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ALLIANZ UK DELIVERS GROWTH IN PROFITS AND PREMIUMS IN 2009 

Financial Highlights:


Group Results:      2009 2008
£M £M
IFRS Operating Profit (before tax)      £203.7 £193.6
Gross Written Premium      £1588.1      £1531.2     
Combined Ratio      92.9%      95.2%

Divisional Results Breakdown


      2009      2008     
£M £M
Commercial     
Gross Written Premium                               £1008.2      £918.6
Combined Ratio      87.6%      86.9%
Retail     
Gross Written Premium                               £579.9      £612.6
Combined Ratio      101.4%      109.6%

Statement from Chief Executive Officer Andrew Torrance


I am very pleased to report that the Company delivered both gross written premium and profit growth in 2009. There are not many UK companies which grew and outperformed both their revenue and
profit plans for 2009, in the midst of the worst economic conditions since the 1930s.

In 2009, the IFRS Operating Profit of £203.7M was £10.1M ahead of the previous year’s result which
is very pleasing. We also grew our GWP to £1588.1M, up £56.9M over 2008. As I have said consistently during my time as Chief Executive, Allianz is looking to profitably grow its business and,in 2009, this objective was achieved ahead of plan in challenging market and macro economic conditions. Against this backdrop, this must be viewed as an excellent result.

Our general Commercial business grew its GWP to £1,008.2M, up 9.7% over 2008 as more customers looked to benefit from our consistent market-leading service levels, broad product range and second-to-none financial strength. The division also delivered an excellent Combined Ratio of 87.6%. However, we must also recognise that this result benefited from approximately £90M of favourable prior year claims development. The pure 2009 accident year performance did not achieve our target level of return on shareholder funds.

Competition in the Engineering market meant that rate strength was very difficult to achieve in either
part of the core insurance and inspection accounts. Despite this, profit was ahead of plan. Premium
levels were also maintained – an excellent performance given that this sector of the economy was
hard hit by the recession.

In Retail Division, I am pleased to report a £39M improvement in underwriting profitability compared
to 2008, reducing the underwriting loss to £7.8M. The combined ratio improved 8.2 percentage points to 101.4%, which is an excellent achievement.

GWP in Retail fell 5.4% to £580M, driven by the corrective rating and underwriting action which was
taken to improve profits in private motor, and the impact of the recession on some of our corporate
partner clients. However, Retail’s Speciality business in Animal Health and Legal Protection
demonstrated its potential, delivering an underwriting profit of £16.8M, 17% up on 2008.

Turning to 2010, I am expecting another challenging year for our industry. The wider economy is moving out of recession only at a sluggish pace and many difficulties lie ahead for the next government, at the centre of which is tackling the public sector deficit. How effectively this is managed will have a direct bearing on the insurance market for commercial and personal customers alike.

It remains a priority for us in 2010 to increase premium rates to a level which provides an adequate
return on the cost of capital. This was not achieved in 2009. We will consequently be looking to increase rates across both our commercial and retail books of business ahead of the rate of claims inflation. In the commercial market, 2010 has not started well in this respect, with rate rises lower than in early 2009, although there are more positive signs in motor and household.

The Group begins 2010 in a strong business and financial position. We have a number of plans to
improve and grow our commercial and retail businesses based on the continued development of the
outstanding value proposition which we offer to our customers. The Group is well equipped through its strong customer relationships, sustained high service levels, broad product range, financial
strength, and a knowledgeable and dedicated workforce, to meet the challenges that lie ahead.

Andrew Torrance
Chief Executive, Allianz Insurance

Note for Editors:

1. Andrew Torrance will be holding a results briefing at 11:00am in Allianz’s 27 Leadenhall St
office on Friday 26 February.

2. For further information please contact:
Mark Bishop, Group Communications Manager
Tel No: 01483 552731
Mobile: 07802 925053

57 Ladymead  Guildford  Surrey   GU1 1DB Story Image
Tel:01483 552969 Fax:01483 552782