ZURICH INSURANCE GROUP LTD 
2023-2024 Chairman's Roadshow
Michel Liès, Chairman of the Board
November 2023 Investor presentation Zurich Insurance Group
Content
Strategy | 3 | ||||
Corporate Governance | 8 | ||||
Remuneration | 11 | ||||
Our ESG approach | 16 |
People and operations | 24 |
Communities30
Responsible Investments 32
Sustainable Insurance | 37 |
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Strategy
Key messages
Earnings growth
Successful strategy execution
Commercial insurance leadership
Life focus confirmed
Farmers transformation
Shareholder return
We are on track to deliver on our 8% EPS growth target, underpinned by P&C top-line growth, improved margins in Retail, growth in preferred lines in Life, Farmers Exchanges1 turn-around and expense discipline
The Swiss and German business units showcase the ability of the organization to deliver on its customer promise, efficiency, while driving growth initiatives
We are consolidating our market leadership in Commercial Insurance, pursuing growth in middle market and selected lines of business, while managing volatility
We have a growing and well diversified Life franchise, relatively immune to interest rate volatility
Farmers Exchanges1 have completed a number of transformational initiatives to restore profitability and capital strength
Growth in earnings and execution of our capital management priorities support delivering superior shareholder return
1 For all references to Farmers Exchanges see the disclaimer and cautionary statement.
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Strategy
Continuing to pursue our strategic vision established in 2016
Consistent strategy
Deliver cross-cycle outperformance in Commercial
based on technical excellence and opportunistic growth
Accelerate customer loyalization in Retail through relevant, innovative propositions and holistic experiences
Value creation through customer intelligence, advanced
data analytics and targeted, customer-led digitalization
Leverage strengths in distribution to pursue targeted growth opportunities in attractive, fast-growing segments
Drive climate transition through focus on sustainable solutions, engaging with customers and investees
Financial targets for 2023 - 20251
BOPAT ROE2 | >20% |
EPS growth3 | 8% |
SST ratio | ≥160% | |
Cash remittances4 | >13.5bn |
- Financial targets for 2023-2025 are based on IFRS 17.
- Business operating profit after tax return on equity, excluding unrealized gains and losses.
- The baseline for the 2023-2025 EPS growth target was the assumed achievement of the 5% EPS CAGR target of the 2020-2022 strategic cycle (i.e., EPS of USD 32.1).
- Cumulative net cash remittances over the period 2023-2025 (in USD).
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Strategy
Profit growth driven by P&C top-line and retail margin recovery, continued growth in Life and expense efficiency
EPS growth over the cycle (USD)
Upside
Contribution2 | |||||
Farmers | P&C | Target 8% | |||
40.4 | |||||
Retail | |||||
EPS CAGR | |||||
32.1 | Life | ||||
P&C Commercial | |||||
FY-22 baseline1 | Target Growth | FY-25 target |
Growth drivers
- P&C Retail: customer value initiatives and rate increases
- P&C Commercial: top line growth in middle market and selected lines; continued rate increases
- Life: continued growth in protection and unit-linked
- Farmers: benefits from business transformation at Farmers Exchanges3
- Expense discipline
- The baseline for the 2023-2025 EPS growth target was the assumed achievement of the 5% EPS CAGR target of the 2020-2022 strategic cycle (i.e., EPS of USD 32.1).
- Contribution based on planned BOP.
- For all references to Farmers Exchanges see the disclaimer and cautionary statement.
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Strategy
We are focused on continuing to reward our shareholders
Dividend policy1
NIAS2 payout ratio of ~75%
Dividend increases based on sustainable earnings growth
Minimum target of prior year level
Earnings and dividend per share
EPS growth target3 | |||||
+8% p.a. | |||||
+5% p.a. | |||||
40.4 | |||||
34.7 | 32.13,4 | ||||
27.7 | |||||
25.6 | 24.0 | ||||
22.0 | |||||
20.0 | 20.0 | ||||
FY-19 | FY-20 | FY-21 | FY-22 | FY-25 | |||
target3 | |||||||
Diluted earnings per share (USD) | Dividend per share (CHF) | ||||||
FY-23 dividend expected to be supplemented by a share buy-
back. Total payout ratio up to 100% of underlying NIAS2
- The dividend is subject to the approval by the shareholders at the Annual General Meeting.
- Net income attributable to shareholders.
- The baseline for the target was the assumed achievement of the 5% EPS CAGR target of the 2020-2022 strategic cycle, i.e., EPS of USD 32.1.
- Diluted EPS of USD 30.8 on a reported basis, USD 32.2 adjusted for the earnings per share impact of H2-22 loss on disposals of USD 260m mainly related to the sale of the legacy Life back book in Italy.
November 2023 | 2023-2024 Chairman's Roadshow | 7 | © Zurich |
Corporate Governance
Corporate Governance
A diverse and independent Board, well positioned to support management delivery on strategic priorities
Board composition1 | Board by length of tenure | ||||||||
Singapore | |||||||||
7% | |||||||||
Germany | |||||||||
20% | 40% | Switzerland | |||||||
Male | 50% | 50% | |||||||
50% | 50% | ||||||||
Female | UK 7% | < 5 years | 5-10 years | ||||||
20% | 7% | ||||||||
U.S. | Luxembourg | ||||||||
Board by background1 | Board by experience, skills and knowledge1 | ||||||||
CEO experience | 83% | ||||||||
Risk management | 50% | ||||||||
Insurance | 25% | ESG | 50% | ||||||
People & culture | 42% | ||||||||
Banking | 33% | ||||||||
IT, data, digital & cyber security | 42% | ||||||||
Non Financial | 58% | ||||||||
Legal, regulatory & governance | 33% | ||||||||
Macroeconomics | 25% | ||||||||
Finance, accounting & audit | 25% | ||||||||
1 Board members are allocated to one or more nationality, sectors and/or specialization areas based on their individual profile. For nationalities the percentages may not total 100 due to rounding. The information provided is as of December 31, 2022, there have been no changes in the Board composition at the AGM on April 6, 2023.
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Corporate Governance
Board leadership and commitment to key strategy and policy issues
Key focus areas in 2022-2023
2022 Board meeting attendance 1
Strategy: continued analysis of customer needs and development of innovative insurance and service propositions, continued focus on the Group's Life business and AI risks and opportunities
Board
Audit Committee
Risk & Investment Committee
GNSC
Remuneration Committee
96% 96%
88%
94%
100%
Sustainability - driving the implementation of the sustainability strategy and monitoring the sustainability performance.
Implementation of IFRS 17 and IFRS 9 and implications for the Group
Maximum number of mandates in listed companies 2
55
4
Zurich 3 | ISS | Glass Lewis |
- Board and Committees; GNSC stands for Governance, Nominations and Sustainability Committee
- According to European proxy voting guidelines 2022. Please note that proxy advisors have additional limitations for directors who serve as chairmen or executives. These special cases were not considered here.
- Including mandate at Zurich Insurance Group Ltd. Additional limitations exist, amongst others, for the total number of mandates (including listed and non-listed). For details, please see article 33 of the Articles of Association
November 2023 | 2023-2024 Chairman's Roadshow | 10 | © Zurich |
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Disclaimer
Zurich Insurance Group AG published this content on 23 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2023 09:05:09 UTC.
