Successful growth champion: HanseMerkur records record new business in 2023

Success story written: Best sales results since the company was founded in 1875
Sustainable development: Record growth in current contributions of EUR 187.1 million or 7.8% to EUR 2.57 billion
Strategic goal achieved: entry into the top 10 of German private health insurers
Strong influx: more than 300,000 people with full health insurance for the first time
Still on the rise: animal insurance catapults HanseMerkur Allgemeine’s premium income to EUR 130.8 million
In top form: “Travel & Leisure” sets another contribution record with EUR 291.9 million
Earnings strength proven: Group annual profit after taxes amounts to EUR 134.7 million
Attractive employer: investment in new jobs and training

In 2023, which is characterized by inflation and a shrinking economy, HanseMerkur remains on the growth path and, with 17.3 million valuation units (BWE), achieved the best sales result in the company’s 149-year history (+ 21.0% compared to the previous year). Current contributions rise to EUR 2.57 billion (+ 7.8% compared to the previous year). Comprehensive health insurance achieves a new business market share of around 12%. In “Property & Casualty”, the strategic segment of animal insurance is a key growth driver and causes HanseMerkur Allgemeine (HMA) to increase premiums to EUR 130.8 million. This means that the HMA’s strategic goal of EUR 100 million in premium income has been significantly exceeded. The “Travel & Leisure” business area broke the premium record set last year and increased premium income by 9.1% to EUR 291.9 million. Group equity increased by 13.3% (EUR 1,200.4 million). The consolidated annual profit after taxes reached EUR 134.7 million (+ 37.2%), the second-best result in the company’s history.

“We have implemented our corporate strategy of profitable growth even in the challenging 2023 financial year. Despite adverse conditions, we once again succeeded in increasing total premium income. Above all, the development of ongoing contributions is a sustainable success story. Since 2010, these have grown by an average of 11% every year or by around 142% in total,” says CEO Eberhard Sautter, describing the business development.

The strong annual result for 2023 is reflected both in current premiums, which amount to an increase of 7.8% to EUR 2,571.6 million, and in gross premium income. This increased to EUR 2,686.3 million (+3.2%). This means that HanseMerkur is growing around five times as fast as the industry average (0.6%). “We have now achieved all of our seven strategic goals set for the anniversary year 2025 at least once – and earlier than planned. We attribute the sustained successful company development primarily to our great continuity in terms of product quality and price-performance ratio coupled with a flair for innovation,” says Eberhard Sautter.

Above-market-average increases in almost all business areas

In the area of “Property & Casualty”, premium income increased by double digits (+35.3%), in the area of “Travel & Leisure” by 9.1% and in “Health & Care” by 7.0%. In the “Risk & Retirement Provision” business area, premium income fell (-26.0%) due to the greatly reduced single premium business. This largely offset the 47.3% drop in single premium business during a phase of rising interest rates. Eberhard Sautter says: “After three intensive single-premium financial years, we have already moved into a phase in 2022, as planned, in which we will focus more on current contributions again. Nevertheless, the changed interest rate landscape in 2023 put a strain on the single premium business, which we were able to limit by successfully placing a new capitalization product against a single premium.” HanseMerkur is also financially strong when it comes to consolidated net income after taxes: this rose by 37.2% to EUR 134.7 million. A further sustained increase in equity to EUR 1,200.4 million was achieved in 2023 (previous year: EUR 1,059.1 million). This means that equity capital increased by over EUR 100 million for the fifth time in a row. A total of around 11.8 million insured people placed their trust in the company during the reporting period. More than one in seven German citizens is insured with HanseMerkur.

Strategic goal achieved in the main business area “Health & Care”

With 7,525 new fully insured people or an increase of 2.6%, HanseMerkur once again clearly beats the market (market growth according to preliminary information from the PKV Association: +0.03%). This means that the insurer not only achieved above-market-average net growth for the 22nd year in a row, it also recorded more than 300,000 fully insured people (300,492 people) for the first time. The number of additionally insured people grew by 15,000 people (+1.2%). The new business market share is 12%. The company increased its premium income from “Health & Care” to EUR 1,965.8 million (+7.0%). When it comes to its positioning in the market, HanseMerkur Krankenversicherung AG reached a special milestone in 2023: “One of our most important growth goals is to move into the top 10 of German private health insurers by 2025. We have already achieved this in 2023 and are in 10th place,” said Eberhard Sautter. Due to the challenging economic conditions, the net interest rate fell from 2.4% in the previous year to 1.6% (industry: 2.7%). The net interest rate of HanseMerkur Krankenversicherung has been below market levels for the first time since 2012.

“Travel & Leisure”: New partners and new international presence

The positioning as a quality provider that has been promoted in recent years with innovative product offerings such as the market’s first Corona travel protection and a workation tariff will also pay off in 2023. After the business area achieved the best result in the company’s history last year, it will reach a new record in 2023 with a premium volume of EUR 291.9 million (+9.1%). This is due to, among other things, the acquisition of new travel partners. International expansion also continued in 2023, with market entry in the Netherlands and significant premium growth in the existing markets of Switzerland (+40.1%), Austria (+33.5%) and Poland (+10.0%).

“Risk & Retirement Provision”: Current contributions remain stable again

In the “Risk & Retirement Provision” business area, premium income fell by 26.0% to EUR 296.1 million – because of the decline in single premiums. In contrast, current contributions remain at the previous year’s level at EUR 180.9 million. The net interest rate for HanseMerkur life insurance is 1.7% (industry: 2.2%) – with a continued low administrative cost ratio (1.4%) and acquisition cost ratio (2.9%). With its sustainably oriented capital investment, high-quality fund range and an attractive product mix, HanseMerkur sees itself as well positioned overall, even in the difficult market environment.

“Property & Casualty”: Pet insurance is ahead

The “Property & Casualty” business area is characterized by intensive growth and ends the year with premium income of EUR 132.5 million (+ 35.3%), of which EUR 130.8 million is attributable to the HMA. The main reason for this is animal insurance, from which EUR 43.7 million or around 33.4% of the HMA’s premium income comes (previous year: 14.3%). In particular, the pet health insurance for dogs and cats, which was introduced in October 2022, is meeting with great customer demand. The volume of new business in the already established animal surgery insurance remains strong. “Operationally, we view animal insurance less as property insurance, but rather based on our health insurance expertise. We have developed customer-oriented, all-round, worry-free packages and high-performance existing IT systems that will form the basis for further new products. The goal remains to become ‘the’ animal insurer in the coming years – measured in terms of premium income,” explains Eberhard Sautter.

Asset management remains stable

The two asset management companies achieved their second-best pre-tax result to date in 2023 at EUR 34.3 million (previous year: EUR 35.8 million) and are proving to be resilient in the face of a tense market environment. The real estate industry in particular was characterized by uncertainty in 2023. In contrast, HanseMerkur Grund Vermögens AG (HMG) continued on its growth path: assets under management amounted to around EUR 6.3 billion (previous year: EUR 6.1 billion). HMG was able to take over six new properties with a market value of over EUR 350 million and currently has 88 properties under direct management. In total, HMG and HanseMerkur Trust AG (HMT) managed around 4.0 billion euros for third-party investors in the past financial year.

HMT is looking back on the most successful year in its history. Assets under management increased from EUR 10.6 to 12.0 billion. In recent years, HMT has built up a broadly diversified range of product solutions for institutional investors. With European equity strategies and multi-asset strategies, each with and without a value preservation component, as well as various Euro bond strategies, HMT offers attractive investment solutions for institutional investors. The private equity and private debt funds of funds supplement the offering for these investors with the asset class of illiquid capital market products. With its proprietary early warning system for credit risks, HMT is very well positioned to take advantage of the increased attractiveness of bonds due to the rise in interest rates. The system allows the analysis of around 4,000 issuers regarding market data and fundamental data in real time. This makes it possible to efficiently monitor risks in bond portfolios and collect interest income with reduced default risks. Private investors also benefit from HMT’s expertise. The very good results were recently highlighted by Handelsblatt and Ascore Rating and the managed fund policies were rated “very good”. The funds of funds managed by HMT made a significant contribution to this. The funds were able to achieve several top rankings, including first place among the best managed funds with the “HanseMerkur Strategy with Opportunities”.

Employees participate in the company’s success

The profitable company growth means that HanseMerkur is constantly creating new jobs – 102 in the past financial year. The need was particularly great in the areas of IT and customer service. In the 2023 financial year, the company employs 1,762 employees in office and field sales (previous year: 1,660). 717 (previous year: 686) agents work for HanseMerkur as self-employed in the field. The traditional company pays particular attention to promoting young talent and training and employs 60 trainees (previous year: 45) – of which 26 are dual students (previous year: 25). In the spirit of long-term collaboration, the training is aimed at enabling those starting out in the profession to take on jobs later. HanseMerkur is also creating attractive spatial conditions: With the construction of a “Future Workplace”, which began in 2023, HanseMerkur is creating a modern collaboration area at its Hamburg location, which will be inaugurated in early summer 2024. The insurer is currently giving its employees a special payment of EUR 2,500 in the company’s success for the successful 2023 financial year. Furthermore, in January 2024, it paid its employees the EUR 1,000 inflation compensation bonus agreed in the collective agreement. In the previous year, HanseMerkur had already paid out a voluntary inflation compensation bonus of EUR 1,000 in addition to the collectively agreed benefit (EUR 1,000), so that the maximum legally possible limit was exhausted with a total of EUR 3,000.

Outlook 2024

In the first quarter, HanseMerkur seamlessly continued the positive result from the previous year and gained around 400,000 net insured people. In the main business area “Health & Care”, premium income increased by

3.2% compared to the same period last year to EUR 495.4 million. The “Travel & Leisure” business area continues to record strong growth with premium income of EUR 90.3 million (+ 8.1% compared to Q1/2023). In the “Casualty & Casualty” business area, premiums increased by 54.4% compared to the same period last year to EUR 60.6 million. Animal insurance is once again responsible for this development. In the “Risk & Retirement Provision” business area, the profit participation was once again kept stable at 2.1% total interest. Premiums written rose to EUR 136.5 million (+163.1%), which is due to higher one-off premiums.

“We are anticipating another high-growth financial year for HanseMerkur in 2024. For us, the main focus is to achieve and increasingly consolidate our strategic goals all at the same time for the first time,” says Eberhard Sautter, giving the outlook. This includes: being ranked in the top 10 of German private health insurers, achieving a premium income of over EUR 3 billion with a stable annual net profit of EUR 100 million after taxes, and a premium volume of EUR 250 million in the “Travel & Leisure” business area. EUR or EUR 100 million in the “Property & Casualty” business area, a market share of over 1% in new “Risk & Retirement Provision” business and assets under management from third-party business of over EUR 3 billion in Asset Management.

About HanseMerkur

With an annual turnover of 2.7 billion euros (2023), HanseMerkur is the only independent and group-independent insurance group in the Hamburg financial center. The roots of the 149-year-old personal insurer lie in health insurance, which is still the company’s main division today. HanseMerkur is also a specialist in private supplementary protection for those with statutory health insurance and, with around 1.3 million additionally insured people (2023), one of the largest German providers in this segment. In addition, with premium income of EUR 291.9 million (2023) in the travel and leisure business area, it is one of the market-leading tourism insurance companies. Further information at www.hansemerkur.de.