Protector Forsikring Ord

All right, welcome to the presentation of Protectors full year 25 results. We will focus on the full year, a quarter is volatile, we say that all the time, focus on the full year result that is more interesting and says more about the underlying realities of the business. And before I go into the results, I always spend a little bit of time on who we are. And what we did this morning was to continue on looking at what the challenger should be in the future. And one thing that we care about is that we even when we are 700 people, even when we grow in a number of countries, that we still act as one team, which is a bit contradictory to a performance culture where we compete against each other and also that we want local decisions and also that we want each individual in the company to make decisions because they are where it happens and they should know what decisions to make so so that's what the challenger is it is about making everything we do focused and simplistic but when it comes to culture we need to complicate it in order to spend time and really understand so that we're on the same platform and the same grounds for the future because i think that's extremely important in order to stay who we are the challenger And then to the highlights, other than that 84.7% combined ratio and a 14% growth with an investment result of a return of 1.5 billion Norwegian kroner, leading to 31.7%. kroners per share in earnings. We have had some other activities in the quarter, one being the placement of a tier one bond where the market was good, so with good terms on that. Maybe the biggest, other than the growth for 1st of January, which I come back to, news is that we have now been relieved of the maybe biggest mistake that we've made in in protected workers compensation in in denmark where we took on board a portfolio knowing that we didn't have the exact data we needed to underwrite it but but we underestimated the downside of that portfolio and and we have now sold that, so the agreement with Darragh is completed and we can now focus on the lines of business and the business that we know how to do in Denmark. So that's very good. I'll get back to the reinsurance side and the growth later on. And speaking about the growth, I think that it is important, in particular following the 1st of January with high growth, it's important to remember how the portfolio is put together. And what we see here is a development. The development is driven by disciplined underwriting. So we underwrite in all these segments. And remember that the commercial segments, so if you look at the segment distribution on the left of the cake diagrams here, commercial sector in all countries is bigger than the public and housing sectors. But we have grown more in the public sector. That is due to mostly market conditions. It's been more rational pricing in the public and housing sectors than what it has been in the commercial sector. So that's why public sector and housing has grown a lot also in the past five-year period. And property and motor by far are biggest products, short tail products. And UK is now close to half the business or at least 42% of the business. But it's also important to remember that the 1st of January growth is related to the Scandinavian markets or the Nordic markets and France. Not UK. And the market conditions are different in those two geographies. So it's been easier to grow in the Nordics and France than what it has been in the UK the past year. So it's just a support so that you see what the inception structure in our portfolio was in the years from 21 to 25. Obviously, we don't know exactly how that will look in 26, but at least you then see that distribution. And when it comes to 2025, what you have seen throughout the year is that from the UK, we've had a good 1st of April in public sector and housing, but I've also said and we've also experienced that the market has been softening. So rates have been going down, especially on the property product in the commercial sector. So it is slightly harder to achieve price increases. It's slightly harder to renew clients and also to get new sales. But the churn in the UK during 2025 has been good. So we've managed to keep the churn at a good level, around slightly above 10%. and been disciplined in the new sales side. And then we've had strong growth in the other territories or in Scandinavia. And that is supported by good renewals, renewal rate of 95% in total for the company. It's basically the same in the Nordics. and but we've also had some new sales so so the markets there are it's good on the norwegian business which has the highest growth out of the scandinavian countries on 1st of january 26 So a similar situation to what you see here. Denmark is number two, 1st of January, 26. But Sweden has a lower growth in 26. So Sweden is the market where there is still more competition and more competition that we view as irrational. And then you have the French business, of course, where not a lot happens in quarter four. So most of it is old news of the start there. However, 1st of January is an interesting time. because we communicated an estimated number of what we thought we would quote for 1st of January following quarter 3. And that number was roughly right. So what we have... seen in the market for 1st of Jan in France is that we have won approximately 10% of what we have quoted in the commercial sector space, Malta. And that's a lower figure than what we are used to in Scandinavia. It's more in line with what we are used to on the motor side in the UK. And then on the housing sector, where most of the property volume from 25 comes from, we have basically won nothing. 1st of January, 26. So one of the big competitors, AXA, has come in and lowered prices a lot compared to what they did in 25. So it's not a hat trick in France. We have not one volume in all the segments we're in, but we've got some traction on the municipality side, the public sector side, where the market situation is very different from the housing sector. And the interesting thing is that the housing sector is quite similar to what we know in the UK, where there is low deductibles, lots of escape of water claims, and calculating the price is not... very difficult. So when we may make a mistake and the competitors, the price lower than us, they may know something we don't. Absolutely. It's new. We're new in France. But at the same time, it's difficult to see that it's very sustainable, those levels that we see in the housing sector now. So at some point, we believe that we can have a success there as well. Maybe not in the same way as 23 in the UK, but at least it's not on the public sector side, which is more about large loss and risk selection. Yeah? Sorry, I forgot to say that. So please ask questions during the presentation.

potential volume, and that your expected quotation rate would be around 70 to 75, but you're actually saying it's still growing.

So it continued to grow, not a lot from that, but the quotation rate went slightly down, both because of capacity, our own capacity. So we prepared as well as we could, but we didn't have enough manpower to do that with quality. So the The actual number is very similar to what you could derive out of the 370 to 75 in quotes. Any more questions on the volume side? And please ask questions in writing as well. Okay, again, when we look at the full year, we also bring out the longer picture here. And there is volatility in not only the runoff and the large losses, but also on the loss ratio below those large losses and without the runoff. The large loss situation in 2025 is lower than what we have said is normalized. And the comment on the top pair going from 7 to 8, I'll get back to when I speak about the reinsurance, but that goes for 26, not for 25. So for 25, it's still a normalized level at 7% approximately. So we're slightly lower than the normalized level in 2025. And we've had some runoff gains, even though it's best estimate. But I've also said previously that following a period with uncertain inflation, you should expect that there is a bit more uncertainty and then there could be some runoff gains from that situation if we have been on the conservative side. And then when it comes to claims, I think the important message here is to say that if we compare full year 25 to full year 24, and you normalise for run-off and large losses, all countries are slightly better. on the loss ratio side. So it's an improvement coming from the price increases where we have unprofitable products or clients. And that's the simple way of seeing it. The only country that is slightly up but very much the same is Sweden. And then there are some technicalities, one of which is related to the transfer of the Danish workers' comp portfolio. So the risk margin is... is reduced. It's a one-off of approximately 80 million for the quarter and the year due to lower risk in the remaining portfolio. I've changed that model. And then there is a a small between the countries has nothing to or no consequence on the total loss ratio but between the countries there is a we've changed the this from a standard very old model of of calculating the future claims handling costs and that changes the distribution with a slightly lower cost which is claims handling cost is on the loss ratio for UK so UK is slightly higher and then Norway and Sweden have had a bit more of that cost and that's a one-off again so they're slightly lower and with that information it's the conclusion is that all countries compared to 24 are slightly better normalized for all of that Any questions on the loss development side? You have all the figures on large loss in order to normalize on all these levels, so I won't go through each of them, but that's the total picture. So we have cost and quality leadership leading to profitable growth as our targets. The cost side is very flat. There is no or very limited efficiency improvements in what you see here. There are some effects that... make this 25 look higher than 24. But if you correct for the fact that the share price has increased, we've talked about that before, more than what it did in 24, and that is connected to an incentive-based share program for some employees, and France, then you'll get slightly lower than what we had in 24. on the cost side, but there is no or very limited efficiency improvement. And we do that consciously, but of course we do want to see the effects of that investment we make. I think it's more likely that we see that effect in new opportunities for growth, that we spend it on developing the company on the growth side to grow, then that we cut and slim down departments very quickly in order to get the low cost. And that takes some time, as you understand. So I think there's nothing very special to comment on here other than those comments I've already had, unless you have any questions on specific countries or the totality on cost. Continue to the quality leadership. Last time we brought this up, we had the UK survey with the brokers, where we got very strong feedback. We've also had the Scandinavian or the Nordic surveys out and had very strong feedback. And it's especially good to see that we are increasing the distance to our competitors in all the Scandinavian countries. And we are also winning more prices, external prices from the brokers. So the largest broker in Scandinavia, we are number one in Sweden and in Norway. And we've also won other external surveys that support our own survey. But at the same time, and as always, the most important thing about this survey is to understand that feedback, use it as a basis to discuss with the brokers, who are our best and only friends, how we can improve, what we should prioritize to improve in the future. So this is good news. It doesn't automatically mean that we will get more business from the brokers, but it means that we're in a position to require more from our best and only friends. And I think that's the important part, that the long-term... The long-term gain from this is that we can require better data, more data. We can require that they invest together with us in competing against the direct channels and that we can do those larger projects because you say that we are the best partner for you. So that's a good thing, but it doesn't mean that we win more clients tomorrow. Yeah, there is basically nothing I haven't touched upon here since we've talked about the cost previously as well. So I'll move forward to the investment side. And yeah, when you see this, it's per 31st of May. December and does not then include the reduction from the transfer of the workers' comp agreement which is for 26 and it does not include the new growth of course. So that's a change. But the results on the investment side are strong in absolute terms and relative, especially on the equity side, but also on the bond side in a very strong market. The yield is down due to the reference rate, if you compare it to last year. Other than that, on the bond side, it's a very similar portfolio. We steer interest rate towards our liabilities and we have a slightly shorter duration in our reserves, so that's down. And then you see the comment at the end that we have the assets under management are reduced by the transaction amount, so the reserves that we had on the Danish workers' comp portfolio, approximately 1 billion. Norwegian kronor. And on the equity side, I think it's right to say that it's a both absolute and relatively strong result. There is some changes in the portfolio. You've seen that the discount to intrinsic value has reduced significantly from last year. Some of it is obviously that we've had had the gain that we have so share prices have gone up but there are also some companies or some sectors that have performed worse than what we have expected so there have been some changes in the intrinsic value so we're open as a value and this year it has been some disappointments on certain segments and companies and some changes in that portfolio but even though it's the same number of holding there have been some changes in the portfolio during 2025, and you'll see that in the annual report, what we had at year-end 2025. Any questions to the investment side? We have a microphone.