insurance switzerland
In the year under review Swiss Life in Switzerland posted a segment result of CHF 634 million (2011: CHF 476 million). This major increase of 33% resulted to a large extent from the excellent investment result and strong premium growth. This improved result is an extremely good achievement, particularly in view of the enduring low interest rate environment and the high pressure on margins in life business.

Long-term initiatives, such as the reduction of risks on the investment side, further optimisations in the multichannel distribution strategy and the renewed sustained cost reduction made a major contribution to the encouraging result. The financial result increased to CHF 4.2 billion and direct investment income rose 3% to CHF 3.0 billion.

According to the Swiss Insurance Association (SIA), life insurance premiums in Switzerland rose by 1.7% over the previous year to CHF 30.3 billion. Premiums in group insurance climbed by 2.3% and in individual insurance fell by 0.3%. Swiss Life grew overall premium volume by 2% to CHF 8.3 billion. Group insurance contributed 81% of income, as per the previous year. Swiss Life’s market share of group insurance came to 28.8%, and in individual insurance it increased to 20.1%.

Operating expenses rose by 11% to CHF 971 million. This mainly results from higher amortisation of deferred acquisition costs, additional expenses for the employee benefits plan (under IAS 19) and higher asset management fees – due to the higher asset volume. The renewed reduction in operational administrative costs results from a sustained efficiency-enhancing programme, which particularly impacted personnel costs.

Insurance benefits, including changes in technical reserves, rose by 12% to CHF 10.0 billion. This increase is mainly due to strengthening of reserves due to the ongoing low interest rate environment and higher savings deposits.

New products launched in 2012 were another key driver for premium growth in own distribution channels and intermediaries. In individual insurance Swiss Life launched a further Swiss Life Premium Select tranche, a non-tax-qualified unit-linked life insurance product. The fund products Swiss Life Premium Vitality Duo and Uno, combined tax- and non-tax-qualified savings under the BVG, were introduced in the second quarter. The Home Option was also launched, offering attractive supplementary benefits when purchasing owner-occupied residential property. In the third quarter another two attractive insurance products were brought out in the form of Swiss Life FlexSave, a modern and flexible savings solution combining guarantees and the potential for return, and the real estate tranche Swiss Life Premium Immo. For its Swiss corporate clients, Swiss Life launched Swiss Life Business Profit, an innovative pension solution with a selection of investment strategies for employees.

Swiss Life in Switzerland aims to continue to develop from a pure life insurer to a comprehensive life and pensions and financial solutions provider. The focus will be on closer and more regular customer interaction and the expansion of our services business. A corresponding growth and transformation programme launched in 2011 showed initial successes in 2012 in the form of new customer approach concepts. In addition, Swiss Life devised a whole new broker services offering for private housing. The company intends to further enhance its efficiency in 2013 and make more improvements to increase its distribution capacity and profitability. A major step towards improving distribution capabilities is the teaming up between Swiss Life in Switzerland and AWD Switzerland, now known as Swiss Life Select Switzerland. The teaming up will be realised during 2013.

Key figures for insurance switzerland
Amounts in CHF million  
  2012 2011 +/–
Gross written premiums, policy fees and deposits received
  8 292 8 123 2.1%
Net earned premiums and policy fees
  7 868 7 757 1.4%
Commission income
  34 19 78.9%
Financial result
  4 246 3 021 40.5%
Other income
  30 43 –30.2%
Total income
  12 177 10 840 12.3%
Net insurance benefits and claims
  –10 048 –8 964 12.1%
Policyholder participation
  –455 –450 1.1%
Interest expense
  –69 –77 –10.4%
Operating expense
  –971 –873 11.2%
Total expense
  –11 543 –10 364 11.4%
Segment result
  634 476 33.2%
Assets under control
  93 002 85 604 8.6%
Insurance reserves
  77 408 72 826 6.3%
Number of employees (full-time equivalents)
  1 937 1 995 –2.9%

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