Other international markets
Africa
Our subsidiary Hannover Life Re Africa, which is based in Johannesburg, bears responsibility for life business in South Africa and most English-speaking African markets. It concentrates on traditional risk-oriented individual and group life business, although for a number of years it has also written sizeable financing transactions in the South African market with rapidly growing life insurers.
Cooperation with a number of new insurers specialising in alternative distribution channels such as direct marketing or internet marketing has also proven to be a promising business segment. In addition, we gave our support to a new life insurer in South Africa that has launched the UK model of enhanced annuities on the local market.
Our other African business, which accounts for roughly 7.5% of the premium volume booked by HLR Africa, is showing a pleasing trend. Through a strategic alliance with a professional reinsurer based in Lagos we have gained access to the important life insurance markets of Nigeria and Kenya, and we are planning to systematically extend this cooperation.
The gross written premium generated by HLR Africa totalled EUR 110.5 million in the year under review, of which EUR 78.0 million was retained for own account. The operating profit (EBIT) amounted to EUR 10.0 million thanks to positive special effects, producing an EBIT margin of 12.8%.
Central and South America
Reinsurance acceptances from these markets are written from Hannover Home Office with the support of our offices in Mexico City (for Central American markets) and Rio de Janeiro (for the Brazilian market).
The premium volume generated from this region, in which we have singled out bancassurance for special emphasis, remained almost unchanged year-on-year at EUR 101.5 million. Conditions are satisfactory given our adherence to a conservative underwriting policy, and profitability in the year under review again lived up to our expectations.
Our strategic cooperation with the professional reinsurer Malucelli Re, the first Brazilian reinsurer after IRB to have received a licence on the basis of the new insurance law, is bearing initial fruit in the market.
Asia
As in previous years, Hannover Life Re divides the Asian markets between its two regional centres in Kuala Lumpur and Hong Kong. While our Malaysian branch handles the ASEAN markets and South Asia, Hong Kong serves Greater China as well as the key life markets of Korea and Japan.
We observed greater demand for financing solutions in all Asian markets in the year under review, enabling us to write four contracts with clients in Hong Kong, China and Japan. In many markets we also noted a resurgence of interest in risk-oriented offerings designed to provide income and asset protection for policyholders.
In Korea and China we now rank among the leading reinsurers for new business, having attained a high market penetration of more than 80% in China. In Japan we have repositioned ourselves with a new team equipped with special actuarial expertise.
In Southeast Asia we consolidated our position in Malaysia and Singapore, and appreciably strengthened our presence in Vietnam. In India we built up the local infrastructure in Mumbai and – assisted by our strategic cooperation with GIC Re – were able to acquire our first sizeable reinsurance participations.
Premium income from Asia climbed by 41.7% to EUR 147.2 million. Despite fiercer competition among international reinsurers, further exacerbated by some local reinsurers from Japan, Korea, China and Malaysia, the results posted by Hannover Life Re remain gratifying.
Australia and New Zealand
Business written in Australia and New Zealand is the responsibility of our subsidiary Hannover Life Re Australasia. The company focuses on risk-oriented business in the context of life, critical illness and various disability covers.
For many years now HLR Australasia has also been involved in the segment of occupational retirement provision, known as superannuation funds. It concentrates on assuming the biometric risks of mortality and disability, but does not take any part in the capital accumulation of these provision schemes.
The company also supports new marketing models in Australia and New Zealand which are designed to directly address policyholders and handle the purchase of policies quickly and efficiently through call centres.
Premium income fell by 13.5% to EUR 251.3 million due to withdrawal from an earlier block assumption transaction with an Australian cedant. Although the claims experience with disability annuities was not satisfactory, the company posted an improved result thanks to higher income from retrocessions: the operating profit (EBIT) rose to EUR 28.4 million, corresponding to an EBIT margin of 25.0%. Net income after tax was also very attractive at EUR 24.6 million.