The current structural conditions pose major challenges as well as attractive opportuities for insurance companies. In particular, the sustained period of low interest rates and changes in customer needs in the digital age are putting significant pressures on the traditional business model. Against this background, UNIQA launched an ambitious strategic programme in 2011 entitled “UNIQA 2.0” and featuring multiple stages. A house – the UNIQA house – was developed as a memorable image for the programme´s objectives and strategic actions.
UNIQA is already at the third stage of the strategic programme, which is running from 2016 until 2020. The objectives for this third stage were adapted in the first quarter of 2016 and presented to the public:
- Growth: UNIQA expects average growth of around 2 per cent per annum in premiums written for the period until 2020. While expectations for premium growth in life insurance in Austria are muted, UNIQA expects average growth of just under 3 per cent p.a. in health insurance and of approximately 4 per cent in property and casualty insurance for the period started.
- Cost ratio: The aim is to improve efficiency and the cost structure on a continuous basis. Although the investment programme launched in 2016 of around €500 million over ten years will lead to an increase in the cost ratio in the medium term, UNIQA does expect an overall cast ratio of under 24 per cent from 2020 as a result of these investments.
- Combined ratio: The combined ratio in property and casualty insurance is the most important key figure for UNIQA in terms of profitability in the core underwriting business. The objective of bringing the combined ratio below 95 per cent on an sustainable basis by 2020 is therefore a high priority.
- Economic capital ratio (ECR): UNIQA is striving to achieve an economic capital ratio of 170 per cent with an fluctuation margin (target range) of between 155 and 190 per cent.
- Profitability: the operating return on equity is defined as the criterion for profitability. Achieving a rate of return on equity on capital employed in line with the risk is a central prerequisite for any economically sustainable business model. To this end, UNIQA aims to achieve an operating return on equity of around 13.5 per cent an average in the period between 2017 and 2020.
- Attractive dividends: Shareholders should receive an attractive dividend in return for providing their capital. Despite high ongoing investments and a sustained low-interest environment, UNIQA intends to continue increasing its annual distribution per share over the next few years as part of a progressive dividend policy.
A series of measures and initiatives have been defined and introduced aimed at achieving these ambitions objectives.