The most important details about the 2022 annual financial statements at a glance:
The dividend is to be sustainably increased on the basis of profitable growth
Core business proves resilient thanks to diversified business activities
- Helvetia continued generating profitable growth in its core business and increased its business volume on a currency-adjusted basis by 2.6% to CHF 11,097.2 million (2021: CHF 11,222.2 million).
- The driver was the non-life business, which grew on a broad basis in all segments and business lines.
- Helvetia increases the cumulative dividend target: now a total of more than CHF 1.65 billion in dividends is to be distributed by the end of the 2025 strategy period (previous target: more than CHF 1.5 billion). The Board of Directors proposes to the Annual General Meeting an increase of 40 rappen in the dividend per share to CHF 5.90 (2021: CHF 5.50) for the past financial year.
Helvetia seizes further growth opportunities with helvetia 20.25
- Helvetia posted a strong IFRS profit after tax of CHF 614.4 million (2021: CHF 519.8 million). Against the backdrop of a challenging market environment, the business has proven to be very resilient. The diversified business focus paid off in the form of a successful technical performance.
- This includes a one-off gain from the sale of the Spanish life insurance company Sa Nostra Vida in the amount of CHF 102.0 million.
- Helvetia's resilience is also reflected in its capitalisation, which remains excellent: the estimated SST ratio was over 300% as at 1 January 2023.
- The consistent focus on customer needs and the expansion of sales channels enabled further growth in the core business.
- Moreover, Helvetia tapped into profitable new growth opportunities with the targeted development of the fee business. The Group thus increased fee income from CHF 354.4 million in the previous year to CHF 377.3 million in 2022. The fee business now contributes around 5% of the Group result, underlining the attractiveness of this business area.
- Moreover, Helvetia increased its holding in Caser from 70% to 80% and thus participates to a greater extend in the profitable development of the Spanish insurer.
"Helvetia once again demonstrated the stability and growth potential of its business model in the 2022 financial year and created value for its shareholders on this basis", says Philipp Gmür, Group CEO of Helvetia, commenting on the 2022 financial statements. He adds: "This record result is based on a very healthy insurance business, a successful development in the fee business and a one-off effect from the sale of Sa Nostra Vida. It is particularly pleasing that the latest major advances in implementing the strategy are bearing fruit."
Profitable growth in the core business – non-life business as the driver
Helvetia successfully continued on its organic growth path in its profitable core business during the 2022 financial year. The business volume amounted to CHF 11,097.2 million (2021: CHF 11,222.2 million). In currency-adjusted terms, the business volume increased by 2.6% (in Swiss francs: -1.1%).
Overall, the Group's non-life business proved a strong growth driver with currency-adjusted growth of 9.4% to CHF 6,965.0 million. In this business area, Helvetia posted broad-based gains in all segments. Growth was above the market in almost all country markets. Helvetia was thus able to further expand its market shares.
In life insurance, business volume amounted to CHF 4,132.2 million (-7.3% at constant fx). In individual life, Helvetia is continuing to pursue its strategy with a focus on capital-efficient business. Investment-linked products saw significant growth in Switzerland and Austria. Savings premiums in the Swiss group life business were lower due to the sustained market-wide shift from full insurance to semi-autonomous solutions. Helvetia is well positioned in this environment with its semi-autonomous products and flat-rate risk solutions.
Robust technical results and one-off profit lead to record result
Helvetia generated a strong IFRS result after tax of CHF 614.4 million in the 2022 financial year (2021: CHF 519.8 million). This was based on the stability and resilience of the business model due to its broad diversification. The resilience of Helvetia paid off in 2022 with robust technical results in non-life and life insurance. As a result, Helvetia was able to increase its technical result in non-life from CHF 289.5 million to CHF 307.1 million. The IFRS result in this business area was CHF 289.6 million (2021: 389.3 million) despite the challenging environment in the financial markets. The margin after costs in the life business area grew to CHF 510.7 million in 2022 (2021: CHF 466.9 million). Last year's IFRS result had been far higher than in the previous year at CHF 419.8 million (2021: CHF 304.1 million). Besides the improved margin after costs, a one-off profit of CHF 102.0 million from the sale of Spanish life insurance company Sa Nostra Vida had a positive impact on the life result.
In both the non-life and life business, by contrast, the weak performance of the financial markets weighed on the investment results in the past financial year. These were down on the previous year's strong performance due to fluctuations in book values.
Combined ratio: efficiency measures and scale effects pay off
In the non-life business, the Group's net combined ratio improved slightly over the previous year, coming to 94.7% (2021: 94.8%). Despite rising inflationary pressure, a further post-pandemic normalisation of claims frequencies and major NatCat events in Specialty Markets, the claims ratio proved very robust. The cost ratio also improved as ongoing efficiency measures as well as scale effects due to profitable growth paid off.
New business margin much improved
New business in the life segment performed very well. The new business margin increased to 3.3% (2021: 2.5%), driven by a more favourable business mix and higher interest rates.
Capitalisation remains excellent
Helvetia continues to have an excellent capitalisation. The SST ratio was estimated to be over 300% as of 1 January 2023. Helvetia has been awarded an "A+" rating by S&P Global Ratings (S&P).
Higher cumulative dividend target and new dividend increase
On the basis of the strong performance of its core business, the one-off profit from the sale of Sa Nostra Vida and the continuous optimisation of the use of capital, Helvetia is targeting an even more attractive distribution policy. For the strategy period up to 2025, Helvetia has set itself a new target of cumulatively paying out more than CHF 1.65 billion in dividends (previous target: more than CHF 1.5 billion). The Board of Directors will therefore propose to the Annual General Assembly that the dividend be raised by 40 rappen to CHF 5.90 per share (2021: CHF 5.50).
Growth opportunities opening up through the helvetia 20.25 strategy
Helvetia successfully seized growth opportunities last year under the helvetia 20.25 strategy. One such example is the clear increase in income from fee and commission business by 12.4% to CHF 377.3 million (2021: CHF 354.4 million). This can be partly attributed to the expansion of the "Health & Care" ecosystem in Spain. In addition, Helvetia expanded its business with asset management services for third parties with a capital increase of the Helvetia (CH) Swiss Property Fund, thus increasing commission income. With the fee business, Helvetia is tapping into new sources of income, diversifying the business mix and reducing its exposure to interest rates.
Helvetia is reporting a profitability figure for the fee business in the form of the fee margin for the first time in the 2022 financial year. The fee margin shows the income generated in the fee business after deduction of costs before tax. It came to CHF 31.3 million in the reporting year. The fee business now contributes around 5% to the Group result. This figure underlines the attractiveness and profitability of the business areas in the fee business.
Non-life business gains significance within the Group
Helvetia also increased its share in Caser by a further 10% to 80%, meaning that it is now participating in the profitable development of Caser to a greater extent. At the same time, the non-life business is gaining significance within the Group.
In addition, Helvetia made selective smaller acquisitions in targeted business areas to support the implementation of the helvetia 20.25 strategy. For example, seven providers have been added to the "Health & Care" ecosystem in Spain. Growth opportunities have also been seized in Specialty Lines through the development of new expertise. In the engineering business, for example, a new underwriting team with a focus on insurance solutions for renewable energies and environmental technology was created.
"The past financial year clearly shows: based on strong capitalisation and broad diversification as well as a profitable and growing core business, Helvetia is achieving sustainable dividend growth. At the same time, we can use growth opportunities by accessing new business areas", is how Philipp Gmür sums up Helvetia's performance in the past financial year.
Changes in the Board of Directors and Nomination and Compensation Committee
As announced in December 2022, the Board of Directors proposes Dr Yvonne Wicki Macus and Dr René Cotting for election as new members of the Board of Directors at the coming Annual General Meeting. Jean-René Fournier, Chairman of Patria Genossenschaft, will not stand for re-election after 12 years. He was most recently a member of the Nomination and Compensation Committee. The Board of Directors proposes Dr Hans C. Künzle to the Annual General Assembly for election as a new member of this committee.