Gjensidige Forsikring Asa

Hi everyone, and welcome to this first quarter presentation of Jensidie. My name is Mitra Negoy and I'm Head of Investor Relations. As always, we will start with our CEO, Geir Holmgren, who will give you the highlights of the quarter, followed by our CFO, Justine Amdahl, who will run through the numbers in further detail. And we have plenty of time for a Q&A after that. Geir, please.

Thank you Mitra, and good morning everyone. We are navigating uncertain times characterized by heightened geopolitical tension, significant macroeconomic uncertainty, and considerable market turmoil. We anticipate that these challenges will persist for some time, and in light of this, it is more crucial than ever to focus on keeping the customers' trust, effective risk management, and prudent financial risk taking. We will continue to closely monitor developments in drivers of claims expenses and respond swiftly to emerging changes. Our strong capital position places us in a favourable position to withstand further turbulence in the capital markets. So let us move on to comments on our first quarter results on page 2. I am very pleased to see that our strong efforts to improve the results are gradually coming through. The profit before tax was 1 billion and 790 million kroner. The general insurance service result was 1 billion and 340 million, significantly up year on year. Insurance revenue increased by more than 10 percent. The combined ratio declined to 86.9 percent, reflecting improvements in both the loss and cost ratios. It is very encouraging to see that underlying profitability improved by 3.7 percentage points when adjusting for weather adverse development in claims and provisions in the first quarter last year. Large losses were somewhat higher than our quarterly estimate this year, amongst others driven by one large fire loss in Norway. Our investment generated returns of 503 million, contributing to delivering a solid return on equity of 22.2%. Jostein will revert with more detailed comments on the results for the quarter. A few words about property insurance on page 3. I am very pleased to see high profitability for private property this quarter, also when adjusting for the more favourable weather conditions. This is thanks to the successful implementation of targeted pricing measures, which I have put through over the past quarters. Although claims for property insurance are highly volatile, we see a promising development in underlying profitability for this product line. Let me take you through some of the drivers this quarter. Claims frequency was significantly lower this year compared to last year. Claims inflation has developed as expected and we currently expect it to increase in the range from 4 to 6 percent for the next 12 to 18 months. The ongoing international trade disputes and tariff threats are creating significant uncertainty. This applies both for property and motor. We are monitoring the situation closely. Average premiums increased by almost 13% during the past year. Our current rate of increase is just about 70%. These are necessary price increases, but having this in mind, it is particularly encouraging to see that our customers remain loyal to us. And that we continue to attract more customers. So over to page four and a few words on motor insurance in Norway. Thanks to the affecting pricing measures, we have seen profitable moving in the right direction for this important product in our portfolio. After several quarters with deteriorating margins, profitability was stable this quarter, also when adjusting for weather and the adverse development in claims occurred in the first quarter last year. We will continue to raise prices until we reach satisfactory profitability. Moving over to drivers this quarter, we can see that the increase in earned line claims frequency appears to be gradually abating. This quarter it was up 1.5%. Our prices reflect continued moderate increases in the claims frequency. Claims inflation increased just over 5% this quarter, which is within our expected range. We expect the repair cost to increase in the range of 4 to 7 percent over the next 12 to 18 months. And as mentioned, we are monitoring the situation very closely and we will respond swiftly upon changes in our assumptions. The more benign weather conditions this quarter resulted in less costly losses. The claims mix varies depending on weather, driving behavior and the mix of type of cars in our portfolio. We continue to push through price increases. Average premiums rose by more than 17% during the past 12 months. The current average rate of increase is more than 19%. And I'm very happy to see that we're able to push through these significant and necessary price increases and maintain our high customer loyalty. So moving on to page five. The strong growth momentum for private continued in the first quarter. Retention in Norway remained at a high level and we increased the number of customers. Our strong position combined with our predictive models and targeted differentiated pricing have ensured that we have kept the best customers in Norway and improved online profitability. We observe that the churn is twice as high for customers in the weakest customer scoring group compared to the best one. Growth in private in Denmark was also strong, and customer retention improved. However, I am not satisfied with the results yet. We will continue to implement pricing measures, as well as improve risk selection, claims handling, distribution efficiency and overall cost efficiency. Our commercial business in Norway and Denmark continued to show good growth this quarter. Customer retention remained high in Norway, while in Denmark it declined due to pricing measures. The growth in revenues in Norway was somewhat muted, reflecting our prioritization of profitability over growth. Thanks to our underwriting expertise and our strong market position, we continue to improve the quality in our Norwegian commercial portfolio, reflected in the improved margins for our Norwegian commercial business. As you can see on the slide, retained customers have 22 percentage points better loss ratio over the past 36 months than customers that have left us during the past 12 months. Commercial in Denmark show weaker profitability this quarter, although this is partly explained by natural inherent volatility. We will maintain a strong focus on enhancing operational efficiency and raising prices to ensure good results. Sweden is progressing well, with results showing the benefits of a further digitalization, automation and improved CRM. Moving on to page 6 and a few words about our acquisition of BuySure. The acquisition broadens our footprint in the market for change of ownership insurance products through a wide range of real estate agents. Home seller insurance fits well into our offerings for customers home journey by protecting them at key touch points from preparing to sell, navigating the sale, and moving out to transitioning into new insurance products for the next home. It complements existing products, ensuring that the seller is comprehensively covered throughout the entire process. In addition to revenues from this growing market, we see very interesting opportunities for cross-selling other insurance products in Jansidia. Over to page 7. We continue to follow up on our strong sustainability ambitions. We have a number of innovative initiatives, as you can see on this slide. The initiatives will create great customer value and reduce claims cost over time. So, with that, I will leave the word to Jostein to present the first quarter results in more detail.

JOSTEIN JOSTEIN- Thank you, Geir, and good morning, everybody. I will start on page 9. As Geir mentioned, we delivered a profit before tax of 1 billion and 719 million kroner in the first quarter. The insurance service result increased significantly to 1 billion 314 million, driven by continued strong top-line growth and a lower loss ratio. A further decrease in the cost ratio also contributed to higher results. I am very pleased to see the improvement in underlying profitability in Norway and Sweden. The development for commercial in Norway, driven by property, marine, motor and health insurance, is particularly encouraging. The improvement for private in Norway was driven by property and travel insurance, while in Sweden it was property and private health insurance that drove the development. We expect the positive impact from the ongoing pricing measures to gradually improve profitability as premiums are earned. The results in both the commercial and private portfolios in Denmark declined this quarter. Property insurance was the main driver of the decline in the commercial portfolio, while accident and health, motor and travel insurance were the drivers behind the deterioration in the private portfolio. Commercial business is generally more volatile due to the composition of products and magnitude of exposures. We recognize an upside potential for both portfolios in Denmark, which we will seek with targeted measures, as Geir mentioned. The pension segment reported a lower pre-tax result, mainly due to the negative development in the insurance service result. I will revert on this in a moment. The net result from our investment portfolios amounted to 441 million in the quarter. We see good progress in our mobility services, driving the improvement in the other items line this quarter. The result from our Baltic business is recorded as discontinued operations, pending regulatory approval for the sale. The result reflects higher insurance revenue and lower loss and cost ratios. We expect to close the transaction at the latest in the beginning of next year. Turning over to page 10. Our strong growth continued in the first quarter, with insurance revenues increasing by more than 10%. This was mainly driven by price increases and continued high customer retention. Within private, we saw particularly high growth in Norway, reflecting mainly price increases in the main product lines, but also some increases in volumes for motor, property, travel and accident and health insurance. The increase in the Danish private portfolio was due to price increases for all main products and higher volumes for motor, accident and health and property insurance. Growth in commercial was driven by both Norway and Denmark. In Norway, the growth was driven by price increases for old products and solid renewals. Growth for some products within accident insurance was muted due to improved risk selection and a consistent prioritization of profitability over growth. The NCD continues to maintain strong competitiveness in the SME market, but has experienced a slight increase in churn among larger, less profitable customers this quarter. In Denmark, the growth was driven by price increases for all main products and higher volumes for property, accident and health, and liability insurance. The insurance revenue in Sweden decreased when measured in local currency. This was due to termination of a partner agreement. Adjusted for this, insurance revenue increased, driven by payment protection and health insurance in the private portfolio due to pricing measures. Higher volumes of motor and price increases for health insurance in the commercial portfolio also contributed to the growth. Turning over to page 11, the group's loss ratio improved by 4.5 percentage points, reflecting an improvement in the underlying frequency loss ratio, higher runoff gains, and a positive impact from the change in risk adjustment. High and large losses and a lower discounting effect contributed negatively. The weather this year was more favorable than last year. The first quarter results last year were in addition negatively impacted by provisions related to the court ruling on pricing in Denmark involving one of our pairs. On the other hand, we saw an adverse development in claims occurring in the first quarter, but recognized only the second quarter accounts of last year. Adjusting for these effects provides a clearer view of our profitability trends. Based on this, the loss ratio was broadly stable, while the underlying frequency loss ratio decreased by 3.7 percentage points. The improvement was primarily driven by Norwegian commercial and private portfolios. Our Swedish operations also showed improved underlying profitability. We are strongly dedicated to continuing the implementation of pricing measures and enhancing operational efficiency to further improve profitability. Bear in mind that the implemented pricing measures take time to get fully reflected in the accounts and that quarterly volatility in claims, frequency and severity will impact results. Let's turn to page 12. We managed to bring the group's cost ratio further down to 12.0%. Commercial and private in Norway drove the improvement of 0.8 percentage points this quarter, thanks to higher insurance revenue. We recognize substantial potential in enhancing our cost ratios in Denmark. Our commitment to operational efficiency remains strong. Over to slide 13 for comments on our pension operations. Our pension business delivered a pre-tax profit of 77 million this quarter, or 105 million adjusted for the change in the contractual service margin. The results were lower than the same quarter last year, mainly driven by lower profitability for occupational pension and adjustments related to reinsurance contracts. Net finance income came to 90 million kroner, reflecting an increase in interest rates during the quarter. Our unit-linked business continues to grow. The number of occupational pension members rose by around 2,500 at the year-end to over 319,000 members this quarter. and assets and management rose by around 1% to 87.8 billion kroner. Although both administration fees and management income increased, the results from the unit-linked business were slightly lower year on year due to increased expenses driven by higher activity levels. Moving on to the investment portfolio on page 14. The first quarter of this year saw significant fluctuations in the capital markets, driven by uncertainty stemming from ongoing trade distributes and the imposition of new tariffs, which heightened investor caution and market volatility. Our investment portfolio generated positive returns for all asset classes, except listed equities. The matched portfolio, net of unwinding and the impact of changes in financial assumptions, returned around 40 basis points, mainly reflecting stable credit spreads and the fact that the investments did not fully match the accounting-based technical provisions. The free portfolio returned 110 basis points, reflecting positive returns from high running yields, stable credit spreads and positive returns from real estate. The risk in our free portfolio was already low entering the quarter, but was further reduced during the quarter. The global macro outlook remains uncertain, with continued volatility expected in the capital markets. And despite the significant market turmoil in April, we have seen very limited impacts on our investment portfolio. We are well positioned to withstand any further common turbulence in the markets. Our investment portfolios are balanced and comprise solid fixed income investments, the majority of which hold an investment grade rating. A few words on the latest development of our operational targets on slide 15. The customer satisfaction score is measured annually in the fourth quarter. The score was slightly down compared with the fourth quarter of 2023, reflecting a lower score mainly in private Norway. We will continue to identify measures and take steps to maintain a strong customer offering and high customer satisfaction. As Geir mentioned, retention in Norway remained high and stable. Retention outside Norway, adjusted for the previously mentioned termination of a partner agreement in Sweden, was broadly stable this quarter. The improvement in the digital distribution index this quarter reflects an increase in digital sales and digital service. Distribution efficiency is progressing well as a result of improvement initiatives in Norway and Denmark, including the transfer of best practice between the countries. Improved digital customer solutions, enhanced implementation of the new core IT system in Denmark, as well as organizational adaptions are among the key drivers for the improvement. Digital claims reporting increased during the quarter, driven by Norway, Denmark and Sweden. Automated claims also increased in the quarter. Over to page 16. We had a solvency ratio of 188% this quarter, up 3 percentage points from the end of the year. Adjusted for the acquisition of Biosher earlier this month, the solvency margin was 184%. Solvency to operating earnings and returns from the free portfolio contributed positively to eligible loan funds, while the formulaic dividend reduces loan funds. The capital requirement is stable this quarter, reflecting the impact from growth offset by changes in technical provisions and currency rates. The approved version of our partial internal model differs from our own model. The differences lie in the calibration of certain parameters in the model. We sent an application to the Norwegian FSA on the correlation between underwriting risk and market risk earlier this year. We will continue to have a dialogue on the remaining differences between our own and the approved model. If all differences were approved, the capital requirement would be reduced by 1.6 billion. And I'll now hand the word back to Geir.