Gary Crist on the challenges and opportunities in Asia

1. Asian Non Life Markets
Challenges and
opportunities
Gary Crist
CEO Ageas Asia
INVESTOR DAY 2012
Investor Day 2012

2. Asian Non-Life Markets
Challenges and Opportunities
Conclusions

3. Asia: a high-growth Non-Life market
Non-Life premiums evolution 2007-2011
275
Index 2007 = 100
250
225
200
175
150
125
Taiwan
India
Singapore
Thailand
Malaysia
Indonesia
Hong Kong
Vietnam
Philippines
Asia (ex Japan)
Western Europe
North America
Premiums
2011 (EUR bn)
CAGR‘07-’11
South Korea
75
China
100
62.7
36.8
10.3
8.8
5.9
4.3
3.6
3.3
2.4
0.7
0.7
162.0
460.9
528.9
26%
9%
7%
14%
18%
12%
14%
20%
7%
22%
6%
16%
2%
1%
Source: Swiss Re, various Country Reports, 2012
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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4. High quality partners with exceptional distribution capacity
Current Non-Life operations at a glance - Malaysia
Malaysia:
Maybank Ageas Holdings
• Partnership since 2001
• Ageas shareholding: 30.95%
• Maybank = Malaysia’s premier bank;

Market leading positions in retail and
corporate banking
 388 branches
 EUR 125 bn total assets (Jun 30 2012)
 EUR 18.4 bn market cap (Sep 2 2012)
 Strong relationship with Bank Negara
• Market share per line of business
(Dec 31 2011) Conventional and
Takaful combined

Fire:
 Misc:
 Motor:
 MAT*:
 Total:
9.2% (#4)
6.7% (#4)
10.8% (#2)
43.7% (#1)
12.7% (#1)
• Market position:
 #1 Takaful Non-Life
 # 3 Conventional Non-Life
(out of 30 insurers)
*MAT= Marine, Aviation and Transport
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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5. High quality partners with exceptional distribution capacity
Current Non-Life operations at a glance - Thailand
Thailand:
Muang Thai Insurance PCL
• Market share per line of business
(Dec 31 2011)
• Partnership since June 2004
 Fire:
10.8% (#3)
• Ageas shareholding: 14.87%
 PA & Health: 5.3% (#7)
• Kasikorn Bank, Top tier listed
 Misc:
4.3% (#5)
 Solid #4 retail bank
 Motor:
2.8% (#10)
 Strong enterprise network
 MAT*:
2.5% (#15)
 825 branches
 Total:
3.8% (#5)
 EUR 48 bn total assets (Jun 30 2012)
 EUR 10.3 bn market cap (Aug 31 2012)
• Awarded 2nd place Prime Minister
• Lamsam family: founded Muang Thai &
Insurance Award: “Non-Life Insurance
Kasikorn Bank.
Company with Outstanding
Successful family with extensive business
Management”
interests and strong local network
 Market Position: # 5 in Non-Life
(out of 68 Non-Life insurers)
*MAT= Marine, Aviation and Transport
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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6. Balanced growth in Non-Life premiums
Discipline in underwriting and retention
Gross Inflow evolution
Gross Inflow by distribution channel for 2011
607
In EUR mio, on a 100% basis
515
CAGR: +22%
381
337
129
Thailand
478
405
269
09
Malaysia
293
08
Banca
22%
111
89
68
Other
13%
10
Brokers
36%
Agency
29%
11
Gross Inflow by product
Net Earned Premium by product
Other
21%
Other
24%
Motor
39%
MAT*
3%
MAT*
26%
Fire
14%
*MAT= Marine, Aviation and Transport
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
Motor
58%
Fire
15%
5

7. Good operating performance
Positive and sustainable contribution to net profit
Non-Life: net profit by country
Non-Life: Combined ratio
In EUR mio, Ageas stake only
12*
0
96.7%
12.5%
24.6%
8**
9
95.4%
12.6%
21.9%
102.0%*
12.2%
21.9%
Commission
1
12
10
Thailand
3
60.8%
10
Expenses *
11
Malaysia
3
-1
Claims
-2
120.1%
Continuous positive result contribution
despite financial turmoil and natural
catastrophe
Non-Life: Combined ratio
98.9%
* Introduction RBC regime Malaysia
** Including EUR 3 mio impact Thai flood claims
* 98.9% excluding Thai flood claims
94.2%
11
95.5%
10
95.6%
09
96.9%
08
59.6%
67.9%
09
7
Malaysia
Thailand
Excellent combined ratios
09
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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11
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8. 2012 Update
Continued good performance
Gross Inflow
In EUR mio, on a 100% basis
+23%
326
Combined ratio (Asia consolidated)
402
100.1%
87
96.5%
Thai
floods
62
Thailand
315
264
6M 2011
H1 11
95.8%
Malaysia
6M 12
H1 2012
6M 11
H1 2011
H1 2012
6M 12
Net flood claims of Muang Thai Insurance
In EUR mio, on a 100% basis
205
 Best estimate as per June 2012
113
92
52
39.57452464
Gross
Recovery*
(Fac & TTY)
**
XOL
40
Net impact
 Significant mitigation from high-quality
reinsurance
*Facultative & Treaty
** Excess of Loss
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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9. Asian Non-Life markets
Challenges and Opportunities
Conclusions

10. Insurance environment
Non-Life Insurance: present challenges & opportunities
 Strong economic




growth
Prevalence of natural
catastrophes & ever
more assets in natural
catastrophe areas
Heavy reliance on
reinsurance
Unsophisticated
underwriting and
pricing practices
Fragmented markets
 Low insurance


Environment
Customers


Distribution
Regulation
penetration
Demand for Islamic
insurance in South-East
Asia
Motor and Fire: core
products
Liability settlements still
modest
Increased focus on
service, pricing and
product design
 Predominance of



agents, brokers and
affinities
Growing importance
of bancassurance
Direct writing still
insignificant
Strong local brands
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
 Diverse regulatory



regimes
Emergence of RBC
“Tariffs”
Increasing focus on
consumer protection
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11. Significant growth potential
Penetration vs. Non-Life Premium per capita (2011)
Premium
penetration
(% of GDP)
6%
South Korea
5%
North America
4%
Western Europe
3%
Asia (ex Japan)
2%
Malaysia
Hong Kong
1%
India
Thailand
Vietnam
Singapore
China
Taiwan
Philippines Indonesia
0%
5
25
Source: Swiss Re
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
125
625
Premium per capita (EUR)
(Log scale)
10

12. Significant growth potential
Non-Life premiums 450
2022 vs. 2012
(Index, 2012 = 100)
China
400
India
350
Vietnam
300
Indonesia
Philippines
250
Malaysia
200
Thailand
150
100
0
25
50
75
100
125
150
175
200
225
Premium per capita (EUR)
Source: Swiss Re
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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13. Drivers for growth
 GDP growth and sustained
infrastructure investments
 Growth in SME sector
 Moving up the personal transportation
ladder
 Emerging middle class and wealth
accumulation
 Increased risk awareness from natural
catastrophes
 Relaxation of regulations
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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14. Asian Non-Life markets
Challenges and Opportunities
Conclusions

15. Conclusions
Path to 2015
 Strong growth opportunities for Non-Life
business in Asia
 Strengthening existing Non-Life
businesses by leveraging on local
partners’ and our own Group’s expertise
 Seek out opportunities in emerging Asian
markets in a consistent and disciplined
manner
 Limited number of select markets
 Strong partners
 Matching market dynamics with Ageas’s
expertise and partner’s strengths
 Alignment with Ageas’s strategic and
financial criteria
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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16. Disclaimer
Certain of the statements contained herein are statements of
future expectations and other forward-looking statements
that are based on management's current views and
assumptions and involve known and unknown risks and
uncertainties that could cause actual results, performance or
events to differ materially from those expressed or implied in
such statements. Future actual results, performance or
events may differ materially from those in such statements
due to, without limitation, (i) general economic conditions,
including in particular economic conditions in Ageas’s core
markets, (ii) performance of financial markets, (iii) the
frequency and severity of insured loss events, (iv) mortality
and morbidity levels and trends, (v) persistency levels, (vi)
interest rate levels, (vii) currency exchange rates, (viii)
increasing levels of competition, (ix) changes in laws and
regulations, including monetary convergence and the
Economic and Monetary Union, (x) changes in the policies of
central banks and/or foreign governments and (xi) general
competitive factors, in each case on a global, regional and/or
national basis. In addition, the financial information
contained in this presentation, including the pro forma
information contained herein, is unaudited and is provided
for illustrative purposes only. It does not purport to be
indicative of what the actual results of operations or financial
condition of Ageas and its subsidiaries would have been had
these events occurred or transactions been consummated
on or as of the dates indicated, nor does it purport to be
indicative of the results of operations or financial condition
that may be achieved in the future.
Investor Day 24&25 September 2012 - Andaz Liverpool Street London
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