corporate strategy using multi-year capital
planning. At an operational level, the capital
management process incorporates the financing
within the Group as well as the safeguarding of adequate capitalisation of the individual legal entities
of the Group. In this process, the capitalisation is
closely monitored and optimised according to in
ternally defined thresholds.
Outlook
The regulatory requirements for risk and capital management remain subject to major changes. Provisionally from 1 January 2016, Solvency II will see the application of an analogous supervisory instrument in
the introduction phase in the EU. With its EU business
units, Helvetia Group is also directly affected by
Solvency II. Due to many years of experience in risk
management and with the Swiss Solvency Test,
Helvetia is well prepared for the new requirements. In
addition to the monitoring of corporate governance,
the introduction of Solvency II in Helvetia requires in
particular providing the necessary data and systems
to enable the optimal incorporation of the new
requirements in the existing processes (particularly
reporting, risk and capital management) and to implement them in a timely manner using strict planning and
tests. Further statements concerning capital management are provided on page 161 in the notes to the
Financial Report.
What measures can insurers take to minimise risks and be as prepared as possible to manage major claim events?
As well as developing the necessary risk awareness, it is also important to recognise that the greater the transparency
of damage potential, the better the insurability. This applies especially to the underwriting department of an insurance
company, where we use calculation and probability models to help us deal professionally with a range of different
scenarios. Following a disciplined underwriting strategy can considerably reduce volatility in the earnings of an insurer.
Ruth Rechsteiner, Underwriter Liability
“Underwriters are responsible for underwriting risks at Helvetia. Together with our sales partners, we analyse and assess
industrial and personal risks und use the information gathered to create our insurance contracts. As an underwriter in
the front office for business customers, I evaluate insurance applications from a wide range of industries. With over 150
years of experience, Helvetia is able to accurately assess the risks of most of our customers. The underwriting department not only aims to assess risks but also strives to provide the best possible support and guidance to our sales partners when acquiring and advising new customers. Our focus is on the end customer and we always try to find the right
solution for them.”
Investment management
Helvetia Group pursues a sustainable investment policy tailored to the liabilities arising from the insurance business. The objective is to generate attractive
medium- and long-term returns for the shareholders
and to make a reliable contribution to the Group
result.
Proven asset liability management
The investment strategy of Helvetia is based on a
time-tested asset liability concept. First, a strategic
asset allocation for each business unit is derived on
the basis of a careful analysis of the liabilities. This
satisfies the high security requirements of the insurance business while at the same time meeting the
requirements for returns of each of the individual
stakeholder groups. Moreover, the asset liability
management ensures that there is always enough
capital available for the ongoing strategic development of the Group and that the increasing regulat
ory requirements are taken into consideration. In
doing so, the regulatory solvency requirements must
be fulfilled at all times. The introduction of the Swiss
Solvency Test made it possible to gradually and noticeably extend the duration of the fixed-income
products in the life business. Due to the long maturities of the assets, the period of very low interest
rates is only gradually having an effect on direct returns. At the same time, the reduction in the guaranteed interest rates included in life insurance policies
also helps balance out this effect.
Broadly diversified investment portfolio
The Helvetia investment portfolio is broadly diversified. The balanced distribution of the portfolio applies both between and within the individual asset
classes. In order to avoid cluster risks, absolute exposure limits apply to the individual counterparties,
depending on their creditworthiness. Moreover,
Helvetia places high demands on the quality of the
counterparties. At the end of the year, around 75 %
of the bond portfolio had at least an AA rating. In
addition, the proportion of government securities
and collateralised bonds is above average at
around 75.7 %.
Attractive, stable investment income
We generate attractive investment income for our
customers and shareholders while controlling investment risk through the prudent combination of lowrisk assets, such as high-quality bonds and mortgages, which make up almost 70 % of the portfolio,
and instruments with higher returns such as real estate and shares. The interest income gained from
bonds, mortgages and real estate ensures the sustained stability of the investment income, while the
valuation gains from the equity exposure create
interesting medium-term potential for returns.

Helvetia’s high-quality property portfolio is an excellent fit with the liabilities from the insurance business, not only because of the long-term stable and
attractive rental income, but also due to the stable
values of the assets.
Prudent investment strategy and timely
risk management
The investment strategy is defined in detail and implemented as part of the annual adaptation of the
investment approach. Adjustments are made to take
advantage of new opportunities arising from shortterm market developments, while remaining within
the tactical bandwidths established by the management. The investment strategy is always supported
by timely risk management. The objective of the
risk-controlling measures is to protect the balance
sheet and the income statement from excessive losses in value. This applies to exposures in foreign currencies and shares, whereby – depending on market developments – particular use is made of options
and futures to hedge risks; in addition, counterparty
risks are subjected to ongoing analysis and control
using various criteria such as ratings, credit quality,
and the development of interest spreads. To avoid
cluster risks, we also apply graded upper limits
based on debtor quality.
Investment strategy and risk management are
designed to ensure the Group’s long-term solv
ency and to optimise the impact of volatile
markets on the annual result.
43
Company profile Board of Directors
Board of Directors
Elections
The term of office of each member is coordinated in
such a way as to ensure that each year one third of
the members of the Board of Directors is available for
election or reelection. In conjunction with the adop
tion of the popular initiative “Gegen die Abzockerei”
(“against abusive remuneration”) in Switzerland (the
Minder initiative), the term of office for all Board
members is limited to one year, although immediate
reelection is possible. Another new element is that the
Chairman of the Board of Directors and the members
of the Nomination and Compensation Committee are
reelected by the Shareholders’ Meeting for one year.
Here, too, immediate reelection is possible. All Board
members, the Chairman and the members of the
Nomination and Compensation Committee are avail
able for reelection; therefore the Board of Directors
asks them to stand for reelection at the Shareholders’
Meeting that takes place on 25 April 2014.
The Board of Directors of Helvetia Holding AG is the
highest management body of the company. It is re
sponsible for the overall management and the strat
egic direction of the Group and it also appoints and
monitors the Executive Management. The Board of
Directors currently consists of nine members. Different
committees have been formed in order to make good
use of the specialist knowledge of its individual mem
bers in its decision-making processes. With the Strat
egy and Governance Committee, the Nomination
and Compensation Committee, the Audit Committee
as well as the Investment and Risk Committee, Helvetia
has four Board committees which ensure the effective
control and monitoring of the company. The tasks of
the committees are of an essentially preparatory na
ture. Any decision-making powers are listed in Appen
dix I of the organisational regulations: www.helvetia.
com/gruppe/governance.
The current composition of the Board of Directors is
shown in the table below.
The Board of Directors of Helvetia Holding AG
44
Function
Entry
Elected until
SGC
NCC
IRC
AC
Erich Walser
Chairman
2001
2014
• •
• •
+
+
D oris
Vice Chairwoman
2008
2014
•
Hans-Jürg Bernet
Member
2006
2014
Jean-René Fournier
Member
2011
2014
Paola Ghillani
Member
2008
2014
Russi Schurter
Christoph Lechner
Member
2006
2014
John Martin Manser
Member
1996
2014
Herbert J. Scheidt
Member
2011
2014
Pierin Vincenz
Member
2000
2014
•
•
• •
•
•
•
•
•
• •
•
•
•
•
SGC
Strategy and Governance Committee
• •
Chairman
NCC
Nomination and Compensation Committee
•
Member
IRC
Investment and Risk Committee
+May join meetings at own request in an advisory
AC
Audit Committee
capacity
Erich Walser
Doris Russi Schurter
Hans-Jürg Bernet
Jean-René Fournier
Paola Ghillani
Christoph Lechner
Herbert J. Scheidt
Pierin Vincenz
Erich Walser
John Martin Manser
Doris Russi Schurter
Bachelor’s degree, law degree
(lic. oec. HSG, lic. iur.)
Swiss, Rehetobel, 1947
Professional background, exercising
operational executive functions Chairman of the Board of Directors; up to 1978 various
roles at banks; 1979 joined Helvetia: various manager
ial functions; 1991 Chief Executive Officer at Helvetia
Versicherungen; 1994 Chief Executive Officer at
Helvetia Patria Group; 2001 Delegate of the Board of
Directors, from 12 December 2003 to 31 August 2007
Chairman of the Board of Directors and CEO of Helvetia
Group, since 1 September 2007 in current role.
Appointments at listed companies
Designated Chairman of the Board of Directors
Huber+Suhner AG, Herisau.
Appointments at other companies
Six appointments, in particular President of the För
dergesellschaft des Instituts für Versicherungswirtschaft
at the University of St Gall.
Law degree (lic. iur.), Lawyer (with own practice)
Swiss, Lucerne, 1956
operational executive functions
Until 2005, partner at KPMG Switzerland, including
1994 – 2005 Managing Partner at KPMG Lucerne.
Member of the Board of Directors at Lucerne canton
al bank, Lucerne.
Four appointments, in particular President of the
Board of Directors at Patria Genossenschaft, Basel;
Vice-President at Swissgrid AG, Laufenburg; and LZ
Medien Holding, Lucerne.
Pro bono appointments
Seven appointments, in particular President of the
Association of Swiss Companies in Germany, VSUD,
Basel, and various commitments at the University of
Applied Sciences and University of Lucerne.
Eight appointments at charitable organisations and
institutions.
45
Hans-Jürg Bernet
Paola Ghillani
Doctorate in economics from the University of
St Gall (Dr. oec. HSG)
Swiss, St Gall, 1949
Joined the Zurich Insurance Group in 1977, various
managerial positions, including: 1993 member of
the Executive Management of Zurich Switzerland,
2001 – 2005 CEO Zurich Switzerland, 2001 – 2004
Member of the Extended Group Executive Board of
the ZFS Group; 2002 – 2005 Vice-President of the
SVV (Swiss Insurance Association); 2001 – 2005
Management Board and Vice-President of the För
dergesellschaft I.VW.
Board of Directors member at St Gall cantonal bank,
St Gall.
Four appointments at non-listed companies, in par
ticular SWICA healthcare organisation, Winterthur.
Four appointments at charitable organisations and
institutions.
Pharmacist
Swiss, Bulle, and Italian,
Collecchio, 1963
Consumer health analyst and product manager for
Ciba / Novartis as well as marketing director for
Benelux; International Marketing Director at Ber
nafon International Ltd; from 1999 to 2005 CEO at
the Max Havelaar Foundation, Switzerland; current
ly owner of her own company in the area of Strat
egic Planning and Management Consulting, Zurich.
Member of the Board of Directors at Romande Energie
Holding SA, Morges.
Two appointments at non-listed companies, in par
ticular member of the management board at Migros
Cooperative, Zurich.
Member of the International Red Cross Committee.
Christoph Lechner
Jean-René Fournier
Bachelor’s degree in economics from the University
of Freiburg (lic. oec. publ.)
Swiss, Sion, 1957
Management positions at UBS; 1997 – 2009 State
Council of the canton of Valais; since 2007 Senate
of the canton of Valais; since 2011 President of the
Finance Commission of the Senate.
No appointments at listed companies
Six appointments at non-listed companies / institu
tions: Board of Directors at Patria Genossenschaft;
Board of Directors at Forces motrices de la Gougra
SA, Sierre, and Grande Dixence SA, Sion; Senior
Advisor at Credit Suisse SA; Member of the Execu
tive Board of the Swiss Trade Association and Presi
dent of the Union valaisanne des arts métiers.
Prof. and Doctor of economics (Prof. Dr. oec.)
Swiss and German citizenship,
Hettlingen, 1967
1987 – 1995 various positions at Deutsche Bank, in
cluding: Corporate Banking and Assistant to the
Management (Germany); Corporate Finance (Singa
pore); 1995 – 2004 University St Gall, promotion
and habilitation, guest professor in the USA (Whar
ton and Connecticut) as well as South America (IAE
Argentina); 2004 to present, professor of Strategic
Management at the University of St Gall and also
Chairman of the Board at the Institute of Manage
ment (IfB).
Member of the Board of Directors at Hügli Holding
AG, Steinach.
No appointments at other companies and
pro bono appointments
No pro bono appointments
46
John Martin Manser
Pierin Vincenz
MBA; financial consultation
Swiss, Riehen, 1947
Doctor of Economics (Dr. oec. HSG)
Swiss, Teufen, 1956
Commercial banking in Switzerland, in the United
Kingdom and in Brazil; 1981 Treasurer in the Brazil
ian affiliate of Ciba-Geigy; 1988 – 1990 Head of Fi
nance and 1990 – 1996 Treasurer Ciba-Geigy AG,
Basel (head office); 1996 – 2007 Head of the No
vartis Group Treasury: Novartis International AG,
Basel.
No appointments at listed companies
Member of the Board of Directors at Union Bancaire
Privée, Geneva.
Member of the Investment Commission at the Univer
sity of Basel.
Herbert J. Scheidt
Business and masters degrees at the Universities of
Sussex and New York
Swiss and German citizenship, Zurich, 1951
Different managerial roles at Deutsche Bank in Es
sen, Frankfurt, New York, Milan and Geneva;
1999 – 2000 Head of Private Banking International
and from 2001 Chief Executive Officer at Deutsche
Bank (Switzerland) AG; 2002 – 2011 CEO of the
Vontobel Group; since May 2011 Chairman of the
Board of Directors Vontobel Holding AG, Zurich.
1979 – 1982 Schweizerische Treuhandgesellschaft,
St Gall; 1986 – 1990 Swiss Bank Corporation Glob
al Treasury at the head office in Zurich, as well as
Vice-Director at Swiss Bank Corporation O’Conner
Services L.P. Chicago; 1991 – 1996 Hunter Douglas,
Lucerne, Vice-President and Treasurer; since 1996
Raiffeisen Group, St Gall: member of Executive
Management and Head of the Finance Department;
since 1999 Chairman of Executive Management of
the Raiffeisen Group, St Gall.
Vice-President of the Board of Directors of Leonteq
Securities AG, Zurich.
Seven appointments at non-listed companies: mem
ber of the Board Committee of the Swiss Bankers’
Association, Basel; President of the Board of Direc
tors of the Aduno Group, Glattbrugg; President of
the Board of Directors at Notenstein Privatbank AG,
St Gall; President of the Board of Directors of Pfand
briefbank Schweizerischer Hypothekarinstitute AG,
Zurich; member of the Board of Directors of SIX
Group AG, Zurich; President of the Board of Direc
tors of Plozza Vini SA, Brusio.
Nine appointments at charitable organisations and
institutions.
Secretary of the Board of Directors:
Christophe Niquille, Doctorate in economics from the
University of St Gall (Dr. oec. HSG)
President of the Board of Directors at Vontobel
Holding AG and Vice-President of the Board of Di
rectors at HERO AG, Lenzburg.
Four appointments at non-listed companies, in par
ticular Director of the Association of Swiss Commer
cial and Investment Banks (VHV); member of the
Board of Directors the SIX Group AG, Zurich; mem
ber of the Board of Directors of the Swiss Bankers’
Association.
Eight appointments at charitable organisations and
institutions.
47
Company profile Executive Management
The Executive Management is the highest execu
tive body of Helvetia Group and is responsible
for implementing the strategy adopted by the
Board of Directors. The organisational structure
of the Management is geared to the value chain
and the management of the operating business
units. Key functions such as the control of finan
cial operations and information technology, in
vestment business, group reinsurance, strategic
and operational functions and elements of risk
and personnel management are centralised,
making it easier to pool knowledge and resources.
T he management structure – with international,
functional responsibilities – is very efficient, en
ables rapid decision-making, enhances transpar
ency and avoids duplication. There were no
changes to the Group Executive Management in
the 2013 reporting year.
Helvetia Italy increased its Executive Manage
ment to include the area of Organisation
and Services, with effect from 1 January 2014.
Roberto Lecciso has been appointed to the

E xecutive Management of this new area.
Changes to subsidiaries
The Executive Management Boards in our coun
try markets were likewise characterised by a
high level of continuity in the reporting year, as
there were no changes to the Executive Manage
ment Boards in Switzerland, Spain or Austria.
In France, Vincent Letac took over the role of
CEO Helvetia from Alain Tintelin, with effect from
1 July 2013.
Jürgen Kutzora retired from Helvetia Germany at
the end of 2013, having been responsible for
Sales for many years. Thomas Primnitz has as
sumed the management position for the expand
ed Sales and Marketing department, with effect
from 1 January 2014. Also in Germany, an inde
pendent IT department has been created that will
be managed by Torsten Müller. He joins the
E xecutive Management team as Chief Informa
tion Officer (CIO).
48
Board of Directors
Erich Walser, Chairman
Group CEO
Stefan Loacker
General Secretariat
Internal Audit
Christophe Niquille**
Simon Schneider**
Finance
Investments
Strategy & Operations
HR International
Paul Norton
Ralph-Thomas Honegger
Markus Gemperle
Markus Isenrich
Switzerland
Germany
Austria
Italy
Spain
France
Philipp Gmür*
Wolfram
Wrabetz*
Burkhard
Gantenbein*
Francesco
La Gioia*
Jozef Marie
Paagman*
Vincent Letac*
Members of the Group Executive Management
Support functions
* CEOs of the country markets.
**Reports to the Chairman of the Board of Directors.
As at mid-March 2014.
49
(from left to right) Paul Norton, Ralph-Thomas Honegger, Stefan Loacker, Philipp Gmür, Wolfram Wrabetz, Markus Gemperle.
Stefan Loacker
Markus Gemperle
Bachelor’s degree (lic. oec. HSG); Master’s
degree (Mag. rer. soc. oec.), Vienna University of
Economics and Business
Austrian, Speicher, 1969 Chief Executive Officer
of Helvetia Group (CEO)
Professional background
1994–1997 Rentenanstalt / Swiss Life: involved in
Group planning projects; 1997 joined Helvetia: As
sistant to Head of Staff Executive Management,
Business Development; Head of Staff Group Execu
tive Management; 2000 Head of Business Devel
opment; Member of Executive Management; 2002
ANKER, Vienna: Head of Finance and IT; Member
of Executive Board; 2005 ANKER, Vienna: Chief
Executive Officer; 2007, since 1 September in his
current position with various appointments at the
foreign subsidiaries of Helvetia Group.
Appointments
In particular, Member of the Board of Directors
of the Swiss Insurance Association, Zurich.
50
Doctorate (Dr. iur. HSG)
Swiss, Niederteufen, 1961
Head of Strategy & Operations (CSO)
1986–1988 Legal Counsel Claims Department,
Helvetia Feuer, St Gall; 1988–1990 Academic
Assistant, Institute for Insurance Studies, Univer
sity of St Gall; 1990 Joined Helvetia Insurance;
Head of various departments in the non-life busi
ness in Switzerland; 2002 Head of Corporate
Centre of Helvetia Patria Group; 2004 Member
of the Executive Management of Helvetia Swit
zerland: CIO; 2006 Member of the Executive
Management of Helvetia Switzerland: Head of
Operations & Partners; 2008 Member of Group
Executive Management in his current position
with various appointments at the subsidiaries of
Helvetia Group in Switzerland and abroad.
Appointments
In particular a Board of Directors appointment at
an unlisted company and a Board of Trustees ap
pointment.
Philipp Gmür
Paul Norton
Doctorate (Dr. iur.), Law degree (LL.M.)
Swiss, Lucerne, 1963
CEO of Helvetia Switzerland
1988–1990 worked in various courts, adminis
tration and law firms; 1991–1993 Court Clerk at
the High Court of Lucerne; 1993 joined Helvetia:
Head of regional office in Lucerne; 2000 Mem
ber of the Management Board, Switzerland:
Head of Sales; 2003 Member of Group Execu
tive Management in his current position with vari
ous mandates at the Swiss subsidiaries of
Helvetia Group.
Appointments
In particular, Chairman of the Campaign Com
mittee of the Swiss Insurance Association; Mem
ber of the Board of Trustees of the pension funds
of Helvetia Insurance; Vice Chairman of the
Helvetia Patria Jeunesse Foundation; Vice Chair
man of the Swisscanto Vested Benefits founda
tion of the Cantonal Banks; Member of the Board
of Directors of Coop Rechtsschutz AG, Aarau;
Member of the Board of Directors of Prevo AG,
Basel, and three other board member mandates
for non-listed companies and three board of trustee appointments.
Ralph-Thomas Honegger
Doctorate (Dr. rer. pol.)
Swiss, Arlesheim, 1959
Head of Investments (CIO)
1987 joined Patria: various management posi
tions, including: Head of Portfolio Strategy and
Portfolio Management; 1997 Member of the
Management Board, Switzerland: initially Head
of Investment Clients, then Head of Individual
Life; 2002 Member of Group Executive Manage
ment in his current position with various man
dates at foreign subsidiaries of Helvetia Group.
Appointments
In particular, Board of Trustees of the pension
funds at Helvetia Insurance; Head of the Invest
ment Commission of the Raiffeisen pension fund;
Honorary Consul General for Austria in Basel;
Member of the Board of Directors of Tertianum
AG, Zurich (until July 2013); Vice Chairman,
Member of the Board of Directors of Allreal Group,
Zurich.
BA History (University of Reading / UK);
Chartered Accountant
British and Swiss national, Zurich, 1961
Chief Financial Officer Helvetia Group (CFO)
1983–1992 Price Waterhouse, London; 1992–
1994 Revisuisse Price Waterhouse, Zurich;
1994–1996 Price Waterhouse, London; 1996–
1999 Zurich Financial Services (ZFS), Centre
Solutions, Head of Transaction Tax and Account
ing Europe; 1999–2002 ZFS: Head of External
Reporting; 2002–2007 Winterthur Versicherun
gen: Head of Corporate Development and Cap
ital Management; 2007: since 1 July 2007 in his
current position; Member of Group Executive
Management with various appointments at the
subsidiaries of Helvetia Group in Switzerland
and abroad.
Appointments
Member of the Economic and Financial Affairs
Committee of the Swiss Insurance Association,
Zurich.
Wolfram Wrabetz
Prof. and Doctor of Laws (Prof. Dr. iur.),
Certified Business Administrator
German citizen, D-Bad Soden, 1950
Chief Executive Officer of Helvetia Germany
Various positions with the Gerling Group; 1981
joined Helvetia Germany: various management
positions; 1995 General Manager for Germany
and Chairman of Helvetia Leben and Helvetia
International, Frankfurt / Main, Germany; since
1998 with the Helvetia Group in current position.
Appointments In particular, member of the Chairman’s and Pro
fessional Committees for Private Customers and
Chairman of the Legal Committee of the German
Insurance Association, Berlin, Germany; repre
sentative of the Hesse State Government for the
insurance industry; Honorary Consul General in
Germany of the Republic of Ecuador in Frank
furt / Main, Germany; Vice Chairman of the
Chamber of Commerce and Industry, Frank
furt / Main, Germany.
51
Company profile Corporate governance
Corporate governance
Helvetia wants to meet the demanding legal and
ethical expectations of its shareholders and all
other stakeholders by providing comprehensive
and transparent reporting and responsible and
value-oriented corporate governance, to the best
of its knowledge and in good faith. The main
aims here are to further strengthen confidence in
Helvetia Group, to safeguard the interests of our
customers, and to ensure and sustainably enhance the value of the Group, while also taking
account of the best interests of the public. We
successfully ensure that the principles of good
corporate governance are consistently implemented and continually optimised throughout the
Group. For the Board of Directors, the Executive
Management and all employees of Helvetia, corporate governance is a continuous process that
is periodically reviewed and used to integrate
new developments, findings and requirements
into daily professional life and responsibilities.
The fact that the Group has its own Corporate
Governance Officer underlines its willingness
and efforts to practice proper corporate govern
ance. Good corporate governance can only
be truly effective if it is constantly oriented to
the Group’s strategy and positioning. For more
information, please refer to pages 12 et seq.
With this strategic focus, Helvetia wants to
comply as fully as possible with the applicable
standards of the “Swiss Code of Best Practice for
Corporate Governance”, the SIX Swiss Exchange
Corporate Governance Guidelines of 29 October 2008 including appendices, and also the
Ordinance Against Excessive Compensation in
Swiss Listed Companies of 20 November 2013
(VegüV). Important information can also be
found in the Financial Report, Note 16 “Compensation paid to the Board of Directors and the
Group Executive Management” on pages 172 to
175. If relevant information is provided elsewhere in the Annual Report or in other documents, reference is made to the location or document concerned. Important documents such as
52
the articles of incorporation and the organisation
rules with appendices are also available on our
website at www.helvetia.com/gruppe/governance. This website also contains a good deal of
additional interesting and up-to-date information.
Following the vote in favour of the Minder initiative, Helvetia will implement the guidelines of
the Ordinance Against Excessive Compensation
in Swiss Listed Companies of 20 November 2013
(VegüV) at the 2014 Shareholders’ Meeting. At
this Shareholders’ Meeting, the articles of incorporation will also be adapted to the new requirements. As this primarily concerns the implementation of mandatory law, in this Annual Report
the relevant facts (especially voting procedures
and compensation issues) are presented as if the
articles of incorporation had already been
adapted to VegüV.
Helvetia Group reports in detail on the compensation paid to the members of the Board of
Directors and the Group Executive Management.
This compensation report consists of two parts,
both of which are integrated into this Annual Report. This report comprises
–Part I “General compensation principles” on
pages 67 et seq. and
–Part II in Note 16 on pages 172 et seq. with
the relevant concrete figures for financial year
2013.
Helvetia’s compensation principles and policy
are simple, transparent, state-of-the art and – in
particular when compared to the principles applied by our most important competitors –
well-balanced. As in past years, these principles
comply with the values held by Helvetia Group.
The Board of Directors considers the compensation policy applied by Helvetia to be exemplary.
1. Group structure and shareholder base
1.1 Group structure
Helvetia is an international Swiss all-lines insurance group that focuses primarily on central and
southern Europe. The parent company, Helvetia
Holding AG, is organised in accordance with
Swiss law. The management structure is shown
on page 49. These structures are intended to
c reate the best possible legal, financial, controlling and regulatory framework and to ensure
smooth, efficient and flexible business operations.
The legal structure of Helvetia Group (including
investments) is shown on page 23.
Helvetia Holding AG has its head office in
St Gall and is listed on the SIX Swiss Exchange in
Zurich: security no. / ticker 1 227 168 / HELN. Key
data for investors is given on pages 35 to 37 under
“Investor information”. Helvetia Holding AG is the
only listed company within the Group. The Group’s
subsidiaries included in the scope of consolidation
are listed on pages 201 and 202. Reports on the
main subsidiaries – Helvetia Schweizerische Versicherungsgesellschaft AG, St Gall (Helvetia Versicherungen) and Helvetia Schweizerische Lebensversicherungsgesellschaft AG, Basel (Helvetia Leben)
– can be found in the Notes on page 206.
–Vontobel Beteiligungen AG, Zurich, with 4.0 % and
–Raiffeisen Schweiz, St Gall,
with 4.0 %
1.2 Major shareholders
In addition to a strong, long-term and, in view of
the positive development of the Group, very successful relationship with our major pool of shareholders, the Patria Genossenschaft (founding
partner), Raiffeisen and Vontobel (cooperation
partners), we maintain an open and shareholder-
friendly strategy in an effort to build up a widely
diversified and informed shareholder base. At
the balance sheet date, 10,021 shareholders
were registered in the share register of Helvetia
Holding. This renewed year-on-year increase in
the number of registered shareholders underscores the attractiveness of our shares, despite
all the turbulence in the financial markets. In
this regard, our shareholder base is worthy of
special mention.
2. Capital structure
2.1 Share capital
Helvetia Holding AG has a share capital of CHF
865,287.50, consisting of 8,652,875 registered
shares with a nominal value of CHF 0.10 each.
At the year-end price of CHF 447.50 per share,
this equals a market capitalisation of CHF
3,872.2 million.
The following three partners hold a combined
e quity stake of 38.1 % in Helvetia Holding:
– Patria Genossenschaft, Basel, with 30.1 %
The pool agreement strengthens and promotes
Helvetia’s strategic focus on cooperation in
areas outside its core business (insurance), and
supports the activities of the Group in crucial
a reas such as sales. It unites the cooperation
partners of Helvetia Group in their capacity as
strategically orientated, long-term investing
shareholders who are interested in the successful
development of the company. Pool members may
only sell their Helvetia shares with the consent of
the other pool members, who also have a right of
first refusal at market conditions. Beyond the
scope of normal cooperation activities relating to
consulting and the sale of financial, insurance
and fund management products and services –
in each case at market conditions – there are no
significant business relationships between pool
members and Helvetia Group.
1.3 Cross-holdings
There are no cross-holdings that exceed 3 % of
the capital or voting rights.
2.2 Treasury shares
Helvetia held 44,255 treasury shares (0.51 %)
on 31 December 2013.
2.3 Conditional capital
The share capital can be increased by a maximum of CHF 129,793.20 by issuing a maximum
of 1,297,932 registered shares with a nominal
value of CHF 0.10 each, which must be fully paid
up. The conditions for this are set out in Art. 3bis
of the articles of incorporation.
53
2.4 Changes in capital
–In 2001, the share capital was reduced by
CHF 16,492,980 to CHF 65,971,920 by a reduction in the nominal share value from CHF
50.00 to CHF 40.00 and a 4-for-1 share split
to CHF 10.00 per share.
–In 2002, the share capital was reduced by
4.61 % to CHF 62,930,000 by means of a
share buyback programme and the cancellation of shares amounting to CHF 3,041,920.
–D ecember 2004, an approved share capital
increase of CHF 23,598,750 was carried out
by issuing 2,359,875 registered shares with a
nominal value of CHF 10.00 each, as a result
of which the share capital increased from
CHF 62,930,000 to CHF 86,528,750.
C onditional share capital was created in
–
2007: see section 2.3.
–H elvetia celebrated its 150th anniversary in
2008. To celebrate this event and recognise
the confidence in and loyalty of the shareholders to Helvetia and at the same time to
optimise the capital structure of the company,
Helvetia reduced the nominal value of
the regis
t ered shares from CHF 10.00 to
CHF 0.10 and paid out the difference of
CHF 9.90 to its shareholders in the form of a
nominal value dividend.
–As the share capital did not change in 2013,
the share capital values set out in sections 2.1
to 2.3, valid from 25 July 2008, and the information on the conditional share capital, are
still correct.
rights of the entire share capital recorded with
the Commercial Register. Here the term “individual” also includes buyers of shares who are connected to each other either by way of capital or
votes, or by united management, or in any other
form. This restriction also applies if, for example,
shares were subscribed or acquired by means of
convertible rights that are associated with instruments issued by the company or third parties. In
the reporting year, no new exceptions were declared regarding the restriction of transferability
(for major shareholders: see section 1.2). Private
individuals who do not declare in the application
for registration that they have acquired the
shares on their own behalf (= nominees) will only
be entered in the share register for a maximum
of 3 % of the total share capital. The registration
regulations are described in detail in Art. 7 of the
articles of incorporation. Any amendment by the
Shareholders’ Meeting to the statutory restriction
of transferability referred to above requires a
two-thirds majority of votes represented.
2.5 / 2.6 Shares, participation certificates and dividend rights certificates
The share capital comprises 8,652,875 fully
paid-up registered shares with voting and dividend rights with a nominal value of CHF 0.10
each. There are no preferential rights, participation certificates or dividend rights certificates.
For more details concerning Helvetia shares,
please refer to pages 35 to 37.
3. Board of Directors
See also the diagram and information provided
on pages 44 to 47.
2.7 Restriction on transferability and
nominee registrations
The Board of Directors may refuse to approve
registration with voting rights if an individual
would then own more than 5 % of the voting
54
2.8 Convertible bonds and options
a)Convertible bonds
No convertible bonds have been issued since
2004.
b)Options
Helvetia Group has not issued any options.
c) Employee options
Helvetia Group has not issued any options.
3.1 Members of the Board of Directors
The Board of Directors of Helvetia Holding AG
consists of nine members. It is identical to the
Boards of Directors of the two subsidiaries,
H elvetia Leben and Helvetia Versicherungen.

Members of the Board of Directors are required
to have experience and knowledge of a wide
varie ty of fields. They should have the requisite
expertise to represent their personal opinion in
discussions with the Executive Management.
Since Helvetia Group conducts a significant
The insurance industry has access to an increasingly vast amount of data as a result of the rapid progress being made in
IT, coupled with ever faster computers. This makes it possible for our actuaries to develop increasingly refined statistical
models to calculate probabilities and loss distributions. We take the time to check every calculation down to the smallest
detail because the only way to avoid unpleasant surprises in the future is to develop accurate models.
Martin Morandell, Actuarial Services Non-Life
“As an actuary at Helvetia, my job is to use mathematical and statistical methods to assess insurance risks and make
them predictable. On the whole, risks are predictable. But what about risks that have a larger impact, such as natural disasters? This is where the law of large numbers falls down. At Helvetia, we aim to be there for our customers even when
major events occur, however rare they may be. At the same time, we are aware of the need to protect the Company’s
balance sheet. One way of doing this is to bring on board another partner as a reinsurer.”
roportion of its business abroad, the Board
p
of Directors also includes citizens of different
countries and members who have extensive international experience. Members of the Board of
Directors should possess strong personal values
(including integrity), specialised financial, business and insurance knowledge, experience in
strategic and executive management, the ability
to think in a visionary manner, social skills and a
belief in sustainability. They must also have the
necessary amount of time at their disposal for the
efficient and proper performance of a director’s
term of office. As far as the independence of the
Board members is concerned, Helvetia complies
with the basic requirements of the Swiss Code of
Best Practice for Corporate Governance. For example, the Board consists only of members
whose personal and business skills enable them
to form an independent opinion and take decisions that are in the best interests of the company. Members of its committees are non-executive.
The members of the Nomination and Compensation Committee and the Audit Committee have
e ither never been members of the Executive

M anagement or have not been members of the
Executive Management for the past three years
or more. The members of the Nomination and
Compensation Committee have neither personal
relationships with Helvetia nor any business
r elationships through the companies and

organisations represented by them; nor do they
hold any cross-involvements. Anticonflict of interest rules are consistently applied by all committees. Every year, the Board of Directors assesses
the level of compliance with these requirements
and the quality of the services it has performed,
both in its entirety and within each committee,
and – where necessary – identifies any improvements that may be required.
The composition of the Board of Directors is
shown on pages 44 to 47. None of the members
of the Board of Directors holds any executive
functions or – except for Erich Walser (until 31
August 2007) – belonged to the Executive Management of Helvetia or any of its Group companies during the financial years preceding the reporting year. None of the members of the Board
of Directors has any significant business relation-
ships with Helvetia other than as policyholders at
standard conditions.
3.2 Other activities and interests
The following business relationships exist with
companies represented by members of the Board
of Directors:
–In the shareholder pool, Doris Russi Schurter
and Jean-René Fournier represent the Patria
Genossenschaft; Pierin Vincenz represents
the Raiffeisen Group; and Herbert J. Scheidt
represents the Vontobel Group.
–Doris Russi Schurter is the Chairwoman and
Jean-René Fournier the Vice Chairman of the
Board of Directors of the Patria Genossenschaft, Basel, the statutory objectives of which
are to promote the conclusion and execution
of life insurance contracts with Helvetia in the
interests of its members, and to secure and
promote its independence and development
by means of financial participation in Helvetia.
–
H elvetia, the Vontobel Group and the
Raiffeisen Group are cooperation partners
in the areas of consulting and the sale of
financial services.
3.3 Cross-involvements
See section 3.2.
A cooperation agreement exists between the
Raiffeisen and the Vontobel Group. Since 2012,
the interests of the Raiffeisen Group on the Board
of Directors of the Vontobel Group have been
represented by a person who has no relationship
with Helvetia. There are no other interlocking
directorates with the Boards of Directors of listed
companies.
3.4 Election and term of office
The ordinary tenure of office of members of the
Board of Directors up to now has been three
years and ends at the latest with the Shareholders’ Meeting in the year in which the Board member turns 70. A new element is that all Board
members, the Chairman and the members of the
Nomination and Compensation Committee will
be re-elected by the Shareholders’ Meeting for
one year without regard to ongoing terms of
o ffice. Re-election of existing Board members
is possible (VegüV). As none of the serving mem-
57
bers of the Board of Directors will reach the statu
tory age limit of 70 before the 2014 Shareholders’ Meeting, all of the members are eligible for
re-election. Proposals for their election will be included in the invitation to the Shareholders’
Meeting. For information concerning the firsttime election to the Board of Directors of H elvetia
Holding AG please refer to the table on page 44.
3.5 Internal organisation
The governance at Helvetia is based on the relevant legal provisions (in particular company law
and stock market legislation) and on internal dir
ectives and regulations. The functions intended
to be carried out by the Board of Directors and
the allocation of duties are set out on page 44.
The Board of Directors appoints the Vice Chairman, the Chairman and members of the various
committees (exception: the members of the Nomination and Compensation Committee) as well as
the secretary of the Board of Directors.
Board committees
In order to use the broad business experience of
its individual members in its decision-making processes and to meet its supervisory reporting obligations, the Board of Directors has formed special committees from among its own members to
assist the Board and the Executive Management
in its management and control activities: The
Strategy and Governance Committee, the Nom
ination and Compensation Committee, the Investment and Risk Committee, and the Audit Committee. The duties and powers of these committees
are described in detail in the organisational
regul ations, and the composition of each committee is presented on page 44.
a)The Strategy and Governance Committee
(SGC) prepares the resolutions to be passed by
the Board of Directors in the event of a change
or redefinition of strategy, monitors the strategic
risks within the framework of the defined strate gy
and the related measures, deals with mergers,
acquisitions and disposals of companies or
m ajor portfolios, and prepares the required

resolutions by the full Board of Directors. It also
ensures good corporate governance within
H elvetia Group, assumes duties and powers that
58
have been assigned to the SGC by the Board of
Directors, deals with issues entrusted to it by the
Chairman that are not reserved for the full Board
of Directors in accordance with the law, the
a rticles of incorporation or Group regulations,
and discusses important and urgent issues. The
SGC convenes as often as business requires. In
order to deal with specific issues, it may call on
internal or external specialists to attend its
meetings, which is regularly the case. The CEO
participates in an advisory capacity. The SGC
met two times in 2013. At one meeting, a Board
member was absent. Most of the meetings lasted
half a day.
b) The Nomination and Compensation Committee (NCC) puts forward proposals regarding the
structure of the compensation system that applies
to the members of the Board of Directors and to
the salaries and compensation of the members of
Group Executive Management, and specifies the
fixed and variable salaries and compensation
due to the members of the Executive Management. It approves the concept and strategy of the
employee pension funds in Switzerland on behalf of the employer and takes note of their an
nual financial statements. It prepares the resolut
ions by the Shareholders’ Meeting regarding the
appointment and dismissal of members of the
Board of Directors, puts forward proposals
regarding personnel decisions and appointments
and dismissals of members of the Group Executive Management, handles the appointment and
dismissal of the country CEOs and other members of the country market Executive Management boards, and periodically reviews plans and
measures to retain and promote senior managers. The NCC convenes as often as business
requires. In order to deal with specific issues, the
Committee may call on internal or external
s pecialists to attend its meetings, which is

regularly the case. The CEO takes part in an
a dvisory capacity where topics that affect the
E xecutive Management are concerned. In 2013,
the NCC held two meetings, both of which were
attended by all its members. Most of the meetings lasted half a day.
c) The Investment and Risk Committee (IRC) formulates the investment concept, basic guidelines
and investment strategy, proposes the strategic
bandwidths of asset allocation, approves the investment strategy and supervises the investment
activities of Helvetia Group. It determines the
most important risk strategies, the risk tolerance,
risk appetite and applicable risk limits, and moni
tors all non-strategic and non-operational risks
as well as the related risk management measures
and compliance with limits. It convenes as often
as business requires. The CEO, CFO, CIO as well
as the Head of Risk Management attend the
meetings in an advisory capacity; in 2013, they
attended all meetings. In order to deal with specific issues, the Committee may call on internal
or external specialists to attend its meetings,
which is regularly the case. The IRC met four
times in 2013. At each of two meetings, one
Board member was absent. Most of the meetings
lasted half a day.
d) The Audit Committee (AC) assists the Board of
Directors in its duties with regard to overall
supervision and financial control. It examines the
accounts from the perspective of completeness,
integrity and transparency, verifies their compliance with applicable accounting standards and
external reporting requirements, assesses risk
governance and risk organisation, and monitors
the functional capacity and effectiveness of the
internal control systems (ICS). It monitors the operational risks and related risk management
measures and verifies the independence and
quality of the audits by the internal and external
auditors. It ensures optimal cooperation between
internal and external control units, the AC, the
Chairman and the Executive Management. The
AC approves the internal audit plan and assists
with the compilation of external audit plans,
examines the results of audits, comments on them
for the attention of the Board of Directors, and
may, if necessary, award special audit assignments. It also prepares the election of the statut
ory auditors, and submits the necessary proposals
to the Board of Directors. It verifies the consist
ency of auditing activities with any existing
c onsulting mandates and examines the overall
fee structure. The Chairman may, at his own
r equest, take part in the meetings in an advisory
capacity. The CEO, CFO, representatives of the
external auditors and the head of Internal Auditing attend its meetings in an advisory capacity.
The attendance rate was 100 % at meetings held
to discuss the financial statements. In order to
deal with specific issues, the Committee may call
on internal or external specialists to attend its
meetings, which is regularly the case. The AC
met three times in 2013 with all of its members attending. Most of the meetings lasted half a day.
The Chairman heads the Board of Directors. He
calls the meetings of the Board, prepares the
agenda for the Board meetings and meetings of
the SGC and NCC, and chairs these meetings.
He prepares the Shareholders’ Meeting and the
invitation to the Shareholders’ Meeting, and also
chairs this meeting. He draws up the strategic objectives that are discussed by the Board of Directors and represents the shareholders in important
strategic projects in consultation with the CEO.
He ensures that shareholders receive timely and
correct information on the Group’s business operations and nurtures relationships with major investors. Together with the other executive bodies
of the Group, the Chairman ensures good corp
orate governance and an effective internal control
system. He serves as line manager to the CEO
and acts in consultation with the CEO whenever
possible. He and the CEO prepare the CEO’s annual agreement on objectives, and he assesses
the CEO’s performance every year. The Chairman may take part in important meetings of the
Executive Management as a guest; to this end he
receives the agenda and accompanying documents for all meetings. He manages the Group’s
internal audit team as well as the head of the secretariat in hierarchical as well as practical terms,
assesses requests for information, meetings or inspection of documents from members of the
Board of Directors as well as their acceptance of
new board or similar mandates (the Nomination
and Compensation Committee decides on such
mandates of the Chairman), signs Commercial
Register applications and handles other tasks
delegated to him by the Board of Directors. He
may at all times inspect any and all documents.
59
Full Board of Directors
The Board of Directors convenes as often as business requires, as a rule five to six times a year.
Most of its meetings, which usually last half a day,
are held at the Group head office in St Gall and
the executive seminar, which usually lasts two
days, is generally held at the premises of a subsidiary abroad. The Board of Directors is quorate if
the majority of its members are present. Its resolutions are carried with a majority of the votes of the
members in attendance. Resolutions may also be
passed by circular letter, which, however, did not
happen in 2013. As a rule, all members of the
Board of Directors and (in an advisory capacity)
all members of the Executive Management attend
its meetings. In the reporting year, four half-day
meetings were held as well as a two-day seminar,
one in the absence of one director and two more
in the absence of two directors. All the members
of the Executive Management attended all meetings. In order to deal with specific issues, it may
call on specialists to attend its meetings, which is
regularly the case. Members of the Board of Directors and all executive bodies are obliged to abstain if business is being dealt with that involves
their own interests or the interests of related parties (natural persons or legal entities).
3.6 Delineation of powers
The Board of Directors possesses the following
powers based on its inalienable and non-transferable duties stipulated in the provisions of
Swiss company law, the articles of incorporation
and the internal organisational regulations of
Helvetia Group:
–overall management of the Group;
–definition of the organisational principles;
–definition of the structure and principles of accounting, financial control and financial planning;
–appointment and dismissal of members of the
Group Executive Management;
–overall supervision of the management of the
Group’s business activities;
–preparation of the Annual Report;
– preparation of the Shareholders’ Meeting;
–implementation of its resolutions; and
–approval of major legal transactions.
60
Appendix I of the organisational regulations contains a detailed description of the division of
powers between the Board of Directors, the
Board Committees and the Executive Management: www.helvetia.com/gruppe/governance.
3.7 Information and control tools
The Board of Directors is kept up to date in a
variety of ways concerning the activities of

H elvetia, its course of business and trends in the
market. At its meetings, it requests information
concerning:
–content and outcome of matters dealt with
by the various Board Committees, including
all resolutions and proposals – all committees are required to submit copies of their
minutes without delay;
–course of business and market trends, to be
provided by the CEO and the individual national managers and division heads, as well
as the main projects, to be provided by the
persons responsible, as necessary;
–s tatus of compliance with budget and other
annual objectives as well as strategic plan
values for several years;
–results and findings of the audits conducted
by the external and internal auditors which
are in particular discussed by the Audit
Committee and recorded in its minutes;
–the most important strategic, financial and
operational risks, any changes to them and
risk management measures that have been
taken or are planned;
–compliance with legal and regulatory provisions and internal regulations;
–
s ignificant developments and events that
could influence the interests of stakeholders,
spontaneously on the occurrence of special
events, otherwise in a detailed annual report and a condensed interim report.
Every month, the members of the Board of Dir
ectors receive key data concerning the course
of business. They also periodically receive reports on current issues relating to governance
as well as selected analyses and situation reports concerning market trends, market players
and noteworthy occurrences. The regular reports submitted to the Board of Directors and its
committees are listed in Appendix I of the organisational regulations: www.helvetia.com/
gruppe/governance.
At the meetings, every member of the Board of
Directors may ask other members and members
of the Executive Management for information
concerning all matters pertaining to the Group.
Outside of meetings, every member of the
Board of Directors may ask the Executive Management to provide information about the general course of business or the course of specific business cases, and / or may inspect any
business documents as required. The Board of
Directors also has the Internal Audit unit at its
disposal as an auditing and supervisory body
that monitors compliance with legal and regulatory provisions, internal guidelines and directives systematically, purposefully and in a
risk-oriented manner. It also receives reports
concerning the general development and specific activities of Helvetia in the areas of corpor
ate governance and compliance.
4. Group Executive Management
See also pages 48 to 51.
4.1 Members of the Executive
Management
The members of the Group Executive Management are presented on page 50. The Group Executive Management of Helvetia Group has
been chaired by Stefan Loacker since 1 September 2007. Together with division heads at Group
level and the management boards of the country
markets, he is responsible for the operational
management of the Group. For further details,
please refer to pages 48 and 49.
4.2 Other activities and interests
See pages 50 and 51.
4.3 Management contracts
There are no management contracts with external parties that have to be disclosed.
5. Co-determination rights
of shareholders
Helvetia observes the principle of equal treatment of shareholders.
5.1 Voting rights restrictions and
proxy voting
Certain restrictions on voting rights that are identical to restrictions relating to the transferability
of registered shares of Helvetia Holding AG are
described in section 2 above.
The Board of Directors specifies the rules that
govern participation in the Shareholders’ Meeting and the determination of voting rights. For
representatives of executive bodies, independent
voting rights and custody proxies (who do not
necessarily have to be shareholders themselves),
it may stipulate regulations that deviate from the
restriction of proxy voting to 10 % of the share
capital.
At the 2013 Shareholders’ Meeting, no individual shareholder or group of shareholders consisting of pool members with voting rights represented more than 10 % of the voting rights,
except for the Patria Genossenschaft. No specific exceptions with respect to voting rights restrictions or proxy voting were granted in the reporting year.
Shareholders who possess voting rights but
who do not attend the Shareholders’ Meeting
may assign their voting rights to a third party
(who does not necessarily have to be a shareholder) by means of a written power of attorney.
However, he or she may only represent the voting rights of third parties if, together with his or
her own shares, they do not exceed 10 % of the
total share capital. Here, too, shareholders who
are connected to each other by way of capital or
votes or by united management or in any other
form count as one shareholder.
5.2 Statutory quorum
The Shareholders’ Meeting is quorate regardless
of the number of shareholders in attendance and
votes represented by proxy. Unless stipulated
otherwise by legal provisions or the articles of
incorporation, the Shareholders’ Meeting passes
resolutions by an absolute majority of the votes
cast. In addition to the resolutions cited in Art. 704,
61
par. 1 of the Swiss Code of Obligations, a twothirds majority of represented votes is required for
amendments to the articles of incorporation, the
premature termination of office of more than one
member of the Board of Directors, and the liquidation of the company. The exceptions for the
Patria Genossenschaft as individual shareholder
and for the group of pool members mentioned in
section 5.1 also apply here.
5.3 Convening the Shareholders’
Meeting
The Shareholders’ Meeting is convened by the
Board of Directors, or, if necessary, by the statutory auditors. Liquidators and representatives of
creditors also have the right to call a meeting.
As a rule, the Ordinary Shareholders’ Meeting is held in April / May, but at the latest within
six months after the end of the financial year.
E xtraordinary Shareholders’ Meetings take place
if the Board of Directors or the statutory auditors
consider it necessary, if this is passed by a Shareholders’ Meeting or if shareholders who represent at least 10 % of the share capital jointly request in writing an Extraordinary Shareholders’
Meeting, whilst stating the items on the agenda
and the motions to be put forward and choosing
the names of the proposed candidates.
Each shareholder receives a personal invitation no later than 20 days before the meeting, including a detailed agenda, a brief explanation
of the motions to be put forward, plus other explanations concerning significant occurrences in
the reporting year. The items on the agenda are
also published in various Swiss newspapers and
in the electronic media.
shareholders with voting rights as of the cut-off date
(15 April 2014) specified by the Board of Directors
and announced in the Swiss Commercial Gazette
and various other newspapers. In exceptional cases,
guest tickets for the Shareholders’ Meeting may be
issued, but holders of such tickets do not have any
voting rights. Every share registered in the register
entitles the holder to cast one vote.
6. Change in control and
protection measures
6.1 Obligation to announce
takeover bids
Art. 26 of the articles of incorporation states that
the obligation to announce a takeover bid in accordance with Art. 32 of the Stock Market Act
only applies if a shareholder acquires 40 % or
more of the voting rights.
6.2 Clauses regulating a change
in control
Employment contracts of Helvetia do not contain
any agreements regarding a change in control.
The practice of “golden parachutes” does not
a pply at Helvetia. Normal periods of notice

apply (maximum twelve months for members of
the Executive Management, six months for other
managerial staff), during which the rules for
c ontractual and variable compensation components remain applicable.
5.4 Addition of items to the agenda
Shareholders with voting rights who together represent shares with the nominal value of at least
CHF 2,000 may request the addition of items to the
agenda in writing, stating the motions to be put forward, no later than 45 days before the Shareholders’ Meeting.
5.5 Registration of shares
The right to attend the Shareholders’ Meeting (25
April 2014) and exercise voting rights is reserved for
persons who were registered in the share register as
62
7. Statutory auditors
7.1 Duration of terms of office
and tenure of office of lead auditor
The independent auditors KPMG AG, Zurich,
have served as the auditors of Helvetia Holding
AG and its consolidated subsidiaries since 2005.
The statutory auditors’ terms of office must be renewed by the Shareholders’ Meeting every year.
The KPMG AG audit team for the financial year
2013 consisted of:
– Philipp Rickert (since 2012), Swiss Certified Accountant, Partner Audit Financial Services,
lead auditor;
– O liver Windhör, Swiss Certified Accountant,
Director Audit Financial Services.
7.2 Audit fees
In the reporting year, the fees charged by the
auditors amounted to: CHF 2,672,732.00.
7.3 Fees for additional consultancy
service
CHF 37,183.00.
These fees primarily concern services associated with legal and tax consultancy.
c) External and internal auditors
Representatives of the external auditors and the
Head of Internal Audit attend meetings of the
Audit Committee in an advisory capacity. Copies
of the minutes are sent to all the members of the
Board of Directors. Reports on the activities of
the Audit Committee are provided at the meetings of the full Board of Directors. In the reporting year, three meetings were held and the
external auditors attended all three meetings.
Disc ussions between the external auditors, the
Chairman of the Board of Directors, the Chairman of the Audit Committee, the CEO and the
CFO take place annually. Meetings or an exchange of experience with specialists from the
areas of Group finance, corporate finance and
risk management, legal and compliance, general secretariat and corporate governance are
held periodically. The external and internal audit
teams also liaise frequently regarding issues such
as audit planning, audits and results as well as
current problems.
7.4 Supervision and control of audit
a) External auditors
The Audit Committee prepares the election of the
statutory auditors. It monitors and assesses their
activities. This supervision is predominantly carried out by means of the external auditors’ reports on audit results, the reporting process, decisions, for example on IFRS issues, and statements
in the local audits. Important findings are summarised in a management letter.
b) Internal auditors
In addition to an external auditor, Helvetia
Group has an internal auditing department that
reports directly to the Audit Committee and the
Chairman of the Board of Directors. The Head of
Internal Audit reports directly to the Chairman of
the Board of Directors. This reinforces the independence of the internal auditors.
63
8. Information policy
As a rule, Helvetia provides its shareholders with
information twice a year as part of the periodic
reporting on annual and interim results in the
form of a detailed letter to the shareholders. This
letter deals with a variety of current issues, including strategy, market positioning and business policy. Furthermore, our website www.
helvetia.com contains additional current and
archived information about Helvetia Group, on
topics such as corporate governance, Group
structure and strategy, employees, sponsorship
and history, as well as investor information such
as key figures, equity story, bonds, rating, annual and interim reports and Helvetia shares including current share price trends. In addition, further
publications, media releases and important
dates can be found here. Those interested have
the opportunity to register online to receive the
latest information on the company and to request
particular publications.
Helvetia periodically meets with institutional
investors and presents the published financial results at special roadshows. Our Investor Relations team will be pleased to assist with any personal enquiries (contact details are indicated at
the end of this report as well as on our website).
Prior to the Shareholders’ Meeting, shareholders have the option of paperless communication with the share register of Helvetia. Services
such as ordering admission cards, notices to
H elvetia, valid issuance of proxies and voting instructions to independent representatives and
corrections of data can be processed online.
Access is via www.shapp.ch. Instructions regarding initial registration will be included in the
invitation to the Shareholders’ Meeting. Shareholders who are already registered will be i ssued
with the respective documentation electronically
until further notice.
64
If you were to suggest that risk management results in missed opportunities, you would be wrong. The yardstick we
use to measure risk management is the Company’s objectives. Risks are unpredictable disruptions that prevent us from
reaching our objectives. Through risk management, we create an overview of the risks that exist and which ones we are
prepared to accept within the confines of our predefined risk appetite. We then develop solutions to reduce any risks
that we are not prepared to accept.
Peter Bamert, Head Risk and Capital Management
“As Head Risk Management, it is my task to identify potential risks to Helvetia and analyse and manage them. In order
do to this, my colleagues and I run specific scenarios in order to recognise potential risks at an early stage and prevent
them. To this end, we develop both preventive and reactive measures along with related recommendations. Should a risk
event nonetheless occur, we analyse it in order to learn from it for the future. Although I think I am a rather risk-averse
person myself, I make sure that I don’t let risks get to me. The key to doing this, on both a personal and professional
level, is to maintain an emotional distance to risks at all times.”
Company profile Compensation report
Compensation report
Helvetia Holding AG prepares a separate compensation report in connection with the “Ordinance
Against Excessive Compensation in Swiss Listed
Companies” (VegüV), which includes additional information. It can be viewed at www.helvetia.com
or requested as a printed version.
The compensation report for the shareholders of
Helvetia Holding AG and interested third parties
consists of two parts. This section describes the general principles and essential features and criteria of
the compensation concept and participation rights
as well as the loan terms and conditions for members of the Board of Directors and the Group and
Switzerland Executive Management teams. It provides an overview of the philosophy, guiding principles and processes pertaining to the compensation paid by Helvetia that apply to all operational
and management levels for performance-related
pay. This represents part I of the compensation report. The application of the general principles in the
financial year and the specific payments are set out
in the financial report under section 14 (page 170)
“Share-based payments” and section 16 “Compensation paid to the Board of Directors and the Group
Executive Management” from page 172 et seq.
They form the second part of the compensation report. Both parts comply with the requirements of the
Corporate Governance Guidelines, the “Swiss
Code of Best Practice for Corporate Governance”,
the FINMA (Swiss Financial Market Supervisory Authority) Circular 2010 / 1 on “Remuneration
Schemes” as well as the Ordinance Against Excessive Compensation in Swiss Listed Companies of 20
November 2013 which entered into force 1 January 2014.
General compensation principles
Helvetia Group applies a multi-level and yet simple
and transparent compensation system for all employees in Switzerland as well as its governing and
executive bodies (Board of Directors and Group
Executive Management). As shown below, this
s ystem is composed of fixed and variable compens
ation components. At Helvetia, compensation is
deliberately fixed so that:
–it is simple, transparent and comprehensible,
and fair and appropriate for the members of the
Board of Directors and Executive Management,
and for all managers and employees. Those
who do good work should also be paid well;
–it takes account of the responsibility carried by
the function holder, the quality of his or her work
and the effort and time involved in carrying out
the work;
Helvetia remuneration model
Board of Directors
Group Executive Management / CEO
All employees in Switzerland
Fixed component
Variable component
Base salary Long-term salary
component
(LTC) as % of
base salary
Board of Directors uniform basis of
remuneration (exception: Chairman
of the Board of Directors) with allow
ances for committees and committee
councils (cash)
ExM and employees: fixed salary
based on individual function
(position, skills, responsibility, etc.)
incl. fringe benefits (cash)
Long-term investment instrument
(only Executive Management: basis of
calculation: shares,
transfer of ownership in shares or in
cash)
Results-based
salary
component
as % of
base salary
Compensation paid
in dependence of
the general business performance
(cash)
Individual
objective
attainment
as % of
base salary
Variable salary
component based
on personal
objective attainment (cash)
67
–there is an appropriate relationship between the
fixed and variable compensation components
to ensure that the variable compensation is not
so high that it has a negative impact on employees’ risk tolerance and motivates them to focus
on short-term criteria only;
–it is function-appropriate and shaped to a considerable extent by individual targets and the
overall result of the company;
–it is reasonable and competitive compared to
the salaries paid by other companies in the
same labour market and business sector; and
–it is reasonable when the lowest and highest salaries within Helvetia are compared.
The delineation of powers for compensation matters is defined in Appendix I of the organisational
regulations: www.helvetia.com/gruppe/governance.
Fixed compensation components
The Nomination and Compensation Committee defines the principles on which compensation decisions are based. With regard to the Shareholders’
Meeting that takes place in April / May and the
compensation periods beginning subsequently
(Board of Directors: Shareholders’ Meeting to Shareholders’ Meeting, Executive Management: 1 July to
30 June), the compensation concepts are reviewed
to ensure that they are still appropriate and in line
with the market; they are then submitted to the
The Board of Directors is in charge of general com- Board of Directors and then to the Shareholders’
pensation issues and compensation models. It is Meeting at which final approval will be granted for
supported in its work by the Nomination and Com- the total sum.
pensation Committee. A new feature resulting from
Various documents are used as the basis for enthe Ordinance Against Excessive Compensation in suring that the fixed compensation components are
Swiss Listed Companies (VegüV) is that it is now appropriate and in line with the market. For ex
mandatory for the Board of Directors to compile a ample, renowned independent institutes are comyearly compensation report, followed by the final missioned from time to time to prepare comparative
approval of the compensation for the Board of studies that can serve as a benchmark. The comDirectors and the Executive Management by the pensation reports of comparable competitors are
Shareholders’ Meeting. Therefore no payment / also analysed. Publications by different interest
share allocations may take place prior to this date. groups such as “Ethos”, information obtained from
Therefore, as of 2014, the Shareholders’ Meet- advisors specialising in personnel issues and audits,
ing has the following competencies in matters con- and articles that appear in the media also provide
an important basis for comparison.
cerning compensation:
a) Review of the compensation report and thus the
principles and conditions under which the compen- Variable compensation components
sation of the members of the Board of Directors and The variable compensation components for memthe Executive Management are determined.
bers of the Board of Directors and the Group Ex
b) Approval of the following total amounts:
ecutive Management – and all Helvetia employees
–fixed compensation to the Board of Directors for in Switzerland – are determined by the Nomination
the period from the current Shareholders’ Meet- and Compensation Committee during the first quaring up to the next Shareholders’ Meeting (pro- ter of every year once the key figures for the past fispective);
nancial year and the individual target achievement
–fixed compensation to the Executive Manage- results are available to the Board of Directors for the
ment for the period from the 1 July following the final approval of the Shareholders’ Meeting (total
current Shareholders’ Meeting up to 30 June of amounts Board of Directors and Executive Managethe next year (prospective);
ment). The Nomination and Compensation Commit–variable compensation to the Board of Directors tee uses a criteria matrix to assess the results-based
for the financial year then ending (retrospec- target achievement; this matrix is discussed in detail
tive);
below in conjunction with the long-term compensa–variable compensation to the Executive Man- tion component (LTC) that has been in force since
agement for the expired financial year (retro- 2010.
spective).
68
Other compensation components
Helvetia also offers employee benefits packages,
which are attractive in a market comparison, to all
its employees and managerial staff. The employee
benefits insurance provides employees and their
dependants with the assurance that they will be financially secure on retirement or if they should become sick or disabled or in the event of death in a
way befitting employees who work for a leading insurance company.
Helvetia’s compensation systems as well as the
employee benefits programmes, some of which can
be optimised at an individual level, have proved
their value; they are correct and fair, balanced and
competitive, and the amounts that are paid can be
justified at all times.
1. Board of Directors
The compensation principles and individual components of the compensation concept as well as the
procedure used for determining performance-related payments are set out in the compensation regulations approved by the full Board of Directors.
The compensation paid to the members of the
Board of Directors consists of the following simple
and transparent components, whereby the fixed
cash component is the largest component by far:
a) Fixed compensation
Each member of the Board of Directors receives
the same basic fixed remuneration determined in
advance, except for the Chairman whose higher
fixed remuneration takes into account his greater
involvement in management and operational activities. The Vice Chairman and the chairmen and
members of the committees also receive an allowance in addition to their basic remuneration. These
payments take account of the responsibility and
specific functions of each of the individual Board
members. The compensation for each individual
Board member calculated in this way is paid out in
cash. When a director leaves the Board, compensation is paid on a pro rata basis up to the end
of the month in which he or she leaves the Board
of
Directors. A payment of the compensation
established on this basis is made only after the
approval of the total amount by the Shareholders’
Meeting.
b) Variable compensation
The variable compensation paid to a Board member is calculated based on a reference value of
30 % of the fixed compensation. This reference
value is multiplied by the extent of target achievement that applies to the LTC (for the calculation of
the percentage of target achieved, see the explanat
ions on the LTC below). The Board member is then
allocated a prospective number of shares (deferred
shares) for this amount. The relevant share price is
calculated as the average of the stock exchange
prices for Helvetia Holding shares for five consecut
ive trading days from the day on which the business
result is announced. Ownership of the resulting
number of shares is transferred after three years.
When a director leaves the Board, the LTC is paid
on a pro rata basis up to the end of the month in
which he or she leaves the Board of Directors. Here,
too, the deferred allocation of LTC shares applic
able to each member of the Board of Directors
takes place only after the approval of the total
amount by the Shareholders’ Meeting.
c) Meeting attendance fees
No attendance fee is paid.
d) Expenses
The members of the Board of Directors receive
lump-sum expense allowances of CHF 10,000 per
member as part of their fixed compensation for
each term of office. This lump-sum expense allowance covers minor expenditures and travel expenses for the members of the Board of Directors within
Switzerland. Costs for accommodation at the place
where a meeting takes place and for foreign trips
are paid by the company.
e) Shares and options
The variable compensation is paid to the members
of the Board of Directors in the form of shares (see
b). They do not participate in any employee share
purchase plans. They also do not participate in any
previous share option programmes.
f) Severance pay, loans and discounts
No severance payments are granted. Loans are
granted at usual market conditions. Board members
also do not benefit from any discounts (premium discounts, etc.) that are offered to Helvetia employees.
69
2. Executive Management
The compensation of the members of the Group Executive Management comprises the components
described below:
a) Fixed compensation
The members of the Executive Management are
paid a fixed compensation in cash which is determined every year by the Nomination and Compensation Committee for the period from 1 July to 30
June of the following year and approved by the
Shareholders’ Meeting. This compensation is determined on an individual basis in accordance with
the aforementioned criteria and takes account of
the function and level of responsibility of the individual member of Executive Management. It also includes all child or education allowances and anniversary bonuses.
b) Variable compensation
The definitive amount of the variable compensation,
which must also be approved by the Shareholders’
Meeting before it is paid out, is dependent on the
following three factors:
Individual target achievement (20 % of fixed compensation): This reference value is multiplied by the
degree of attainment of the personal targets agreed
with the line manager in advance. The result of this
multiplication is paid out to the member of Executive Management in cash. The individual targets of
a member of Executive Management can include
quantitative and / or qualitative components and depend on his or her operational responsibility. Compensation for individual target achievement is due
to the Executive Management member regardless
of the general business result.
year with a special consideration of the processes
in Switzerland.
Long-term results-based compensation component
(LTC; no more than 40 % of fixed compensation):
This compensation component with a longer-term
orientation is multiplied by the percentage of the
strategic target achieved. In contrast to the regular
results-based compensation component, the
amount calculated in this way is not paid out to the
Executive Management member in cash, but in the
form of a deferred claim to a certain number of
shares. The relevant share price is calculated as the
average of the stock exchange prices for Helvetia
Holding shares for five consecutive trading days
from the day on which the business result is announced. This number of shares is transferred to the
ownership of the Executive Management member
after three years either in the form of shares or as a
cash payment based on the share price at that time,
provided that there were no negative developments
in this period that were triggered in the reporting
year and can be attributed to the conduct of the Executive Management member in question. If the
person in question leaves the Executive Management, his or her deferred claim lapses as follows:
cancellation of all claims for the year in which notice of termination was given, cancellation of one
half of the claims for the first preceding year and no
cancellation of any claims from the second preceding year. This concept establishes a direct link between the members of Executive Management and
the long-term development of the company in two
ways: positive or negative share price trends over
the three-year period and the possibility that the
number of allocated shares can be reduced retroactively.
Results-based compensation component (reference
value 20 % of fixed compensation): This compensation component based on the annual result is multiplied by the extent of target achievement which in
each case also applies for establishing the results-based variable compensation for all employees in Switzerland. The resulting amount is paid out
to the member of Executive Management in cash.
The amount of the results-based compensation is
based on the operating result and the achievement
of the budget goals set for the respective financial
70
The degree to which strategic objectives have
been attained (ranging between 0 and 125%) is
fixed annually during the first quarter following
the end of a financial year by the Nomination
and Compensation Committee of the Board of
Directors. The Committee has additional room
for discretion, allowing it to take additional
c riteria and an overall assessment into account,
while remaining within the established upper
limit of 125%:
– Profit: The reference figure is the annually reported Group profit for the period relative to the
budget.
– Growth: The reference figure is the growth in business volume in the active business sectors relative
to the relevant market segment achieved in the
financial year.
– Risk-adjusted return: The calculation is based on
the return on equity (ROE) in the reporting year
relative to the important sector-relevant solvency
figures.
– Shareholder value: The reference figure is the performance of Helvetia registered shares compared
with the performance of the DJ European Insurance SXIE (index of European insurance stocks).
Compensation for Executive Management
max.
40%
20%
Reference figure 80%
of fixed component
0–
0–1
20%
Fixed component (cash)
+
12
5%
25%
0 – 100 %
Variable component
Long-term salary component
(deferred shares)
Dependent on business
performance (cash)
Individual objective
attainment (cash)
For the LTC (Executive Management Group, Switzerland, and Board of Directors), there is an additional restriction in that no deferred shares are allocated if the Group as a whole reports a loss, and / or
the solvency figures are insufficient.
The percentage of target achieved (LTC, results-based
component), as calculated by the Nomination and
Compensation Committee of the Board of Directors,
is multiplied by the respective target figure (percentage of the fixed compensation). The results-based
component calculated in this way and the result of
the individual target achievement together comprise
the total variable compensation of the employees and
the Executive Management Group and Switzerland.
These variable compensation components (individual, results-based and LTC) are an important feature of Helvetia’s performance culture, under which
every individual employee is compensated according to the quality and quantity of his or her work as
well as his or her responsibility and workload and
also the result achieved by the company as a whole.
The variable compensation components are paid
out in cash and only the LTC is paid in the form of
deferred shares after three years or in the equivalent amount in cash, if desired.
c) Expenses and benefits in kind
The reimbursement of expenses is governed by written regulations. The members of Executive Management are entitled to a Helvetia company car which
they may also use for private purposes for a fixed
fee. The employer does not grant any other benefits
in kind.
d) Shares and options
The members of the Group Executive Management
can, on a voluntary basis, acquire the maximum
number of shares available to them under the employee share purchase plan. The same conditions
apply as for all other employees of Helvetia in Switzerland (see section 3). They therefore also benefit
from a discount of 16.038 % which is granted because these shares are blocked for three years. There
have not been any share option programmes since
2003.
e) Severance pay and loans
No severance payments are granted. Loans are
granted at usual employee conditions.
71
f) Pension benefits
The benefits to which members of the Executive
Management are entitled under occupational pension plans are in line with the model for internal
pension regulations applicable to all employees. In
addition, the employer makes the standard joint
contribution. The employer also finances the option
for members of the Executive Management to retire
upon reaching the age of 60. These additional contributions are presented as part of the overall pension contributions made to members of the Executive Management. No extraordinary benefits were
paid.
Local Executive Management Boards
Analogous compensation regulations apply as described above for the Executive Management Switzerland as for Group Executive Management. The
Executive Management abroad is compensated according to the local market conditions governing
the compensation systems. The local compensation
systems can include fixed and variable salary components. At Group level, members of the local Executive Management abroad are also paid a results-based bonus in the form of shares, based on a
reference figure of 10 % of the local basic compensation. The reference figure is also multiplied by the
LTC percentage of target achieved. This Group
bonus has been designed to promote the sense of
belonging to the Group of the Executive Management teams abroad.
72
3. Helvetia employees in Switzerland:
share purchase plan
In 2005, an employee share purchase plan was
introduced in Switzerland to allow employees to
participate in the performance of Helvetia and thus
to strengthen their personal ties to the company.
Employees can purchase registered shares of

Helvetia Holding AG at reduced prices. The number of available shares is specified by the Board of
Directors, taking account of the financial results and
the functions of the employees concerned. The
purchase price is calculated on the basis of the
average stock market price during the five trading
days following the publication of the financial
results. Participation in this scheme is voluntary. As
these shares are subject to a mandatory vesting
period of three years, they can be sold by the company at a tax-exempt discount of 16.038 %. The
members of the Executive Management can also
take part in this programme, but the members of the
Board of Directors may not. The share purchase
plan is not open to employees abroad.
74
Market environment
76
Helvetia Group’s
performance
78
Development of
business activities
80
Investments
82
Business units
Company profile Market environment
Market environment
Our market position
In over 150 years, Helvetia Group has grown
from a number of Swiss and foreign insurance
companies into a successful insurance group that
conducts business everywhere in Europe. As an
all-lines insurer in Switzerland and a niche provider of marine and transport insurance in
France, Helvetia enjoys a strong position, being
fourth and second in the respective markets. The
European insurance market
Our market positions
Strong potential for growth based on room for
growth in market positions abroad
Ambition 2015+
The markets in which Helvetia is active generate a volume
of US $ 772 billion, representing 16.7 % of the global market1.
Helvetia strives to sustainably
boost its attractive business portfolio in its current active markets
and to continuously develop
market shares.
CH
No. 4
F
CHF 4,371 million
82 % life
18 % non-life
D
No. 35
EUR 686 million
36 % life
64 % non-life
A
Niche position
No. 2
(transport /marine)
EUR 330 million
32 % life
68 % non-life
D
No. 11
F
A
CH
I
No. 18
EUR 879 million
55 % life
45 % non-life
74
Market positions country markets at the
end of 2012
No. 28
EUR 262 million
40 % life
60 % non-life
I
Source: sigma 3 / 2013, Swiss Re
1
Premium volume of country markets in
financial year 2013
EUR 212 million
E
growth potential in these markets may be lower
due to the high insurance penetration, but the volumes generated, particularly in Switzerland, are
very profitable.
Germany, Italy and Spain are among the
highest volume insurance markets in the world,
with over 5 %, 3 % and 2 % of global market
share respectively. As Helvetia’s market share in
these markets is low, we consider the growth potential here to be high. We utilise this potential
by focusing on our customers and sales partners,
for whom we are a good match due to our size,
sales structures and geographical scope.
E
The current market conditions in the European markets
continued to present a number of challenges to in
surers in 2013. The global economy may have
continued to grow, but this growth was driven primarily by the USA, as recovery in the European markets
tended to be slow in comparison. The effects of the
financial and sovereign debt crisis still had a significant impact on some of the Southern European
markets in particular, where growth potential remains
limited for the time being as a result. Efforts to industrialise the insurance sector also increased price pressure in 2013. The restructured supervisory regulations
in Europe under Solvency II created additional
momentum and a greater need for action.
In the non-life business, the effects of the recession continued to have a negative impact on premium
volumes in Italy and Spain. Price competition was particularly stiff in the Italian motor vehicle business. The
market participants in Spain also reduced their prices
in an effort to generate more business volume and
thereby at least maintain their premium income. Transport insurance in France also saw an increase in competition that was caused primarily by pricing measures. In contrast, the Swiss non-life market remained
solid in 2013 and the German non-life business was
helped by the economic recovery, with a marked ten-
Company profile Market environment
dency towards price increases in individual lines of
property insurance (e.g. motor vehicle or residential
buildings) being observed. The main source of claims
in 2013 was storm damage in Germany and Austria,
which will be reflected in the combined ratios of European insurers. In addition, the low interest rate environment in the non-life business also had a negative
impact on profitability.
The life insurance business in 2013 was dominated by conditions in the capital market. The biggest
problem in 2013 was once again the low interest rate
environment, as investments that had been consider
ed safe yielded very low returns. With regard to
business volume, all Helvetia country markets showed
renewed signs of growth. The foreseeable further cuts
in statutory pension schemes will boost demand for
private pension solutions. The turmoil in the financial
markets has increased the demand for products with
financial guarantees and yield-oriented financial investments. Many life insurance companies have therefore responded with new products to reflect this trend.
The global reinsurance market was characterised by overcapacity in 2013. The global impact of
natural hazards will prove to be lower in 2013 than
in previous years, despite the floods, storms and hailstorms that occurred in central and northern Europe.
These factors kept the environment competitive despite
the caution caused by low interest rates. With regard
to primary insurance, there was a wider spread of
reinsurance cessions on the one hand, while on the
other, there were several cases where the trend
towards consolidation and centralisation for purchasing reinsurance continued. In these activities, the
cedants are generally reducing reinsurance purchas
ed by increasing retentions and internal diversificat
ion, and therefore outsourcing less business to active
reinsurers.
Market environment in the European capital
markets
The expansionary monetary policy pursued by the
central banks dominated events in the investment
and financial markets. The equity markets recorded
a strong performance, increasing over 20 % by the
year-end as measured by the world index. Our core
markets performed even better than this. As the US
economy recovered and fears that tapering could
begin too early were prevalent, there were periods
of significant price volatility. This, however, did not
dampen the overall positive mood.
As with the equity markets, the liquidity flood also
affected the bond markets. Interest rates for high
quality European bonds rose significantly from their
artificially low rates, while spreads in the peripheral
countries decreased substantially. The performance
data were therefore correspondingly uneven. Some
of the securities of top, AAA-rated debtors were
forced to relinquish the price gains of the recent c risis
years and achieved overall negative returns, while
lower-rated securities managed a more positive
performance.
Compared to the euro, which is important for our
business, the Swiss franc showed relatively little
fluctuation as the fixed minimum exchange rate of
CHF 1.20 per euro continued to apply. The somewhat weaker US dollar is of very little relevance for us.
As a medium-sized, very well-capitalised market
participant, Helvetia once again performed well in
2013 and sees a high potential for further value creation in the future. Our innovative products which
are aligned to customer needs, our strong sales pos
ition and focus on continuously improving our operational efficiency as well as our use of capital provide a strong foundation for this assumption. Details
regarding Helvetia’s business development can be
found on pages 78 – 80.
75
Company profile Helvetia Group’s performance
Helvetia Group’s performance
Helvetia Group generated a profit of CHF 363.8 million in the 2013 financial year, an increase of 9.2 % 1
over the previous period. The impressive annual result
underscores the Group’s successful performance. Business volume rose considerably from CHF 6,978.5 million to CHF 7,476.8 million. This represents encouraging growth of 6.3 % in original currency and 7.1 % in
CHF. Despite the much greater impact of severe wea
ther events in some country markets compared to the
previous year, it has been possible to slightly further
improve the net combined ratio from its already good
level. It stands at 93.6 % (previous year: 93.7 % 2). The
capital base remains at a very strong level with a
Solvency I ratio of 218 % (previous year: 227 %). Our
capital strength is also reflected in the fact that rating
agency S&P upgraded our rating from “A–” to “A” in
May 2013.
Business volume: significant increase due to
growth momentum in life and acquisition effects
in non-life business
At Group level, Helvetia was again able to increase
business volume by 6.3 % (in original currency, in
CHF: 7.1 %) in financial year 2013. The main driver
was the home market of Switzerland, which in-
Helvetia Group key figures
2013
2012
Growth in
% (CHF)
Growth in
% (OC)
Business volume
7 476.8
6 978.5
7.1
6.3
Gross premiums life
4 547.5
4 201.4
8.2
7.8
183.6
149.8
22.6
20.4
2 550.9
2 412.4
5.7
4.3
7 282.0
6 763.6
7.7
6.8
194.8
214.9
– 9.4
– 9.4
363.8
333.1
9.2
8.6
Life
152.9
138.2
10.7
10.1
Non-life
191.7
172.9
10.9
10.2
19.2
22.0
– 13.1
– 13.1
in CHF million
Deposits received life
Gross premiums non-life
Business volume for direct
insurance
Assumed reinsurance
Profit for the period
Other activities
creased by 9.9 % compared to the previous year. But
Germany, Austria and France also experienced posi
tive growth rates, with the increase in France driven
by acquisition.
In the life business we increased our business
volume by 8.2 % in original currency (in CHF: 8.7 %)
to CHF 4,731.1 million (previous year: CHF 4,351.2
million). Almost all country markets grew significantly. The increase in volume was driven by our home
market of Switzerland, which further improved its
position with a gain of 12.3 %. The German and
Austrian country market performances were also impressive, each showing a marked increase. Germany
grew by 16.3 % (in CHF: 18.7 %) and Austria by
11.9 % (in CHF: 14.2 %). Despite the still difficult economic environment, even Spain experienced growth
of 1.6 % (in CHF: 3.7 %). Only Italy’s volume remained below that of the previous year, which is due
to the deliberate adjustment of the distribution agreement with Banco di Desio. On the product side,
group life business as well as unit- and index-linked
life insurance in individual life business were the key
drivers. In accordance with our strategy, we particularly want to grow in individual life with these capital-efficient modern products. The fact that unit- and
% share
index-linked products comprised a 28 (2012: 21 %) of total premium volume in individual
life in the past financial year is also encouraging.
The non-life business achieved a premium
volume of CHF 2,550.9 million (previous year:

CHF 2,412.4 million). At 4.3 % in original currency
(in CHF: 5.7 %) the growth rate compared with 2012
was also at a very good level. The transport portfolio
of Gan Eurocourtage in France, acquired in the
fourth quarter of the previous year, provided a strong
contribution to growth. The Swiss and Austrian country markets were also able to continue to grow compared to the previous year. In contrast, the volumes
in Italy and Spain declined due to the still difficult
economic situation. However, it is encouraging that
the decline has slowed. Whereas premiums in original currency fell 4.1 % in Italy and 4.8 % in Spain in
financial year 2012, they only fell 2.4 % in Italy and
2.5 % in Spain in original currency in financial year
1
2
76
Data
for the financial year 2012 has been adjusted in
accordance with amendments to the accounting and
valuation principles.
Previous year’s combined ratio restated due
to amended IAS 19.
Company profile Helvetia Group’s performance
2013. In addition, portfolio optimisation impacted
premium performance in Germany and Italy to the
expected extent.
However, assumed reinsurance, which pursues an income-oriented policy with no volume
goals, recorded a decline in volume of 9.4 %, due
mainly to the non-renewal of major businesses relationships.
Results: another robust annual result thanks to
good contributions from both the home and
foreign markets
Helvetia Group achieved an impressive annual
result of CHF 363.8 million, which with a 9.2 %
increase is significantly above the previous year
(2012: CHF 333.1 million). Both the segments –
life and non-life – grew considerably. Life business contributed CHF 152.9 million to the result
and non-life business contributed CHF 191.7 million. Profits are also broadly based in geographic
terms. In addition to our home market of Switzerland, almost all the foreign markets impressed
with positive contributions to earnings – despite
the still somewhat challenging environment in the
southern European markets of Italy and Spain.
The significant improvement in life (+10.7 %) is due
not just to the robust home market of Switzerland; almost all our foreign markets were also able to improve
their results.
The combined ratio for non-life business again improved slightly to 93.6 % (previous year: 93.7 % 2). It
was consequently again better than the Group’s target
range of between 94 and 96 %. The fact that all the
country markets have a combined ratio of below
100 % is also encouraging.
At CHF 19.2 million, “Other activities” (which includes the Corporate Centre and reinsurance alongside the financing companies and holding company)
was below the previous year (2012: CHF 22.0 million). The reason for this is the somewhat worse results
in Group internal reinsurance, which was mainly due
to the severe weather events in Germany.
Capitalisation / Solvency: solvency remains
sound; profitability increased
Helvetia was able to further improve its robust capital position with its convincing performance. This is
reflected in the excellent Solvency I ratio of 218 %.
Despite paying an attractive dividend, equity also
rose 2.0 % compared to the previous year to
CHF 4,131.2 million, and, in spite of this, the return
on equity increased from 9.1 % to 9.3 % due to
increased profitability. As a result of the excellent
capitalisation, but also due to the Group’s strong
financial performance, Standard & Poor’s upgraded
Helvetia’s rating from “A–” to “A” during the reporting
year.
Direct business volume by country
6 % | 405.2
Spain
4 % | 321.2
Austria
4 % | 261.1
France
14 % | 1 079.9
Italy
60 % | 4 371.4
Switzerland
12 % | 843.2
Germany
Total 100 % | 7 282.0
Business volume by business area
3 % | 194.8
Assumed reinsurance
63 % | 4 731.1
Life
34 % | 2 550.9
Non-Life
Total 100 % | 7 476.8
77
Company profile Development of business activities
Development of business activities
Life
Business volume: robust growth in group life insurance business and unit-linked insurance solutions
Financial year 2013 saw life business volume in ori
ginal currency increase by 8.2 % (in CHF: 8.7 %) to
CHF 4,731.1 million (previous year: CHF 4,351.2
million). This increase was strongly driven by group
life insurance business in our home market of
Switzerland. However, our foreign business units
also reported favourable growth.
The Group life insurance business achieved
a marked increase of 13.3 % in original currency (in
CHF: 13.4 %). The volume in individual life business also rose 0.5 % (in CHF: 1.5 %). Single pre
mium business remained below the previous year as
a result of continuing low interest rates. The significantly higher index-linked and unit-linked insurance
premiums (growth in original currency: 36.1 %, in
CHF: 37.1 %) and higher deposits (growth in original
currency: 20.4 %, in CHF: 22.6 %) offset the decline
in single premium business.
The growth is broadly diversified geographically. All country markets except Italy contributed to
the increase.
The business volume in individual life business increased by 12.3 % in our home market of Switzerland despite lower single premium business as a result of the interest rate environments, particularly
driven by the strongly increased group life business,
higher tranche products and unit-linked insurance
Life business volume by country
2013
2012
Growth
in %
(CHF)
Growth
in %
(OC)
4 731.1
4 351.2
8.7
8.2
in CHF million
Business volume
Switzerland
3 574.4
3 182.9
12.3
12.3
Germany
301.1
253.6
18.7
16.3
Italy
595.6
675.4
– 11.8
– 13.6
Spain
130.2
125.6
3.7
1.6
Austria
129.8
113.7
14.2
11.9
78
solutions. The German and Austrian markets were
also impressive with double-digit growth rates of
16.3 % in Germany and 11.9 % in Austria in original
currency (in CHF: 18.7 % in Germany and 14.2 % in
Austria). This growth was primarily due to higher
traditional and unit-linked volumes in both countries.
Despite the difficult economic environment, Spain
also developed positively with growth of 1.6 % in
original currency (in CHF: 3.7 %). Here, we were
able to compensate for declining traditional products
with a higher level of unit-linked insurance solutions
and the continuing growth in burial insurance. Italy
is therefore the only declining market at 13.6 % in
original currency (in CHF: 11.8 %). This downturn is
essentially due to the renewal of the sales agreement
with Banco di Desio in January 2013 under slightly
modified terms, which was agreed in order to
increase profitability through an appropriately

balanced product mix and also to manage more
actively the exposure in Italian government bonds.
Further details on the development of the individual
country units can be found starting on page 82.
Profit for the period
At CHF 152.9 million, the life business posted an increase of 10.7 % year-on-year (2012: CHF 138.2
million). The sustained low interest rates continued to
represent a major challenge for the life business. Particularly in our home market of Switzerland, but also
in Germany and Austria, low interest rates required
further increases to reserves, albeit no longer to the
same extent as the previous year. Despite this period
of low interest rates, investment income remained
solid and was higher than the previous year, which
also enabled a significantly higher allocation to the
policyholder bonus funds.
Embedded value: increase reflects solid
development of life business
At the end of 2013, the embedded value of Helvetia
Group amounted to CHF 2,922.6 million, which represents an increase of CHF 275.1 million or 10.4 %
compared to December 2012. The analysis of chan
ges shows that the increase in value is primarily due
to better than expected economic results and the
Company profile Development of business activities
positive contribution of new business in all countries.
New business volume grew, especially in Switzerland, which recorded growth in single premium business in occupational pension plans, whereas the
new business volume in foreign markets remained
subdued because of the difficult economic environment. By contrast, dividend payments reduced the
life insurance portfolio’s shareholder value. Details
and an explanation of the embedded value calculation can be found on pages 214 – 216.
Life business volume by sector
6 % | 286.3
4 % | 183.6
Unit-linked
Deposits
57 % | 2 705.4
33 % | 1 555.8
Group life
Individual life
Non-life
Business volume: growth despite challenging
markets and portfolio optimisations
In the non-life business, we achieved satisfying
growth at Group level of 4.3 % in original currency
(in CHF: 5.7 %) to CHF 2,550.9 million (previous
year: CHF 2,412.4 million). In terms of insurance
lines of business, the transport business provided
the greatest currency-adjusted contribution to growth
of 77.8 % (in CHF: 81.2 %) due to the acquisition of
the transport insurance portfolio of Gan Eurocourtage
in France, a subsidiary of Groupama SA, in the
fourth quarter of 2012. Looking at the remaining insurance lines of business shows that “motor insurance”, which was still the largest business line in the
previous year, decreased 4.9 % in original currency
(in CHF: 3.6 %), primarily due to our restructuring
measures in Italy and Germany. The property business line grew 0.9 % in original currency and 2.1 %
in CHF and was thus able to overtake motor business
by volume. The other business lines reported positive
growth rates at a lower level.
Viewed by country market, France stands out
as a result of the acquisition at a growth rate of
126.5 % in original currency (in CHF: 131.2 %). The
home market of Switzerland saw slight organic
growth of 0.2 %, largely due to the greater motor vehicle volume. With growth broadly diversified across
all business lines, Austria was also able to grow by
1.6 % in original currency (in CHF: 3.7 %). Volumes
fell however in the country markets of Germany, Italy
and Spain compared to the previous year. In
Germany, as part of a profit improvement pro
gramme, non-profitable business relationships in
property, motor and liability insurance were cancelled, with a resulting reduction in premium vol-
Total 100 % | 4 731.1
Non-life business volume by sector
6 % | 146.0
10 % | 257.6
Accident / health
Liability
35 % | 897.1
12 % | 312.5
Motor vehicle
Transport
37 % | 937.7
Property
Total 100 % | 2 550.9
Non-life business volume by country
2013
2012
Growth
in % (CHF)
Growth
in % (OC)
4.3
in CHF million
Business volume
2 550.9
2 412.4
5.7
Switzerland
797.0
795.5
0.2
0.2
Germany
542.1
556.8
– 2.6
– 4.6
Italy
484.3
486.4
– 0.4
– 2.4
Spain
275.0
276.2
– 0.4
– 2.5
Austria
191.4
184.6
3.7
1.6
France
261.1
112.9
131.2
126.5
79
Company profile Development of business activities / Investments
umes. In Italy, the decline also originated predominantly from portfolio cleansing in motor business
which was carried out to further improve profitability. Spain continued to suffer as a result of the recession. For this reason, as in previous years, the written
premium volumes in non-life once again declined
slightly market-wide. Further details on the development of the individual country units can be found
starting on page 82.
Combined ratio: improvement despite the greater
impact of severe weather events on some country
markets – all country markets had combined ratios
of below 100 %
In non-life business, the net combined ratio further improved from its already high level of 93.6 % despite
the greater impact of severe weather events on some
country markets. It was consequently again better
than the Group’s target range of between 94 % and
96 %. In addition, it is particularly satisfying that all
country markets had combined ratios of below
Combined ratio
CH
DE
IT
ES
AT
FR
1)
63.4
30.2
64.8
28.91
56.1
28.6
56.7
28.61
65.9
32.0
30.91
67.1
31.7
71.7
27.01
69.1
25.0
67.9
25.01
66.9
32.8
66.0
62.0
93.6
93.7
84.7
85.3
67.2
70.7
Other activities
Alongside the financing companies and the holding
company, the “Other activities” area also includes
the Corporate Centre and reinsurance. Assumed reinsurance, which pursues an income-oriented policy
with no volume goals, recorded a decline in volume
of 9.4 %, due mainly to the non-renewal of major
business relationships. At CHF 19.2 million, the result
for “Other activities” is CHF 2.8 million lower than
the result of the previous year, which is due to Group
internal reinsurance which was more strongly impacted by large claims and could not be fully offset
by higher financial income.
Investments
in %
Group direct
100 %. Despite the impact of storms and major
flood, in Germany, Austria and Switzerland, the
claims ratio declined slightly to 63.4 % (previous
year: 64.8 %). By contrast, the cost ratio increased
by 1.3 percentage points compared to the previous
year. This rise is in line with our strategy of managing the overall combined ratio. It resulted mainly
from the higher cost ratios in the newly acquired
companies (some of which, however, have signif
icantly lower claims ratios) and from short-term
reductions of premium volumes through portfolio
optimisations, whose effect already appears in

reduced claims ratios.
32.81
32.8
32.21
P revious year’s cost ratio and combined ratio
Net claims ratio 2013
restated due to application of amended IAS 19.
Net cost ratio 2013
Net claims ratio 2012
Net cost ratio 2012
97.9
98.1
98.8
98.7
94.1
92.9
99.7
103.5
98.8
94.2
Investment result from Group financial assets and
investment property: direct yield stable at 2.7 %
With a result of CHF 1,212.3 million, financial
assets and investment property again made a
valuable contribution to the overall result in the
reporting year. Current income of CHF 985.7
million increased slightly by CHF 25.8 million
compared to the previous year. The increase is
due to the CHF 1,720.2 million rise in investment
volume. Despite continuing low interest rates, the
direct yield only fell by 0.1 percentage points
and is now 2.7 %. This moderate decline reflects
the successfully implemented policy of gradually
decreasing the duration gap between the
1
80
revious year’s cost ratio restated due to
P
amended IAS 19.
Company profile Investments
Investment structure 2013
58 % | 23 040.2
5 % | 2 124.8
Bonds
Unit-linked
investments
5 % | 2 068.6
Shares
3 % | 1 278.1
Money market instruments,
associates
2 % | 735.7
Investment funds, alternative
investments, derivatives
13 % | 5 059.8
Investment property
10 % | 3 863.2
Mortgages
4 % | 1 405.7
Loans
Total 100 % | 39 576.1
Performance of Group investments
2013
2012
Current income from Group financial assets
781.1
761.9
Rental income from Group investment property
204.6
198.0
Current income from Group investments (net)
985.7
959.9
Gains and losses on Group financial assets
243.4
180.8
Gains and losses on Group investment property
– 16.8
37.1
Gains and losses on Group investments (net)
226.6
217.9
Investment result from Group financial assets and investment property (net)
1 212.3
1 177.8
Change in unrealised gains and losses recognised in equity
– 527.9
679.8
in CHF million
Total profit from Group financial assets and investment property
684.4
1 857.6
36 550.4
34 318.3
Direct yield
2.7 %
2.8 %
1.9 %
5.5 %
Average investment portfolio of the Group
81
Company profile Investments / Business units
i nterest-bearing assets and the liabilities from the
life business.
Realised gains, totalling CHF 226.6 million, developed particularly favourably. These originate primarily from equities, CHF 171.0 million, and bonds
and convertible bonds, CHF 64.0 million. The investment performance recognised in profit and loss was
thus 3.3 %.
Taking account of the unrealised losses recognised in equity, the investment performance was
1.9 %. The unrealised losses recognised in equity are
due to rising interest rates. The deliberately long
duration of the securities further strengthens this

effect. Price fluctuations and the resulting unrealised
gains / losses during the term are actually of less significance as we hold the vast majority of the interest-bearing securities to maturity from an integral asset-liability point of view. In addition, although the
interest-rate-related correction reduces the unrealised gains, which were recognised in equity created
during the crisis years, it does not eliminate them.
These still stood at CHF 821.1 million as at the end
of the year.
Our balanced investment structure, tailored to
the liabilities arising from the insurance business, has
proved itself once again. The same applies to our
prudent risk policy and comprehensive and timely
risk management. The systematic hedging of the
share portfolios against excessive losses with simultaneous full participation in rising markets paid off
particularly in the reporting year with a physical
share portfolio of 5 %.
in %
Shares
Bonds
Mortgages
21.1
– 0.1
2.5
Investment property
Average
82
3.9
1.9
Both the investment policy and the operational
risk management approach will remain unchanged in the current year.
Business units
Switzerland
Our home market of Switzerland again proved a
solid pillar of Helvetia Group in 2013. Business

volume increased 9.9 % year-on-year to CHF 4,371.4
million (previous year: CHF 3,978.4 million). The
growth came particularly from the life business and
was due to both increased single premium business
and an increase in regular premiums. Profit improved
by 9.8 % to CHF 250.8 million. This was due to
robust technical results in both life and non-life

business as well as solid investment income – despite
substantial increases to reserves in life business.
Life: premiums increase by 12.3 % – encouraging
sales of modern capital-efficient products
Business volume in the life business increased 12.3 %
year-on-year to CHF 3,574.4 million (previous year:
CHF 3,182.9 million). The lion’s share of this is attributable to group life business, which reported an increase of 16.3 %. Of particular note is the satisfying
5.1 % increase in regular premium volume. In add
ition to our own sales force, selected brokers and
direct sales particularly contributed to the business
expansion. The demand for full insurance solutions
in occupational pension schemes remained as strong
as ever.
In the individual life business, both the regular
premium business and single premium business performed well. The 3.5 % growth of the periodic pre
mium business is primarily thanks to the now fully
consolidated SEV Versicherungen Genossenschaft
portfolio and to unit-linked insurance. In line with our
Helvetia 2015+ strategy, we also focused on the sale
of capital-efficient non-traditional products in the
past year. The index-linked and unit-linked premiums
have risen by almost 50 % year-on-year. Their proportion of total premium volume in individual life has
risen significantly to almost 35 % from 23 % in the
previous year. In single premium business we succeeded in continuing the targeted growth path
thanks to the index-linked “Helvetia Value Trend”.
Company profile Business units
This is all the more satisfying because demand for
traditional single premium products stagnated.
“Helvetia Value Trend” was placed in two tranches
and had a total volume of CHF 217.8 million. Helvetia
Switzerland successfully launched another new
modern insurance product without biometric risk
with the “payment plan” (Auszahlungsplan). The premiums received are booked as deposits. These have
also successfully contributed to business volume
growth. By contrast, the marketing of traditional savings life insurance declined in line with our strategy.
The technical result and investment result were
very encouraging due to prudent investment and
underwriting policies and the beneficial price trend
on capital markets. This made it possible to add to
the bonus reserve. In light of the continuing low interest rates and demographic developments, we once
again strengthened our reserves.
Non-life: very good technical result – solid portfolio
quality results in an excellent net combined ratio of
84.7 % despite some storm damage
Non-life business was once again impressive because of an excellent technical result and sustainable
profitability. The combined ratio in Switzerland at
84.7 % net is again at an outstanding level (previous
year: 85.3 %). The claims ratio fell to 56.1 % despite
some storm damage (previous year: 56.7 %), which
underscores the solid portfolio quality. The cost ratio
remained unchanged at 28.6 %. Gross premiums in
the non-life business increased by 0.2 % (continued
business – after the sale of accident and health
Key figures Switzerland
Growth
in %
2013
2012
4 371.4
3 978.4
9.9
3 574.4
3 182.9
12.3
0.2
in CHF million
Business volume
Life
Non-life
Combined ratio
Profit for the
period
1
797.0
795.5
84.7 %
85.3 % 1
250.8
228.5
0.6 %) to CHF 797.0 million (previous year:
CHF 795.5 million). Motor business and liability
insurance drove the growth, whereas the other lines
of business declined.
Germany
With gross written premiums of CHF 843.2 million
(previous year: CHF 810.4 million), Helvetia Germany
achieved premium growth of 1.9 % (in CHF 4.0 %).
Whereas non-life business fell 4.6 % in original currency (CHF −2.6 %) as a result of targeted measures
to reduce risk and strengthen earnings power, life
business achieved a strong growth in volume of
16.3 % in original currency (CHF 18.7 %). At
CHF 24.2 million, the result from the German
business was below that of the previous year (2012:
CHF 27.0 million). This was caused by a one-time tax
effect in the previous year. The 2013 financial year
was shaped by severe weather events in Germany.
Nevertheless, the measures we launched in 2012
to reduce risk and strengthen earnings power in
the non-life business are making an impact. These,
together with improved reinsurance, largely compens
ated for the effect of the erosion of premiums and
weather related claims and therefore it was possible
to improve the net combined ratio from 98.1 % to
97.9 %.
Life: very dynamic life growth
The life business performed very dynamically in
2013. With a total volume of CHF 301.1 million, we
achieved satisfying growth of 16.3 % in original currency (in CHF: 18.7 %) (previous year: CHF 253.6
million). This is particularly due to our attractive products, especially in unit-linked business, which we
have been able to market successfully as a consequence of good acceptance by brokers. Both single
premiums and regular premiums increased continuously in original currency, single premiums by 50.1 %
and regular premiums by 4.0 %. The increase to the
statutory interest rate reserves as a result of the continuing low interest rate environment was financed
entirely from the investment results.
9.8
revious year’s combined ratio restated due
P
to amended IAS 19.
83
Non-life: consolidation in non-life business – efficiency measures introduced make an impact – net
combined ratio improved despite storm damage
In non-life business, the volume of business fell by
4.6 % (in CHF: −2.6 %) to CHF 542.1 million (previous year: CHF 556.8 million). This is primarily
due to the cancellation of major business relationships with high claims ratios in motor and
resid ential building business. In addition to initial
positive effects from the adjustment of premiums,
the positive growth in profitable business lines
such as commercial business and transport was
only able to partially offset this effect.
In 2013, the insurance industry was hit by an unprecedented level of weather events. In addition to
floods as a result of strong rains, there were also
several regional hail and storm events. The effective
restructuring measures of the previous year paid off
directly for Helvetia Germany. Supported by an improved reinsurance coverage, it was even possible
to improve the net claims ratio from 67.2 % 1 to 65.9 %
despite the additional impact from weather-related
losses. However, as the restructuring programme in
Germany also resulted in declines in premiums, the
net cost ratio has risen from 30.9 % to 32.0 % in the
short term. Due to the substantially lower claims ratio,
we were, however, able to slightly further improve
the net combined ratio compared to the previous
year from a total of 98.1 % to 97.9 %.
Key figures Germany
2013
2012
Growth in
% (CHF)
Growth in
% (OC)
in CHF million
Business
volume
843.2
810.4
4.0
1.9
Life
301.1
253.6
18.7
16.3
Non-life
– 2.6
– 4.6
– 10.2
– 12.0
542.1
556.8
Combined
ratio
97.9 %
98.1 % 1
Profit for
the period
24.2
27.0
1
84
Italy
Helvetia Group Italy achieved a premium volume of
CHF 1,079.9 million in financial year 2013, a decrease of 8.9 % (in CHF: −7.0 %) compared to the
previous year (2012: CHF 1,161.8 million). Whereas
the market for life insurance products grew again in
2013, the aftermath of the recession continued to be
felt in non-life business. The acquisition of Chiara Assicurazioni in non-life business, which is included in
the premiums on a pro rata basis, and better than expected sales of our products through agents and the
bank distribution channel somewhat mitigated the
expected decline in premium volume. The measures
to improve portfolio quality in non-life have shown
the first results. In the life business, we profited from
a better investment result. Both businesses thus contributed to a satisfying increase in after-tax profit to
CHF 20.6 million (+16.2 % in original currency or
+18.6 % in CHF)
Operationally, it should be noted that it was possible to complete the integration of Chiara Assicurazioni organisationally and logistically.
Life: declining business volume
in favour of profitability
In life business, Helvetia Italy achieved business
volume of CHF 595.6 million in financial year
2013 (previous year: CHF 675.4 million). Business volume thus fell 13.6 % (in CHF: −11.8 %)
compared to the previous year. However, this decline was according to plan, as we have geared
our product portfolio to improving profitability.
The changed distribution agreement with Banco
di Desio is intended to contribute to a better
product mix, even if this is at the expense of volume and expansion of market penetration in the
short term. For this reason, lower volume was
generated through this distribution channel in
particular. By contrast, the business volume
achieved through agents increased significantly
and reached the highest level of the last five
years in financial year 2013.
P
to amended IAS 19.
On the product side, we experienced sustained
demand for traditional products. However,
Helvetia Italy was also able to successfully place
two tranche products in the past financial year.
Unit-linked products also performed positively.
Helvetia has thus come a good step closer to its
strategic objective of continuously increasing the
proportion of capital-efficient modern insurance
products. Modern capital-efficient products comprised 27 % of the total volume in individual life
business (previous year: 22 %).
Non-life: conscious volume reduction in favour
of profitability and portfolio quality
Non-life business in Italy was again shaped by a difficult market environment in 2013. The area of motor
insurance was particularly affected. The average
premiums fell by around 6 % across the market here
in the third quarter alone. In addition, the number of
insured vehicles also declined. In this environment,
Helvetia has again decided to focus on portfolio
quality and profitability and to forego volume. The
measures introduced in 2012 to improve underwriting quality were therefore continued. At CHF 484.3
million, business volume was 2.4 % (in CHF: −0.4 %)
below the level of the previous year (2012: CHF
486.4 million). In line with the market, the decline primarily comes from the motor vehicle business. In contrast, other insurance lines reported stable premiums,
not least thanks to the pro rata contribution of Chiara
Assicurazioni’s premium volume. At 67.1 %, the
claims ratio was -4.6 percentage points below the
previous year (2012: 71.7 %). By contrast, the cost ratio increased from 27.0 % to 31.7 %. This is primarily
due to the lower volume and higher selling costs of
Chiara Assicurazioni, which has specialised in the
sale of non-life insurance solutions via bank branches. The bank distribution channel naturally has a
higher cost ratio. However, the insurance solutions
marketed through Chiara Assicurazioni conversely
have significantly lower claims ratios. Overall, we
succeeded in stabilising the combined ratio at the
level of the previous year at 98.8 % (2012: 98.7 % 1).
Spain
Spain continued to suffer from the consequences of
the recession in financial year 2013. Insurance premiums fell by an average of 3 % across the market.
By contrast, our Spanish business unit proved itself to
be very solid. At CHF 405.2 million in original currency, the premium volume was only 1.2 % below
that of the previous year (in CHF: +0.8 %) (2012:
CHF 401.8 million). We were able to increase our
premium volume by 1.6 % in the life business (in CHF:
+3.7 %). On the other hand, non-life business was
not able to escape the consequences of the recession
and there was a fall in volume of 2.5 % (in CHF:
–0.4 %). The increase in profit from CHF 20.5 million
in 2012 to CHF 27.1 million in the past financial year
is partly due to lower increases in reserves in life
business. As a result of lower average non-life premium volume, the net combined ratio was 94.1 % (previous year: 92.9 %).
Key figures Italy
2013
2012
Growth in
% (CHF)
Growth in
% (OC)
1 079.9
1 161.8
– 7.0
– 8.9
Life: premium performance
positive contrary to the market trend
in CHF million
Business
volume
Life
595.6
675.4
– 11.8
– 13.6
Non-life
484.3
486.4
– 0.4
– 2.4
Combined
ratio
98.8 %
98.7 % 1
Profit for
the period
20.6
17.4
18.6
16.2
1
P
to amended IAS 19.
In the life business, our Spanish business unit was
able to continue to grow against the market trend.
While current estimates put the fall in premiums at an
average of 3.9 % across the market, we achieved
growth of 1.6 % in original currency (in CHF: +3.7 %)
from CHF 125.6 million to CHF 130.2 million. On the
product side, continuing good demand for our bur
ial insurance drove growth in group life business. In
the individual life insurance business, unit-linked insurance solutions performed particularly positively.
85
A new tranche product was also successfully established in Spain in 2013, and this supported this
growth. Together with the positive performance of
pure risk products, this made it possible to offset the
decline in traditional savings life insurance policies
in line with strategy.
Non-life: business volume weaker due to
market conditions
The recessionary economic environment made itself felt in the financial year 2013, particularly
where sales of products in the non-life business
were concerned. With a volume of CHF 275.0
million (previous year: CHF 276.2 million),
Helvetia Spain suffered a decline in original currency of 2.5 % (in CHF: −0.4 %). Nevertheless,
this meant that Helvetia Group performed better
than the market, which fell by around 2.8 % according to estimates. All business lines were affected, with the exception of private property insurance, which increased slightly compared to
the previous year.
The net combined ratio was 94.1 % (previous
year: 92.9 %). Whereas the cost ratio remained
stable at 25 % due to cost reductions and efficiency
measures, the claims ratio rose slightly from 67.9 %
to 69.1 % due to lower average premiums.
Key figures Spain
2013
2012
Growth in
% (CHF)
Growth in
% (OC)
in CHF million
Business
volume
405.2
401.8
0.8
– 1.2
Life
130.2
125.6
3.7
1.6
Non-life
– 0.4
– 2.5
32.5
29.8
275.0
276.2
Combined
ratio
94.1 %
92.9 % 1
Profit for
the period
27.1
20.5
1
86
P
to amended IAS 19.
“Other insurance units”
“Other insurance units” consists of the countries
of Austria and France and also reinsurance.
The volume achieved in this segment stood a
t
CHF 777.1 million (previous year: CHF 626.1 million). This corresponds to a 22.2 % increase
compared to the previous year in original currency (in CHF: 24.1 %) and is essentially due to the
transport portfolio of Gan Eurocourtage which
was acquired in the autumn of 2012. By contrast,
profit for the period fell from CHF 41.6 million to
CHF 29.7 million. This was caused by the weaker Group reinsurance result compared to the
o us year, which was characterised by
previ
d isproportionately high claims from natural

disasters in our non-life businesses.
Austria
The Austrian insurance market stabilised again in
2013. Helvetia Austria generated premium volume
of CHF 321.2 million in the past financial year (previous year: CHF 298.3 million). This corresponds to
an increase in volume of 5.5 % (in CHF: 7.7 %). This
increase was achieved both from the life and the
non-life businesses.
Life: premium growth considerably stronger than
market growth
With a premium volume of CHF 129.8 million (previous year: CHF 113.7 million), our Austrian business
unit closed financial year 2013 with extremely pleasing premium growth of 11.9 % in original currency (in
CHF: 14.2 %). By comparison, the Austrian Insurance
Association’s most recent statistics on the Austrian life
insurance market shows a decrease in premiums of
0.4 %. In contrast to the market, Helvetia Austria was
able to increase both its regular premium volume
and its single premium business. The performance of
the capital-efficient modern insurance solutions is
particularly encouraging and is in line with strategy.
As in the previous year, unit-linked life insurance
stimulated growth and achieved a very good increase of 35.6 % (in original currency) in regular premiums, particularly with the innovative fund savings
plan. Single premium business improved by 42.2 %
(in original currency). The drivers of this were one-off
additional payments and reinvestment of expired
contracts.
Non-life: encouraging premium growth in all
business lines – net combined ratio of 99.7 %
We were also able to continue our growth in non-life
business in 2013, even though the financial year was
shaped by an earnings-oriented underwriting policy.
Premiums grew to CHF 191.4 million (previous year:
CHF 184.6) and were thus 1.6 % higher than the previous year in original currency (in CHF: +3.7 %). All
business lines contributed to this encouraging development. Whereas the motor business did not resume
its growth until mid-year, the other business lines
achieved an increase of 1.7 % in original currency
(in CHF: +3.8 %).
Compared with the previous year, the net combined ratio improved from 103.5 % to 99.7 %. This
improvement resulted primarily from a considerably
lower claims ratio than the previous year of 66.9 %
(2012: 70.7 %). It was possible to compensate for the
floods in June with the very good claims statistics in
weather-dependent business lines in the second half.
We also realised sustainable reductions of 0.3 to 0.4
percentage points in the claims ratio through portfolio optimisations.
France
In France, the transport insurance business of Gan
Eurocourtage, a subsidiary of Groupama SA, which
was acquired in December 2012, was fully consolidated for the first time for the whole financial year.
The net combined ratio of Helvetia France increased from 94.2 % 1 to 98.8 %. The causes of the
increase compared to the previous year are large
losses and adjustments to prior-year claims and cost
synergies not yet realised to their full extent despite
the fact the integration is progressing according to
plan.
Assumed reinsurance
Business development: encouraging annual results
with robust combined ratio
Compared with the previous year, the premium volume of assumed reinsurance fell 9.4 % to CHF 194.8
million (previous year: CHF 214.9 million). This is
firstly due to the changed placement strategy of
some larger customers. Secondly, we no longer renewed business which does not meet our profitability requirements. The net claims ratio rose 0.8 percentage points to 70.1 % compared to the previous
year. The main reason for this is the large claims expense, which was higher than in 2012 and reached
the level of 2011. Background factors in this are larger individual claims reported and claim costs from
various wind-storm and hail events in Europe. The
fact that 2013 had the lowest number of named
Key figures Other insurance units
2013
2012
Growth in
% (CHF)
Growth in
% (OC)
777.1
626.1
24.1
22.2
Austria
321.2
298.3
7.7
5.5
Life
129.8
113.7
14.2
11.9
Non-life
191.4
184.6
3.7
1.6
France
261.1
112.9
131.2
126.5
Non-life
261.1
112.9
131.2
126.5
Reinsurance
194.8
214.9
– 9.4
– 9.4
in CHF million
Solid premium development – net combined
ratio reflects the ongoing integration of
Gan Eurocourtage
The premium volume of Helvetia France increased
by 126.5 % in original currency (in CHF: 131.2 %)
in the 2013 financial year, thus amounting to
CHF 261.1 million (previous year: CHF 112.9
million). This increase is due to the acquisition of
the Gan Eurocourtage portfolio in 2012. This acquisition makes Helvetia the number 2 in France and
means that Helvetia now offers comprehensive protection for the French marine and transport industry.
Business volume
Combined ratio
Austria
99.7 % 103.5 % 1
France
98.8 %
1
94.2 % 1
P revious year’s combined ratio restated due to amended IAS 19.
87
storms in the North Atlantic hurricane season since
1982 had a positive effect. The net cost ratio improved slightly (0.5 percentage points) compared to
the previous year due to the reduced commission-bearing proportional business and thus
reached 27.6 %. At a net combined ratio of 97.7 %,
assumed reinsurance again achieved an encouraging annual result in a highly competitive market environment and made a good contribution to the
Group’s result. The disciplined underwriting policy
which remained focused on profitability, efficient
retrocession agreements and a slightly improved
cost ratio contributed to this.
Portfolio structure of assumed reinsurance
by region 2013
9 % | 17.3
Other
9 % | 17.6
Middle East
69 % | 134.4
Europe
13 % | 25.4
America
Total 100 % | 194.8
Portfolio structure of assumed reinsurance
by insurance line 2013
Share in % | in OC | in CHF million
8 % | 16.1
8 % | 16.6
Motor vehicle
Liability
10 % | 20.5
Technical
8 % | 14.7
Other
7 % | 12.8
Transport
59 % | 114.1
Property
Total 100 % | 194.8
88
In order to ensure continuous solvency, Helvetia works with loss simulations in which we subject the balance sheet
to various stress tests. How do our assets respond to this? Are the hedging measures that we have implemented to ensure
that losses remain within the range specified by regulatory provisions and approved by Executive Management
sufficient? Our objective is to achieve optimal returns for both customer and company whilst staying within the framework conditions for solvency, loss limits and our budget.
Markus Schär, Portfolio strategy
“At Helvetia, the investment strategy is always supported by timely risk management. Our objective is to use risk
controlling measures to protect the balance sheet and income statement against excessive losses in value and thus ensure
compliance with the regulatory requirements for capitalisation targets. As the department responsible for developing
our investment portfolio, we need foresight to adjust or optimise strategies at the right time. In the extremely dynamic
world of the financial markets, the future cannot be predicted. It pays to develop scenarios that are not currently an issue
because this will allow you to react more quickly to new situations and to be better prepared for the future.”
Financial report
Consolidated financial statements
of Helvetia Group
92Consolidated income statement
93 Consolidated statement of
comprehensive income
94 Consolidated balance sheet
96 Consolidated statement
of equity
98 Consolidated cash flow
statement
otes to the Consolidated
N
financial statements
100 General information
Summary of significant
101 accounting policies
115
Segment information
125 Foreign currency translation
126 Property and equipment
Goodwill and other
128 intangible assets
130Investments
143 Financial liabilities
147 Insurance business
154
Income taxes
157Equity
Provisions and other
163 commitments
165 Employee benefits
170
Share-based payments
171 Related party transactions
Compensation paid to the
Board of Directors and the
172 Group Executive Management
176
Risk management
Events after the
198 reporting date
199
Scope of consolidation
203
Report of the Statutory Auditor
Financial statements of
Helvetia Holding AG
205
Income statement
205 Balance sheet
Notes to the financial
206 statements
209
R eport of the Statutory Auditor
Financial report
Consolidated income statement
Notes
2013
in CHF million
2012
restated
Income
Gross premiums written
3
7 293.2
6 828.7
Reinsurance premiums ceded
– 288.6
– 283.8
Net premiums written
7 004.6
6 544.9
Net change in unearned premium reserve
Net earned premiums
15.1
28.0
7 019.7
6 572.9
Current income from Group investments (net)
7.1.1
985.7
959.9
7.1.3
226.6
217.9
Income from unit-linked investments
7.1.5
104.7
137.3
Share of profit or loss of associates
15.2
0.2
Other income
73.3
79.0
8 425.2
7 967.2
Claims incurred including claims handling costs (non-life)
– 1 761.8
– 1 685.6
Claims and benefits paid (life)
– 2 932.4
– 2 803.0
Change in actuarial reserves
– 1 891.1
– 1 777.8
Total operating income
Expenses
Reinsurers’ share of benefits and claims
Policyholder dividends and bonuses1
Net insurance benefits and claims
Acquisition costs
Reinsurers’ share of acquisition costs
Operating and administrative expenses1
146.8
130.8
– 159.6
– 106.4
– 6 598.1
– 6 242.0
– 799.5
– 747.4
47.1
51.0
– 412.3
– 390.0
Interest payable
– 25.0
– 27.7
Other expenses1
– 153.7
– 178.5
– 7 941.5
– 7 534.6
Profit or loss from operating activities
483.7
432.6
Financing costs
– 22.0
– 9.0
Profit or loss before tax
461.7
423.6
– 97.9
– 90.5
363.8
333.1
363.3
330.5
0.5
2.6
Total operating expenses
Income taxes1
10.1
Profit or loss for the period
Attributable to:
Shareholders of Helvetia Holding AG
Minority interests
Earnings per share:
Basic earnings per share (in CHF)1
11.5
40.89
37.07
Diluted earnings per share (in CHF)1
11.5
40.89
37.07
1
92
Adjustments of prior-year figures, see section 2.3 on page 102.
Consolidated financial statements of Helvetia Group 2013
Financial report
Consolidated statement
of comprehensive income
Notes
2013
in CHF million
2012
adjusted
Profit or loss for the period1
363.8
333.1
– 532.6
679.4
–
0.0
Other comprehensive income
May be reclassified to income
Change in unrealised gains and losses on investments
Share of associates’ net profit recognised directly in equity
Change from net investment hedge
5.3
2.4
Foreign currency translation differences
8.2
– 9.7
395.6
– 361.7
34.1
– 79.5
– 89.4
230.9
Change in liabilities for contracts with participation features
Deferred taxes
10.4
Total that may be reclassified to income
Will not be reclassified to income
Revaluation from reclassification of property and equipment
4.7
0.4
Revaluation of benefit obligations
8.2
55.4
– 11.1
– 14.0
– 2.4
– 6.1
Deferred taxes
10.4
Total that will not be reclassified to income
– 0.6
35.7
Total other comprehensive income
– 90.0
266.6
Comprehensive income1
273.8
599.7
273.1
587.3
0.7
12.4
Attributable to:
Shareholders of Helvetia Holding AG
Minority interests
1
93
Financial report
Consolidated balance sheet
as of 31.12.
Notes
2013
in CHF million
2012
1.1.2012
adjusted
adjusted
Assets
Property and equipment
5
372.1
368.3
368.9
Goodwill and other intangible assets
6
335.1
336.7
284.5
7.4.1
1.9
48.5
48.7
Investment property
7.5
5 059.8
4 893.3
4 763.5
Group financial assets
7.2
32 389.6
30 835.9
28 214.5
Investments for unit-linked contracts
7.2
2 124.8
1 955.5
1 812.3
Receivables from insurance business
9.6
1 022.1
1 042.1
1 041.7
Investments in associates
Deferred acquisition costs
9.5
400.5
378.3
367.4
Reinsurance assets
9.1
465.9
432.0
402.8
Deferred tax assets
10.5
23.2
23.4
29.4
17.8
17.9
17.7
241.7
248.5
205.4
Current income tax assets
Other assets
Accrued investment income
349.0
351.5
339.6
Cash and cash equivalents
1 708.1
1 565.2
1 250.5
44 511.6
42 497.1
39 146.9
Total assets
94
Financial report
as of 31.12.
Notes
2013
in CHF million
2012
1.1.2012
restated
restated
Liabilities and equity
Share capital
11.1
Capital reserves
Treasury shares
Unrealised gains and losses (net)
11.2.4
0.9
0.9
0.9
128.8
248.4
316.6
– 11.3
– 9.8
– 8.4
198.4
226.7
106.1
Foreign currency translation differences
– 302.7
– 306.9
– 299.8
Retained earnings1
2 939.0
2 665.0
2 420.8
863.5
886.2
737.3
3 816.6
3 710.5
3 273.5
Valuation reserves for contracts with participation features1
11.2.5
Equity of Helvetia Holding AG shareholders
Minority interests1
Equity (without preferred securities)
Preferred securities
11.3
Total equity
14.6
39.7
28.0
3 831.2
3 750.2
3 301.5
300.0
300.0
300.0
4 131.2
4 050.2
3 601.5
25 808.5
Actuarial reserves (gross)
9.1
29 815.6
27 842.5
Provision for future policyholder participation1
9.1
937.1
1 249.6
866.4
Loss reserves (gross)
9.1
3 121.6
3 060.5
2 799.6
970.7
Unearned premium reserve (gross)
9.1
1 053.5
992.5
Financial liabilities from financing activities
8.1
278.7
256.0
182.3
Financial liabilities from insurance business
8.2
2 173.2
2 303.4
2 306.1
Other financial liabilities
8.3
116.5
33.5
74.7
Liabilities from insurance business
9.6
1 679.0
1 472.5
1 344.6
Non-actuarial provisions
12.1
86.1
100.7
96.7
Employee benefit obligations1
13.2
331.2
340.4
380.7
Deferred tax liabilities1
10.5
485.6
555.6
567.9
Current income tax liabilities
42.7
51.0
41.0
Other liabilities and accruals
189.6
176.4
188.5
40 380.4
38 446.9
35 545.4
44 511.6
42 497.1
39 146.9
Total liabilities
Total liabilities and equity
1
95
Financial report
Consolidated statement of equity
Share capital Capital reserves Treasury shares
Notes
11.1
Unrealised
gains and
losses (net)
11.2.4
in CHF million
Balance as of 1 January 2012
Effects of changes in accounting and valuation principles1
Balance as of 1 January 2012 restated
316.6
– 8.4
–
–
–
106.1
–
0.9
316.6
– 8.4
106.1
Profit or loss for the period1
–
–
–
–
Income and expense that may be reclassified to income
–
–
–
120.6
Income and expense that will not be reclassified to income
–
–
–
0.3
–
–
–
120.9
Comprehensive income1
–
–
–
120.9
Transfer from / to retained earnings
–
–
–
– 0.3
Acquisition of subsidiaries
–
–
–
–
Change in minority interests
–
–
–
–
Purchase of treasury shares
–
–
– 5.6
–
Sale of treasury shares
–
– 0.7
4.2
–
Share-based payment
–
1.7
–
–
Dividends
–
– 69.2
–
–
Shareholders’ contributions
–
42.0
–
–
Allocation of shareholders’ contributions
–
– 42.0
–
–
Balance as of 31 December 2012
0.9
248.4
– 9.8
226.7
Balance as of 1 January 2013 restated1
226.7
0.9
248.4
– 9.8
–
–
–
–
Income and expense that may be reclassified to income
–
–
–
– 35.1
Income and expense that will not be reclassified to income
–
–
–
3.1
–
–
–
– 32.0
Comprehensive income
–
–
–
– 32.0
Transfer from / to retained earnings
–
–
–
–
Acquisition of subsidiaries
–
–
–
–
Change in minority interests
–
–
–
3.7
–
–
– 4.9
–
–
– 0.5
3.4
–
Share-based payment
–
2.0
–
–
Dividends
–
– 121.1
–
–
–
42.0
–
–
Allocation of shareholders’ contributions
–
– 42.0
–
–
0.9
128.8
– 11.3
198.4
Balance as of 31 December 2013
1
96
0.9
Financial report
Foreign
currency
translation
differences
– 299.8
Retained
earnings
Valuation
reserves for
contracts with
participation
features
11.2.2
11.2.5
Equity of
Helvetia
Holding AG
shareholders
Minority
interests
Equity
(without
preferred
securities)
adjusted
adjusted
adjusted
adjusted
adjusted
2 473.7
760.9
3 350.0
27.9
3 377.9
Preferred
securities
Total equity
300.0
3 677.9
adjusted
–
– 52.9
– 23.6
– 76.5
0.1
– 76.4
–
– 76.4
– 299.8
2 420.8
737.3
3 273.5
28.0
3 301.5
300.0
3 601.5
–
307.2
23.3
330.5
2.6
333.1
–
333.1
– 7.1
–
107.6
221.1
9.8
230.9
–
230.9
–
19.6
15.8
35.7
0.0
35.7
–
35.7
– 7.1
19.6
123.4
256.8
9.8
266.6
–
266.6
– 7.1
326.8
146.7
587.3
12.4
599.7
–
599.7
–
– 13.1
2.2
– 11.2
–
– 11.2
11.2
0.0
–
–
–
–
–
–
–
–
0.0
– 0.4
–
– 0.4
– 0.4
– 0.8
–
– 0.8
–
–
–
– 5.6
–
– 5.6
–
– 5.6
–
–
–
3.5
–
3.5
–
3.5
–
–
–
1.7
–
1.7
–
1.7
–
– 69.1
–
– 138.3
– 0.3
– 138.6
– 11.2
– 149.8
–
–
–
42.0
–
42.0
–
42.0
–
–
–
– 42.0
–
– 42.0
–
– 42.0
– 306.9
2 665.0
886.2
3 710.5
39.7
3 750.2
300.0
4 050.2
– 306.9
2 665.0
886.2
3 710.5
39.7
3 750.2
300.0
4 050.2
–
322.2
41.1
363.3
0.5
363.8
–
363.8
13.5
0.0
– 68.0
– 89.6
0.2
– 89.4
–
– 89.4
–
– 8.3
4.6
– 0.6
0.0
– 0.6
–
– 0.6
13.5
– 8.3
– 63.4
– 90.2
0.2
– 90.0
–
– 90.0
13.5
313.9
– 22.3
273.1
0.7
273.8
–
273.8
–
– 10.9
– 0.3
– 11.2
–
– 11.2
11.2
0.0
–
– 11.3
–
– 11.3
12.3
1.0
–
1.0
– 9.3
7.1
– 0.1
1.4
– 37.5
– 36.1
–
– 36.1
–
–
–
– 4.9
–
– 4.9
–
– 4.9
–
–
–
2.9
–
2.9
–
2.9
–
–
–
2.0
–
2.0
–
2.0
–
– 24.8
–
– 145.9
– 0.6
– 146.5
– 11.2
– 157.7
–
–
–
42.0
–
42.0
–
42.0
–
–
–
– 42.0
–
– 42.0
–
– 42.0
– 302.7
2 939.0
863.5
3 816.6
14.6
3 831.2
300.0
4 131.2
97
Financial report
Consolidated cash flow statement
2013
in CHF million
2012
adjusted
Cash flow from operating activities
Profit before tax1
461.7
423.6
– 3.7
– 5.4
Reclassifications to investing and financing activities (affecting cash)
Realised gains and losses on property, equipment and intangible assets
Realised gains and losses on sale of affiliated and associated companies
Dividends from associates
– 14.7
0.0
– 0.5
– 0.5
Adjustments
Depreciation / amortisation of property, equipment and intangible assets
Realised gains and losses on financial instruments and investment property
Unrealised gains and losses on investments in associates
Unrealised gains and losses on investment property
Unrealised gains and losses on financial instruments
Share-based payments for employees
42.6
46.7
– 21.5
– 41.5
0.0
0.5
14.6
– 22.4
– 277.2
– 233.2
2.0
1.7
Foreign currency gains and losses1
– 2.7
7.2
Other income and expenses not affecting cash2
52.0
89.2
6.2
1.1
Changes in operating assets and liabilities
Deferred acquisition costs
Reinsurance assets
– 17.1
6.0
Actuarial reserves
1 891.1
1 777.7
Provisions for future policyholder participation1
29.1
– 36.3
Loss reserves
31.0
44.3
– 14.1
– 22.5
– 207.5
– 98.1
303.7
115.7
– 234.2
– 160.9
Unearned premium reserve
Financial liabilities from insurance business
Changes in other operating assets and liabilities
1
Cash flow from investments and investment property
Purchase of investment property
Sale of investment property
Purchase of interest-bearing securities
149.6
– 3 937.0
– 4 784.7
Repayment / sale of interest-bearing securities
2 901.5
3 379.3
Purchase of shares, investment funds and alternative investments
– 981.9
– 1 202.1
Sale of shares, investment funds and alternative investments
782.4
1 232.6
Purchase of structured products
– 18.2
– 15.3
Sale of structured products
0.1
0.1
– 8 894.4
– 8 633.4
Sale of derivatives
8 789.6
8 526.7
Origination of mortgages and loans
– 538.9
– 516.5
Purchase of derivatives
Repayment of mortages and loans
356.0
449.0
– 5 635.3
– 22 773.3
5 422.5
22 662.4
Cash flow from operating activities (gross)
340.3
367.3
Income taxes paid
– 77.2
– 80.6
Cash flow from operating activities (net)
263.1
286.7
Purchase of money market instruments
Repayment of money market instruments
98
53.1
Financial report
2013
in CHF million
2012
adjusted
Cash flow from investing activities
Purchase of property and equipment
– 12.6
Sale of property and equipment
– 8.9
1.8
9.1
– 21.7
– 16.3
Sale of intangible assets
15.9
0.4
Sale of investments in associates
61.2
0.0
– 20.4
90.3
Purchase of intangible assets
Purchase of investments in subsidiaries, net of cash and cash equivalents
Dividends from associates
Cash flow from investing activities (net)
0.5
0.5
24.7
75.1
Cash flow from financing activities
Purchase of investments in subsidiaries
Issuance of debt instruments
2.9
3.5
– 4.9
– 5.6
42.0
42.0
– 36.1
– 0.8
157.5
70.8
Repayment of debt
– 151.7
–
Dividends paid
– 160.8
– 152.8
Lease payments under finance lease
Cash flow from financing activities (net)
Effect of exchange rate differences on cash and cash equivalents
Total change in cash and cash equivalents
– 2.4
– 2.4
– 153.5
– 45.3
8.6
– 1.8
142.9
314.7
1 565.2
1 250.5
142.9
314.7
1 708.1
1 565.2
0.3
0.3
1 695.4
1 550.8
12.4
14.1
1 708.1
1 565.2
786.6
761.2
60.0
51.9
6.3
6.4
Cash and cash equivalents
Cash and cash equivalents as of 1 January
Change in cash and cash equivalents
Cash and cash equivalents as of 31 December
Composition of cash and cash equivalents
Cash
Due from banks
Other cash equivalents with a maturity of less than three months
Balance as of 31 December
Other disclosures on cash flow from operating activities
Interest received
Dividends received
Interest paid
“Other income and expenses not affecting cash” primarily contains the change to interest-accruing profit participation of owners of contracts
with discretionary participation features.
1
2
99
Financial report General information
1. General information
Helvetia Group is an all-lines insurance group which operates in many sectors of the life
and non-life business as well as in reinsurance. The holding company, Helvetia Holding
AG, with headquarters in St Gall, is a Swiss public limited company listed on the SIX
Swiss Exchange. The Group operates through its branch offices and subsidiaries in the
insurance markets of Switzerland, Germany, Austria, Spain, Italy and France, and worldwide in the active reinsurance business. Parts of its investment and financing activities
are managed through subsidiaries and funds in Luxembourg and Jersey. The Board of
Directors approved the consolidated financial statements and authorised them for publication on 27 February 2014. The financial statements will be submitted to the shareholders for approval at the Shareholders’ Meeting on 25 April 2014.
100
Notes to the Consolidated financial statements of Helvetia Group 2013
Financial report Summary of significant accounting policies
2. Summary of significant
accounting policies
The Consolidated financial statements of Helvetia Group were prepared in accordance
with the International Financial Reporting Standards (IFRS) and under the historical cost
convention with the exception of adjustments resulting from the IFRS requirement to
recognise investments at fair value. Fair value measurement methods are explained in
section 2.6 (page 104).
2.1
tandards applied
S
for the first time in the
reporting year
The following published sector-relevant standards (IAS / IFRS), interpretations (IFRIC)
and amendments to the standards were applied by the Group for the first time in the
reporting year:
–– Amendments to IAS 1: Presentation of OCI
–– Amendments to IAS 19: Employee benefits
–– IAS 28: Associates and joint ventures
–– Amendments to IAS 36: Disclosures on recoverable amount of non-financial assets
(early application)
–– Amendments to IFRS 7: Disclosures – offsetting financial assets and financial liabil
ities
–– IFRS 10: Consolidated financial statements
–– IFRS 11: Joint arrangements
–– IFRS 12: Disclosure of interests in other entities
–– IFRS 10,11,12: Consolidated financial statements, joint arrangements and disclosure
of interests in other entities: Transitional provision
–– IFRS 13: Fair value measurement
–– Annual improvements to IFRS (2009–2011)
Amendments to IAS 1:
Presentation of OCI
The following gives certain explanations to the changes:
In accordance with the amendment, companies must allocate the items shown in the
statement of comprehensive income to one of two categories – based on whether or not
they will be derecognised through the income statement in the future (“may be reclassified to income”). If items of OCI are shown before tax, the associated tax amount will
also be recognised separately in accordance with the two categories.
The amendments to IAS 19 have a material impact on the recognition of employee
b enefits. The most important changes are the following:
–– Actuarial gains and losses must be recognised immediately in the statement of comprehensive income, without affecting profit or loss. The option to defer recognition
of gains and losses is no longer allowed. This is expected to increase the volatility
of the balance sheet and the statement of comprehensive income.
–– All past service cost must be recognised in the period of the plan amendment. It can
no longer be allocated over the period until the benefits become vested.
–– Income from plan assets recognised in the income statement must be calculated using
the same interest rate applied to the calculation of interest on defined benefit obligations. This is expected to result in an increased P&L charge, as the expected return
on assets is usually estimated to be higher than the discount rate.
–– Additional or amended notes.
mendments to IAS 19:
A
Employee benefits
101
IFRS 13: Fair value
m easurement
Other changes in
accounting policies
2.2Standards not yet
applied in the
reporting year
IFRS 13 aims to create uniform and consistent guidelines for determining fair value, for
which various standards were previously used.
For all assets and liabilities measured at fair value, the determination of fair value remains essentially unchanged. However, extensive explanatory and quantitative details,
particularly in regard to the methodology and quality of the fair value calculation, have
been introduced.
The adoption of the remaining standards and amendments did not have any material
impact on Helvetia Group’s financial statements.
Due to their effective dates, the following published sector-relevant standards, interpretations and amendments to standards were not applied to the 2013 consolidated financial statements:
Changes in accounting policies
to be applied for annual periods beginning on / after:
Amendments to IAS 32: Offsetting financial assets and financial liabilities 1.1.2014
Amendments to IAS 39: Novation of derivatives and continuation of hedge accounting
1.1.2014
Amendments to IAS 19: Employee benefits – defined benefit plans:
Employee contributions 1.7.2014
Annual improvements to IFRS (2010 – 2012) 1.7.2014
Annual improvements to IFRS (2011 – 2013)
1.7.2014
IFRS 9 Financial instruments: Classification and measurement and
corresponding changes to IFRS 7
undefined
IFRS 9 Financial instruments: General hedge accounting undefined
The effects of IFRS 9 cannot yet be predicted. The other recently published standards
and amendments to standards are not expected to have any material impact on the
financial statements.
2.3
102
C hanges in accounting
and valuation prin
ciples
The balance sheet and income statement for the previous reporting periods have been
adjusted in connection with the amendments to IAS 19 described in section 2.1.
In addition, the accounting and valuation principles have been adjusted with regard
to recognition of deferred taxes. Helvetia Group classifies new local tax-deductible
amortisation of goodwill as a taxable temporary difference, as repayment of the tax
d e duction is theoretically possible. In the past it was assumed to be a permanent
difference, as repayment of the tax deduction can be virtually excluded. Thus, from
1 January 2013, Helvetia Group includes deferred tax liabilities of CHF 13.9 million in
the balance sheet in respect of local amortisation of goodwill.
Earlier reporting periods have been adjusted to the new accounting and valuation
principles accordingly. The following table summarises the effects of the amendments
on the consolidated balance sheet and income statement.
Initially
reported
Adjustments
After
adjustments
Initially
reported
Adjustments
After
adjustments
in CHF million
Consolidated balance sheet
1.1.2012
31.12.2012
Liabilities and equity
Retained earnings
2 473.7
– 52.9
2 420.8
2 706.0
– 41.0
2 665.0
760.9
– 23.6
737.3
895.4
– 9.2
886.2
27.9
0.1
28.0
39.6
0.1
39.7
Provision for future policyholder participation
899.7
– 33.3
866.4
1 270.3
– 20.7
1 249.6
Employee benefit obligations
265.2
115.5
380.7
273.2
67.2
340.4
Deferred tax liabilities
491.4
– 5.8
485.6
564.3
3.6
567.9
Valuation reserves for contracts with participation features
Minority interests
Consolidated income statement
31.12.2012
Policyholder dividends and bonuses
– 107.7
1.3
– 106.4
Operating and administrative expenses
– 385.0
– 5.0
– 390.0
Other expenses
– 176.5
– 2.0
– 178.5
Income taxes
– 87.1
– 3.4
– 90.5
342.2
– 9.1
333.1
Earnings per share
31.12.2012
Basic earnings per share (in CHF)
38.12
– 1.05
37.07
Diluted earnings per share (in CHF)
38.12
– 1.05
37.07
Consolidated statement of comprehensive income
31.12.2012
Will not be reclassified to income
Deferred taxes
Comprehensive income
0.0
55.4
55.4
0.0
– 14.0
– 14.0
– 0.1
– 6.0
– 6.1
573.4
26.3
599.7
2.4Consolidation
principles
All the material companies included in the consolidation have the same reporting periods.
Smaller Group companies with different financial years prepare interim financial statements
as of the reporting date of 31 December.
2.4.1Subsidiaries
The consolidated financial statements include the financial statements of Helvetia
H olding AG, its subsidiaries and its own investment funds. Consolidation applies when
Helvetia Holding AG exercises indirect or direct control over the company’s operations.
Subsidiaries acquired during the course of the financial year are included in the consoli
dated financial statements from the date on which Helvetia Group took effective c ontrol.
Acquisitions of companies are recorded using the purchase method. Intergroup trans
actions and balance sheet items are eliminated.
Non-controlling interests (minority interests) are valued at the time of acquisition with their
proportionate share of the identifiable net assets of the company.
Any changes in Helvetia Group’s percentage of shares held in a subsidiary, without losing
control, are treated as transactions among shareholders. The adjustments of minority interests are based on the proportional net assets of the subsidiary. Goodwill is not adjusted and
no gains or losses are recognised in the income statement.
2.4.2Associates
Associates of Helvetia Group are accounted for using the equity method if significant
influence is exercised by Helvetia Group. The goodwill resulting from the equity valu
ation is recognised in “Investments in associates”. The book value of all investments is
tested for impairment if there is objective and substantial evidence for impairment at the
balance sheet date.
Associates of Helvetia Group are listed together with the fully consolidated subsid
iaries in section 19 (from page 199).
103
2.5Foreign currency
translation
2.5.1Translation of financial
statements prepared in
foreign currency
104
The reporting currency of Helvetia Group is the Swiss franc (CHF).
Items included in the financial statements of those entities that do not have the Swiss franc as
their functional currency were translated using the applicable closing rate. Items in the income
statement are translated at the average exchange rates for the reporting period. The resulting
translation differences are recorded in “Foreign currency translation differences” in equity, not
affecting profit or loss. Upon (partial) disposal of a subsidiary, these currency differences, attributable to the subsidiary in question and accumulated in equity, are released through income. The rates applied in these financial statements are given in section 4.1 (page 125).
2.5.2Translation of foreign
currency transactions
Foreign currency transactions in the individual entities are accounted for using the exchange rate on the date of the transaction.
The individual entities translate balance sheet items denominated in foreign currencies at
the balance sheet date as follows: monetary and non-monetary balance sheet items recorded at fair value, at closing rates, and non-monetary balance sheet items recorded at cost, at
historical rates. “Monetary items” include cash and cash equivalents, assets and liabilities
for which Helvetia Group either receives or pays a fixed or determinable amount of money.
For non-monetary items classified as available-for-sale investments, such as shares and
shares in investment funds, the unrealised foreign currency gain is recognised in equity without affecting the income statement until the financial instrument is sold. However, for mon
etary items such as bonds and loans, the unrealised foreign currency gain is immediately
recognised in the income statement.
2.6Accounting estimates
and key assumptions
Preparing the financial statements in accordance with IFRS requires Group management
to make assumptions and estimates that affect the reported amounts of assets and liabilities for the ongoing financial year. All estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the circumstances. Actual figures and estimates may differ as a result. The following information conveys which of
the assumptions needed for the preparation of the financial statements require particular management judgement.
2.6.1Fair value of financial
assets and liabilities
The fair value of financial assets is equal to the price at which an asset could be sold on
the valuation date in a normal business transaction between market participants.
Financial instruments measured at the prices listed on an active market belong to the
“Level 1” category of valuation methods. “In an active market” means that the prices are
made available regularly, either by a stock exchange, a broker or a pricing service, and
that these prices represent current and regular market transactions.
If a market value in an active market is not available, the fair value is determined
using valuation methods. Such methods are considerably influenced by assumptions,
which can lead to varying fair value estimates. Financial instruments for which the
model assumptions are based on observable market data are allocated to the “Level 2”
valuation category. This category includes comparisons with current market trans
actions, references to transactions with similar instruments, and option price models. This
concerns the following items, in particular:
–– Mortgages and loans: The fair value of mortgages and borrower’s note loans is determined on the basis of discounted cash flows. Mortgages are measured by applying the current interest rates of Helvetia Group for comparable mortgages that have
been granted. The Swiss franc swap curve is used to measure borrower’s note loans.
–– Interest-bearing securities without an active market, including own bonds: The fair
value is based on rates set by brokers or banks, which are validated through comparison with current market transactions and in consideration of transactions with similar
instruments, or determined by means of the discounted cash flow (DCF) method.
–– Money market instruments: The fair value is based on rates set by brokers or banks
or determined by means of the discounted cash flow method.
–– Derivative financial instruments: The fair value of equity and currency options is
d etermined using option price models (Black-Scholes option pricing), while the fair
value of forward exchange rate agreements is determined on the basis of the f orward
exchange rate on the reporting date. The fair value of interest rate swaps is calculated using the present value of future payments.
–– Financial liabilities: There is no active market for financial liabilities. The fair value is
derived from the fair values of the underlying assets or determined by means of the
discounted cash flow method.
–– Minority interests in own funds and deposits for investment contracts: The fair value
is derived from the fair values of the underlying assets.
If the valuation assumptions are not based on observable market data, the financial instrument in question falls into the “Level 3” valuation category. This applies in particular to
alternative investments. The fair value of private equity investments is calculated using the
discounted cash flow method and applying the internal rate of return.
If the range of possible fair values is very large and reliable estimates cannot be made,
the financial instrument is measured at cost, less any value adjustments (impairment).
2.6.2 Impairment of availablefor-sale investments
The judgement as to whether an equity instrument classified as available-for-sale is subject to impairment depends on the existence of objective indications. One decisive criterion is a constant or considerable decrease in the value of an instrument: at Helvetia
Group, instruments are considered impaired if their fair value remains below cost for
longer than nine months or falls 20 % or more below cost irrespective of the period of
time. In addition, ratings and analyst reports can serve as an indication that a company’s circumstances have changed with respect to technology, the market, economy or
law, to such an extent that the cost can probably no longer be recovered. In these c ases,
the need for impairment is examined and – if justified – recorded.
2.6.3 F air value of investment
property
In Switzerland, investment properties are valued in accordance with the discounted cash
flow (DCF) method. The procedure is described in section 2.12.1 (page 108).
The choice of the discount rate plays an important role in the DCF valuation method
used in Switzerland. The discount rates are based on a long-term, risk-free average rate
plus a premium for market risk plus regional and property-related surcharges and discounts based on the current condition and location of the property in question. The discount rates applied in the reporting period are set out in section 7.5 (page 137). The
portfolio is regularly reviewed and appraisal reports are prepared by independent
experts. All other countries use independent experts to determine market estimates at
intervals of no more than three years.
2.6.4 Insurance-specific estimate
uncertainties
The estimate uncertainties in the area of technical results are explained in section 2.16
(from page 110). Any material change to the parameters used for the calculation of the
provisions is documented in sections 9.3 from page 150 (non-life business) and 9.4 on
page 152 (life business).
2.6.5 Impairment of goodwill
Capitalised goodwill is tested annually for impairment. The procedure is described in
Note 2.11 (page 107). The recoverable amount is calculated on the basis of several assumptions, which are disclosed in section 6 (from page 128).
2.7The current, non–
current distinction
Assets and liabilities are classified as current if they are expected to be realised or settled within twelve months after the reporting date. All other assets and liabilities are considered to be non-current.
The following items are basically classified as non-current: “Property and equipment”, “Goodwill and other intangible assets”, “Investments in associates”, “Investment
property” and “Deferred tax assets and liabilities”.
The following items are fundamentally classified as current: “Current income tax
assets and liabilities”, “Accrued investment income” and “Cash and cash equivalents”.
105
All other items are of a mixed nature. The differentiation between the current and
non-current balances of relevant items is explained in the notes. The maturity schedule
of financial assets, financial liabilities and provisions for insurance and investment
co ntracts is described in section 17.5 (from page 185) as part of the risk assessment
p rocess.
2.8Property and
equipment
Property and equipment are carried at cost less accumulated depreciation and accrued
impairment. Depreciation is normally calculated using the straight-line method over the
estimated useful life as follows:
Furniture
4 – 15 years
Technical equipment
4 – 10 years
Vehicles
4 – 6 years
Computer hardware
2 – 5 years
The following rates of depreciation apply to owner-occupied property:
Supporting structure
Interior completion
1.0 – 3.5 %
1.33 – 8.0 %
Land is not depreciated. Useful life is adjusted if the pattern of consumption of the economic benefit has changed. Value-adding investments are added to the current book
value in the period and are depreciated over the entire term if an increase in the economic benefit is expected from the investment and reliable estimates exist for the cost.
Depreciation is recognised in the income statement under “Operating and administrative expenses”. Repairs and maintenance are charged to the income statement as incurred. Tangible assets are regularly tested for impairment (see section 2.11, page 107).
106
2.9Leasing
If a lease agreement transfers all risks and rewards incidental to the ownership to
H elvetia Group, the lease is classified and treated as a finance lease. The finance lease
agreements of Helvetia Group are limited to lessee agreements. At inception of the lease
agreement, recognition occurs at the lower of the present value of the minimum lease
payments and the fair value of the lease object. A finance lease obligation of the same
amount is recorded as a liability. Lease payments are apportioned between the finance
charge and reduction of the outstanding liability so as to achieve a constant rate of
interest on the remaining balance of the liability. The depreciation of the asset follows
the rules for depreciating tangible assets. All other lease agreements are classified as
operating leases. Payments – less any reductions – made under operating lease agreements are charged to the income statement on a straight-line basis over the term of the
lease.
2.10Goodwill and other
intangible assets
Acquired intangible assets are recognised at cost and amortised over their useful life. If
a portfolio of insurance contracts or investment contracts is acquired, an intangible a
sset
is recognised for an amount that equals the present value of all future gains minus the
solvency costs included in the acquired contracts. This “value in force” (VIF) is amortised
in proportion to the gross gains or gross margins over the actual term of the acquired
contracts. This term is usually between three and ten years. Helvetia has only capitalised VIF in respect of the life business. This is tested for impairment every year. The
intangible assets also include acquired distribution agreements. The value of an acquired distribution agreement equals the present value of all expected future gains. The
distribution agreements are depreciated in proportion to the expected gross gains or
gross margins over the term of the future contracts. This term is usually between five and
fifteen years. Other intangible assets also include intangible assets developed by the
company, principally internally developed software that is recorded at cost and amort
ised on a straight-line basis from the date on which it enters service. Depreciation is
recognised in the income statement under “Operating and administrative expenses”. The
useful life is usually between three and ten years.
Intangible assets with an indefinite useful life are not amortised, but are reviewed annually for impairment (see section 2.11, below). Goodwill is recognised as of the acquisition date and comprises the fair value purchase price plus the amount of any non-controlling interest in the acquired company and, in a business combination achieved in
stages, the acquisition date fair value of the acquirer’s previously held equity interest in
the acquired company, minus the net of the acquisition date fair value of the identifiable
assets, liabilities and contingent liabilities of the acquired company.
A positive balance is accounted for as goodwill. If the value of the acquired entity’s
net assets exceeds the acquisition costs at the purchase date, this surplus is immediately recognised in the income statement. Goodwill acquired in a business combination is
recognised at cost, net of accumulated impairment loss, and is tested annually for impairment. It is carried as an asset in the local currency of the acquired entity and translated at the applicable closing rate on each balance sheet date.
2.11 I mpairment of tangible
assets, goodwill and
other intangible assets
The book value of tangible assets or an intangible asset amortised using the straight-line
method is tested for impairment if there is evidence for impairment. Goodwill and intangible assets with an indefinite useful life are reviewed for impairment annually in the second half of the year. They are also tested for impairment again if there is evidence of
impairment.
An intangible asset is impaired if its carrying value exceeds its recoverable amount.
The recoverable amount is measured as the higher of fair value less cost to sell and v alue
in use. Fair value less cost to sell is the amount obtainable from the sale of an asset at
current market conditions after deducting any direct disposal costs. Value in use is the
present value of estimated future cash flows expected to be generated from the con
tinuing use of an asset and from its disposal at the end of its useful life. For the purpose
of impairment testing, the value in use is measured under realistic conditions, with consideration given to planned activities and their resulting cash in and outflows. If the recoverable amount is less than the carrying value, the difference is charged to the income
statement as an impairment loss. This is reported in the position “Other expenses”.
A reversal of the impairment loss is recognised if there has been a change in the estimates used to determine the recoverable amount since the impairment loss was accounted for. If the new circumstances result in a decreased impairment loss, the reversal
impairment is reported up to the maximum of the historical cost and recorded in the income statement in “Other expenses”.
For the purpose of impairment testing, goodwill is allocated at the time of acquisition
to those cash generating units (CGU) that are expected to benefit from the business combination. To calculate any impairment loss, the value in use of the CGU is determined
and compared to the book value. The value in use is calculated by applying the discounted cash flow method, with future operating cash flows less necessary operating investments (free cash flows) being included. Alternatively, the fair value less cost to sell is
used for impairment testing. If an impairment loss arises, the goodwill is adjusted accordingly. An impairment loss for goodwill cannot be reversed.
2.12 I nvestments
At Helvetia Group, investments comprise investments in associates, investment property
and financial assets (securities, derivative financial assets, loans and money market
instruments). The treatment of investments in associates is described in section 2.4.2
(page 103), under “Consolidation principles”.
107
108
2.12.1Investment property
The aim of the investment property portfolio is to earn rentals or achieve long-term cap
ital appreciation. Property held for investment purposes includes both land and buildings
and is carried at fair value.
Changes in fair value are recognised in the income statement. Companies in
Switzerland calculate fair value using a generally accepted discounted cash flow (DCF)
valuation method. The portfolio is regularly reviewed and appraisal reports are prepared
by independent experts. All other countries use independent experts to determine market estimates at least every three years. These estimates are updated between valuation
dates.
The DCF valuation method is a two-tier gross rental method based on the principle
that the value of a property equals the total of future earnings on the property. In the
first phase, the individual annual cash flows for a property over the next ten years are
calculated and discounted as of the valuation date. In the second phase, the unlimited
capitalised income value for the time following the first ten years is calculated and also
discounted as of the valuation date. The risk-adjusted discounted rates used for the DCF
valuation are based on the current condition and location of the property in question.
The cash flows used for the forecast are based on the rental income that can be earned
in the long term.
Helvetia Group does not capitalise properties where it acts as tenant in an operating
lease relationship. Rental income is recognised on a straight-line basis over the lease term.
2.12.2Financial assets
The recognition and measurement of financial assets follow the IFRS categories: loans
and receivables (LAR), “held-to-maturity” (HTM), “at fair value through profit or loss”,
“available-for-sale” (AFS) and “derivatives for hedge accounting”.
irectly attributable transaction
Financial assets are initially recognised at fair value. D
costs are capitalised, except for financial assets at fair value through profit or loss, for
which the transaction costs are charged to the income statement. Helvetia Group records
all acquisitions and disposals of financial instruments at trade date. Derecognition of a
financial investment occurs on expiration of the contract or at disposal if all risks and control have been transferred and if no rights to cash flows from the investment are retained.
Loans and receivables (LAR) and financial assets that the Group has the intention and
ability to hold to maturity (HTM) are carried at amortised cost (AC). Loans and receivab
les are not traded on an active market. Helvetia Group usually generates them by directly providing funds to a debtor.
“Financial assets at fair value through profit or loss” comprise “financial assets held
for trading” and “financial assets designated as at fair value through profit or loss”. An
instrument is classified as “held for trading” if it is held with the aim of making short-term
gains from market price fluctuations and dealer margins. Upon initial recognition, financial investments are irrevocably classified as “designated as at fair value” only if they
are a component of a particular group of financial assets that, according to a documented investment strategy, are managed on a fair value basis, or their recognition as at fair
value serves to compensate for market value fluctuations of liabilities due to policyholders. The value fluctuations that result from the fair value valuation are directly recognised
in the income statement and for Group investments are reported separately from current
income in the item “Gains and losses on Group investments (net)”.
Financial assets held for an indefinite period and which cannot be classified to any
other category are classified as “available-for-sale” (AFS). AFS investments are carried
in the balance sheet at fair value. Unrealised gains and losses are recognised directly
in equity with no impact on profit or loss. Upon disposal or impairment, the gains and
losses accumulated in equity are released through income.
Interest income is recognised on an accruals basis subject to the asset’s effective rate
of interest (including “Financial assets at fair value through profit or loss”). Dividends are
recorded when a legal right arises. Depreciation and appreciation resulting from the
amortised cost method are included in interest income in the income statement. Interest
and dividend income from Group investments that are designated as “at fair value through
profit or loss” are included in the item “Current income on Group investments (net)”.
2.12.3Impairment of financial
assets
The carrying values of financial assets that are not classified as “at fair value through
profit or loss” (LAR, HTM, AFS) are regularly reviewed for impairment. If objective and
substantial evidence indicates permanent impairment at the reporting date, the difference between cost and the recoverable amount is recognised as an impairment through
profit or loss. An equity instrument is impaired if its fair value is considerably or constantly below cost (see also section 2.6, page 104). Debt instruments are impaired or sold if
it is probable that not all amounts due under the contractual terms will be collectible.
This usually happens when contractually agreed interest or redemption payments are
stopped or are in arrears, if the debtor suffers from serious financial difficulties and / or
if the rating falls below a specific threshold value. If, in order to avoid impairment, new
conditions are negotiated for mortgages or loans, the mortgages or loans in question
continue to be recognised in the balance sheet at amortised cost.
For LAR and HTM financial investments, the recoverable amount at the reporting date
is equivalent to the present value of estimated future cash flows discounted at the ori
ginal interest rate. Impairments are booked using an allowance account. The impairment
is reversed through profit or loss if a subsequent event causes a decrease in the impairment loss.
For AFS financial assets, the recoverable amount at the reporting date equals the fair
value. For non-monetary AFS financial assets, such as shares and investment fund units,
any additional impairment loss after the initial impairment is immediately recognised in
the income statement. The impairment is not reversed, even if the circumstances causing
the impairment cease to apply. Valuation gains are recognised in equity until disposal.
For monetary AFS financial assets, such as bonds, the impairment is reversed through
profit or loss if the circumstances causing the impairment cease to apply.
Financial investments are derecognised no later than when the bankruptcy proceedings end or, in the case of ongoing bankruptcy proceedings, when the outstanding debt
plus interest is received. If a settlement is agreed, derecognition takes place at the end
of the agreed period after receipt of the payment.
2.13 Financial derivatives
Derivative financial instruments are classified as “Financial assets held for trading” and
are shown in the item “Financial assets at fair value through profit or loss” or are carried as “Derivatives for hedge accounting”. The hedging strategies used by Helvetia
Group for risk management purposes are described in section 17 (from page 176).
Derivatives may also be embedded in financial instruments, insurance contracts or
other contracts. They are measured either together with their host contract or separately at fair value. The underlying security and derivative are measured and recognised
separately if the risk characteristics of the embedded derivative are not closely related
to those of the host contract. Changes in the fair value of derivatives are recognised in
the income statement.
2.14 Net investment hedge
For hedges of currency gains and losses on investments in subsidiaries with a foreign reporting currency, the hedge-effective portion of the gain or loss on the valuation of the
hedging instrument is recognised in equity, while the ineffective portion is recognised
directly in the income statement.
When a net investment hedge ends, the hedge instrument continues to be recognised
in the balance sheet at fair value. All gains and losses reported in equity remain a component of equity until the company is (partially) sold. Upon the (partial) sale of the company, the unrealised gains and losses recognised in equity are transferred to the income
statement.
109
110
2.15 Financial liabilities
Financial liabilities are initially recognised at fair value. Directly attributable transaction
costs are offset, except in the case of financial liabilities at fair value through profit or loss.
After initial recognition, financial liabilities are carried at fair value or amortised cost (AC).
The financial liability is derecognised when the obligation has been discharged.
Those financial liabilities that are either held for trading or are irrevocably classified
upon initial recognition as “designated as at fair value through profit or loss” are recognised at fair value. The latter classification is given to deposits if they are associated
with investment funds or products for which the policyholder benefit is almost identical
with the investment return. For these deposits for investment contracts without a discretionary participation feature (see section 2.16, below) only the withdrawals and allocations that are part of the operating result are recorded in the income statement. The risk
and cost portions of premiums from policyholders are recognised in the income statement and recorded in the item “Other income”. The policyholder’s deposit is directly
credited or debited with the investment portion of the premium.
Those financial liabilities not held for trading and also not designated as at fair v alue
through profit or loss are recognised at amortised cost. Interest expenses for financial
liabilities that are used for financing purposes are recognised in the income statement
as “Financing costs”. Depreciation and appreciation resulting from the amortised cost
method are offset against interest expenses in the income statement.
2.16 Insurance business
Direct business comprises assumed primary business and business ceded to reinsurers.
Indirect business consists of assumed reinsurance business and business retroceded to
reinsurers. The technical items are described as “gross” before deduction of ceded business and as “net” after the deduction.
Insurance contracts as defined by IFRS comprise all products containing a significant
technical risk. The significance is assessed at product level.
Contracts that are considered insurance products in the formal sense of the law and
mainly carry financial risk rather than any significant technical risk are not insurance
contracts but are treated as financial instruments unless they carry a discretionary participation feature (DPF), in which case they are classified as insurance contracts. Under
IFRS, discretionary participation features are contractual benefits where, in addition to
the guaranteed benefit, the policyholder has a claim to the realised or unrealised investment returns on certain assets or to a share of the insurance company’s profit or loss.
This additional benefit must form a significant proportion of the overall contractual bene
fit, and its amount or timing must be at the insurance company’s discretion.
2.16.1Non-life business
The technical items in non-life business are established Group-wide on the same prin
ciples. All non-life insurance products of Helvetia Group contain significant technical
risks and are recognised as insurance contracts.
Loss reserves are set aside for all claims incurred by the end of the accounting p eriod.
The reserves also include provisions for claims incurred but not yet reported. Actuarial
methods that take account of uncertainties are applied to determine the amount of
reserves. Reserves are not discounted, except for those provisions for claims for which
there are payment arrangements.
Reserve estimates and the assumptions on which they are based are reviewed continuously. Valuation changes are entered as profit or loss on the income statement at the
time of the change.
A Liability Adequacy Test (LAT) is carried out on every reporting date to determine
whether, taking into consideration expected future cash flows, the existing liabilities of
each sector (property, motor vehicle, liability, transport and accident / health insurance)
at all Group companies are adequately covered up to the reporting date in order to ensure a loss-free valuation. Expected future premium income is compared to expected
claims expenses, expected administration and acquisition costs and expected policyholder dividends. If the expected costs exceed the expected premium income, the loss
reserves are increased – without prior amortisation of the deferred acquisition costs.
Helvetia Group defers acquisition costs. These are calculated from the commission that
was paid and are depreciated over the term of the contracts or, if shorter, the premium
payment period.
Premiums are booked at the beginning of the contract period. Earned premiums are
calculated pro rata per individual contract and recorded as income for the relevant risk
periods. Premium proportions relating to future business periods are accounted for as
unearned premium reserves. The cost of claims is assigned to the relevant period.
2.16.2Life business
Helvetia Group classifies all life products containing significant technical risk as insurance contracts.
The technical items in life business are determined in accordance with the local valu
ation and accounting principles for the respective companies. The assumptions made in
setting the reserves are based on best estimate principles that, firstly, take account of
the business-specific situation, such as existing capital investments and the market situation as well as, for example, possible yields from reinvestments, and secondly, local
actuarial bases of calculation (e.g. interest rates, mortality). The assumptions vary according to country, product and year of acceptance, and take account of country-specific experiences.
Unearned premium reserves and actuarial reserves are calculated using local me
thods. Zillmerisation is not applied to actuarial reserves in any country market apart
from Germany and Austria.
All Group companies defer acquisition costs under local accounting rules. Depending on the country, either the effectively incurred acquisition costs or acquisition cost surcharges included in the premium are deferred in part.
A Liability Adequacy Test (LAT) is applied at each reporting date to examine whether
existing reserves are sufficient to cover expected future needs. The reserve increases
that are shown by the LAT to be necessary are calculated Group-wide according to
standard principles. The LAT is based on actuarial principles using best estimate assumptions. The estimate of expected needs is calculated by using the difference between the
present value of the benefits (including expected administration costs and expected poli
cyholder dividends) and the present value of expected gross premiums. If expected
needs exceed existing reserves (less deferred acquisition costs not included in the actuarial reserve), the actuarial reserve is increased to the required level through profit or
loss – without prior amortisation of the deferred acquisition costs. If existing reserves exceed expected needs, the strengthened reserves are reduced again through profit or
loss.
Policyholders with contracts containing discretionary participation features may
have the right to participate in local investment returns on capital or local company results under local statutory or contractual regulations. Provisions set up for that purpose
in accordance with local accounting principles are not changed under IFRS rules and
are included under “Provision for future policyholder participation” or under “Actuarial
reserve” in the balance sheet.
Portions of the valuation differences in relation to local accounting principles allocated to contracts containing discretionary participation features which affect either the
net income or unrealised gains in equity are also reserved under “Provision for future
policyholder participation”. The portion is equal to the percentage rate which sets the
minimum participation level of policyholders in the respective revenues under local statu
tory or contractual regulations. This participation in income is credited or debited to the
item “Provision for future policyholder participation” through profit or loss. Similarly, the
portion of unrealised gains or losses is recognised in the provisions without affecting
profit or loss.
The remaining gains – either through profit or loss or with no impact on the results –
that relate to contracts with a discretionary participation feature (i.e. every share for
which no legal or contractual obligations exists) are recorded under “Valuation reserves
for contracts with participation features” within equity.
111
Bonuses already assigned which accrue interest are allocated to the deposits of policyholders and are contained in the balance sheet item “Financial liabilities from insurance
business”.
If insurance contracts contain both an insurance and a deposit component, unbundling is carried out if the rights and obligations resulting from the deposit component
cannot be fully reflected without a separate valuation of the deposit component.
Financial derivatives embedded in insurance contracts that are not closely related to
the host contract are recognised at fair value. Option pricing techniques are used to
a ssess embedded derivatives. Such embedded derivatives are accounted for under
“Other financial liabilities”, separate from the actuarial reserve.
Premiums, insurance benefits and costs arising from life insurance contracts are
booked as they fall due. These income and expenses are accrued or deferred so that
profit from the contracts is recognised in the appropriate period.
112
2.16.3Reinsurance
Reinsurance contracts are contracts between insurance companies. As in primary insurance business, there must be sufficient risk transfer for a transaction to be booked as a
reinsurance contract, otherwise the contract is considered a financial instrument.
The direct business transferred to reinsurance companies is called ceded reinsurance
and includes cessions from the direct life and non-life businesses. Premiums, unearned
premium reserves and premium adjustments for ceded business are recognised and
shown separately from primary business in the financial statements. The accounting rules
used for primary insurance business apply to ceded business.
Assets from ceded reinsurance business are regularly reviewed for potential impairment and uncollectibility. If there is objective and substantial evidence of permanent impairment at the balance sheet date, the difference between the carrying value and estimated recoverable amount is recognised in the income statement as an impairment
loss.
Indirect business accepted from another insurance company is called assumed
reinsurance. As in primary insurance business, technical provisions are included in the
respective technical items on the liabilities side, and are similarly estimated using mathe
matical-statistical models and the most up-to-date information available. They also reflect uncertainties. Non-traditional insurance contracts are treated as financial instruments and are reported under “Reinsurance assets” or “Financial liabilities from
insurance business” if no significant insurance risks have been transferred. Net commission is reported directly in the income statement.
Indirect business ceded to insurance companies outside the Group is reported as
retroc ession. The principles of ceded business apply in this instance.
2.17 Income taxes
Actual income tax assets and liabilities are calculated using the currently applicable tax
rates. Income tax assets and liabilities are only recognised if a reimbursement or payment is expected.
Reserves for deferred income tax assets and liabilities are calculated using the tax
rate changes enacted or substantively enacted as of the balance sheet date. D eferred
income taxes are recognised for all temporary differences between the IFRS carrying
values of assets and liabilities and the tax bases of these assets and liabilities, using the
liability method. Deferred tax assets from losses carried forward are recorded only to
the extent that it is probable that future taxable profit can be offset against the relevant
losses. Deferred tax assets and liabilities are offset when an enforceable legal right was
granted by the tax authorities in question to set off actual tax assets against actual tax
liabilities.
2.18Receivables
Receivables from insurance business and other receivables are carried at amortised cost
which is, in general, the nominal value of the receivables. Impairment is recognised in
the income statement. The impairment loss is reported under “Other expenses” in the income statement.
Impairment for receivables from insurance business is booked as individual impairment or collective impairment. If the counterparty does not meet its payment obligations
during the normal reminder procedure, the claims are impaired on the basis of the historic delinquency ratio for specific risk groups. Individual impairment is also carried out
to take account of current default risks, in the event the counterparty is overindebted or
threatened by bankruptcy, or in the event of foreclosure.
2.19Accrued investment
income
Interest income on interest-bearing financial investments and loans that must be allocated to the reporting year are accrued or deferred under financial assets.
2.20Cash and cash
equivalents
Cash and cash equivalents consist of cash on hand, demand deposits and short-term
liquid investments with a maturity of not more than three months from the date of acquisi
tion.
2.21 Treasury shares
Treasury shares are recorded at cost, including transaction costs, and reported as a deduction from equity. In case of a sale, the difference between cost and sale price is recorded as a change in capital reserves, with no impact on profit or loss. Treasury shares
are exclusively shares of Helvetia Holding AG, St Gall.
2.22Non-technical
provisions and
contingent liabilities
Non-technical provisions contain current obligations that will probably require an outflow of assets, but the extent of such obligations and the time they will be called have
not yet been determined exactly. Provisions are created if, on the balance sheet date
and on the basis of a past event, a current obligation exists, the probability of an outflow of assets is high and the extent of the outflow can be reliably estimated.
Any current obligations with a low probability of an outflow of assets or the extent
of which cannot be reliably estimated are reported under contingent liabilities.
2.23Employee benefits
Employee benefits include short-term employee benefits, post-employment benefits,
other long-term employee benefits and termination benefits.
Short-term employee benefits are due in full within twelve months after the end of the
reporting period. They include salaries, social security contributions, holiday and sickness pay, bonuses and non-monetary benefits for active employees. Expected expenses for entitlements that can be accumulated, such as accrued holiday and overtime entitlements, are recognised as short-term liabilities at the balance sheet date.
Post-employment benefits pertain to defined contribution plans and defined benefit
plans. The amount of the employers’ contributions for defined contribution plans depends on the employee services rendered during the reporting period and is charged
directly to the income statement. For defined benefit plans, pension obligations and related past service cost are calculated at each balance sheet date by a qualified actuary, using the projected unit credit method. The actuarial assumptions applied to the calculations consider the regulations of the respective countries and Group companies.
Changes in the assumptions, experience adjustments and differences between the expected and actual return from the plan’s assets are actuarial gains and losses. These are
recognised as revaluations in comprehensive income with no effect on the income statement. Net interest income from plan assets to be recognised in the income statement is
calculated using the same interest rate applied to the calculation of interest on defined
benefit obligations.
113
For funded benefit plans, a surplus in the plan which is recognised in comprehensive
income with no effect on the income statement may arise if the fair value of the plan
assets exceeds the present value of the defined benefit obligations. Portions of this surplus are only recognised and recorded as an asset if an economic benefit in the form of
future reductions in contributions or refunds to the employer arises (“asset ceiling”).
There is a contribution reduction as defined by IFRS if the employer must pay lower contributions than service cost.
Other long-term employee benefits are benefits that fall due twelve months or more
after the balance sheet date. At Helvetia Group, these consist mainly of long-service
awards and are calculated using actuarial principles. The amount recognised in the balance sheet is equal to the present value of the defined benefit obligation less any plan
assets.
Termination benefits consist, for example, of severance pay and benefits from social
schemes for redundancies. Such benefits are immediately recognised as expenses in the
income statement at the time the employment relationship is terminated.
114
2.24Share-based payments
Share-based payment transactions include all compensation agreements under which
employees receive shares, options or similar equity instruments or the granting Group
company assumes obligations that depend on the price of its shares. All share-based
payment transactions with employees are recognised at fair value.
A long-term compensation component (LTC) for the Board of Directors and the
E xecutive Management was introduced as part of the variable salary. This consists of
Helvetia Holding AG shares allocated prospectively over three years. The objective is
to promote a longer-term business perspective. This payment is recognised proportionally in the income statement every year until ownership to the shares is transferred.
Equity instruments granted to employees through employee share purchase plans represent compensation for services already rendered for which compensation expenses
arise in the granting company. The amount of the compensation expenses is based on
the fair value of the equity instruments at the grant date and is expensed over the vesting period.
2.25 Other liabilities
Other liabilities are carried at amortised cost, which is generally equal to the nominal
value.
2.26Offsetting of assets
and liabilities
Assets and liabilities are netted in the balance sheet when there is a legal right to offset
the recognised amounts and only the net position has actually been reported.
Financial report Segment information
3. Segment information
Helvetia Group is managed primarily by country markets. Each country has its own Executive Management which is responsible for the operational management of all local
business units and for the legal entities. Apart from reinsurance, which operates worldwide, segmentation is based on the geographical country markets where all service-rendering activities occur. These country markets correspond to the locations of Helvetia
Group’s customers.
The operating segments of Helvetia Group derived from this are the country markets
“Switzerland”, “Germany”, “Italy”, “Spain” and “Other insurance units”, consisting of
Austria, France and Reinsurance (which operates worldwide). “Corporate” comprises a
separate reportable segment. This comprises all Group activities, the financing com
panies and Helvetia Holding AG.
As additional information, Helvetia Group categorises its activities into life business,
non-life business and other activities.
In life business, Helvetia Group offers products in the areas of life insurance and oldage and pension insurance. The non-life business provides property, motor vehicle, li
ability, transport, health and accident insurance. Units without any technical business
which can be directly classed in the “life” or “non-life” business are presented in the respective segment.
All other units and assumed reinsurance are classed in “Other activities”.
The accounting principles used for segment reporting correspond to the significant policies for the financial statements. Helvetia Group treats services and the transfer of
assets and liabilities between the segments like transactions with third parties. Investments and dividend income from subsidiaries between segments are eliminated in the
segment in question. All other cross-segment relationships and revenues within the
Group are eliminated entirely.
The allocation of the individual Group companies to the regions and segments is set out
in section 19 (from page 199).
115
3.1 Segment information
Switzerland
2013
in CHF million
Germany
2012
2013
adjusted
Italy
2012
2013
adjusted
2012
adjusted
Income
4 350.3
3 978.4
843.2
810.4
917.4
1 012.0
– 128.6
– 131.0
– 84.8
– 80.9
– 77.9
– 67.0
4 221.7
3 847.4
758.4
729.5
839.5
945.0
Net earned premiums
Current income on Group investments (net)
– 0.3
1.5
– 0.1
– 2.7
15.1
12.9
4 221.4
3 848.9
758.3
726.8
854.6
957.9
704.8
687.4
73.8
74.8
105.8
102.2
94.3
95.6
41.2
28.3
42.3
55.7
18.1
40.2
41.7
36.2
40.7
55.3
14.8
– 0.2
–
–
–
–
Other income
21.1
32.9
4.6
3.7
30.1
26.8
5 074.5
4 704.8
919.6
869.8
1 073.5
1 197.9
71.9
74.1
60.3
59.0
27.5
24.9
5 146.4
4 778.9
979.9
928.8
1 101.0
1 222.8
– 416.1
– 436.6
– 366.5
– 367.4
– 347.5
– 357.5
– 2 340.8
– 2 239.2
– 130.9
– 119.9
– 274.3
– 235.7
– 1 426.9
– 1 245.2
– 201.1
– 164.4
– 199.7
– 325.0
40.0
55.5
61.0
44.8
61.1
46.4
– 124.1
– 67.7
– 30.3
– 26.9
– 0.9
– 6.1
– 4 267.9
– 3 933.2
– 667.8
– 633.8
– 761.3
– 877.9
– 265.6
– 258.4
– 173.0
– 170.9
– 113.0
– 100.1
19.4
16.3
17.5
22.7
12.4
10.8
– 209.7
– 204.0
– 50.8
– 47.5
– 66.3
– 59.7
of which transactions between geographical segments
Total revenues from external customers
Expenses
Acquisition costs
Interest payable
– 20.2
– 22.3
– 3.4
– 3.7
– 2.2
– 2.6
Other expenses1
– 27.1
– 23.7
– 6.4
– 4.0
– 108.2
– 133.5
– 4 771.1
– 4 425.3
– 883.9
– 837.2
– 1 038.6
– 1 163.0
303.4
279.5
35.7
32.6
34.9
34.9
Financing costs
–
–
–
–
– 0.2
– 0.4
303.4
279.5
35.7
32.6
34.7
34.5
Income taxes1
– 52.6
– 51.0
– 11.5
– 5.6
– 14.1
– 17.1
250.8
228.5
24.2
27.0
20.6
17.4
1
116
Other insurance units
Spain
2013
2012
2013
adjusted
Corporate
2012
2013
Elimination
2012
2013
Total
2012
2013
adjusted
2012
adjusted
405.2
401.8
938.8
789.6
–
–
– 161.7
– 163.5
7 293.2
– 16.4
– 18.9
– 143.1
– 149.4
–
–
162.2
163.4
– 288.6
6 828.7
– 283.8
388.8
382.9
795.7
640.2
–
–
0.5
– 0.1
7 004.6
6 544.9
0.5
7.5
0.4
8.7
–
–
– 0.5
0.1
15.1
28.0
389.3
390.4
796.1
648.9
–
–
–
–
7 019.7
6 572.9
25.4
24.1
61.8
62.2
16.2
12.0
– 2.1
– 2.8
985.7
959.9
2.7
2.4
25.6
29.7
20.5
6.2
–
–
226.6
217.9
3.7
2.8
0.5
2.8
–
0.0
–
–
104.7
137.3
0.4
0.4
0.0
0.0
–
–
–
–
15.2
0.2
5.0
4.6
11.2
10.1
1.9
1.7
– 0.6
– 0.8
73.3
79.0
426.5
424.7
895.2
753.7
38.6
19.9
– 2.7
– 3.6
8 425.2
7 967.2
13.6
15.7
– 175.1
– 176.6
– 0.9
– 0.7
2.7
3.6
–
–
440.1
440.4
720.1
577.1
37.7
19.2
–
–
8 425.2
7 967.2
– 184.8
– 192.3
– 533.8
– 432.3
–
–
86.9
100.5
– 1 761.8
– 1 685.6
– 77.7
– 89.7
– 115.5
– 130.8
–
–
6.8
12.3
– 2 932.4
– 2 803.0
– 25.2
– 19.2
– 38.2
– 22.6
–
–
0.0
– 1.4
– 1 891.1
– 1 777.8
5.6
13.3
75.1
84.3
–
–
– 96.0
– 113.5
146.8
130.8
–
–
– 4.3
– 5.7
–
–
–
–
– 159.6
– 106.4
– 282.1
– 287.9
– 616.7
– 507.1
–
–
– 2.3
– 2.1
– 6 598.1
– 6 242.0
– 77.6
– 77.9
– 202.8
– 170.3
–
–
32.5
30.2
– 799.5
– 747.4
3.6
4.5
24.4
24.9
–
–
– 30.2
– 28.2
47.1
51.0
– 27.1
– 28.0
– 53.5
– 42.3
– 4.9
– 8.6
0.0
0.1
– 412.3
– 390.0
– 0.1
0.0
– 0.6
– 0.7
– 1.2
– 2.0
2.7
3.6
– 25.0
– 27.7
– 1.8
– 6.6
– 9.1
– 7.4
– 1.1
– 3.3
0.0
0.0
– 153.7
– 178.5
– 385.1
– 395.9
– 858.3
– 702.9
– 7.2
– 13.9
2.7
3.6
– 7 941.5
– 7 534.6
41.4
28.8
36.9
50.8
31.4
6.0
0.0
0.0
483.7
432.6
–
–
–
–
– 21.8
– 8.6
–
–
– 22.0
– 9.0
41.4
28.8
36.9
50.8
9.6
– 2.6
0.0
0.0
461.7
423.6
– 14.3
– 8.3
– 7.2
– 9.2
1.8
0.7
0.0
0.0
– 97.9
– 90.5
27.1
20.5
29.7
41.6
11.4
– 1.9
0.0
0.0
363.8
333.1
117
3.2 Information by business activities
Life
2013
in CHF million
Non-life
2012
2013
adjusted
2012
adjusted
Income
4 547.5
4 201.4
2 552.8
– 62.6
– 61.7
– 368.5
2 412.4
– 275.5
4 484.9
4 139.7
2 184.3
2 136.9
– 3.7
– 1.0
22.2
29.7
4 481.2
4 138.7
2 206.5
2 166.6
Current income on Group investments (net)
869.8
848.8
105.9
103.3
167.8
186.8
38.1
29.3
104.7
137.3
–
–
14.8
– 0.2
0.4
0.4
Net earned premiums
Other income
42.7
45.6
27.0
31.9
5 681.0
5 357.0
2 377.9
2 331.5
Expenses
–
–
– 1 620.0
– 1 545.3
– 2 932.1
– 2 796.6
–
–
– 1 895.0
– 1 782.9
–
–
31.6
28.3
219.7
144.3
Acquisition costs
– 102.9
0.3
– 3.5
– 4 654.1
– 1 400.0
– 1 404.5
– 216.1
– 204.5
– 536.7
– 488.7
14.5
16.3
73.5
46.0
– 170.0
– 164.6
– 230.7
– 209.8
Interest payable
– 31.5
– 34.0
– 8.9
– 8.6
Other expenses1
– 123.6
– 143.5
– 30.7
– 36.4
– 5 482.1
– 5 184.4
– 2 133.5
– 2 102.0
198.9
172.6
244.4
229.5
Financing costs
–
–
– 0.2
– 0.4
198.9
172.6
244.2
229.1
Income taxes1
– 46.0
– 34.4
– 52.5
– 56.2
152.9
138.2
191.7
172.9
1
118
– 159.9
– 4 955.4
Other activities
2013
Elimination
2012
2013
Total
2012
2013
adjusted
2012
adjusted
466.2
411.6
– 273.3
– 196.7
7 293.2
– 132.0
– 142.9
274.5
196.3
– 288.6
6 828.7
– 283.8
334.2
268.7
1.2
– 0.4
7 004.6
6 544.9
– 2.2
– 1.1
– 1.2
0.4
15.1
28.0
332.0
267.6
–
–
7 019.7
6 572.9
26.6
23.9
– 16.6
– 16.1
985.7
959.9
20.7
1.8
–
–
226.6
217.9
–
0.0
–
–
104.7
137.3
–
–
–
–
15.2
0.2
6.1
7.3
– 2.5
– 5.8
73.3
79.0
385.4
300.6
– 19.1
– 21.9
8 425.2
7 967.2
– 310.3
– 252.7
168.5
112.4
– 1 761.8
– 1 685.6
– 7.5
– 19.5
7.2
13.1
– 2 932.4
– 2 803.0
– 1 777.8
3.9
6.6
0.0
– 1.5
– 1 891.1
73.6
84.5
– 178.1
– 126.3
146.8
130.8
–
–
–
–
– 159.6
– 106.4
– 240.3
– 181.1
– 2.4
– 2.3
– 6 598.1
– 6 242.0
– 112.2
– 91.8
65.5
37.6
– 799.5
– 747.4
22.4
24.1
– 63.3
– 35.4
47.1
51.0
– 11.9
– 15.6
0.3
0.0
– 412.3
– 390.0
– 1.7
– 2.2
17.1
17.1
– 25.0
– 27.7
– 1.3
– 3.5
1.9
4.9
– 153.7
– 178.5
– 345.0
– 270.1
19.1
21.9
– 7 941.5
– 7 534.6
40.4
30.5
0.0
0.0
483.7
432.6
– 21.8
– 8.6
–
–
– 22.0
– 9.0
18.6
21.9
0.0
0.0
461.7
423.6
0.6
0.1
0.0
0.0
– 97.9
– 90.5
19.2
22.0
0.0
0.0
363.8
333.1
119
3.3 Additional information
by segment:
Switzerland
as of 31.12.
2013
in CHF million
Germany
2012
2013
adjusted
Italy
2012
2013
adjusted
2012
adjusted
Assets by geographical segment
31 688.8
30 267.9
3 213.4
2 961.7
5 365.7
5 057.9
of which investments
28 939.8
27 754.2
2 764.8
2 523.1
4 299.6
4 053.0
0.1
46.3
–
–
–
–
Liabilities by geographical segment1
28 788.3
27 413.6
2 915.1
2 689.8
4 970.0
4 721.4
of which technical provisions (gross)
25 979.7
24 844.2
2 578.8
2 374.1
3 351.8
2 999.5
of which investments in associates
Cash flow from operating activities (net)
224.5
223.2
– 38.6
– 34.9
22.4
137.7
Cash flow from investing activities (net)
39.6
68.7
3.9
30.3
– 9.2
– 23.1
Cash flow from financing activities (net)
14.5
18.7
24.6
6.0
– 43.7
8.6
1.0
4.8
4.2
1.6
27.0
9.2
– 8.6
– 12.0
– 3.0
– 2.8
– 18.1
– 18.6
–
–
–
–
–
–
–
–
–
–
–
–
– 1.0
– 1.0
–
–
–
–
Acquisition of owner-occupied property, equipment and intangible assets
Depreciation and amortisation on tangible and intangible
assets
Impairment of tangible and intangible assets affecting income
Reversal of impairment losses on tangible and intangible assets
affecting income
Share-based payment transaction costs
by business activity:
Life
as of 31.12.
2013
in CHF million
2013
adjusted
2012
adjusted
Assets by business activity
37 078.4
35 373.8
6 578.7
6 215.0
Liabilities by business activity1
34 901.2
33 224.5
4 652.7
4 456.4
Acquisition of owner-occupied property, equipment and intangible assets
– 4.1
2.4
33.7
88.6
– 11.2
– 15.3
– 21.2
– 20.3
Impairment of tangible and intangible assets affecting income
–
–
0.0
– 0.6
Reversal of impairment losses on tangible and intangible assets affecting income
–
–
–
–
– 0.5
– 0.5
– 0.5
– 0.5
Depreciation and amortisation on tangible and intangible assets
Share-based payment transaction costs
1
120
Non-life
2012
Other insurance units
Spain
2013
2012
2013
adjusted
Corporate
2012
2013
Elimination
2012
2013
Total
2012
2013
adjusted
2012
adjusted
1 227.0
1 226.9
3 283.8
3 169.1
93.9
169.9
– 361.0
– 356.3
44 511.6
42 497.1
931.3
935.2
2 175.6
2 060.2
477.5
420.0
– 12.5
– 12.5
39 576.1
37 733.2
1.8
2.2
0.0
0.0
–
–
–
–
1.9
48.5
1 037.5
1 020.1
2 834.3
2 838.3
196.2
120.0
– 361.0
– 356.3
40 380.4
38 446.9
868.3
852.3
2 358.4
2 278.6
–
–
– 209.2
– 203.6
34 927.8
33 145.1
61.9
27.4
– 67.3
91.8
59.3
– 162.9
0.9
4.4
263.1
286.7
9.9
– 3.2
– 8.7
– 12.2
– 9.9
19.0
– 0.9
– 4.4
24.7
75.1
– 52.0
– 26.0
81.4
2.3
– 178.3
– 54.9
–
–
– 153.5
– 45.3
5.8
3.8
5.8
81.4
1.5
4.0
–
–
45.3
104.8
– 4.7
– 5.4
– 6.1
– 3.8
– 2.1
– 3.5
–
–
– 42.6
– 46.1
0.0
– 0.6
–
–
–
–
–
–
0.0
– 0.6
–
–
–
–
–
–
–
–
–
–
–
–
–
–
– 1.0
– 0.7
–
–
– 2.0
– 1.7
2012
2013
Other
activities
2013
Elimination
2012
2013
Total
adjusted
2012
adjusted
1 267.7
1 304.9
– 413.2
– 396.6
44 511.6
42 497.1
1 239.7
1 162.6
– 413.2
– 396.6
40 380.4
38 446.9
15.7
13.8
–
–
45.3
104.8
– 10.2
– 10.5
–
–
– 42.6
– 46.1
–
–
–
–
0.0
– 0.6
–
–
–
–
–
–
– 1.0
– 0.7
–
–
– 2.0
– 1.7
121
3.4 Gross premiums by geography and business area
Gross
premiums
before
elimination
2013
Gross
premiums
Elimination
2012
2013
2012
Change in %
2013
Change in %
(FX-adjusted)
2012
in CHF million
Switzerland
non-life
Switzerland
life
Total Switzerland
795.5
–
–
797.0
795.5
0.2
0.2
3 182.9
–
–
3 553.3
3 182.9
11.6
11.6
4 350.3
3 978.4
–
–
4 350.3
3 978.4
9.3
9.3
Germany
non-life
542.1
556.8
–
–
542.1
556.8
– 2.6
– 4.6
Germany
life
301.1
253.6
–
–
301.1
253.6
18.7
16.3
843.2
810.4
–
–
843.2
810.4
4.0
1.9
Total Germany
Italy
non-life
484.3
486.4
–
–
484.3
486.4
– 0.4
– 2.4
Italy
life
433.1
525.6
–
–
433.1
525.6
– 17.6
– 19.3
917.4
1 012.0
–
–
917.4
1 012.0
– 9.3
– 11.2
Total Italy
Spain
non-life
275.0
276.2
–
–
275.0
276.2
– 0.4
– 2.5
Spain
life
130.2
125.6
–
–
130.2
125.6
3.7
1.6
405.2
401.8
–
–
405.2
401.8
0.8
– 1.2
49.0
Total Spain
Other countries
non-life
454.4
297.5
– 1.9
–
452.5
297.5
52.1
Other countries
life
129.8
113.7
–
–
129.8
113.7
14.2
11.9
Reinsurance
354.6
378.4
– 159.8
– 163.5
194.8
214.9
– 9.4
– 9.4
Total other insurance
business
938.8
789.6
– 161.7
– 163.5
777.1
626.1
24.1
22.2
7 454.9
6 992.2
– 161.7
– 163.5
7 293.2
6 828.7
6.8
6.0
Total gross premiums
122
797.0
3 553.3
Financial