Helvetia Baloise Holding AG (HBAN) Earnings Call Transcript

Ladies and gentlemen, we are very glad to welcome you all to our Helvetia Capital Markets Day. According to COVID-19, this pandemic produced many new words and/or meanings such as hybrid. According to the dictionary, hybrid stands for 2 different meanings. Thus, a hybrid business is a company which has both an Internet front end and its physical bricks and premises. Hence, Helvetia is holding its Capital Markets Day in a hybrid format. I say hello to all those being physically present in the Samsung Hall in Zurich as well as to all those people joining us via video conference. Right at the beginning, I would like to present to you our management team sitting here in the front rows. Since the last Capital Markets Day, there are 3 new colleagues who were joining Helvetia. Our new Chief Financial Officer, Annelis Lüscher Hammerli, who joined Helvetia back in October 2020; Martin Jara, our new CEO Switzerland, who joined Helvetia back in May 2020; and last but not least, our new Chief Investment Officer, André Keller, who joined Helvetia in 2019 on April 1st. Now let me turn to the program. After an introduction and a first view on helvetia 20.25 by our Chairwoman, we would like to present you our new acquisition in Spain, Caser. We then want to elaborate our strategy helvetia 20.25 along 5 different blocks, namely along the strategic priorities, the business segment strategies, the prerequisites for a successful accomplishment of our goals. We want to talk with you about corporate responsibility initiatives. And last but not least, of course, about our financials. At the end and in between, we are ready to answer your questions in 2 Q&A sessions. Now before diving into the program, let me just make 3 organizational remarks. The first one, for all those people being present in this room, please make sure that your mobile phones are put on silent. For all those people joining us via the means of video conference, please make sure that your microphones are put on mute. And last but not least, I would like to remind you that this conference is being streamed. Now I would like to hand over to our Chairwoman, Doris Russi Schurter. Doris, unfortunately, cannot be present today for personal reasons. However, she would like to share her thoughts with all of you with a video message. Please.

Ladies and gentlemen, in the next few minutes, I would like to share with you my thoughts on our new helvetia 20.25 strategy. With this strategy, we are pursuing a clear and ambitious goal. Helvetia wants to be the best partner for financial security. We want to set standards in customer convenience and customer access. I'd like to compare this ambitious goal with a mountaineering tour. Since I grew up in the mountains, this comparison is obvious to me. In fact, it takes staying power to reach a summit. The well-known successful Alpine Mountaineer, Reinhold Messner, once said, when climbing a mountain, I never took 2 steps at once. If you want to shift boundaries, you have to do it slowly, steadily and calmly step by step. If you skip steps, you will stumble sooner or later. This also applies to our strategy helvetia 20.25. We have defined clear priorities for the path to the summit. First of all, we want to be present where insurance needs arise. We will continue to focus on the right offer and profitable growth. Finally, we want to seize the opportunities for new business models. For our 3 market units, Switzerland, Europe and specialty markets, this means that we want to consolidate our position as the leading Swiss all-line insurer in Switzerland. The Swiss market is and remains very important to us. However, with the integration of the Spanish insurer, Caser, we succeeded in massively expanding our European business and making Europe a second pillar in our group. Helvetia will become as a result an even more European-oriented financial service provider. This Europeanization makes me personally very proud. You will meet the CEO of Caser in person today and can, therefore, also gain direct impressions of what is a very valuable acquisition for Helvetia. Finally, in specialty markets, we are aiming for further profitable growth in international specialty insurance business and in active reinsurance. Our new strategy, therefore, is based on even broader diversification and thus, sustainably increases Helvetia's success for investors, customers, employees and all other stakeholders. A strategy always involves financial goals, too. We have set these goals just as ambitiously focusing on profitability, operational efficiency and the sustainable ability to pay dividends. This will ensure that we remain a reliable partner for our shareholders in the future. We are aware that our mountain tour requires a lot of stamina and endurance. And we want to move forward step-by-step steadily and quietly as Reinhold Messner defined it. Thanks to a deep breath and the appropriate patience. I am sure that we will reach our goal, the summit. I would be very pleased if you would join us on this climb. I would like to thank you very much for your interest in Helvetia.

Ladies and gentlemen, allow me a short view back on helvetia 20.20. We are glad to conclude that we were keeping our promise in terms of growth, profitability, capital strength and dividends. And of course, that's our aim for 2025 as well. We want to stick to our goals. Now with our new strategy helvetia 20.25, Helvetia is entering into a new era. From a Swiss insurance group with a couple of operations abroad to a financial services provider anchored in Switzerland with a strong footprint in selected European markets, global access through specialty markets and tremendous opportunities around asset management and ecosystems. Our group's profile changed within the last few years. Specialty markets and our European branches increased and thus also changed our group's profile. Talking about our group's profile. As you saw on this chart, the European segment increased from 32% to 38% in terms of volume within the last few years. And what could better illustrate this enormous development than the acquisition of a 70% stake of Caser in Spain. Back in January 2020, just before the outbreak of COVID-19, we were announcing this transaction. And despite many challenges, but thanks to the trust of our investors, we could finance the deal and conclude the transaction by the end of June 2020. Caser did to many and to a great extent, even exceed our expectations. And already for the first 6 months of the consolidation of this company, it paid off very well. Who could better present this pearl in our group than our Caser CEO, Ignacio Eyries García de Vinuesa. Please Ignacio [Foreign Language], welcome on stage.

Thank you very much, Philipp. For me, it's a real pleasure to introduce Caser and myself to all of you. Caser is definitely in the Spanish market a first-tier leading actor with a well-diversified product structure as well as distribution channels. It does bring to Helvetia its strength on non-life, together with bancassurance as well as a long-standing experience on handling services related to the insurance ecosystems as well a very well-known recognized positively brand name, together with a long lasting experience team. You can see in the chart that bancassurance -- sorry, that non-life accounts for 66% of the portfolio. And even non-life, the breakdown by private is a quite attractive one. Both multi-risk with a stake of more than 32% is well above the average market but as well the balancing presence of motor, small and medium enterprise, what we call corporate, health and other lines brings a diversified and balanced portfolio. As well in life, as you may see, 21% of risk premiums. But in services, I would like to highlight how Caser in the last 15 years has developed its presence on handling firsthand services related to the insurance ecosystems. That means homeowners, mobility, life cycle and health and self. If we get into distribution, not only bancassurance, but as well our presence in agents and brokers, more focused on agents than in brokers as well as with the special designed up to customer agreements with large accounts brings as well a good diversification. If we get into the bancassurance itself, bancassurance accounts for something like 50% of our portfolio in terms of premiums as well in profitability. It can be said without any doubt that we are one of the leading players in bancassurance, maybe among the 3, first one or the second one. That has been built with a network of more than 3 branches, which in exclusivity distribute Caser Private with a history of more than 30 years and 40 agreements where Caser has been able to adapt our business system to the specific needs of those different banks both in terms of product, systems, remuneration, training and more recently, through the signing of exclusivity agreements which permitted Caser, not only to warranty relevant volumes of premiums, but as well sales under a much more profitable circumstance. That drove us as well to the co-creation of Private that agreed development of marketing campaigns and remuneration of the sales force elements. In parallel to that bancassurance strength and non-life, big and diversified presence, Caser has been able in the last years to diversify our portfolio through the building. We've seen those ecosystems I already mentioned, to the building of product-oriented or client-oriented products, such as the one I am introducing here. Let me explain some of the examples which are shown. Caser home insurance amayores, it is a typical multi-risk products, where it is mix, the coverage of a homeowner multi-risk with the increasing needs of aged people for services and dependency help at home within, once more, the life cycle of the persons. Together with reverse mortgage when those people owning a home, but lacking of the day-to-day cash can cash little by little their home and subsequently have a better pension scheme or auto insurance Coche x Coche, where the typical old car with very, very marginal end value, in the case of a total loss, the indemnity is not paid as an amount, but as well as a similar car than the one that person is utilizing for whatever service he may need. All the diversification, together with the initial strength I already mentioned, non-life, Bancassurance has permitted Caser even in a year, complicated as the year 2020 with the COVID slowdown of the market to almost multiply by 3, the growth of the market, showing that those strengths permit us having, as I already mentioned, that first year leading position. Thank you very much.

Thank you, Ignacio. I would like to mention again in a nutshell, what are the 3 elements which make Caser a unique position in our Helvetia's group portfolio. There is the first reason. It's a very profitable insurance company with a highly profitable non-life portfolio. It is second, an insurance company, which has unique market access, especially through the bank assurance channels and above that through new cooperations and also new agents networks. And it is 3 model company for integrating a whole bunch of different ecosystems initiatives into its business model and thus, scaling the insurance activities and improving and increasing the profitability. Thanks a lot, Ignacio. You have a very well-managed company. Now let us turn to helvetia 20.25 and the current trends and opportunities. The world is changing, and so is the insurance industry, which mirrors all those developments around us. The first one is the changing of the customer behavior. We want to even better focus on customer convenience within the next strategy period. And next trend we have to face is the question, do we have the right offerings in a low interest environment for all our customers. And given the many challenges our customers have, do we have the right answers in our product portfolio? And we would like to talk about that as well. A third challenge is the pressure on margins, of course. Our answer is we want to even improve our technical excellence in order to ensure a profitable growth in our insurance portfolio, be it in life, be it in non-life. And last but not least, of course, insurance products, insurance policies might, to a certain extent, be or become a commodity. However, we are sure that our counseling of customers, our approaching the real customer needs is paying off in profitability, in also more closeness to our clients, and it's worth to invest in all those different developments. Of course, all what we do shall make sense. That's why we are really thrilled by our purpose. Life has its risks and opportunities, and we are there when it matters. To do so, we want to make sure that we are not only living our purpose, but on a day-to-daily basis, pursuing our vision which means to be the best partner for our clients, the best partner in financial security, setting standards in customer convenience and accessibility. Of course, by the end of the day, all what we do shall also pay off in terms of financials for our investors, and for our clients because they are trusting in having their insurance policies with a company which is rock solid. Clear financial objectives and financial targets means that we want to make sure that the quality of earnings and growth is kept on a traditionally high level. We are achieving a net combined ratio between 92% and 94% and a new business margin in life between 2% and 3%. We want to increase our fee volume to as much as at least CHF 350 million by the end of 2025. And the fee volume shall contribute to our overall group profit by at least 5%, thus, helping our -- to make our balance sheet even more resilient and mitigating our interest rate exposure in our balance sheet in the mid and long term. Furthermore, we want to realize operational efficiency gains in the sum of at least CHF 100 million. And of course, capital strength and dividends remain decisive in our industry and with Helvetia. Of course, we want to grow the business. Of course, we want to make sure that our life clients get their share. But nevertheless, we want to make sure that we keep our single A rating, notwithstanding our growth. We want to make sure that we can pay out at least CHF 1.5 billion to our shareholders over the next 5 years. And all that with a return on equity of between 8% and 11%. Making helvetia 20.25 a success story means living our purpose, pursuing our vision sticking to our financial goals, of course, and making sure that overall, we are not only making happy our clients but also our investors by ensuring the profitability of our insurance group. Now I would like to dive into our strategic priorities. The first one is dealing with customer convenience. As I said before, the customer needs are changing over time, of course. And there is not that customer and that customer need. The customers and their needs are and remain hybrid. And it is our duty to make sure that we are coping with as many needs as possible in a reasonable way. We want to be best partner in financial security, setting standards in convenience and accessibility. What does that mean? We want to be present at all those different points of sale when insurance needs might arise. We would like to present you now at the beginning of this section, 2 videos. The first one dealing with Smile, the #1 insurer in Switzerland. And the second one, dealing with a very efficient tool for our clients in the marine insurance called PuMarSpeed. Please have a look.

Hi. My name is Pierangelo. I'm the CEO of Smile. Today, I'm going to show you why Smile is significantly contributing to Helvetia's strategic priority customer convenience. Smile is a leading online insurer in Switzerland, the oldest insurer tech and the only insurance to be perceived by the Harvest brand predictor study as a digital brand. From the financial point of view, we look back on a strong development over the past years and a record-breaking year in 2020, where we exceeded the top line of CHF 100 million and 150,000 customers in our portfolio without compromising on profitability, which is reflected in a strong combined ratio. Through this, we significantly contributed to Helvetia's non-life business, especially in the motor business. We have been named and awarded several times as the Netflix of insurance. We truly believe that the only way to successfully compete in a digital environment is to reach a day-to-day relevance just like other consumer brands as Netflix, Amazon or Spotify. Let me now explain how we do that. First of all, and very important customer centricities are driver enabled by technology and not the other way around. We redefine the user experience with the mobile phone in focus and harvest the mobile potential by being a service champion and following rigorously customer centricity, like addressing consumers by first name, introducing a subscription model or gamification elements like Smile Drive Coach. We facilitate radical automation and turn data to value with a serverless technology and architecture and scope. We have ambitious plans. And by 2025, we aim to double our customer base without compromising on profitability. Based on our success from the past, we know we're going to deliver simplicity, scalability and customer centricity are the foundations of Smile and will drive us also in the future to harvest the pure digital potential. With a unique complementary business model to Helvetia and a differentiating value proposition, Smile does not only significantly contribute to Helvetia's strategic priority, customer convenience, but also ensures new sources of growth and income for Helvetia. And finally, thanks being part of the Helvetia. We can share our experiences across all parts of Helvetia, so that we can bring innovative approaches of Smile to scale in our core business.

My name is Pascal Barbato, and I'm responsible for the Global Marine business at Helvetia. Helvetia is by far the largest marine insurer in Switzerland with a range of transport insurance products tailored to the respective needs. And thanks to our international network, we offer worldwide solutions. Our customers, our logistics, our transport companies as well as manufacturers and traders with the need to ensure their own or third-party goods during transportations worldwide against loss of damage. To increase the customer convenience, satisfaction and loyalty according to our strategic priorities, we have developed together with our customers, a modern online solution. In less than 120 seconds, our customers can ensure the shipments online. Whenever they want the system is available 24 hours, 7 days a week and worldwide. With 1 simple click also an insurance certificate is produced, if required. The user interface is so simple that no training at all is needed. We have integrated a speedy calculator for costs, including taxes, so that our customers have an immediate information about the insurance premium. It is a cloud-based and future-oriented technology compatible with tablets. Large data volumes are no problem at all. And also international insurance programs can be displayed. We have integrated compliance checks and a simple and secure log in. The system can be adapted individually to all customer needs or country requirements. Even an interface can be created to other systems to avoid double entry. Hundreds of satisfied users are already ensuring thousands of transport with PuMarSpeed at Helvetia. For the future, we will further develop the system with new features and integrate new business lines like Art insurance. PuMarSpeed is a unique solution and boosts customer convenience and therefore, increases customer retention.

Apart from all those easy access tools, which should make the life of our customers more convenient, we are also developing more and more tailor-made insurance products with added value. Here is an example of Helvetia France, a geolocation tool in yacht insurance. What is all that for? It first helps all our clients prevent their damages because they know where their yachts are right at the thunderstorms. And at the same time, it helps Helvetia mitigate their risks and better monitor the risks we have out there on the high sea. Now let me wrap up. What we want to do around customer convenience is we want to reduce complexity. And at the same time, we are sure that we are enhancing customer experience and by increasing efficiency, not only helping our clients to have a more convenient access to Helvetia, but for Helvetia to lower its costs. By the end of the day, we want to live our brand promise, simple, clear Helvetia. And all that shall, of course, pay off in terms of financials. Happy clients are clients who stay with Helvetia, happy clients are clients who we can benefit from in terms of cross-selling and happy clients are usually clients who help us keep a high profitability. By becoming more and more efficient, we are lowering our cost base and thus helping ensure our profitability and at the same time, giving our customers the good feeling that they're insured with a good rocket solid company. And by the end of the day, we want to make sure that all this profitability helps to pay our dividends and to keep Helvetia a rock solid company with a single A rating, of course. Now let me turn to the second strategic priority to the right offering. As I said before, fit-for-purpose offering is key in order to make sure that our clients have the feeling and the security that they're insured with the right company. In a low interest rate environment, it is a challenge to have this fit-for-purpose offerings, of course. We want to make sure that our products and services are part of a comprehensive offering for our clients that they come from a single source and that this solution pays off not only for the clients, but also for the company. Now talking about life business. I would like now to hand over to our head of the pension and life business in Switzerland, Hedwig Ulmer and to André Keller, our Chief Investment Officer. They're interviewed by Susanne Tengler, our Head of Investor Relations.

Hello, Hedwig and André. It's a pleasure to have you here. I would like to take the opportunity to talk with you about the Life business in light of the low interest environment. I have prepared a few questions, and I'm curious what's Helvetia strategy going forward and what is our value proposition. My first question is for André. The low interest environment is putting pressure on life insurers and therefore, also on Helvetia. How is Helvetia responding to the low interest rate environment on the investment side?

It is true. The low interest rate environment makes it difficult to generate attractive investment returns by historical standards. For this reason, we started to diversify the investment portfolio more broadly in recent years and to increase the share of private market investments, mainly investments in real estate, infrastructure and private debt. Even in the low interest rate environment, these asset classes still offer attractive return opportunities, especially compared to traditional investments.

Hedwig, what are the consequences of the low interest environment in terms of products and offerings?

On the offering side, we initiated the shift away from classic guarantees to investment-linked products years ago, both in private pension and in occupational pension. In the occupational pension benefit scheme, around half of the insured persons are already in so-called semiautonomous solutions. This development will continue. We have also adjusted the occupational pension scheme as far as possible to the economic reality with low interest rates and increasing life expectancy and, for example, lowered conversion rates. Helvetia is first mover here. The other insurance companies are now following.

What are the opportunities of this situation?

The trend towards semiautonomous solutions mentioned by Hedwig gives us the opportunity to make our investment expertise available to third parties, whether for our own offers at Helvetia or collective and investment foundations or for other collective foundations.

And the state pension provision is perceived as insecure. The benefits of the occupational benefit scheme are increasing. As a consequence, the importance of private pension solutions is increasing. We filled this gap with savings and risk solutions. I see enormous opportunities for us here.

So what specific positioning does Helvetia want to pursue in this environment then?

We offer life and pension solutions that enable our customers to protect the ones they love and a very free and independent life from a financial perspective. We offer products and solutions that give customers the necessary leeway to adapt them very flexibly according to their life situation. In doing so, we will increasingly combine asset management offers with classic insurance policies.

Naturally, we support the development towards integrated investment and pension solutions. With our Allegra Funds, we have developed a first solution for different risk profiles. With the Helvetia Swiss Property Fund, we also launched our own real estate fund in 2020, which we will continue to expand in the coming years. The focus on investment solutions and services for pension and third-party customers will open up a new source of income for Helvetia in the fee business. These fee streams offer an attractive complement to insurance business due to their relative stability and high capital efficiency.

Another trend is sustainability. What is Helvetia doing here?

At Helvetia, we have increased our focus on integrating sustainability aspects into our investment activities, both in our own investment portfolios and in the product range in the area of pensions. For example, we launched FairFuture Lane in Austria, a unit-linked life insurance policy that invests exclusively in sustainable securities.

My last question is for you Hedwig. Are you sticking to full insurance in the occupational benefit scheme?

We are convinced of the benefits of the comprehensive security of full insurance for a small and medium enterprise, but the price for the security is currently high in the low interest rate environment and the legal framework conditions. We, therefore, also see the advantages of semi-autonomous solutions. These offer clients with a good risk profile, the opportunity to benefit from rising capital markets. Our customers have the choice between semi-autonomous solutions and full insurance, which is very much appreciated.

Hedwig, André, thank you very much for your time and your answers.

Hedwig just mentioned it. Small and medium-sized enterprises are key for Helvetia. Why do we think that this target group is of a big value for us? We think that the SMEs are more and more in a sandwich position between the retail customers and the big corporates. And that's where our value proposition shall jump in. We have, for you 3 different use cases from Switzerland, Austria, and from the third one, you will see it. It's like a surprise, where you see what our SME offerings specifically add has a value for our customers. Have a look.

My name is Adrian Kollegger, I'm the Head of Non-life Switzerland. More than 90% of the registered companies in Switzerland have less than 10 employees. SME customers have other priorities than insurance. They are not experts and insurance is a low interest product for them. Therefore, they rely on their adviser and convenience is key. With more than 160,000 SME customers, the commercial non-life business is attractive for Helvetia. We are a strong partner for SMEs. We have a growing market share, see a high customer loyalty and achieve good profitability, and there is further potential for profitable growth. To achieve this, we deliver on our strong proposition road map. We have launched a new SME service product that addresses customer needs much more precisely. With the service product, we are able to increase average premium per customer and differentiate ourselves in the market. In January, we started a strategic partnership with the IFJ, the Institute for new entrepreneurs. This partnership is unique in the industry and further strengthens our position in the SME segment as expert partners. And in late summer, we are going to launch our SME ecosystem Atlanto. Atlanto offers an integrated platform and marketplace for Swiss SMEs. With this offering, we allow SME to reduce administrative workload and to have access to value-adding services. Atlanto is a unique value proposition in the Swiss financial sector, and we are very keen to its launch. We'll provide you with more information as soon as Atlanto has started.

Hello from Vienna. My name is Thomas Neusiedler, and I am the CEO of Helvetia Austria. Within our strategic target to deliver the right offering for our customers, we, in Austria, are focusing on small commercial business. This is based on our good positioning with our distribution partners, which we have built up over the last few years with the best partner approach. We are now further enhancing this market access to expand our SME business. The focus is on small businesses in almost all sectors, but also on large commercial enterprises with a turnover of EUR 1 million and more. SMEs with special insurance needs such as cyber or special segments such as marine companies and SMEs with a need for transport insurance. Therefore, we have developed new products and services. We, in addition, are building on our existing strengths, close relationships, thanks to our decentralized structure, building up SME knowledge among our sales partners, top service and simple processes. In addition, we are increasingly relying on digitalization and automatization. This is how we differentiate ourselves in the market. Sharpening our profile in the commercial insurance segment will help us to deliver the helvetia 20.25 strategic ambition.

Hello. I'm Vincent Letac, CEO of Helvetia France. Until 2015, Helvetia France was positioned as a pure marine and transport insurer, known to be the #3 in France and with the wider scope of offer. Helvetia considers the SME market as a profitable growth market with a 20% market share and the best technical results among our peers. Helvetia was in good starting position to widen our offer outside of marine and transport to be able to promote ourselves as a multi specialist insurer for medium-sized companies. Between 2016 and 2021, we have, therefore, continuously extended our product range in order to best serve our customers and distribution community of 3,000 brokers. We aim to be preferred by the customers and the distribution partners for excellent service based on knowledgeable and dedicated staff. We will also improve our position as a provider of international programs. Our efforts have paid off, and our business volume has increased from CHF 235 million in 2018 to CHF 337 million in 2020, while our combined ratio has declined below 93%, showing that our technical results are excellent and that our cost ratios have remained well under control. We project that by 2025, our business volume will increase significantly, that our new business lines will constitute 50% of our business and that we will be transacting with more than 4,000 brokers.

Ladies and gentlemen, you see that our SME initiatives throughout the group are amazingly underway. And especially the last one we brought you as a surprise from France. Now of course, all those initiatives shall be paying off in terms of financials. We are sure that the capital-light products help us to mitigate our risks in the balance sheet we have regarding the interest rate exposure. And at the same time, it helps our clients to benefit from new, of course, value propositions. For the SME business, we are sure that this profitable customer segment is very promising for Helvetia. Because it is a segment where the personal counsel, be it by brokers, be it by agents, is still of a great value. There are not robots yet counseling our clients. Now let me turn to the next strategic priority. It deals with the profitable growth. Of course, if we want to develop our group, then it is decisive to profitably grow our business. We want to benefit from our #3 position in Switzerland as an all-line insurance company. We want to benefit from our strong footprint in the European countries in order to make the European segment the second strong pillar in our group. And we want to benefit from the global access in specialty markets in order to make sure that we benefit in active reinsurance and in many specialty lines, such as engineering, marine and art. I now ask my 3 colleagues, Markus Gemperle, CEO Europe; Martin Jara, CEO Switzerland; and David Ribeaud, CEO of Specialty Markets, to present their respective strategic plans. Please go ahead.

Thank you. In Switzerland, we pursued a strategic priority of profitable growth by increasing customer value and by actively managing our margins in product and in portfolios. How do we increase customer value? By getting more customers for Helvetia and by getting more Helvetia per customer. It all starts with the value proposition and the differentiation by customer intimacy and by customer convenience. Based on this, we can go and exploit the full potential of the omnichannel approach we got in Switzerland. This means simple sales processes and simple cross-selling processes based on and steered by advanced analytics that tell us exactly when it's best and how it's best to address our customers with our value propositions. To get the full potential of the growth and of the increase of the customer value, we also have to expand in our customer access to new customers by partnerships. You will hear more about this in the B2B2C section afterwards. How do we optimize our margins? This, at one hand, means a clear focus and also a rigidity on cost management, overall, on administrative costs. At the other hand, we have to stay on top of the market regarding our technical capabilities in pricing, portfolio management, and in claims handling. Martin Tschopp, our Chief Customer Officer in Switzerland; and Adrian Kollegger, Head of non-life Switzerland will go into these topics now. Let's have a look.

My name is Martin. I'm the CCO at Helvetia Switzerland and a member of its Executive Committee. Profitable growth in our core insurance businesses, Life and Non-life is a key strategic priority. Top line increase stems from 3 main sources; pushing cross-selling and up-selling to existing customers, achieving higher retention by superior customer satisfaction and attracting new customers, of course. Rigorous outside-in thinking, combined with a data-driven approach and our distribution power, in particular, our strong tied agent network are the foundation of our growth agenda. We aspire to differentiate ourselves through customer intimacy and convenience. Intimacy results from personalized customer address and customized solutions. Convenience from seamless end-to-end customer journeys and intuitive interactions at every touchpoint. I would like to illustrate the described approach with 2 specific examples. At Helvetia, for instance, we launched a marketing campaign focused on pension planning, which was built on both our capabilities in data analytics and our tied agent sales force. Leads were sourced and prequalified by our data analytics team, while segment-specific go-to-market was designed by the marketing folks. The final results were convincing. We were able to increase conversion rates from lead to closing by an impressive 30%. As part of our mobile first strategy at Smile, a lifestyle app was introduced. In addition to pure insurance functionalities, the app enables payment and mobility services. Drive Coach, for example, is an add-on service, which analyzes drive style of user, i.e., speed, acceleration and braking. Collected data is processed real time, and an algorithm scores the driving and give specific feedback on drive behavior. Good driving is rewarded with Smile points, which can be exchanged to cash or donated to a charity. As a result, the customer considers the interaction with the app as meaningful which increases loyalty of existing customers and hopefully attracts new ones. Both examples illustrate nicely that analytics is neither intuition nor gut feel. It is the result of consistent data gathering and rigorous number crunching. Consequence scaling of gained insights in all distribution channels is a key contribution to profitable growth.

My name is Adrian Kollegger. I'm the Head of Non-life Switzerland. The Swiss insurance market is quite saturated. Increasing competition puts further pressure on our margins. The digital transformation changes our business model. Cost discipline is of utmost importance and the use of data will be more important than ever. With our Non-Life Technical Excellence Program, we exploit the potential of data, stabilize and selectively improve our margins and assure competitiveness. The program is based on 2 pillars; pricing, underwriting, portfolio management as well as advanced claims management. Our technical pricing already integrates internal and external risk, customer and market data. To stabilize or selectively increase our margins, we are building new pricing mechanisms using analytical capabilities. This strategy has been jointly developed with Smile. We are able to benefit from Smile's specific experience in this area and can scale it in our core business across all distribution channels. Advanced claims management includes our efforts in digitization, automation and straight-through processing, combined with the growing use of data and analytics. A good example for this is the automated processing of cost estimates submitted by the body shops in case of a motor claim. Cost estimates are processed automatically. An analytic service has been implemented to make the triage between straight-through processing and individual reviews by an expert. Through machine learning, we trained the service and achieve best results in detecting irregularities. We are more efficient and achieve a significant contribution to margin improvement. Next focus areas to further strengthen our excellent market position, are fraud and the claims partner management. To summarize, thanks to our technical excellence program, we address all potentials to stabilize and strengthen our margins in the Swiss portfolio and thus enable profitable growth over the strategy period.

Since deregulation of our industry, we have learned that, of course, innovation in products and services, they are needed. But they are not enough to sustainably differentiate in the markets. So therefore, Helvetia has implemented a kind of a change program, which we call the best partner approach with the aim to create a specific proximity, also loyalty to our sales partners. This means a lot in the organization, overcoming silos, a lot of commitment, a lot of accessibility also especially in areas which are not used to work like this. So if you are a successful sales partner at Helvetia, you are not just talking with some regional deputy sales manager, let's say, in Auto Bavaria, you are talking with the responsible manager in the German management team or even the CEO because you are important. In addition to these, let's say, cultural elements, we, of course, are also delivering hard facts, like digital platforms, technical knowledge, local support, all specific offerings, let's say, for SMEs and their owners. All this with the aim to create an alignment of interest together with our sales partners, and alignment of objectives on profitability of the portfolios, targeted segments or growth to sustainably develop our core business. So we have implemented that best partner approach in all our country markets. And I would now like to share with you a couple of examples out of different markets and different channels. First, starting with Germany and Austria.

My name is Volker Steck. Since January 2015, I have been the CEO of Helvetia Germany. I'm delighted to be with you today and to have the opportunity to share our ideas on how to sustain and accelerate profitable growth. In addition to our tied agents who are part of our Helvetia family, we also work closely together with brokers who are our main sales channel. Today, I am focusing on our independent friends, namely brokers with our best partner concept. All of our sales partners benefit from this. Those who work more intensely together with us benefit even more, depending on the size and quality of their business volume, best partners gain more idealized services and comprehensive support. Brokers expect quick and high-quality responses to inquiries. This will be raised by key accounts and sales, fast policy issuing, quick claim settlement and direct access to our team of underwriting specialists. Highly digitalized processes allow us to serve a growing number of brokers without losing personal contact. Individually, personalized service and digitization complement each other perfectly. In summary, fast response times, our personalized service and best fitting offer, combined with competitive pricing, are an important argument for being a best partner with Helvetia Germany. We measure the success of a best partner approach by clear goals. We want to be ranked among the top 5 insurance partners for our targeted progress based on sales volume. Thanks to our approach, we aim to expand our business in the next 5 years sustainably. Thank you for your attention and your interest in Helvetia Germany.

My name is Thomas Neusiedler, CEO of Helvetia Austria. Regarding our strategic target profitable growth, helvetia 20.25, I'm pleased to present to you how we apply the best partner approach and what contribution we are making to the strategic initiative of profitable growth. Helvetia Austria offers independent agents various benefits. We stand out due to our short decision-making path. Thanks to our size, we are very agile and can respond to agents' needs. This is particularly interesting for those agents who want a great deal of freedom to make decisions when advising customers so that they can play to their own strength. This best partner approach convinces many agents. In recent years, we have noticed a great willingness to transfer entire P&C portfolios to Helvetia. We have developed a structured approach to ensure the quality of the transferred portfolios and at the same time, increase the loyalty of the agents. This approach has been very successful. Helvetia Austria has been able to grow significantly above the market in each of the past years, while steadily improving the combined ratio. For this strategic period, we have set ourselves the goal of growing again while maintaining the same profitability. This is our contribution to the strategic priority of profitable growth.

And of course, we have also implemented the best partner approach in Spain. With excellent results at Helvetia Seguros within their agents channel, all with a clearly best-in-class approach for bancassurance at Caser. But on top of this, we are now approaching the Spanish market with 2 entities. The 2 CEOs, Íñigo Soto and Ignacio Eyries will now explain a bit more in detail how this works, especially also in the field of digitization, product offering and a bit specific, but for us, very important because very profitable, the burial insurance business. Both companies already today are very well positioned.

Good afternoon. My name is Íñigo Soto, and I am the CEO of Helvetia Seguros España, which is a company that has, among other values, a large and very loyal network of agents and brokers that has been consolidated over the years. The strong and close relationship that the company has with its employees and that network is our best competitive advantage. And it is also our base for the ambitious targets of profitable growth that we have in the coming years.

My name is Ignacio Eyries. I am the Managing Director of Caser Seguros. Caser grows together with the Spanish former savings banks, becoming a leader on the non-life bancassurance distribution. Nowadays, Caser has developed all together, agents, brokers, large accounts and any type of distribution, having partners all around the different alternatives of our industry. In parallel, Caser has developed its presence in a large account of related to insurance services, together with their life cycle. In other words, heritage homes, hospitals, dental clinics and the service and maintenance of buildings and any added value related to the different ecosystems where insurance is present.

Built mainly in our network of agents and brokers Helvetia Seguros has a strong competitive position in the burial insurance business, where we also have a significant volume of premiums. Through a competitive, innovative and very profitable product, we have managed to reach a wide and diverse target in our market.

As well, Caser's presence in burial has a long story, coming from a historic agency network from a company Caser [indiscernible] in the recent years we as well developed our presence on telemarketing, bancassurance and agreements with large accounts. So that means that altogether, we can profit from the critical mass of having a relevant enough size of market presence in burial insurance.

Yes, the combinations of the volume of Helvetia and Caser will make the cost of the burial services more efficient. I am convinced that thanks this cooperation, the burial business will bring steady and profitable growth far above our competitors in the coming years.

Caser has developed a unique expertise in anything it has to do with employee benefits, working compensation and as well pensions. Most recently, with the evolution of the market and the habit of the consumers, we did introduce our Caser Asesores Financieros addressed to give information and to associate our clients on how to build the best offer.

In Helvetia Seguros over the years, we have developed plans to train our agents in the field of saving life business, also trying to give to our customer personalized advice. Now we are working together to transfer Caser pension capacities also to Helvetia network. It will bring us better offer, insurance offer in this kind of product.

For the future, we have clear that altogether, we can develop both niche strategies for given segments of products and clientele as well as putting all together our strengths, having a much more growth presence on the highly attractive high-income individuals savings management.

Additionally, in the area of e-business, both Caser and Helvetia have developed their digital channels, offering an interesting variety of products. We are aware that the change in customer behaviors requires us to develop a multi-channeling strategy. Giving the customer the users, the possibility to freely flow from 1 digital channel to a physical one, maintaining the features of the products and the price offers and also giving priorities to our existing network of broker agents and bancassurance.

Our shared willingness to develop and investigate new opportunities of developing our presence based on the utilization drives Caser to investigate tied-ups with insurtechs, with online brokers and new actors presence through the digital channel. That is fully compatible with our presence on traditional insurance commercialization as well as with our will on keeping on developing the latest services industry.

In specialty markets, we contribute to profitable growth by further developing existing business on the one hand and by underwriting new risks and selected niches on the other hand. Leveraging our existing infrastructure and experience, we are selectively expanding our product offering. This leads to a diversified growth and improvement market positioning as well as a greater cross-selling potential. A few examples are the introduction and ongoing development of aviation, space, cyber, as well as dedicated coverages for renewable energies. We are developing our niches internationally, which we champion with a dedicated presence in London, in Singapore for Asia and in Miami for Latin America. These offices put us closer to the relevant customers and risks and enable us to capture the significant growth potential available globally. The business is acquired in close collaboration with our business units here in Switzerland. Hence, allowing us to deploy the full expertise and technical excellence of our group in all regions. Our long-standing lines of business also offer a great potential in particular, in a currently very favorable market environment. We can indeed increase our shares on existing policies, write business we previously turned down because of unsatisfactory rates and conditions, or nearly see, thanks to our much better profile as an international player. Reto Keller, Head of Active Reinsurance will now give you in his video statement an overview of how we are growing profitably in our insurance. Other examples pertaining to engineering and aviation can be found in the Capital Markets Day section of our website.

Hello. My name is Reto Keller, I'm the CEO of Active Reinsurance Department at Helvetia. I joined Helvetia in October 2019. But before that, I worked for more than 25 years in the reinsurance industry in various roles and functions on the buying and selling side of reinsurance. I have the pleasure in the next couple of minutes to talk to you about our contribution to the group's overall 20.25 strategy. And the focus lies on the topic of growth. But before doing that, I would like to answer the question, why is Helvetia Active in the assumed reinsurance business at all? Well, on one side, it gives us access to international risks, which are complementary to Helvetia's auto activities; and on the other side, we are able to contribute to the sustainable profitability of the group. Active Reinsurance writes a business volume of around CHF 730 million per year. And with that, we're responsible for 50% of the business originated within specialty markets. That's a clear demonstration of our importance to the overall international footprint of Helvetia. So let's move on to the 2025 strategy and how do we fit into that. Well, we have started to being a following line reinsurer, and we will continue doing that. And we have also been on an expansion strategy for the last couple of years, and we will also continue doing that. But the key focus for the next 5 years lies on the diversification of our portfolio. So how do we do that? We have specifically specified 5 initiatives, which help us to achieve that overall goal. Those 5 activities can be clustered in 2 categories. One is the geographic dimension and the other one is the product dimension. On the geographic dimension, we have the leverage aspect in mind when it comes to the diversification of our footprint in the emerging markets, that's Latin America and Asia. And there, we are leveraging existing platforms we have there in Singapore and Miami. On the other side, we have intensified our activities in the European areas where we are underrepresented in certain areas like the Central and Eastern Europe part as well as the Nordics. On the product side, we have clear enhanced our activities and capabilities in the NatCat side, but we also have enhanced our capabilities in the biometric Life Re segment and we would like to benefit from the attractive opportunities in the specialty lines. So with all that, we are able to produce a very consolidated business approach, and we are able to continue with the risk portfolio diversification and which helps us to continue with our profitability. So what's our ambition for the future and how can we succeed? Well, we aim to execute on our 2025 strategy by living up to our vision of being a long-term value-oriented technical competent reinsurer. We are supported by the Helvetia's strong balance sheet and also by the experience and expertise of our employees. Together with that and our product dimensions, we feel that we have a convincing story line to tell to our clients. And therefore, we are able to succeed there. We also are currently benefiting from the favorable conditions in the reinsurance market globally that is in particular on the rate side, but also on the terms and conditions side. And with all of that, we are convinced that we will succeed in the future.

Thanks to all of you. We are sure, and I mentioned it before, that profitably growing our insurance business is the backbone of our group, of course. And we have to question ourselves, what is the profit contribution of all those different initiatives. The contribution lies in, first, the quality of earnings. It is decisive to even better manage our insurance portfolios in all the different countries, be it in non-life or life by, for instance, facing margin pressure by new means of technical excellence, as we saw before. It is decisive to make sure that our portfolio, be it life, be it non-life or be it the whole portfolio is and remains well balanced. And it is key, of course, to improve our operational efficiency in order to make sure that our backbone, the insurance portfolios remain in best shape. Now let us turn to the fourth strategic priority. It deals with the new opportunities. Of course, you seldom see in a balance sheet of an insurance company align, which reads research and development. But we at Helvetia, we are sure that the recipes of today might not be the recipes of tomorrow. That is why we want to explore new business opportunities, anchored in a profitable insurance business with a resilient balance sheet, we have to make sure that we are facing the future and its tremendous opportunities around, for instance, ecosystems and asset management. What does that mean? We want in different pillars go forward in trying new business models in looking for new opportunities and of course, in integrating all those new models into our core business. The first example we would like to share with you is the ecosystem Home and its anchor MoneyPark in Switzerland. You will see in this video clip Martin Tschopp, our Chief Customer Officer; and the Chairman of MoneyPark, together with Stefan Heitmann, MoneyPark's CEO and Founder.

Hi. My name is Martin. I'm the Chief Customer Officer at Helvetia Switzerland and the Chairman of the Board of Directors at MoneyPark. A key strategic thrust of Helvetia is to tap into new revenue sources adjacent to its core insurance businesses in life and non-life. As a spearhead to develop a corporate ecosystem around customer needs related to privately owned property, Helvetia acquired a majority stake in MoneyPark back in 2016. I would like to hand over now to Stefan who will give you more background to our joint strategic vision.

Hello, my name is Stefan and I'm the Founder and CEO of MoneyPark. I have the pleasure to briefly share with you the very strong development of the last year as well as our vision for the future. As Martin just mentioned, since 2016, Helvetia is a majority owner of MoneyPark, and MoneyPark is the anchor of the Helvetia ecosystem Home. We fit together very well, which benefits our customers, Helvetia's and MoneyPark's. We are closely interlinked in our core areas of expertise in mortgage advice mortgage related pension planning and real estate. The year 2020 has shown that the ecosystem with MoneyPark is a strong anchor is already starting to prove itself very well. Despite COVID, it was MoneyPark's best business year yet. Last year, we brokered well over CHF 3 billion mortgages from over 150 different banking and mortgage providers out of our 20 branches and together with our 300-plus colleagues. The fact that demand for homeownership and the desire for a house is such high, especially in the current situation, has certainly helped us here. In 2020, we also took the next big step in our short history. We got directly into the business of supporting our clients in buying and selling real estate. Why? First, because the same values that guide us are still lacking in today's real estate market, transparency, independence, convenience. And also because we have thousands of customers looking to buy and tens of thousands that we finance over the time, some of them will eventually want to sell as well. Therefore, we have created Switzerland's first Big Data platform, currently unique in its kind. Compared to other offerings and platforms in the market, ours is by far the most developed and comprehensive, and we are constantly expanding it. We're currently unique in this market, and our offer provides a completely new type of real estate and mortgage brokerage services, helping customers from buying to owning, into selling, from price assessment to value development from searching to financing. Going forward, we want to become the #1 choice for any customer in Switzerland dreaming of their own house. And we want to be the #1 choice for our customers in terms of getting all the information and all the data he or she may need to make his or her decisions. We want MoneyPark to become the information powerhouse in the Swiss real estate and banking market. And in doing so, we connect previously separated worlds and break down silos in a property owners customer journey. Helvetia is a key partner for us in this journey. We see great potential going forward in this partnership. Many Helvetia customers deal with real estate. Many of them have ownership issues and at some point, have questions concerning their homes. And thanks to the cooperation between MoneyPark and Helvetia, they will soon receive independent advice also in this regard. This is what MoneyPark is all about.

New opportunities apart from orchestrating an ecosystem home in Switzerland. Caser, as we've heard several times this afternoon, is orchestrating its own ecosystem around health and care in Spain, thus addressing new customer needs of an aging population, combining their needs with traditional insurance solutions and making a difference in the market. Have a look at the next video clip, how our people in Spain are orchestrating their specific ecosystem, health and care.

My name is Miguel Azpeitia. I'm the Health business manager at Caser. My responsibility comprises, the health insurance, our main activity in the field, but also all those other that complement and enhance in what we call the health ecosystem. Let's start with the opportunity we foresee. Aging population and medical innovation will make us more relevant for the future. In this context, providing complete services to our clients forces us to go beyond the insurance. But this more customer-centric approach makes a difference in our value proposal. Health insurance complement the public system in 2 principal ways, faster access and personalized attention. Only 1/5 of the Spanish population have a private health insurance. To give access to more people, we have a product for every need. Balanced omnichannel distribution through banks, agents, brokers, direct sales and affinities is a company's strength. It also allows us to get to all the different types of clients. Focusing on families and SMAs requires an efficient communication with clients. Health products involve more than 20x more frequent contacts than other insurances. Our Caser health app is in the epicenter of this servicing strategy. In telemedicine, medicine comes first. An actual medical center has an integrated team under the supervision of a competent medical manager. The access to patients' medical records, coordinated care, including medication prescription and control, a complete virtual hospital. Teleconsultation, video consultation and medical chat are all different modalities of connection, but always supported by the same medical staff, a powerful tool, all along the care cycle from prevention to long-term care. Health insurance marketing has 2 implications both got to consider. Firstly, is you and your family who will receive the care included. Secondly, it has plenty of very important details to explain. Specialization is crucial. By deploying our own sales network, Caser has been able to focus on selected markets, looking for growth potential and profitability. It also permits us concentrated effort in a specific product segments and campaigns. The network is integrated by more than 250 tied agents working from both branches, contributing 25% of our sales. There's a great opportunity for insurance companies in dental care, not being covered by the public system. Private market is a large one, more than EUR 8,000 million and expanding, thanks to the medical innovation, the longevity, increasing interest for oral health and aesthetics. 7 years ago, we started deploying our own dental clinics chain, now integrated between 22 of them, to help develop dental insurance. More than 60,000 clients benefit from the best dental treatments through it. Not everything can be easily included in an insurance. Caser can help with also other health interests; maternity, nutrition, wellness, physical activity, genetics and many other. As membership, advantages club pushes 2 main goals. Increasing loyalty of our health clients being more present in their life and making easier the cross-selling, permitting motor, home or life clients approach to our health services. To make possible the use of private health with no insurance, more than 80 hospitals partnered with us for a real turnkey service. Coordinating the previous checks, the surgeon, operations theater, and aesthetics, hospital and postsurgical recovery, always with the best professional resources, fair and closed price warranty and support. Finally, we can conclude with our ecosystem motto, insurance plus services equals more health. This is how the health ecosystem works, every part supporting each other.

Ladies and gentlemen, new business opportunities. Managing an insurance company also means thinking about what the future could look like, what's new customer needs could look like, what our industry could look like. And that's why we were investing and setting up a venture fund a couple of years ago. The venture fund at Helvetia gives us access to new business ideas, new people and new future. Have a look at the video clip of Michael Wieser, our Managing Partner for the Helvetia Venture Fund.

Start-ups are driving force in global innovation. The Helvetia Venture Fund invests in early-stage start-ups that use new technologies, enter new markets and provide new customer experiences relevant to Helvetia's core business. In general, Helvetia Venture Fund aims for a minority stake and invests on average between CHF 500,000 and CHF 2 million per financing round. Out of the 16 investments we have made so far, let me briefly introduce you to one. With FAAREN, Helvetia can increase its reach into the upcoming car subscription market.

My name is Daniel. I'm one of the founders of FAAREN. FAAREN enables automotive companies to offer car subscription services. We do this by offering a white label solution in the marketplace. For consumers, it's very important that car subscription means that it's an all-inclusive fee. And this also means that insurance is part of the all-in fee. And this is why we are very lucky to work with Helvetia Venture Fund as VC investor, but also with the Helvetia insurance company as a pan-European corporation partner for the insurance part of this important topic.

The investment in FAAREN was made a few weeks ago. FAAREN and Helvetia are currently initiating a corporation as Daniel mentioned. FAAREN is a good example of how we take advantage of new opportunities. The investment gives us access to the car subscription market, which has gained massively in importance over the last year. After 4 years of operation, we are on track with our strategic goal to partner with a number of technology firms and to enable more future revenue for Helvetia. In addition, the fund also pursues financial goals. The Helvetia Venture Fund is performing well within good venture capital benchmarks. In the years ahead, we'll continue to focus on insurtech and proptech, and we'll increase our sourcing activities in Spain. In this way, we take advantage of new opportunities.

Life is actually full of risks and opportunities, and we want to be there when it matters when new insurance needs might arise. It might be at the point of sale of a mortgage of a car or of a consumer good. That's why we were investing quite a lot in our B2B2C initiatives. Daniel Signer, the Head of Partnerships and B2B2C in Switzerland, is sharing in the next video clips, a couple of his thoughts also talking about a pioneer cooperation with the Car of the Year Polestar.

My name is Daniel Signer, and I'm responsible for the B2B2C business of Helvetia, where we integrate our offering into the customer journeys of partners such as MediaMarkt, Polestar or furniture retailers. Let me briefly show you how Helvetia is exploiting new opportunities in the B2B2C market and make sure that we are there when it comes to insurance consequently thought from a customer perspective. How does this market actually work? B2B2C models make tailor-made insurance products available to end consumers at the point of sale. Helvetia is therefore cooperating with partners like vendors or manufacturers and is thus present whilst the need to protect a good is greatest. This market is becoming increasingly important. On the one hand, because it allows vendors to offer additional service components to the customer. On the other hand, digitalization simplifies the sale of products by a third party. Helvetia offers innovative and tailor-made insurance products for goods and services in different industries, as, for example, for electronic goods or sports equipment, amongst many others. In April, we entered into a cooperation with the Swedish electric car manufacturer Polestar in the Swiss market. Helvetia motor vehicle insurance can now be concluded directly via Polestar's digital sales platform. With this cooperation, Helvetia is also successfully positioning itself in the area of motor vehicles, a market that will change accordingly in the coming years as a result of changing mobility needs. Thanks to Helvetia Liechtenstein, it is our USP in the market that we can offer our partners tailor-made insurance products for their products across Europe and in Switzerland as well. Until the end of the strategic period, our ambition is to continue to grow profitably and to benefit from the increasing attractiveness and relevance of the market. A lean organization with minimal staff requirements allows us to ensure great economies of scale, and the very capital-light portfolio delivers positive results regarding return on risk capital. We will continue to expand data analysis skills and technical excellence to ensure that we deliver sustainable, profitable growth in this very promising part of Helvetia's business. As you can see, this market is gaining importance and is very attractive. Helvetia is ideally positioned to take advantage of this new opportunity.

Ladies and gentlemen, of course, you could challenge all that and ask us what's the burn rate of all that, of all those initiatives you're undertaking. We are not talking about burn rates. We are talking about profit contribution around all those different initiatives, starting with Smile, which is not a start-up burning any money but a #1 insurance solution in Switzerland with a combined ratio below 90% and thus contributing to our overall profit. Talking about new business ideas, of course, it also pays off in getting new ideas, in getting new business models. However, we want to make sure that all those initiatives are earning as much as at least CHF 350 until the end of 2025 and that the profit contribution is at least 5% to the overall group's profit. Now let me quickly summarize. We were starting with the presentation of Caser, our new pearl in Spain, which is a very profitable insurance company, and furthermore, having tremendous opportunities around its ecosystems, health and care and down there as well in Spain. This ecosystem is not coming out of any fantasy. It is working and generating profits. We then moved on in exploring our 4 strategic priorities: customer convenience, profitable growth, the right offering and new business opportunities. And before having a break, we would now like to open for your questions. And for that, I hand over to Susanne Tengler.

Thank you, Philipp. Ladies and gentlemen, you will now have the opportunity to ask questions on our strategic priorities. We have scheduled about 10 minutes for this session. [Operator Instructions] We will start here in the room and then post the Q&A session to the live stream. [Operator Instructions] So we will start here with the questions in the room, and I would like to open the Q&A session to you. So who is going to ask the first question? Anne-Chantal, please.

Thank you. Anne-Chantal Risold from Octavian. We have seen the 2 Spanish CEO just before on screen, see that there is a beginning of synergy between the Helvetia Spain and Caser with the product exchange or information exchange. It would be interesting to hear more about what's the next milestone about the integration of Caser in the group.

I would like Markus, our CEO for Europe, and then Ignacio to answer this question.

Yes. Thanks for that question. Obviously not the first time that we have that question on the table. So it is clear for the time being, we do have a 70% stake at Caser. So we are not only owner of Caser. We do have our most important bank partners as shareholders still in the shareholding. So therefore, we will approach the market with 2 separate entities. But we do have, of course, a specific plan to take synergies, of course, but not just cost synergies. We see a lot of opportunities to derisk the market. So for the time being, we do approach with 2 entities in that market.

While Ignacio is coming on stage, I can tell you that on a group level, we already could leverage, of course, some synergies, for instance, in terms of internal financing, which is already concluded. We could finance at better conditions, a couple of obligations Caser had within our group. Second, we are exploiting our group reinsurance policies together with Caser. Caser gives us, with its very profitable portfolio, new opportunities in better tailoring our reinsurance position as a reinsurance buyer for the direct insurance activities in Spain. And there are a couple of other synergies on the group level. But now back to the market.

Thank you very much, Phil and Markus. I think that with the adding of Caser, Helvetia Seguros, the position of Helvetia in Spain changed dramatically, not only on some products to weather development but as well in anything which has to do with the market position, bargaining power in front of providers, networks, actors, partners. Gives us, Caser, the strong position of being part of Helvetia, having a solid partner but as well improve our cost and bargaining our market position. We are playing like a first year, #7 in non-life actor that changes totally the work for both of us.

Any further questions? Yes, over there, please.

Matthias Niklowitz with Handelszeitung. Do we have some more M&A plans like Caser in other markets around Switzerland? And if yes, in which areas would you go? Which typical size? Would it be a similar-sized object? Could you please give us some ideas on that?

Thank you for this question. Of course, for the time being, it's about consolidating what we just acquired last year. If looking at M&A targets, then we are focusing on those markets we are already in. So there are no plans to go beyond, for instance, our European countries. If there are interesting specialty lines portfolios, of course, there are more on a global basis, but basically, we are looking for M&A targets within our European boundaries.

Any further questions from the room? Otherwise, I would switch to the live stream. Here, I have one question from Will Hardcastle. So Will, please turn on your camera and go ahead.

Hopefully, you can hear me. Just really touching on the question -- on the commentary we made on the investment side, just trying to ascertain the -- perhaps the illiquidity premium currently being achieved on the private debt and how this has changed over the past 18 months. And also how does the credit rating work on the private debt here? Is it internal? Or is it based on an average rating?

I would ask Andre Keller, our Chief Investment Officer, to answer this question.

Thank you for the question. So the illiquidity premium, obviously with the expansive monetary policy has decreased over time. And as all financial markets are highly valued, also the illiquidity premium has decreased and private markets are more expensive as well. We still believe, considering valuations, that it's, compared to traditional markets, attractive but obviously expensive as well. So the second part as regards to internal ratings, so we work also together with different advisers that support us in creating a rating, an internal light rating. But it's nonrated in the disclosure. Susanne?

If you have a further question, Will, you have to unmute again and -- because we can't hear you.

Okay. I think I'm -- there we go. Can we -- can you just clarify how it's treated on SST? Is it given a blanket corporate rating?

In SST, it's mapped into a similar category like a BB.

On the live stream, I have no further questions at the moment. So again, in the room. Fabrizio Cattaneo, please.

Thank you from Pictet Asset Management. Maybe on the reinsurance business, the strategic priorities, maybe a bit of color on the relationship with Caser since they seem they will be underwriting some of the business there and the metrics that they use to be selective on the underwriting front.

There are no plans -- if you are talking about the Active Reinsurance, there are no plans that Caser is underwriting Active Reinsurance. We are really sticking to a very rigid governance, so to say, in Active Reinsurance, underwriting every contract out of Switzerland. And it's only the reinsurance, the Active Reinsurance department, which is underwriting reinsurance policies. Of course, there are, so to say, a couple of front men positioned in Miami or Singapore who do not have underwriting competencies, but they should have better access to the market. But there are no plans that any of our business units or segments or countries, markets, whatsoever, are underwriting Active Reinsurance. Not at all.

Okay. So I take a final question.

It's more about the synergies, sorry, of the group reinsurance as a buyer of reinsurance coverage. That's where we see synergies.

Okay. I'll take a final question from the live stream for that first Q&A session. We will have another at the end. And the next question comes from Rene Locher. So Rene, please turn on your camera and go ahead. We can see you but we can't hear you at the moment.

Okay. That might be time for a break.