VIG, 9M2022: continued GWP growth trend; GWP year-end target set at over EUR 12 billion

17 November 2022 — Daniela GHETU
Despite the major geopolitical and economic challenges, Vienna Insurance Group (VIG) 3Q 2022 results improved y-o-y. The Group expects year-end GWP worth at least EUR 12 billion and profit before taxes that surpasses the previous year's figure of EUR 511 million.

"Of course, like any company, we are feeling the effects of the current situation, with inflation being the main factor here. The situation is leading to increased claims expenses among other things, thereby weighing on the development of the combined ratio. Nevertheless, we are confident that our strategy of broad diversification will enable us to effectively manage the inflation risk overall. A risk assessment has demonstrated that our largest markets in terms of volume are well positioned due to the measures taken and the current pricing policy. We remain confident in the long-term growth potential of the CEE region, especially as the current forecasts for this region are once again clearly above those for the eurozone," Elisabeth Stadler, CEO of Vienna Insurance Group said.

Total GWP increased markedly by 13.6% over 9M 2022, to EUR 9,530 million, the figure including the first-time consolidation of the most recently acquired insurance companies in Hungary and Turkiye, with premiums of around EUR 291 million, which account for 3.0% of the total premium volume. Even without these companies, premium growth is in the double digits at 10.1%. There has been premium growth across all lines of business and segments of VIG. With the exception of single premium life insurance (+3.1%), all business lines are posting double-digit growth rates (motor third-party liability +21%, motor own damage insurance +13.6%, other property and casualty insurance +15.3%, health insurance +11.8%, regular premium life insurance +10%).

Profit before taxes up by around 10%

At EUR 413.4 million, profit before taxes was around 10% above the value in the previous year. At EUR 479.2 million, the financial result (excluding the result from at-equity consolidated companies) is down 8.4% on the previous year, due primarily to the measures already taken in the first and second quarters of 2022 in connection with exposures to Russian government and corporate bonds. At EUR 302.4 million, net income was 10.1% higher than in the previous year.

Combined ratio slightly improved

At 95.1%, the combined ratio is slightly below the previous year's value (95.2%). However, the pressure of increased average losses, partially due to inflation, is evident in comparison with the first half of the year, when the combined ratio was 94.3%. However, VIG aims to maintaining the combined ratio to around 95% for the full year 2022.

VIG Group investments including cash and cash equivalents were EUR 34.1 billion as of 30 September 2022. Earnings per share (annualized) rose from EUR 2.86 to EUR 3.07 in the period under review (+7.3%).

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