Sava Insurance Group, 1H2020: Net profit expanded by 42.5% y-o-y

20 August 2020 — press.release
From January to June 2020, Sava Insurance Group generated an operating revenue of EUR 314 million (+16.6%) and a net profit of EUR 32 million (+42.5%). The operating revenue reached 51.5% from its original full year 2020 target, while the net profit 71.5%.

These achievements were in part supported by one-off income of EUR 6.8 million relating to the excess of the fair value of the net assets acquired over the cost of the investment in Vita. Because of the material impacts of the Vita acquisition and Covid-19 on operations, the group has revised its annual targets.

Sava Insurance Group 1H2020 preliminary figures, y-o-y changes

  • Gross written premiums: EUR 374 million (+11.0%), of which:
    • Non-life Slovenia: EUR 217 million (+12.1%)
    • Non-life International: EUR 41 million (-2.1%)
    • Life Slovenia: EUR 45 million (+14.3%)
    • Life International: EUR 5 million (+17.2%)
    • Reinsurance: EUR 65 million (+15.0%)
    • Pensions: EUR 1 million (-21.9%)
  • Net combined ratio: 91.7% (-2.9 pp.)
  • Return on equity: 14.3% (+1.8 pp.)
  • Operating revenue: EUR 314 million (+16.6%)
  • Net profit: EUR 32 million (+42.5%)

In the first half of the year, the Group's operating revenue grew by 16.6% year on year. In addition to intensive acquisition activities, this growth was achieved through seeking opportunities to expand FoS business (freedom of services) written by Zavarovalnica Sava in cooperation with various EU partners, and through growth in reinsurance business. The slump in economic activity as a result of the Covid-19 pandemic affected growth in most operating segments of the Sava Insurance Group.

The half-year non-life gross premiums written in Slovenia, excluding FoS business and non-life business of Vita, grew by 4% year on year, whereas Slovenian life business, in which some maturities of existing policies were anticipated, excluding the life insurance part of Vita, saw a 4% drop in premiums.

There was also a 2% drop in the Group's non-Slovenian non-life premiums and operating revenues of assistance business also saw a decline. Covid-19 had a major impact on the financial markets, eroding the value of assets under management in pension companies and in the fund management company.

The net expense ratio improved by 1 pp. year on year, mainly due to the better expense ratio for reinsurance operations, due to the integration of Vita, which operates at a lower-than-average expense ratio in the Group, and due to measures to contain costs taken by the Group to ease the negative financial impact of Covid-19 on operations.

Profitability improved as the result of both a better expense ratio and a more favourable claims experience in Slovenia thanks to a lower loss rate in motor business.

A significant contribution to the net profit for the period came from the acquisition of Vita, consolidated in the Group accounts as from 31 May 2020. Through this acquisition, the Group doubled its market share in the Slovenian life insurance market, while also generating a one-off income of EUR 6.8 million from the excess of the fair value of the net assets acquired over the cost of the investment in Vita. Without the effects of Vita, the Group's net profit would total EUR 24.5 million, up 8.4% year on year, and 54.4% of the original full-year 2020 target.

The return on the investment portfolio in the first half of the year was 1.5%, which is 0.2 p.p. above the plan. The portfolio of predominantly highly rated government and corporate bonds is fairly resilient to financial market volatility. The key goal of the Group's investment policy is to maintain a low volatility and a high level of security of invested insurance contract assets, as well as to ensure high liquidity and risk diversification.

Following its regular annual rating review, the rating agency Standard & Poor's affirmed the "A" (strong) insurer financial strength rating on Sava Re and Zavarovalnica Sava, outlook stable.

More financial information about Sava Insurance Group can be found at


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