Financial Assessment of the Global Insurance Industry

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Financial Assessment of the Global Insurance Industry

  1. 1. Financial Assessment of the Global Insurance Industry Managing mediocrity with greater excellence Sheetal Kothari, Research Analyst Business & Financial ServicesNB37-F1December 2012
  2. 2. Table of Contents S No Topic/Contents 1. Introduction 2. Scope and Research Methodology 3. Industry Drivers, Restraints and Challenges 4. Geographic Analysis 5. Sector Analysis 6. Industry Scorecard 7. ConclusionNB37-F1 2
  3. 3. Introduction Key study objectives include: To analyse companies in the insurance industry based on key financial metrics and financial ratios. To identify the best performers in the industry based on financial metrics. To identify best performing sector (Sector analysis) and region (geographic analysis) in the industry. Source: Frost & Sullivan analysis.NB37-F1 3
  4. 4. Scope of the study • Global – divided into 5 regions Regions covered • North America, Europe, Asia Pacific, Middle East and Africa, Latin America and Caribbean • 5 sectors – Multi –line insurance, Property and Casualty Sectors covered insurance, Life and Health insurance, Reinsurance, Insurance Brokers. • A total of 647 public companies across the globe are included as a part of the analysis in this study. Companies covered • The number of companies by sector by region/country is provided in the forthcoming slides in this section. • Four sets of ratios – Profitability, Underwriting, Liquidity, Solvency. Ratios covered • Ratios included under each set are explained in the forthcoming slides in this section Source: Frost & Sullivan analysis.NB37-F1 4
  5. 5. Scope of the Study – Sector/Geographic Coverage of Companies Insurance Industry: Companies Coverage by Region by Sector, FY2011 Latin Asia America Middle East NorthSector Europe Total Pacific and and Africa America CaribbeanMulti-line Insurance 28 44 12 113 19 216Property and Casualty Insurance 95 21 12 41 57 226Life and Health Insurance 45 23 5 17 38 128Reinsurance 9 8 14 5 2 38Insurance Brokers 4 16 2 2 15 39Grand Total 181 112 45 178 131 647 Source: Frost & Sullivan analysis.NB37-F1 5
  6. 6. Scope of the Study – Ratios Covered Insurance Industry: Ratios for Financial management analysis, Global, FY2011 Criteria/Explanation for performanceRatio Formula assessment WeightageUnderwriting Ratios 25.0% Net claims and claim adj. expenses incurred/Net PremiumsLoss Ratio earned Lower the better 10 Policy Acq. and UnderwritingExpense Ratio Costs/Net premiums earned Lower the better 10Combined Ratio Loss Ratio+Expense Ratio Less than 100% is better 5 Compare to Industry Average, lower theNet premium written to Net premiums written/(Assets- variance from industry average thepolicy holders surplus Liabilities) better 10Profitability Ratios 25.0% Higher the better, ideal in the range ofReturn on Assets Net Profit/Assets 10-15 percent 10 Higher the better, ideal in the range ofReturn on Equity Net Profit/Equity 0.5-1.5 percent 10Net Income margin Net profit/Revenue Higher the better 10EBIT Margin EBIT/Revenue Higher the better 5Net premium written(NPW)to Net premiumearned (NPE) NPW/NPE Greater than 1 indicates growth 10 Source: Frost & Sullivan analysis.NB37-F1 6
  7. 7. Scope of the Study – Ratios Covered Insurance Industry: Ratios for Risk management analysis, Global, FY2011 Criteria/Explanation forRatio Formula performance assessment WeightageLiquidity Ratios 25.0%Overall Liquidity Ratio Assets/(Liabilities-Retained Earnings) 10Current Ratio Current Assets/Current Liabilities Compare to Industry Average, lower 10 the variance from industry average theCash Ratio Cash/Current Liabilities 10 betterOperating Cash Flow Operating Cash Flow/Current Liabilities 10ratioSolvency Ratios 25.0% Compare to Industry Average, lowerNet Assets to Net (Assets – Liabilities)/Net premium written the variance from industry average the 10Premiums written better Compare to Industry Average, lower the variance from industry average theDebt to Capital Debt/Capital 10 better. Lesser than 35 percent is ideal for this industry.Debt to Equity Debt/Equity 10Leverage Assets/Equity Compare to Industry Average, lower 10Debt to assets Debt/Assets the variance from industry average the 10 betterReserves to anticipated Retained Earnings/(Unpaid Claims + Net 10losses claims and claim adj. expenses incurred) Source: Frost & Sullivan analysis.NB37-F1 7
  8. 8. Research Methodology Insurance Industry: Methodology Used for Financial Assessment, Global, FY2011 • Financial journals • Annual reports • Market research reports • Industry websites 1. Secondary • Industry-related databases data analysis Define objective and scope • Thought leader briefings Calculate and assess the financial ratios 3. Analyze and Secondary Research Process collate Research different Compute industry benchmarks perspectives Primary Research Identify and assess top companies 2. Interview and their best practices Participants • CEOs/CFOs • Board members Outcome—Top-performing companies Stakeholder • Research heads Insights, based on financial and risk management • Strategic decision makers and industry trends/events that can • Financial advisors Perspectives, & • Investors impact the industry in the next 12 months Strategies Research Process Research Methodology Source: Frost & Sullivan analysis.NB37-F1 8
  9. 9. Calculation Methodology Ranking all companies Calculating Identifying based on each the overall and ratio. For risk score using segregating management sum product 647 public ratios, variance of rank of companies from the industry each ratio set by region and average is and its sector considered. weightage. 1 2 3 4 5 6 Gathering financial Calculating score for Ranking all data through each set of ratio – companies secondary sources profitability, liquidity, based on and calculating underwriting, solvency. the overall financial ratios for all This would be the sum score. companies based on product of rank of each availability of ratio within the set and information the weightage given to the ratio. The weightage given to each ratio and the entire ratio set is mentioned in Introduction Section (Scope) of this study. Source: Frost & Sullivan analysis.NB37-F1 9
  10. 10. Industry Drivers Insurance Industry: Market Drivers, Global, 2012-2018 Low Medium High 1 2 3 Changing Demographics New distribution channels The high growth 4 economies Increasing life Increased Changing lifestyles of expectancy, expanding Customer Focus The need to create a the tech savvy population and wealth, strong foothold in the generation Y growing urbanization, Insurance Industry is global market would lead consumers have changing dynamics of the moving from a “product insurers to invest in high brought a new middle class would lead centric” to a “customer growth economies where opportunity for insurers to think of new centric” approach there is more scope for insurers to design new products that better suit shifting power to the financial inclusion and products and delivery the needs of the consumers. market penetration. methods. changing market. 1-2 3-4 5-7 1-2 3-4 5-7 1-2 3-4 5-7 1-2 Years 3-4 Years 5-7 Years Years Years Years Years Years Years Years Years Years Source: Frost & Sullivan analysis.NB37-F1 10
  11. 11. Market Restraints Insurance Industry: Market Restraints, Global, 2012-2018 1-2 3-4 5-7 1-2 3-4 5-7 1-2 3-4 5-7 1-2 3-4 5-7 Years Years Years Years Years Years Years Years Years Years Years Years Post 2008 crisis, The increase in severity, Organizations need to Investments in the governments in both frequency and variability of strike a balance in Insurance industry is low developed and developing natural catastrophes retaining experienced and declining in developed markets are imposing across the globe would Generation X employees economies posing a burdensome regulations increase insurance losses who are close to their concern in development of on insurers leading to an substantially for the retirement age and hire this industry. increase in operating and industry in the next 5-7 young and fresh compliance costs for the years. generation Y talent that industry. would be able to grapple Investments in with the changing industry landscape. Insurance Environmental 4 Changes Talent Drain Regulation and Capital management 3 Low Medium High 2 1 Source: Frost & Sullivan analysis.NB37-F1 11
  12. 12. Industry Risks and Challenges addressed by Efficient Financial and Risk Management Technology Regulation Investment yield improvements Modeling Risk Distribution network Emerging Economies Source: Frost & Sullivan analysis.NB37-F1 12
  13. 13. Geographic Analysis Source: Frost & Sullivan analysis.NB37-F1 13
  14. 14. Geographic Analysis - Financial Snapshot Insurance Industry: Key Stats by region, Global, FY2011 9,000.00 8,000.00 7,000.00 6,000.00 5,000.00 in $ Billion 4,000.00 3,000.00 2,000.00 1,000.00 0.00 Latin America Middle East and Europe North America Asia Pacific and Caribbean Africa Total Assets 8,164.81 5,540.30 2,653.17 250.99 212.59 Total Capital 919.70 1,010.69 377.86 84.96 34.43 Total Equity 571.59 648.75 283.04 73.03 28.93 Total Revenue 1,099.21 707.50 568.26 62.01 47.95 Region • Europe has been the largest insurance market in terms of total assets and total revenue in FY2011. However, European insurance firms have less capital (implies high risk) when compared to their North American counterparts. • Latin America and Caribbean is the most efficient insurance market in FY2011 with an asset turnover ratio of 0.25x followed by Middle East and Africa (0.23x) and Asia Pacific (0.21x). Europe and North America have an asset turnover of 0.13x. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 14
  15. 15. Geographic Analysis – Profitability Management Insurance Industry: Profitability Analysis by region, Global, FY2011 Return on Equity 1. Middle East and Africa is 12.0% the most profitable region in 10.0% the industry in FY2011. 8.0% 6.0% 4.0% 2. Latin America and 2.0% Caribbean stand second Net Income Margin 0.0% Return on Assets followed by North America, Asia Pacific and Europe EBIT Margin Middle East and Africa Asia Pacific Europe Latin America and Caribbean North America Return on Return on Net Income Profitability ProfitabilityRegion Equity Assets EBIT Margin Margin Score RankMiddle East and Africa 12.5% 1.7% 11.0% 7.5% 1.75 1Asia Pacific 8.1% 0.9% 6.8% 4.0% 3.75 4Europe 7.6% 0.5% 6.8% 4.0% 4.75 5Latin America andCaribbean 7.4% 2.1% 10.4% 8.7% 2.50 2North America 9.0% 1.1% 11.0% 8.2% 2.25 3 Highest Note: Each Ratio is given 25.0 percent weightage to calculate profitability score. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 15
  16. 16. Geographic Analysis – Underwriting Management Insurance Industry: Underwriting Efficiency by region, Global, FY2011 120.0% 96.3% 100.0% 80.0% 23.7% Global Combined Ratio – 47.3% 61.4% 60.0% 40.1% 19.7% 36.8% 40.0% 24.8% 15.4% 17.1% 20.0% 12.7% 12.1% 21.4% 23.0% 72.6% 41.3% 0.0% Region Middle East and Asia Pacific Europe Latin America and North America Africa Caribbean Loss Ratio Expense Ratio The lower the combined ratio, the better. Thus, Middle East and Africa, Asia Pacific and Europe outperform the global combined ratio while Latin America and Caribbean and North America underperform in this regard in FY2011. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 16
  17. 17. Geographic Analysis – Liquidity and Solvency Management Insurance Industry: Liquidity Analysis by Insurance Industry: Solvency Analysis by region, Global, FY2011 region, Global, FY2011 Ratio Percent 0.0 2.0 4.0 0.0% 50.0% 100.0% 150.0% Middle East and 1.25 16.0% Africa 3.16 Middle East and Africa 115.7% Global Overall 0.99 Liquidity – 1.13 Asia Pacific 33.4% 1.17 Asia Pacific 68.8% Global Debt to Global Current capital– 35.8% Region Region 1.11 Ratio– 1.24 39.1% Europe Europe 1.04 41.9% Latin America and 1.87 Latin America and 14.5% Caribbean 1.48 Caribbean 82.6% 1.22 36.2% North America North America 1.54 74.1% Overall Liquidity Current Ratio Debt To capital Reserves to anticipated losses Middle East and Africa has excess liquidity and Middle East and Africa, Latin America and Caribbean are less leveraged than their other global counterparts. insurers in this region may find the need to use their resources more efficiently in order to generate higher Also the reserves in both these regions are adequate to meet unpaid claims and loss adjustments giving profits. these regions a strong solvency position. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 17
  18. 18. Geographic Analysis – Top 5 Companies in FY2011 byRegionNorth America - 131 companies1. Am Trust Financial Services, Inc. (Nasdaq GS:AFSI)2. Universal Insurance Holdings Inc. (AMEX:UVE)3. Kingstone Companies, Inc. Europe – 112 companies Asia Pacific – 181 companies (NasdaqCM:KINS) 1. Flagstone Reinsurance 1. United Insurance Co. Of Pakistan Ltd.4. MetLife, Inc. (NYSE:MET) Holdings SA (NYSE:FSR) (KASE:UNIC)5. State Auto Financial Corp. 2. Zurich Insurance Group AG 2. The Universal Insurance Company (NasdaqGS:STFC) (SWX:ZURN) Limited (KASE:UVIC) 3. Swiss Re Ltd. (SWX:SREN) 3. PICC Property and Casualty Co. Ltd. 4. AXA (ENXTPA:CS) (SEHK:2328) 5. Abbey Protection Plc 4. Pacific & Orient Bhd (KLSE:P&O) (AIM:ABB) 5. Silver Star Insurance (KASE:SSIC) Latin America and Caribbean – 45 companies Middle East and Africa – 178 companies 1. Arch Capital Group Ltd. (NasdaqGS:ACGL) 1. Mauritius Union Assurance Company 2. Guardian Holdings Limited (TTSE:GHL) Limited (MUSE:MUA) 3. Montpelier Re Holdings Ltd. (NYSE:MRH) 2. Qatar Insurance Company S.A.Q. 4. Hardy Underwriting Bermuda Ltd (LSE:HDU) (DSM:QATI) 5. White Mountains Insurance Group, Ltd. 3. Green Crescent Insurance Company (NYSE:WTM) PJSC (ADX:GCIC) 4. Methaq Takaful Insurance Company PSC (ADX:METHAQ) 5. Gulf Insurance Company K.S.C. (KWSE:GINS) Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 18
  19. 19. Geographic Analysis - Summary North America Top sectors – Property and Casualty Insurance• North America ranks second in terms of total assets and revenue globally. The region has average profitability (rank 3), has higher than average underwriting costs, average liquidity and solvency position. Europe Top sectors – Reinsurance, Multi line Insurance• Europe has the largest assets base and generates the largest revenue globally in this industry. However, the region is the least profitable with average underwriting efficiency. It has a weak liquidity and solvency position compared to the global average. Asia Pacific Top sectors – Property and Casualty Insurance• Asia Pacific is an emerging market and the region is characterised by low profitability (global rank 4), good underwriting efficiency, below average solvency and liquidity position. Middle East and Africa Top sectors – Multi line Insurance• Middle East and Africa is a fast growing market with the highest profitability, superior underwriting efficiency, very strong liquidity and solvency position. Latin America and Caribbean Top sectors – Property and Casualty Insurance, Reinsurance• Latin America and Caribbean ranks second in terms of profitability and has a strong liquidity and solvency position. However, the region has very high underwriting costs with a combined ratio of 96.3 percent. Source: Frost & Sullivan analysis.NB37-F1 19
  20. 20. Sector Analysis Source: Frost & Sullivan analysis.NB37-F1 20
  21. 21. Sector Analysis - Financial Snapshot Insurance Industry: Key Stats by sector, Global, FY2011 10,000.00 9,000.00 8,000.00 7,000.00 6,000.00 in $ Billion 5,000.00 4,000.00 3,000.00 2,000.00 1,000.00 0.00 Property and Insurance Life and Health Multi-line Casualty Reinsurance Brokers Insurance Insurance Insurance Total Assets 77.45 8,688.65 5,448.23 1,788.13 819.42 Total Capital 34.91 954.51 855.52 482.22 173.23 Total Equity 22.98 590.57 537.80 329.56 124.41 Total Revenue 34.93 982.86 827.43 474.24 165.47 Sector • Life and Health insurance has been the largest sector in FY2011 in terms of total assets and total revenue. • Insurance Brokers is the most efficient insurance market with an asset turnover ratio of 0.45x followed by Property and Casualty insurance (0.27x) and Reinsurance (0.20x). Multi line insurance has an asset turnover of 0.15x. The same stands at 0.11x for the Life and Health insurance sector for FY2011. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 21
  22. 22. Sector Analysis – Profitability Management Insurance Industry: Profitability Analysis by sector, Global, FY2011 Return on Equity 16.0% 1. Insurance Brokers are the 14.0% most profitable sector in the 12.0% 10.0% industry in FY2011. 8.0% 6.0% 4.0% 2. Property and Casualty 2.0% Net Income Margin 0.0% Return on Assets Insurance are the most profitable insurers followed by Multi line Insurance, Life and Health Insurance and Note: Each Ratio is given 25 percent weightage to calculate profitability score. Source: Capital IQ, Frost & Sullivan Analysis Reinsurance in that order. EBIT Margin Insurance Brokers Life and Health Insurance Multi-line Insurance Property and Casualty Insurance Reinsurance Return on Return on Net Income Profitability ProfitabilitySector Equity Assets EBIT Margin Margin Score RankMulti-line Insurance 8.9% 0.9% 7.3% 5.8% 3.25 3Life and HealthInsurance 7.8% 0.5% 9.0% 4.7% 4.00 4Property and CasualtyInsurance 8.8% 1.6% 7.5% 6.1% 2.50 2Reinsurance 6.4% 1.0% 7.1% 4.8% 4.25 5Insurance Brokers 13.0% 3.9% 15.1% 8.5% 1.00 1 Highest Note: Each Ratio is given 25.0 percent weightage to calculate profitability score. Source: Capital IQ, Frost & Sullivan AnalysisNB37-F1 22
  23. 23. Sector Analysis – Underwriting Management Insurance Industry: Underwriting Efficiency by sector, Global, FY2011 100.0% 81.6% 80.0% 65.9% 60.0% 24.5% 47.7% 20.4% % 40.0% 17.9% 20.0% 20.0% 12.7% 7.4% 29.9% 57.2% 45.6% 0.0% Life and Health Insurance Multi-line Insurance Property and Casualty Reinsurance Insurance Sector Loss Ratio Expense Ratio • Property and Casualty insurance has the highest combined ratio followed by Reinsurance. • Loss ratio is the least for Life and Health insurance sector. Loss ratios are more than double the expense ratios in Property and Casualty, Reinsurance sectors. Note: Insurance Brokers sector is not included as underwriting is not applicable to this sector. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 23
  24. 24. Sector Analysis – Liquidity and Solvency Management Insurance Industry: Liquidity Analysis by Insurance Industry: Solvency Analysis by Sector, Global, FY2011 Sector, Global, FY2011 0.0 0.5 1.0 Ratio 2.0 2.5 3.0 1.5 Percent 0.0% 200.0% 400.0% 2.40 Insurance Brokers 34.2% 1.20 Insurance Brokers - Life and Health 1.05 Insurance 1.83 Life and Health 38.1% Insurance 286.7%Sector 1.16 Sector Multi-line Insurance 37.1% 1.11 Multi-line Insurance 41.9% Property and Casualty 1.41 Property and Casualty 31.7% Insurance 0.76 Insurance 42.3% 1.32 28.2% Reinsurance Reinsurance 0.76 32.2% Overall Liquidity Current Ratio Debt To capital Reserves to anticipated losses Property and Casualty insurance and Reinsurance Life and Health Insurance is the most leveraged sector have a current ratio lower than 1. This may be in terms of debt to capital ratio. The sector also has considered as a weak liquidity position as casualty abundant reserves to recover losses and claims. insurance sector needs to meet ad hoc claims. Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 24
  25. 25. Sector Analysis – Top 5 Companies in FY2011 by Sector Multi line Insurance Property and Casualty Life and Health Insurance Insurance Mauritius Union Assurance AmTrust Financial Services, Inc. Green Crescent Insurance Company Limited (MUSE:MUA) (NasdaqGS:AFSI) Company PJSC (ADX:GCIC) Zurich Insurance Group AG Qatar Insurance Company (SWX:ZURN) MetLife, Inc. (NYSE:MET) S.A.Q. (DSM:QATI) Methaq Takaful Insurance United Insurance Co. Of AFLAC Inc. (NYSE:AFL) Company PSC (ADX:METHAQ) Pakistan Ltd. (KASE:UNIC) The Universal Insurance MAA Group Berhad AXA (ENXTPA:CS) Company Limited (KASE:UVIC (KLSE:MAA) Gulf Insurance Company K.S.C. Universal Insurance Holdings New China Life Insurance Co., (KWSE:GINS) Inc. (AMEX:UVE) Ltd. (SEHK:1336) Reinsurance Insurance Brokers Flagstone Reinsurance Jardine Lloyd Thompson Group Holdings SA (NYSE:FSR) plc (LSE:JLT) Swiss Re Ltd. (SWX:SREN) Austbrokers Holdings Limited (ASX:AUB) Arch Capital Group Ltd. (NasdaqGS:ACGL) Brightside Group Plc (AIM:BRT) Montpelier Re Holdings Ltd. Crawford & Company (NYSE:MRH) (NYSE:CRD.B) SCOR SE (ENXTPA:SCR) April SA (ENXTPA:APR) Source: Capital IQ, Frost & Sullivan analysis.NB37-F1 25
  26. 26. Sector Analysis - Summary Multi line Insurance Average Financial Management• The sector is characterized by average profitability, average underwriting costs and a strong liquidity position. However, reserves to anticipated losses is at 41.9 percent and seems to be low given the multitude and variability of risks insured in this sector. Property and Casualty Insurance Good Financial management• The sector is the most profitable sector in the industry in terms of insurance carriers. However, the sector has high underwriting costs, below average liquidity and low reserves to anticipated losses. Life and Health Insurance Good Risk Management• The sector is the largest in terms of revenues and assets in the insurance industry. The sector has below average profitability, low underwriting costs and a strong liquidity and solvency position. Reinsurance Poor Financial Management• Reinsurance is the least profitable sector in the industry with above average underwriting costs, weak liquidity position and below average solvency position. Insurance Brokers Good Financial Management• This is the smallest but the most profitable sector in the industry. The sector has a strong liquidity and solvency position. Source: Frost & Sullivan analysis.NB37-F1 26
  27. 27. Industry Scorecard Source: Frost & Sullivan analysis.NB37-F1 27
  28. 28. Financial Management vs. Risk Management Insurance Industry: Risk Management vs. Financial Management, Top 35 Companies, Global, FY2011 700 Top performers ENXTPA:CS 650 ASX:QBE TTSE:GHL SWX:ZURN AMEX:UVE DB:ALV NasdaqGM:AAME SEHK:2328 NYSE:OB NasdaqGS:AFSI LSE:HDU NasdaqGS:STFC NYSE:MET SWX:SREN ADX:GCIC WBAG:UQA Risk Management (Scores) 600 NYSE:ACE NasdaqGS:ACGL NYSE:FSR NYSE:MRH NYSE:HMN NasdaqCM:KINS DSM:QATI OTCBB:UIHC KWSE:GINS MUSE:MUA 550 KASE:UVIC KASE:UNIC KLSE:P&O 500 NYSE:RLI ADX:METHAQ NYSE:PRA 450 AIM:ABB KASE:SSIC LSE:LRE 400 400 450 500 550 600 650 700 Financial Management (Scores) Source: Frost & Sullivan analysis.NB37-F1 28
  29. 29. Industry Scorecard Insurance Industry: Top 10 Companies (Overall), Global, FY2011 S Country Underwrit Profitabili Liquidity Solvency Company Name with Ticker Sector No (Headquarters) ing Rank ty Rank Rank Rank Property and AmTrust Financial Services, 1 United States Casualty 96 84 91 25 Inc. (NasdaqGS:AFSI) Insurance Mauritius Union Assurance Multi-line 2 Mauritius 15 29 139 113 Company Limited (MUSE:MUA) Insurance Property and Qatar Insurance Company 3 Qatar Casualty 50 17 89 150 S.A.Q. (DSM:QATI) Insurance Flagstone Reinsurance 4 Luxembourg Reinsurance 117 15 117 68 Holdings SA (NYSE:FSR) Property and United Insurance Co. Of 5 Pakistan Casualty 1 53 169 106 Pakistan Ltd. (KASE:UNIC) Insurance Source: Frost & Sullivan analysis.NB37-F1 29
  30. 30. Industry Scorecard (Continued) Insurance Industry: Top 10 Companies (Overall), Global, FY2011 S Country Underwrit Profitabili Liquidity Solvency Company Name with Ticker Sector No (Headquarters) ing Rank ty Rank Rank Rank Zurich Insurance Group AG Multi-line 6 Switzerland 36 279 18 4 (SWX:ZURN) Insurance Life and Green Crescent Insurance United Arab 7 Health 134 41 105 59 Company PJSC (ADX:GCIC) Emirates Insurance Property and The Universal Insurance 8 Pakistan Casualty 16 55 115 154 Company Limited (KASE:UVIC) Insurance Property and Universal Insurance Holdings 9 United States Casualty 243 167 5 8 Inc. (AMEX:UVE) Insurance Methaq Takaful Insurance United Arab Multi-line 10 58 1 315 50 Company PSC (ADX:METHAQ) Emirates Insurance Source: Frost & Sullivan analysis.NB37-F1 30
  31. 31. Industry Scorecard (continued) Insurance Industry: Top 5 Companies (Profitability Ranking), Global, FY2011 Market Country Revenue Overall S No Company Name with Ticker Sector Capitalizat (Headquarters) ($ million) Rank ion Methaq Takaful Insurance United Arab Multi-line 1 17.9 Micro cap 2 Company PSC (ADX:METHAQ) Emirates Insurance Property and 2 Admiral Group plc (LSE:ADM) United Kingdom Casualty 1354.7 Mid cap 93 Insurance Thai Reinsurance Public Company 3 Thailand Reinsurance 188.0 Small cap 122 Limited (SET:THRE) Property and Personal Group Holdings Plc 4 United Kingdom Casualty 42.6 Micro cap 243 (AIM:PGH) Insurance Takaful Emarat Insurance PSC United Arab Life and Health 5 3.6 Micro cap 178 (DFM:TAKAFUL-EM) Emirates Insurance Less than $250 million –Micro cap, $250 million - $2 billion – Small cap, $2 billion - $10 billion – Mid cap, More than $10 billion – Large cap Source: Frost & Sullivan analysis.NB37-F1 31
  32. 32. Industry Scorecard (continued) Insurance Industry: Top 5 Companies (Underwriting Ranking), Global, FY2011 Market Country Revenue Overall S No Company Name with Ticker Sector Capitalizat (Headquarters) ($ million) Rank ion Property and United Insurance Co. Of Pakistan 1 Pakistan Casualty Micro cap 4 Ltd. (KASE:UNIC) 7.36 Insurance Swiss Life Holding AG Life and Health 2 Switzerland Mid cap 16 (SWX:SLHN) Insurance 17,332.8 Independence Holding Co. Life and Health 3 United States Micro cap 37 (NYSE:IHC) Insurance 418.0 Life and Health 4 Delta Lloyd N.V. (ENXTAM:DL) Netherlands Mid cap 84 Insurance 12,658.1 Multi-line 5 AXA (ENXTPA:CS) France Large cap 5 Insurance 132,196.2 Less than $250 million –Micro cap, $250 million - $2 billion – Small cap, $2 billion - $10 billion – Mid cap, More than $10 billion – Large cap Source: Frost & Sullivan analysis.NB37-F1 32
  33. 33. Industry Scorecard (continued) Insurance Industry: Top 5 Companies (Liquidity Ranking), Global, FY2011 Market Country Revenue Overall S No Company Name with Ticker Sector Capitalizat (Headquarters) ($ million) Rank ion Life and Health 1 Standard Life plc (LSE:SL.) United Kingdom Mid cap 377 Insurance 14,961.5 Great Eastern Holdings Ltd. Life and Health 2 Singapore Mid cap 125 (SGX:G07) Insurance 6,175.3 Property and MS&AD Insurance Group 3 Japan Casualty Large cap 272 Holdings, Inc. (TSE:8725) 42,898.5 Insurance Life and Health 4 Prudential plc (LSE:PRU) United Kingdom Large cap 315 Insurance 56,823.1 Property and Universal Insurance Holdings Inc. 5 United States Casualty Micro cap 20 (AMEX:UVE) 224.3 Insurance Less than $250 million –Micro cap, $250 million - $2 billion – Small cap, $2 billion - $10 billion – Mid cap, More than $10 billion – Large cap Source: Frost & Sullivan analysis.NB37-F1 33
  34. 34. Industry Scorecard (continued) Insurance Industry: Top 5 Companies (Solvency Ranking), Global, FY2011 Market Country Revenue Overall S No Company Name with Ticker Sector Capitalizat (Headquarters) ($ million) Rank ion Multi-line 1 Allianz SE (DB:ALV) Germany Large cap 7 Insurance 117,244.6 Vienna Insurance Group Multi-line 2 Austria Mid cap 109 (WBAG:VIG) Insurance 11,999.7 Property and Tokio Marine Holdings Inc. 3 Japan Casualty Large cap 124 (TSE:8766) 39,009.5 Insurance Zurich Insurance Group AG Multi-line 4 Switzerland Large cap 1 (SWX:ZURN) Insurance 52,977.0 China Pacific Insurance (Group) Multi-line 5 China Large cap 92 Co., Ltd. (SHSE:601601) Insurance 24,445.8 Less than $250 million –Micro cap, $250 million - $2 billion – Small cap, $2 billion - $10 billion – Mid cap, More than $10 billion – Large cap Source: Frost & Sullivan analysis.NB37-F1 34
  35. 35. Conclusion Insurance Industry: Top companies by Region by Sector, Global, FY2011 Property and Multi-line Life and HealthRegion Casualty Reinsurance Insurance Brokers Insurance Insurance Insurance Thai Reinsurance HNB Assurance United Insurance Austbrokers MAA Group Berhad Public CompanyAsia Pacific PLC (COSE:HASU- Co. Of Pakistan Ltd. Holdings Limited (KLSE:MAA) Limited N-0000) (KASE:UNIC) (ASX:AUB) (SET:THRE) Flagstone Zurich Insurance Jardine Lloyd Abbey Protection Swiss Life Holding ReinsuranceEurope Group AG Thompson Group Plc (AIM:ABB) AG (SWX:SLHN) Holdings SA (SWX:ZURN) plc (LSE:JLT) (NYSE:FSR) Mapfre Perú Vida Brasil Insurance Guardian Holdings Hardy Underwriting Compañía de Arch Capital GroupLatin America Participacoes e Limited Bermuda Ltd Seguros y Ltd.and Caribbean Administracao SA (TTSE:GHL) (LSE:HDU) Reaseguros SA (NasdaqGS:ACGL) (BOVESPA:BRIN3) (BVL:MAPFREC1) Mauritius Union Qatar Insurance Green CrescentMiddle East and Assurance Zimre Holdings Ltd. Agma Lahlou-Tazi Company S.A.Q. Insurance CompanyAfrica Company Limited (ZMSE:ZHL) S.A. (CBSE:AGM) (DSM:QATI) PJSC (ADX:GCIC) (MUSE:MUA) Atlantic American AmTrust Financial Crawford & MetLife, Inc. Alleghany Corp.North America Corp. Services, Inc. Company (NYSE:MET) (NYSE:Y) (NasdaqGM:AAME) (NasdaqGS:AFSI) (NYSE:CRD.B) Source: Frost & Sullivan analysis.NB37-F1 35
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