Continued strong growth: 29.2 percent increase in premiums in the 2021 financial year
HanseMerkur is the most popular comprehensive health insurer among independent brokers
• Gross premium income exceeds three billion euros for the first time
• New business increased by 20 percent compared to the previous year
• Growth above market level in all business areas
• Wanderlust returns: Corona travel protection from HanseMerkur gives customers security
• Pet insurance is becoming increasingly popular
• EUR 134.8 million after-tax consolidated profit for the year
• Net return on all investments is listed at 3.2 percent
• Group equity increases to EUR 949.7 million
• Solvency ratio stands at 279 percent in Q4/2021
Hamburg, May 03, 2022. HanseMerkur confirms its growth strategy and outperformed the market in all business areas in 2021. Gross premium income increased by 29.2 percent compared to the previous year to EUR 3.3 billion. The company thus achieved the contribution target of three billion euros it had set itself for 2025 for the first time. On the sales side, the best result so far can be recorded in the company’s history at 20 percent above the previous year. In addition to the premium income, HanseMerkur has also further strengthened its financial substance. At EUR 134.8 million, consolidated net income after tax was above the EUR 100 million mark for the third year in a row. Group equity reached a new high with an increase of EUR 145.7 million to EUR 949.7 million. The financial strength of the HanseMerkur Group (SCR ratio Q4/2021: 279 percent) also reflected in the good solvency ratios of the individual companies in 2021, such as HanseMerkur Lebensversicherung AG at 283 percent and HanseMerkur Krankenversicherung AG at 410 percent. When it comes to comprehensive health insurance, HanseMerkur is again the favorite of independent brokers (Asscompact Trends I/2022).
“Despite ongoing challenges, we were once again able to achieve very good results. In 2021, HanseMerkur outperformed the market in all business areas. This corresponds to our corporate goal of holistic and profitable growth. In the past 20 years we have increased our gross premium income by an average of around ten percent a year and at the same time have achieved an average annual profit increase of 16 percent. These surpluses lead to a high level of equity,” explains Eberhard Sautter, CEO of HanseMerkur, at the Hamburg-based company’s balance sheet press conference, which was being held for the first time in a hybrid format. “With these strong key figures, we are crisis-resistant, can limit the premium development for our customers more and are a reliable partner for them even in uncertain times. Exceeding the three billion mark for the first time in the 2021 financial year is a milestone that was reached early and underscores the strength of our very wide sales force. Our declared goal for the future is to stabilize this contribution volume,” Eberhard Sautter continues. The very good net return on capital investments of 3.2 percent of the HanseMerkur Group in the low-interest environment, coupled with high contribution stability and low administration and acquisition costs, made a significant contribution to the business success. A total of around 11.3 million policyholders placed their trust in the company in the reporting period. This means that almost every seventh German citizen is insured with HanseMerkur.
Digitally successful in the “Health and Care” business field
In its main business field “health and care”, HanseMerkur increased its premium income by 5.2 percent (market: 5.0 percent) to EUR 1,771.4 million. With around 7,500 new people with full insurance, the company once again recorded growth that was above the market average. The number of people with supplementary insurance is constantly high (1.26 million without GPV). Customers benefited from net interest of 3.4 percent (industry: 2.9 percent). Since 2012, the net return on HanseMerkur health insurance has been above the market level. The average premium adjustment for the entire portfolio of HanseMerkur last year was 3.4 percent. In the current financial year it is 0.66 percent. Overall, HanseMerkur has been positioned below the industry average here for many years: “With the combination of attractive, stable contributions and our ambition to be a pioneer for medical innovations, we are becoming the first choice for more and more customers. The independent brokers recently voted us the most popular provider of comprehensive health insurance. We are convinced that digital health services make a significant contribution to protecting people’s health – especially in the prevention of diabetes, stroke and other common diseases. In the course of this, we work closely with start-ups from the health sector and use our expertise to actively shape the further development of innovative health concepts,” says Eberhard Sautter, summarizing the strategic background. In the year under review, for example, the company launched several new e-health offerings with an AI-based EKG for stroke prevention that patients can carry out independently at home and an app-controlled blood pressure coach. Services such as the billing app and the online doctor have been expanded to include customer-oriented features.
Travel and leisure: enablers for safe travel in Corona times
In travel insurance, HanseMerkur is one of the market leaders. In 2021, it was able to underpin this role in its “Travel and Leisure” business field with premium growth of 14.9 percent to EUR 183.4 million. The largest share of the total business of HanseMerkur Reiseversicherung was accounted for by the travel cancellation segment with 46.8 percent, followed by the travel sick segment with 45.4 percent. Although 2021 was still heavily influenced by pandemic-related travel restrictions and demand was still well below the pre-pandemic level, we managed to initiate a trend reversal and get back on the road to success. The decisive factor here was that the travel insurance expert HanseMerkur recognized changing customer needs and market requirements at an early stage and made the corresponding new products available quickly and flexibly. Eberhard Sautter: “In 2020 we were the first to bring corona travel protection onto the market. In 2021, this protection restored the confidence of many consumers to travel. With the introduction of Corona travel protection in Austria and Switzerland, we were able to create significant benefits for the DACH region and the German-speaking tourism sector.” HanseMerkur was also a pioneer on the Polish market with its Corona travel protection.
An important product expansion followed at the beginning of 2021: Since then, the Corona travel protection has also been effective if a travel warning for the destination country was already in place when you started your journey. In addition, HanseMerkur redesigned its travel protection product concept in favor of customers and travel sales partners. Added to this are, for example, rental camper tariffs and the additional “Active Vacation Plus” tariff for sports travel. Furthermore, with the increase in the premium limit from 10,000 euros up to 15,000 euros, even higher value trips can be insured. The fact that the company is well positioned with its products was attested by the Stiftung Warentest “Finanztest”, for example, which HanseMerkur named the test winner in a comparison of travel cancellation policies at the end of 2021. In 2022 HanseMerkur is geared to changing market requirements, above all with the redesign of business trip tariffs and a new travel protection concept for bus operators.
With a view to the current financial year, Sautter predicts: “We are assuming that there will be catch-up effects this year and that there will be an even greater desire to secure travel.” This is confirmed by the results of the “HanseMerkur travel survey 2022”, according to which the 82 percent of respondents long to travel again in 2022. At the same time, there is a great desire for security and thus for travel insurance. The Hamburg insurance group has remained a reliable partner for the travel industry, especially during the past two years of the crisis. As one of the few providers on the market, HanseMerkur continues to be one of the few providers on the market to reliably support tourism companies with customer money protection through its contract agent tourVERS.
Risk and old-age provision: Convincing key figures
HanseMerkur almost doubled the growth in premiums in the “Risk and old-age provision” business area. With an increase of 96 percent (market: -1.4 percent) compared to 2020, premium income is EUR 1,300.4 million. The growth is fed in particular from a significant increase (+132.6 percent) in single premiums to EUR 1,118.4 million. “With our strong equity ratio, one of the lowest interest obligations in the market and an excellently positioned asset management, we can invest in an opportunity-oriented manner so that our customers benefit from attractive interest rates even in phases of low or zero interest rates,” says Eberhard Sautter, commenting on the company’s single-premium strategy to date. The net return on HanseMerkur life insurance was 3.1 percent (industry: 2.8 percent), – with a further reduction in the administration cost ratio (0.3 percent) and acquisition cost ratio (3.4 percent). Based on this, Wirtschaftswoche crowned HanseMerkur in the Finsinger rating (40/2021) for the fourth time in a row as one of the top-performing companies in an industry comparison of 58 market participants. The interest on the capital investments, low cost ratios for sales and administration and the payout ratio were evaluated as fair participation of the customers in the surpluses.
“Property and casualty” business segment: Pet insurance growth market
Premium growth of ten percent (market: 2.2 percent) and premium income of EUR 88.6 million was achieved in the “Property and casualty” business field. The property insurance (+39.6 percent) and motor insurance (+11.4 percent) segments developed most strongly compared to 2020. At 75.2 percent, the overall claims ratio in property insurance was higher than in the previous year (43.8 percent). This was primarily due to the storm “Bernd” and the resulting elemental damage. Accident insurance was able to achieve a premium increase of 3.8 percent. The main reason for this was the strategic field of pet insurance. With the introduction of surgical insurance in 2019, HanseMerkur had the right feeling for the needs of its customers. “Pet insurance is a growth market with great potential. The number of households with pets in Germany is constantly increasing. In addition, the social and emotional importance of pets is constantly increasing, which is reflected in the desire to protect four-legged friends,” says Eberhard Sautter, pointing out the perspective. This was reflected in above-average growth in 2021: around 17 percent of premium income in the area of ”property and casualty” came from pet insurance. The wide range of services not only convinced more and more customers, but was also rated accordingly in the professional world. In the test of surgical insurance for dogs by Stiftung Warentest “Finanztest”, HanseMerkur performed excellently: With a very high level of performance, it is positioned among the top providers. Pet insurance remains a strategic focus topic for HanseMerkur. Pet owners can look forward to further expansion of the product range.
High level of expertise in asset management: success factor for third-party investors
The “Asset Management” business field has developed into a significant source of income. In 2021, HanseMerkur Trust AG (HMT) managed assets of EUR 12.2 billion. The newly established business area of illiquid assets experienced a significant increase in demand from institutional investors in the negative and low interest rate environment. The fund of funds HanseMerkur Private Debt S.C.Sp. with a target volume of one billion euros has already reached capital calls of almost 500 million euros. In particular, the congruence of interests – HanseMerkur is the long-term anchor investor in the fund of funds products. The assets under management of the real estate subsidiary HanseMerkur Grundvermögen AG (HMG) in real estate and real estate financing reached around EUR 5.3 billion in 2021. The past financial year is HMG’s most successful investment year to date with EUR 1.2 billion, including increasingly large-volume properties in the three-digit million range. HanseMerkur relied on specialized asset management at an early stage. “Due to the exceptionally high level of expertise of HMT and HMG, we can regularly offer our customers interest rates above the market level. Thanks to the successful investment policy, third-party business in the form of institutional investors is also gaining momentum. In 2021, HMG and HMT were already managing three billion euros for third-party investors,” says Eberhard Sautter.
HanseMerkur also created new jobs in 2021: The company employs 2,291 people in the office and in the field, as well as full-time agents. This corresponds to an increase of 54 positions. With a special payment of 2,800 euros, HanseMerkur gave employees a share in the company’s success. “I would like to thank all employees. With their extraordinary commitment, they made a decisive contribution to our good result,” says Eberhard Sautter, emphasizing the team effort. In view of its self-image as a responsible employer, HanseMerkur 2021 offered COVID-19 first, second and booster vaccinations to all employees in its in-house vaccination center. A total of 960 people used this option. With the end of the statutory home office obligation, the proportion of attendance has now risen to around two days a week. Nevertheless, mobile working in the sense of making working hours and locations more flexible will play a permanent role. The company management and employee representatives made the corresponding preparations for this in 2021 with a corresponding company agreement.
Sustainability: Firmly anchored in the company
As a personal insurer, HanseMerkur has always been geared towards insuring the present and future of people across generations. In its range of products, it continually demonstrates this, in particular with its contribution stability. In addition, as part of a comprehensive strategy process, the company has set out to make its activities comprehensively sustainable in line with ESG criteria. In the course of this, the long-established company supports all 17 Sustainable Development Goals of the United Nations and is convinced that it will set positive accents, in particular to achieve SDG 3 (health and well-being), SDG 8 (decent work and economic growth) and SDG 13 (measures to protect the climate). By joining the Net-Zero Asset Owner Alliance in 2021, HanseMerkur has taken an important step in its commitment to a more sustainable financial system. This network of the world’s largest investors aims to achieve net-zero carbon emissions from their entire investment portfolio by 2050. HanseMerkur Trust has already firmly anchored sustainability in its investment philosophy and initiated the new HMT Aktien Value Protect ESG fund in 2021. At the end of the year, four HanseMerkur Trust AG funds were awarded the coveted FNG seal and star.
HanseMerkur has made a successful start to the 2022 financial year in all segments. “In the area of risk and old-age provision, a slightly different picture will emerge over the course of the year than in 2021, as planned, since we will now be curbing the deliberately high single-premium share of the past three years. We are aiming for around a fifth of the single-premium business from 2021. This is essentially a reaction to the reduction in the maximum discount rate to 0.25 percent,” says Eberhard Sautter, giving the outlook for 2022. Due to the current global political and economic framework, Sautter expects a demanding and challenging year, especially in the area of capital investments: “The terrible war in Ukraine and its impact on inflation and economic development will characterize the year. It is still too early to forecast what effects this will have on the course of business – especially since indirect consequences are also to be expected. The war changed the political agenda and originally planned projects such as the introduction of a share-based pension insurance may be prepared later.” Nevertheless, the company confirms its medium-term goals. By 2025, these envisage a permanent premium income of more than three billion euros with a stable annual profit of 100 million euros after taxes and a placement among the top 10 German private health insurers.
Business development from January to March 2022
In March, HanseMerkur announced that from July 2022, as the new main sponsor, it would significantly expand its long-term partnership with the HSV football club – a clear commitment by the Hamburg insurer to the traditional club and to the Hanseatic city. The presence associated with the cooperation will further increase the brand awareness of HanseMerkur and make the brand even more tangible for fans and customers.
In terms of business development, the positive trend from 2021 continued in Q1/2022. With a total of 300,000 new policyholders, HanseMerkur achieved a new customer record in the first quarter. In the main business segment “Health and Care”, premium income increased by 3.5 percent compared to the same period of the previous year to EUR 444.9 million. In the “Travel and Leisure” business segment, the market volume recovered noticeably, so that premiums of EUR 68.4 million were achieved, just below the pre-Corona level. In the “Risk and old-age provision” business area, the surplus participation was once again kept stable at a total interest rate of 2.1 percent. As expected, the premiums written are declining due to the lower single-premium business. In the “Property and Casualty” business field, premiums increased by 13.0 percent compared to the same period of the previous year. Pet insurance is once again the carrier of this development. With “Unfall Best Gold”, the company has also introduced a new accident product which, with its comprehensive service package, reflects the changing reality of people’s lives.
Images and further information are available for download at www.hansemerkur.de/presse.
With an annual turnover of 3.3 billion euros (2021), HanseMerkur is the only independent insurance group in the financial center of Hamburg. The roots of the 147-year-old personal insurer lie in health insurance, which is still the main division of the company today. HanseMerkur is also a specialist for private supplementary protection for those with statutory health insurance and, with around 1.26 million people with supplementary insurance (2021), one of the largest German providers in this segment. In addition, with premium income of EUR 183 million (2021) in the travel and leisure segment, it is one of the market leaders in tourism insurance. Further information at www.hansemerkur.de