Over the past financial year, we succeeded in building on the progress we had already achieved and, despite the challenging market environment, achieved healthy results with profit attributable to shareholders of CHF 548.0 million (2021: CHF 588.4 million). In local currency terms, Baloise generated growth in its target segments in 2022. The net combined ratio stood at 91.9 per cent, a testament to the high quality of our business. The expense ratio improved slightly, while the claims ratio was robust in a mixed environment for claims. Extreme weather events impacted results again in 2022, and war in Europe exacerbated what was already a difficult economic situation due to the effects of the coronavirus pandemic. The economic environment was also shaped by latent geopolitical risks. These factors are increasingly affecting national economies and are slowing sustainable growth in many countries. Supply shortages, inflation and interest rates are also having an impact on our business and on customer behaviour. In line with our objective of sustainable and forward-looking business management, we have also recognised reserves to cushion potential inflation effects.

Our capital position remains strong. We expect the SST ratio as at 1 January 2023 to be over 230 per cent, and in summer 2022 Standard & Poor’s confirmed its rating for the Baloise Group’s core companies of A+ with a stable outlook. Based on the high operational profitability and reliable cash generation, we intend to ask the Annual General Meeting to increase the dividend by CHF 0.40 to CHF 7.40. Over the past 20 years, we have continuously increased the dividend or at least kept it constant. This is almost unparalleled within the Swiss insurance industry and confirms Baloise as a reliable and attractive investment.

Our business model and strategy are designed for the long term. Measured by these targets, the first year of the new strategic phase got off to a satisfactory start, especially in light of the difficult environment. We generated CHF 471 million of our target of CHF 2 billion in cash in 2022, 9 per cent more than in 2021. We also attracted a total of 173,000 new customers. For our employee target, we introduced a new measuring method and a significantly expanded benchmark group in 2022. We are consistently among the top 35 per cent of the best employers in Europe. We achieved an excellent 79 per cent approval rating for employee satisfaction, and only 4 per cent of responses to the survey were negative. Baloise is an excellent employer and we are not letting up in our efforts to improve our position.

Having recovered from cancer, our Group CEO Gert De Winter has made the difficult decision to leave Baloise on 30 June 2023 after around 18 years. Following the personal events of recent months, he believes that now is the right time to reassess his priorities. The insurance industry is undergoing a fundamental transformation, and since taking on his role seven years ago Gert de Winter has made sure that Baloise is fully prepared for these changes. He has been a huge asset to Baloise and has earned the gratitude of the whole Board of Directors. The baton will pass to Michael Müller, currently CEO of Baloise in Switzerland, when he becomes the new CEO of the Baloise Group on 1 July. He has been with Baloise for 26 years and has been a member of the Corporate Executive Committee since 2011. Michael Müller represents continuity but will also provide impetus to take the Company forward in his new role. He will build on the strengths of previous years to ensure that Baloise remains a highly attractive, reliable and responsible company for our customers, employees and shareholders.

Events of recent years illustrate the strengths and thus the importance of insurance companies. We continuously adapt our business activities in line with our sustainability strategy and the challenges facing society. Our role traditionally becomes even more important during phases of change. Baloise has always been part of any transition process, and that is why we are certain that we can play an important role in society when it comes to tackling climate change. We have the expertise and the solutions required to help economies overcome some of the leading risks such as cyber, earthquakes, power supply shortages or the next pandemic. In Switzerland, we have had a sustainable and community-based solution in the area of natural disasters for years. Not all the biggest risks are insurable, but we should work with the national government to find solutions for certain key risks because there are large gaps in cover. These gaps can prove very costly for individuals and economies.

Switzerland has been grappling with the thorny political issue of how to finance pension provision in a sustainable way for years. Other European countries are also facing similar challenges. Demographic change is testing the inter-generational contract and the growing number of pensioners is putting the state-funded part of retirement provision under pressure. Policymakers need to adjust the state parameters in occupational pension provision as a matter of urgency. As one of the few remaining providers with a comprehensive range of occupational pension solutions, we are responsible for a great many small and medium-sized enterprises and thus for an equitable society. The importance of our services for private pension provision is likely to continue to grow in future.
Over the past 160 years, Baloise has tackled every economic challenge head-on. The qualities that set us apart and make us strong will continue to support us as we move into the future. We have excellent capitalisation, a stable and loyal customer base, and a committed workforce that we can rely on. We can therefore be sure of sustainable value generation that you, our valued shareholders, can continue to depend on in future.
 

Basel, March 2023

Dr Thomas von Planta
Chairman of the Board of Directors

Gert DeWinter
Group CEO