With a new programme

With a new programme to further reduce costs and continually improve profit, as well as the preferred partnership with Raiffeisen, UNIQA has laid the foundation for a continuation of its successful internationalisation strategy. In the friendly global economic environment, we were able to make some sound decisions in 2006, to further secure our future as an independent player on the insurance markets of Central and Eastern Europe – the future of an insurance group that is active in 16 countries with a premium volume of over € 5 billion,

“Our strategy of internationalisation is focussed on profitable growth, securing our future as an independent insurance group in Europe.” Konstantin Klien

that manages investments of over € 21 billion, and has a market capitalisation of € 3 billion.

The solid foundation of our far-reaching decisions remained our long-term corporate strategy – a strategy that strengthens our market position in Austria, diversifies the risks of our portfolio through consequential internationalisation and, at the same time; makes use of the enormous growth opportunities in Central and Eastern Europe to promote strong Group expansion with increasing profitability.

		Responsible for: Group management, sales, planning and controlling human resources, marketing, communications, investor relations and internal audit Country responsibility: Austria Dr Klien joined the UNIQA Group in October 2000 as vice Chairman of the Management Board. Since 1 January 2002, he has been Chairman of the Management Board and CEO of UNIQA Versicherungen AG. Dr Klien began his professional career at Arthur Andersen and transferred to Nordstern Versicherung in 1978, where he was appointed to the Management Board in 1986. In 1991, he became Chairman of the Management Board of the Austrian AXA holding company and held executive positions in the AXA companies in Central Europe.
Konstantin Klien (* 1951) Chairman of the Management Board

Streamlining to counteract the biting winds of competition

Size alone is no guarantee of survival in the future. We must continuously increase our efficiency in all areas, in an on-going company-wide optimisation process. We must continuously improve our customer service and sales impact, lower costs and increase income. We must work hard and without pause to become even more efficient and competitive. The slogan is: “more efficiency”.

In global competition, enterprises that are lean and healthy will do the best. More efficiency also results in a sustainable increase in income and financial power. For us, a central element for safeguarding our independence is being able to independently earn the funds we need to finance our strategic investments for the future.

Ambitious profit improvement programme (PIP)

After successfully completing two programmes to increase profits, UNIQA has decided on a third profit improvement programme for the years 2007–2010. In the process, we will intensify some structures and tasks, do without some activities and bundle certain occupations in international Group companies by outsourcing them.

In the course of this programme, which is based on numerous measures and action plans, we want to further reduce both costs and loss ratios, and lastingly secure the (pre-tax) return on equity of our Group at a level of 20%. From the total savings potential of € 280 million, we intend to reinvest € 80 million in Austria and internationally in expanding sales, in infrastructure and increasing the awareness of our brand. Because of the profit improvement programme, our annual pre-tax result should climb steadily until 2010, from € 200 million to € 430 million.

Profit improvement programme 2007–2010 Pre-tax result in € million

		Responsible for: private customer business, IT, company organisation, customer service, Group actuarial control and risk management Country responsibility: Slovakia, Hungary, Liechtenstein Karl Unger joined Volksfürsorge Versicherung as an actuary in 1979. Later he transferred to Nordstern Versicherung, where he was appointed to the Management Board in 1994 and took over the life insurance department. In 1999, Karl Unger took on responsibility for Central Europe within the AXA Group. In 2001, he transferred to UNIQA as head of the administrative department for corporate planning, and joined the Management Board of UNIQA Versicherungen AG in 2002.
Karl Unger (* 1953) Member of the Management Board

Financing of further expansion secured

With funds we have earned on our own, the issuance of a supplementary capital bond for € 250 million and the planned increase of the funding framework at the European Bank for Reconstruction and Development, we are well prepared for further profitable expansion in Austria and internationally.

The structure of our insurance business will change noticeably with the internationalisation of the company portfolio. At the moment, the Austrian market dominates the Group premium revenue, with about a two-thirds share. By the year 2010, however, international business should already be contributing well over 40% to the Group premium volume and to the Group results.

Playing out the advantages of being Austria’s top brand

We also owe this success to the differentiated expansion strategy of concentric circles in our target markets. Our Austrian strategy centres on solidifying our position as market leader in personal injury insurance and as one of the largest property insurers, and focussing on qualitative growth. In so doing, we play out the competitive advantages UNIQA has as the best-known insurance brand with excellent customer service and a powerful sales department with an innovative product portfolio in all sales channels. This is winning over more and more total customers and continuously strengthening the profitability of the business in Austria.

		Responsible for: asset management (front office), equity holdings, property management, legal affairs, general administration and internal audit Country responsibility: Czech Republic Dr Wanitschek started working in the insurance business back in the eighties and was first head of the legal office and later, secretary general of Raiffeisen Versicherung AG. From 1991 until he was appointed to the Management Board of UNIQA Versicherungen AG, he was director of Beteiligungsholding Leipnik-Lundenburger Industrie AG, managing director of Kurier GmbH, member of the management at Mediaprint and director of Zeitschriften-Verlagsbeteiligungs- AG.
Dr Gottfried Wanitschek (* 1955) Member of the Management Board

Niche strategy for Western Europe is paying off

In our Western European markets in Italy, Germany, Switzerland and Liechtenstein, we operate with niche and specialty products for private customers and medium-sized companies. In Germany, Mannheimer Versicherung is on a successful path as an established brand name company and supplier of brand programmes, above all in the high-growth area of southern Germany.

The close cooperation between the three Group companies in Italy after the acquisition of Claris Vita led to a jump in premiums, in particular due to the bank sales made through Veneto Banca. In Switzerland and Liechtenstein, we score points with an exclusive target group business.

On a course of expansion as composite insurer in Eastern Europe

In the countries on both sides of the Eastern border of the European Union, we are positioned as a composite insurer and, in cooperation with the Raiffeisen bank group, are relying more strongly on bank assurance in order to make the most of the enormous potential in the retail market business. In the process, we are aspiring to achieve a unified market presence of the UNIQA brand and a market share of 5 to 7% in property insurance and from 3 to 5% in life insurance.

In the established Eastern European markets such as Poland, the Czech Republic, Slovakia, Hungary and Croatia, we are accelerating our growth rate with dynamisation projects using our own funds. With the expansion of sales structures and fortified organic growth, we want to attain the targeted market shares quickly but without any further company acquisitions. We are placing particular importance on profitable and sustainable growth in all sales channels.

		Responsible for: new markets and mergers & acquisitions Country responsibility: Romania, Bulgaria, Ukraine, Serbia, Italy Dr Brandstetter joined the Group in 1997 and was responsible for the restructuring of UNIQA Versicherungen AG in 1999; he was appointed to the Management Board in 2002. Before that, he was head of the EU office of the Austrian Raiffeisenverband in Brussels.
Andreas Brandstetter (* 1969) Member of the Management Board

EBRD as an important partner

The EBRD (European Bank for Reconstruction and Development) is an important partner for further expansion in UNIQA’s focus markets. The bank was founded in 1991 with the goal of supporting Eastern European countries in their progression towards a market economy with private corporate activities. The EBRD subsidises structural and sector-specific reforms such as competition, privatisation and entrepreneurship. Through its financing it helps secure co-financing and direct foreign investment, as well as mobilising domestic capital. Investments are mainly made in private companies, usually together with business partners. In addition, the bank provides technical cooperation in relevant areas and cooperates with international financial institutions and international and national organisations. The EBRD and UNIQA have had business relations since 1998.

Development of Group premium volume written incl. the savings portion of premiums from the unit-linked and index-linked life insurance in € million For several years, the European Bank for Reconstruction and Development (EBRD) has been supporting us in taking optimum advantage of the business potential in the Eastern and South- Eastern European countries. The EBRD has already invested minority stakes in the UNIQA companies in Croatia, Hungary, the Czech Republic and Poland.

Preferred partnership as growth driver

Share of international business in % The successful cooperation with the Raiffeisen bank group in the countries of Eastern and South-eastern Europe is a strategic advantage for our commitment in the New Eastern Emerging Markets and a central building block for our launch in Serbia and the Ukraine. This cooperation, which in the meantime spans eleven of fifteen international markets, has given us access to 10 million customers: this is a very promising area of future potential for tailored insurance solutions, above all in the area of old-age provision.

“Go east“ remains in focus

During our further internationalisation, we will continue to keep our eyes on Russia, Albania, Macedonia and Kosovo, because of the enormous growth opportunities they offer. If the screening of these target markets is positive, we will stake our claims there as well.

All in all, we have every reason to continue our decisive company strategy of yield-orientated growth and consistent internationalisation. We are headed in the right direction. We can look to the future with confidence.

		Responsible for: group accounting, planning and controlling, asset management (back office) and investor relations Country responsibility: Poland, Croatia, Bosnia and Herzegovina, Germany Hannes Bogner joined the Group in 1994, and was appointed to the managing board in 1998. Before that, he worked at THS Treuhand Wirtschaftsprüfung sgesellschaft in Salzburg and at PricewaterhouseCoopers in Vienna. Mr Bogner became a tax consultant in 1988 and a chartered accountant in 1993.
Hannes Bogner (* 1959) Member of the Management Board