Assicurazioni Generali S.p.A.

Good afternoon. This is the Coral School conference operator. Welcome and thank you for joining the Generali Group nine-month 2023 results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Fabio Cleva, Head of Investor and Rating Agency Relations. Please go ahead, sir.

Thank you, operator. Hello, everyone, and welcome to our nine-month 2023 results conference call. Here with us, we have our Group General Manager, Marco Cezanne, and our Group CFO, Cristiano Borean. Before opening the Q&A session, Marco and Cristiano would like to share some opening remarks. Marco, over to you.

Thank you, Fabio. Hi to everyone. Welcome on the call. And let me start by saying that our third quarter financial result confirmed the group operational delivery and the ongoing implementation of the action aimed at addressing the macro environment. which, as you all know, has become more uncertain after the recent geopolitical development. I will start with the client, as usual, and we are very pleased that customers value positively the action that we put in place to enhance our value proposition. In the third quarter, 23, we further consolidated the number one position in our peer group in terms of net promoter score. In addition, retention is confirmed at 89% and more than 50% of our customers are relying on Generali to cover at least two or more of their needs. Let me also touch an important point here. As most of you have seen in the news, this is a difficult time for some of the communities in some of the countries in which we operate and due to recent weather events. We are very close to this community. We have defined several initiatives and we are present on the ground to support people. And I would like to thank all of our colleagues and agents who are working hard to guarantee full support to our clients. Let's now see briefly our business, and we start with life. So in terms of volume, the third quarter saw a continuation of the industry trend observed year-to-date. Protection reached €3.6 billion of net flow, while Unitlink achieved around €4 billion. Protection continued to generate around 40% of our new business value. Concerning lapse, we observe an improvement in lapses in Italy, especially in the bank assurance channel. You know that in this year, this is the channel that suffered more. And we have seen a gradual normalization of the outflow in France. The net outflow numbers were impacted also by the cancellation of the quasi-money market product in Germany and by some planned expiry and low-margin bank assurance product in China. These specific outflows have had an immaterial impact on the CSM, as Cristiano will explain to you in a moment. The surrenders in our life portfolio during the third Q were 1.6 billion lower than the second Q, which led to halving of the net outflow in the third Q versus those recorded in the second Q. Our business unit have adapted to meet the changing customer appetite and preserve market competitiveness. In particular, we are continuing to update our existing product and launching new products more attractive in the current market context. Let me also say that we maintain a strong focus on the new business underwriting discipline, on protection and health business, and on capital-like products enhanced by protection riders. Our strategy will continue to be oriented to bundle solutions addressing multiple customer needs within a single product in line with our lifetime partners' ambition. These tailor-made solutions are better suited to respond to client needs and are also less exposed to competition from government bonds. Let's look now to P&C. So P&C business growth has confirmed the trend seen year-to-date. So the third quarter 23, gross return premium were up 11.9%. At half-year 23 presentation, we disclosed an increase in the average premium in our retail and SME book of 6.4%. At nine months, the average premium was up 6.9% compared to nine months 22. With growth-based improvement across the portfolio and an acceleration in motor where the average annual premium increase has improved from 3.2% at half-year to 3.9% at nine months. These figures are reflecting both a generalized upturn in personal line and will continue in the coming quarters, and I would say even years, as we have entered in an environment where adaptive pricing is part of our ongoing strategy. Therefore, we will continue to increase tariffs in line with our granular view of claims inflation and frequency. We are also continuing to implement the technical measures necessary to pursue profitable growth, especially in terms of portfolio enhancing and claims management. Clearly, the third quarter recorded significant weather events, in particular in the hailstorm in Italy in July and August. The unusually nut-cut burden reported in the quarter mainly derives from the so-called secondary perils and, of course, from organic and inorganic growth of portfolio. Nevertheless, our undiscounted current year loss ratio, excluding NatCat, remains strong and improving at 67.2%, with a 70 bps improvement versus 9-month-22%. Moving to investment. So our investment yield remained very good versus in-force book and market at 4.3% in life and 4% in PNC. We increased cash buffer and reduced bond duration. On listed equity, we maintain a prudent approach and we tactically reduce exposure by harvesting gains after the positive performance here today. A sizable portion of the residual exposure is edged via derivative options. In credit, we confirm our selective approach with low exposure to more cyclical sector and highly leveraged companies. On private asset, we have been more selective in terms of new commitment, balancing attractive opportunity, especially in private debt valuation with ILM constraint. Finally, let me underline that our exposure to Israel and the Middle East, both in terms of business and investment, is immaterial. In conclusion, this result of the third quarter of 2023 confirmed the group's continued ability to deliver solid growth and execute on our strategic plan, in line with our lifetime partner purpose. As we move into the last quarter of the year, we are confident about the right direction on which we are steering the group. So thank you for your attention, and now I hand it over to Cristiano.