Unipol Grupo Spa

Good afternoon. This is the Coruscall Conference Operator. Welcome and thank you for joining the Unipol Group first quarter 2023 results and Q&A session conference call. At this time, I would like to turn the conference over to Mr. Matteo Laterza, CEO of Unipol SAI and General Manager of Unipol. Please go ahead, sir.

Good afternoon to everyone. I'm here with Enrico San Pietro, Insurance General Manager. Before opening the floor to the Q&A, let me make some comment on the first quarter that we closed at the 31st of March. As you know, it is the first quarter in which we applied the new accounting standards, IFRS 17 and 9. We look forward to give more information and more disclosure in the next quarter. I will start from the P&C business, where at level of top line, we achieved a very solid top line growth, matching the assumption of our industrial plan, above all in non-motor. where we grew in all the line of business, above all in health, where Unisalute achieved a growth of more than 40% in terms of premium, driven not only by the traditional business, but also by the fact that starting from January of this year, we started to distribute Unisalute product to both the agent and the bank assurance companies. distribution network. By the way, bank assurance was in general one of the most important driver of growth in general in non-motor. Considering motor, top line grew close to 2%, driven both by an increase of the number of clients in the first quarter and the from the pricing effect that is just starting to give some effect in the increase of the premium collected. Passing to the profitability, the combined ratio, as you saw, had a small deterioration. This deterioration is driven both by an increase of frequency that we achieve in all the line of business, a lot of the line of business, in particular also in motor, where on top of that we continue to see the impact of inflation impacting in the average cost of claim. So combining these two effects, And the fact that the pricing strategy is just starting to have an effect, but it is just at the beginning, it explains the big part of the increase of the combined ratio versus the same number at the end of March 22. In life, we had a very strong growth, as you saw in the presentation. This growth is driven by the pension funds business, where we achieved a very important mandate for the management of very important pension funds. In general, we are working in increasing the yield of the segregated funds, where we achieved an increase of more than six basis points. And at the same time, we reduced the average of minimum guarantee of one basis points. In terms of surrenders, of course, there is a small increase compared to the same number in the first quarter, 22, but at a much smaller extent. And we are still very far from the level of surrenders that we had yesterday. Before the COVID, just to give you a period in which the absolute level of interest rates in the Italian government bond were at the same level in which we are today. Concerning investments, the contribution of investment income in the first quarter of 23 was very strong, driven by the very good performance of financial market. We had a tightening of the spread across the board, both in the Italian BTPs versus Bund and also in the credit market, in all the segments of the credit market. And on top of that, also equity market performed well. And this is the reason why the contribution of investments in first quarter 23 was good. On the opposite, on what it were in the first quarter 22, applying the new accounting standards IFRS 9. The capital generation produced by the group and the good performance in financial market was the main driver of the improvement of the solvency ratio both at group level and at UnipoSci level. These are the main remarks and comments that I can make on the first quarter 23. Having said that, with Enrico, we are open to answer to your question. Thank you.

Thank you. This is the Coruscant conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one under touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Michael Hotner with Varenberg. Please go ahead.