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Allianz Annual Report 2013

Annual Report 2013    Allianz Group 53 C Group Management Report Your Allianz 49 Business Operations and Markets 56 Strategy and Steering 59 Progress in Sustainable Development technical capabilities achieved through continuous investment and innovation. This achievement was strongly supported by the performance of our agent network, which was merged in 2013 after operating as three separate entities in the past. This marks a milestone in the history of ­Allianz Italy and was accompanied by the introduction of the com- mon digital platform Digital Agency. This new platform supports simple, mobile and paperless processes, allowing for significant increases in service quality, agent efficiency and customer satisfac- tion. Another driver of innovation has been the introduction of Modu- lar Offer, which provides family coverage against the most serious risks. It is a single contract with protection modules from all insur- ancelinesandaffordablepricingonamonthlysubscriptionbasis.The success of our initiatives is reflected in a net promoter score for our agents of + 21 %, which stands out against a market average of (11) %. The growth of Genialloyd in terms of pure direct premiums reached 19 % and contributed to our strong performance in Property- Casualty. In our life business, we increased our premium volume by 33 %, raising our overall life market share by approximately one percentage point. This growth was particularly supported by our bancassurance cooperation with UniCredit and our proprietary financial advisors network. Our unit-linked product market share increased signifi- cantly to 20 % 1, leading to an improved new business mix. Sales of unit-linked products accounted for over 70 % of new business, com- pared to a market average of approximately 34 %. Progetto Reddito, our innovative decumulation product, has generated € 1.3  bn of new business since its launch at the beginning of 2013. Looking ahead, we aim to further gain market share in the ­property-casualty business despite the challenging market condi- tions, and to preserve our combined ratio advantage by accelerating our digital transformation. In our life business, we strive to further rebalance our portfolio by improving our new business mix. France ­Allianz France S.A. is a major provider of insurance and financial ser- vices in the French retail and commercial markets, offering a broad range of property-casualty and life/health products for individuals and corporate customers. These include liability insurance, disabil- ity cover as well as investment and savings products. We distribute these offerings mostly via agents, life and health consultants, brokers and independent financial advisors, as well as selected external part- ners.Inaddition,ourcustomerscanresearchandbuyproductson­­line, either through e­Allianz or via our direct sales channel AllSecur. The French property-casualty market has seen limited growth in recent years and remains highly competitive. Competition is likely to remain tough, with expected higher customer churn due to local 1 Based on the first nine months of 2013. regulatory changes regarding cancellation rules. In this business environment, we continue to concentrate on increasing the efficiency of our company structures, simplifying our product range and pro- cesses and rebuilding our IT platform, with a view to delivering state- of-the-art digital solutions and high-quality claims services. This constant focus allows us to grow our customer base, for example in motor insurance. Thanks to the full integration of Gan Eurocourtage in 2013, which specializes in distributing its products via brokers, we are now one of the leaders in the midcorp market. Concerning the life market in France, we anticipate a continued period of low interest rates, reinforcing the need to focus on technical margins and cost optimization to maintain the attractiveness of our offer. We have responded to the needs of our clients with a range of traditional and unit-linked products in both group and individual business, combining financial strength with the opportunity for more attractive yields. As an example, our new offer of a discretionary mandate is a successful illustration of this approach. We also hold a strong position in the health market, often com- bining elements of life, health and casualty insurance as comprehen- sive solutions for individual and commercial customers. Recent regulatory changes have created new opportunities for the develop- ment of our group business. Our historic know-how will allow us to adapt our offer and positioning rapidly. Our retail insurance activities are complemented by ­Allianz Banque, which allows us to offer one-stop solutions, in particular for our life customers. United States Our property-casualty insurance business in the United States is con- ducted through Fireman’s Fund Insurance Company (FFIC). Our life and annuity business is managed through ­Allianz Life Insurance Company of North America (­Allianz Life). Through FFIC, we underwrite personal and commercial lines, selling these products through independent agents and brokers. We also participate in a crop insurance program through a reinsurance arrangement. Our personal business unit focuses on affluent and high-net-worth individuals while our commercial business unit offers specialized property-casualty coverage for small and medium- sized businesses. FFIC is one of the few carriers in the United States that has a nationwide personal and commercial lines presence. During 2013, catastrophe activity was relatively light and we saw a stabilization of the U.S. property-casualty insurance market, leading to modest market growth. At FFIC, a restructuring of the reinsurance program for crop insurance business reduced our premiums for this business line in 2013. While ongoing portfolio action to address prof- itability concerns and change the business mix unfavorably impact- ed our premiums, we saw improving results in 2013. The low interest rate environment, however, continues to put pressure on profits. In 2014, we remain focused on niche markets, enhancing customer ser- vice and improving FFIC’s core underwriting strengths. This should

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