MunichRe IDay2017 Presentation PDF

INVESTOR DAY
Munich Re driving digital transformation
Munich, 21 November 2017

Agenda
A Framework
and infrastructure B Business
transformation C Business
extension
Munich Re (Group) Cyber insurance Internet of Things

Joachim Wenning Daljitt Barn Greg Barats
CEO – Munich Re (Group) Global Head of Cyber President and CEO – HSB
ERGO Digital Ventures Canadian multi-channel Digital Partners

Mark Klein distribution Mary Forrest Andy Rear
Chief Digital Officer – ERGO Group President & CEO, North America (Life and Health) CEO – Digital Partners
Reinsurance ERGO Mobility Solutions nexible

Marcus Winter Karsten Crede John Paul Pieper
Head of Reinsurance Development CEO – Mobility Solutions CEO – nexible
Data and analytics Mass customisation in India

Wolfgang Hauner Ritesh Kumar
Chief Data Officer Managing Director and CEO HDFC ERGO India
Investor Day 2017 2

Munich Re (Group)
Joachim Wenning
Investor Day 2017 3

Framework and infrastructure – Munich Re (Group)
Digital business models have been penetrating

all industries since almost 20 years
Product launch
1998 2008 2009 2010
RETAIL MUSIC COMMUNICATIONS TRANSPORTATION
Insurance industry in the midst of digital transformation
Images: used under license from shutterstock.com Investor Day 2017 4

Insurance industry perspective –

Future winners will leverage “digital ingredients”
Traditional insurance Additional value-creation lever: Opening the gates to
value drivers will remain Data analytics and technology new businesses
Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: Getty Images
REINSURANCE  New risks, extended insurability,  Changing front ends

 Risk assessment and risk mitigation/prevention  Changing needs of transforming
 Products  New products, solutions, and industries (from standard products to
PRIMARY INSURANCE extended services system solutions)
 Sales  Effectively serve the (hybrid)
 Operations customer across all channels
ASSET MANAGEMENT  Efficiency increases and automation
This will sophisticate/extend “traditional” and create “solution” business for transforming industries
Investor Day 2017 5

To remain a winner in the future, “digital ingredients”

are embedded in our business strategy
STRATEGIC FOCUS
Improve and grow the Group portfolio Invest and divest according to Digital transformation
Business first strategic fit and performance Build new businesses
RESULT FOCUS DIGITAL FOCUS LEADERSHIP FOCUS

Strict bottom-line focus Invest in technology, data, and agile IT Rigorous execution
ERGO Strategy Programme Partner with start-ups and InsurTechs Powerful leadership
Create new business opportunities Create new market access and Reduce complexity and drive
new business models business
Leverage underwriting and
innovation Co-create new businesses with clients Push to win
Strong asset management
BASIS
Reliable results Client and business focus Leading brand
Attractive returns to shareholders Leading functional competencies Attractive place to work
Transparency Strong capital position Driving change
Investor Day 2017 6
To achieve concrete results from innovation and

digitalisation, we systematically follow three steps
OUR AMBITION
Focus and execute Fully exploit value-
 Develop Munich Re creation potential
Explore and learn portfolio through from “digital ingredients”
 Scout technology business transformation
Build the foundation and trends and business extension
 Establish innovation
 Drive idea generation  Consequently drive
infrastructure
 Experiment along key activities
 Create separate room
variety of initiatives
for innovation
 Promote cultural change 3
1 2
Investor Day 2017 7

1 We have invested in building a global foundation

for innovation across the Group
Invest in global
innovation footprint
Invest in Invest in
people projects
Global network of >€160m invested
>300 FTE dedicated to beyond FTE assignment
innovation activities and since 2015
>200 FTE with a data
science background
Invest in data analytics Invest in

and technology infrastructure acquisitions
Bi-modal IT, smart data analytics, data storage >€60m invested in more than 10 corporate venture capital
(“data lake”), cooperation with technology (CVC) projects and start-ups with primary focus on
analytics providers InsurTech, IoT and data specialists – further M&A activities
based on strategic fit and performance/scalability
Investor Day 2017 8

2 We turn ideas into business potential based on

a managed process from idea generation to implementation
Encourage
idea generation
>420 innovation ideas assessed,
based on >1,000 proposals
Execution or early exit

~200
Testing and ideas
discarded
learning (from
success and
>220 innovation projects and
pilots (thereof ~130 ongoing)
failures) ~90
projects
Market launch stopped
and scaling >20 implementations
Investor Day 2017 9

3 We take an active role to continuously transform and extend

our business – Selected projects to be discussed today
Business transformation Business extension

Pure digital player
Develop & strengthen traditional core (nexible) Explore & discover
 Enhance value proposition  Extend traditional core, develop new
 Extend insurability business models
 Alter the value chain  Identify new business fields
 Increase efficiency Digital Partners
Cyber insurance Sensor-driven business models

(IoT)
Canadian multi-channel distribution ERGO Mobility
Solutions
Mass customisation (India)
Additionally: Ongoing analysis of “question marks”,
e.g. Blockchain-driven business models
DISTANCE TO THE CORE
Investor Day 2017 10

3 We realise innovation synergies from our set-up as RI

and PI through our project on Interlocked Business Models
Key areas for innovation synergies
 Joint innovation activities and building of business models,
Expertise e.g. IoT, digital platforms, and ecosystems
 Joint use of resources
 Product development competencies, e.g. cyber
Technology
and data  Innovation infrastructure, e.g. innovation scouting
 Technology know-how and infrastructure,
e.g. data analytics, artificial intelligence
Customer  Leverage global presence of RI,
access
e.g. for ERGO Mobility Solutions in China
 Corporate venture capital (CVC) infrastructure and competencies
Create a strategic advantage from primary insurance and reinsurance set-up

ERGO Digital Ventures
Mark Klein

Framework and infrastructure – ERGO Digital Ventures
We live in a time of technological change
Devices and sensors Data Computing power Artificial intelligence
It took Google
30 billion 90% of data 1,202 CPUs A new world

connected devices was gathered and 176 GPUs to beat the chatbots, robots,
by 20201 in the last 2 years world champion at the game Go autonomous cars …
Changing behaviour is driving digital opportunities for primary insurance business
1 Source: HIS. Images: used under license from shutterstock.com Investor Day 2017 13
Our origin and mission:

Turn ERGO into the leading provider for digital solutions
ERGO 8 Fundamental optimisation of product portfolio
Strategy 9 Integrated offerings for hybrid customers

Programme 10 Solutions for pure online customers
fit digital successful 11 Strengthening internat. comm./indust. business
Net investment of ~€1bn (2016–2020) 12 International B2B2C partnerships
€400m €400m €200m 13 International growth
Founding of ERGO Deutschland ERGO Digital Ventures ERGO International
Our mission Ensure successful  P&L responsible for >€1bn GWP

execution of ERGO’s online and direct sales in Germany1
digital transformation  Driver of growth initiatives
1 As at 31 December 2016 including ERGO Direkt. Investor Day 2017 14

Framework for digitalisation at ERGO
Enabling technology
and digital innovation
Improving Disrupting Establishing

existing existing new business
business business models
models models
Starting with
Starting with Starting with automotive
pure digital
Hybrid
customer
Digital culture – a new way of working and global exchange

Image: Stockphoto

Framework and infrastructure – ERGO Digital Ventures – Hybrid customer
The online market for insurances is growing strongly
Insurances – Online share

Information
Sales ~75%
Significant potential
in online/offline link
50%
30%
~25%
19% Further growth potential
14%
9% in online sales
2%
2005 2010 2015 2020

GfK, Bain "Global Digital Insurance Benchmarking Report 2015"
© Bildagentur PantherMedia/vantuz

Framework and infrastructure – ERGO Digital Ventures – Hybrid customer
We aim at the modern customer and

adapt in sales, retention and service
360-degree customer view The new agency
 We aim to further harmonise products  50% of ERGO.de’s web traffic induced
(car, home, liability) and operations to from our agencies’ web sites
meet our customers’ needs and  We strive to become the leading website
expectations on all channels for tied agents in Germany
 Usage of customer relationship
management started in October,
serving our first individualised
cross-channel campaigns
Service Empowering ERGO in online business

 We aim to provide Germany’s leading  We aim to make all main retail products
insurance customer self-service portal attractive and available for sales on all
(measured in absolute number of logins) iStock.com/Tijana87
channels (online, telephone, print, …)
 More than 620,000 registered users,  Conversion rates increased in health
annual growth rate 35% products by 22%

Framework and infrastructure – ERGO Digital Ventures – ERGO Digital IT
We empower ERGO to deliver best-in-class

user experience by means of our new digital factory
as part of ERGO’s global IT

BERLIN WARSAW
Source: Shutterstock ~50 experts Source: Shutterstock ~250 experts
~€140m (gross) ERGO Mobility Solutions Success case
planned investment 2017–2020  Increase volume – Increase overall sales

in customer-facing IT solutions volume and number of policies concluded
for unrivaled costs per product in car business by establishing new sales
channel through OEMs
We live a new way of working
 Market penetration – Conclude
 Use greenfield approach where cooperation with OEMs and strengthen
possible market penetration for ERGO
 Agile projects – developed
 Sustained profitability – Aim to achieve
Multitool Life end-to-end in
sustained profitability of the ERGO brand
only three months

Framework and infrastructure – ERGO Digital Ventures – Innovation management
We focus and account for different maturities

of innovation topics by using a hype-cycle logic
Observe Explore Deploy
Expectations Connected cars

Genomics
International
3D printing
3D scanning knowledge
Drones Sharing economy
Autonomous
exchange
driving Telematics on mutual
Smart factory
AI/bots
business
Web
Mobile/ analytics
IoT for B2B apps
Blockchain
distributed ledgers Peer-to-peer Social CRM
insurance media
AI underwriters
Wearables Big data & analytics
Cyber security
Video interaction Connected home
Innovation trigger Peak of inflated expectations Trough of disillusionment Slope of enlightenment Plateau of productivity

Framework and infrastructure – ERGO Digital Ventures – Innovation management
Connected Home – ERGO Safe Home minimises and

prevents damage for smart-home customers
Overview: ERGO Safe Home Deutsche Telekom cooperation
Smart-home
hub  Product bundle of insurance, technology and service
Sensor-based alarm system combined with house-
Fire
hold insurance and assistance service. Sensors
detect incident and notify customer and assistance
service partner for immediate relief.
 Joint sales with Deutsche Telekom
Burglary Water
Sale of smart-home bundle via ERGO’s tied agents
and sale of stand-alone assistance service via
Telekom shops
Automated alert chain triggered by sensors

with 24/7 emergency assistance
We have established units and programmes to drive

digitalisation from the edge
Hybrid
customer
HDFC
ERGO
“core”
nexible
Digital
health
EMS
https://commons.wikimedia.org/wiki/File:NASA-HS201427a-HubbleUltraDeepField2014-20140603.jpg

Reinsurance
Marcus Winter

Reinsurance
Our innovation activities capitalise on major external trends
TECHNOLOGICAL SHIFTS – “INDUSTRY 4.0” NEW TYPES OF RISKS

Sensors Cyber
Digitalisation
1 3
and automation
“Hyperloop”
Image: used under license from Image: used under license from
shutterstock.com/Robert Lucian Crusitu shutterstock.com/Pressmaster
DIGITAL ECOSYSTEM DATA & ANALYTICS

1 0 Data lake
110011
Digital Partners Image: used under license from
shutterstock.com/Rawpixel.com 01001
2 4 01 10 Digitally
Canadian augmented
multi-channel underwriting/
distribution claims
Reinsurance
1 “Industry 4.0” provides us with the opportunity

to access a huge market with new business models
 “Industry 4.0” provides access to

significant new revenue streams and
a new customer base
 Change of value proposition

 Claims prevention vs. claims coverage
 Assurance of outcome vs. insurance of risk
 Provision of hardware (sensors/assets)
and performance guarantee

Reinsurance
2 Digital Ecosystem – We provide an attractive value

proposition for players rethinking insurance delivery
Digital Partners Canadian Multi-channel Distribution
Global multiline Product design

capacity and data
AGILE
DELIVERY
Venture capital Technology
 Providing digital backend systems beyond traditional underwriting/pricing support

 Offering value to different players servicing consumers with risk coverage

Reinsurance
3 We have a longstanding tradition

in insuring new types of risks
Image: used under license from shutterstock.com
Pushing the boundaries of technology: Extend value proposition into services: Leverage data analytics:
“Hyperloop” Cyber Pandemics cover

Reinsurance
4 Strong investment into data analytics allows us to extract

value from internal and (new) external data sources
TECHNOLOGY
State-of-the-art data analytics infrastructure
“Munich Re Data Lake” in place – no legacy
systems
PEOPLE
Investment into decentral data analytics
capabilities, >150 FTE with data science
background across global organisation
VALUE
Data scientists and business function teams
partner to deliver cognitive computing and
artificial intelligence across the value chain

Reinsurance
Our transformation: Agile, flexible, modular
Network of partnerships
supplementing traditional
linear value chain
Digital
solutions Innovation activities
designed drive cultural change
for a modular towards a flexible and
environment agile mindset

Reinsurance
We drive innovation in the industry
Unique positioning Unique mix of value propositions for our partners
 Global presence  Domain expertise in underwriting, claims and risk

 Financial strength management
 Full range of monetisation options  Efficient access to new solutions
 No IT legacy  Strong brand and reputation
 No channel conflicts  Mutual trust
 Longevity of our offerings

Reinsurance
Strategic investments in selected partnerships

to leverage joint value creation potential
InsurTech IoT  >€60m invested into >10 assets

focusing on InsurTech and IoT
ecosystem
 Strategic intent is joint value creation

and establishment of long-term
partnerships
 We provide value – not only money:

Start-ups seek access to domain
Other expertise, clients and brand
accreditation provided by Munich Re

Reinsurance
From incremental innovation to leading-edge technology –

Tangible success cases
IoT
M.I.N.D.
Cyber Augmented
solutions underwriting
Drone Data AI
coverages Analytics Suite
Canadian Data lake

Insurance gap and Epidemic trends
multi-channel solutions 1 0
financially motivated distribution
110 011
reinsurance
Digital
Partners
Data-driven
Expanding the solutions
Reshuffling boundaries of
Capital the value insurability
Traditional market
reinsurance chain
solutions

Data and analytics
Wolfgang Hauner

Data and analytics
Data and analytics – Why, why now, and how?
Sales
New developments We enable our employees

help to use full power General Insurance- and customers to use
Underwriting
of technologies
AI specific AI enriched data, advanced
tools and state-of-the-art
Claims analytics
Neural
networks
1997 2011 2016
Data volume Munich Re is leading in

is growing insurance-specific
exponentially artificial intelligence (AI)
Powered by
Data scientists and business-function teams partner to deliver cognitive computing

and artificial intelligence across the value chain
Data and analytics
Data and analytics supports Munich Re’s core strategic areas,

serving as business enabler for the whole Group
Mission: Generate business value
through data analytics for internal
 Tariff optimisation  Churn
and external clients  Customer satisfaction  Cross selling
 Automated underwriting  Loss-driver analysis
Data Portfolio Fee  Loss-driver analysis  IoT and telematics
analytics analysis business  Telematics  Supply chain monitoring
Help to retain Generate Getting paid Data

business by more and for services and
providing data better analytics
analytics business,
services identify weak
spots
 Daily sick allowance  Predict interest rates
 Medical coding assistant  Portfolio optimisation
(MOCA)  Sentiment analysis
 Predictive underwriting
 Dental billing check
Data and analytics
Data and analytics serves purposes along

the (re)insurance value chain
Insurance
value chain
Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: used under license from Getty Images / Benjamin Torode
DISTRIBUTION UNDERWRITING CLAIMS
AI trends AUTOMATED ADVISORY AUTOMATED UNDERWRITING VISUAL CLAIMS SUPPORT

 Complement face-to-face  Leverage all data and  Enable fast response
interaction resources  Obtain more detailed
 Enable innovative distribution  Improve workflow and information
(e.g. P2P) customer experience  Handle low-volume,
 Serve low-volume,  E.g. “The Box“
high-frequency claims
high-frequency segment
 E.g. M.I.N.D
 E.g. mass business in India

Data and analytics in reinsurance
How it works in the reinsurance group
1 2 3 4
Collect data Store, cluster and Analyse data Add value
structure data
Client/
portfolio data Data lake
Munich Re
data
External data
sources
Machine learning, Solution
AI, statistics  Improve efficiency
 Improve portfolio
quality
 Business generation
Image: used under license from shutterstock.com Investor Day 2017 36

1 Collect data: Combination of data with

domain-specific expertise is key!
The Device
Industrialisation 4.0 Mesh New Payment Models
Up-/cross- 3D Printing Materials Ambient User Experience
Haptic Technologies Augmented and Virtual Worlds
selling Cloud/Client Architecture Telematics
Web-Scale IT Digitalisation
Streaming Weather Smart Home
data data Wearable Devices
Predictive/ Internet of Loc-based Services
Actuarial
automated Things
science Artificial General
Risk u/w Digital Health Intelligence
Services Information
manage- Churn Web 5.0
of everything Advanced Machine
Learning
ment data Quantum
Smart Autonomous Agents
Social Geospatial Social Computing
machines Autonomous Vehicles
media data media Predictive
analysis data Analytics Robotics/Drones
Historical
Fraud Data driven Algorithmic Smart Dust
claims Decisions business
Detection Crowd
data Context-aware
Computing sourcing
Supply Cyber-
Blockchain Technology security User Centered Design
chain
Open Data
Sensor Portfolio Adaptive Security Collaborative
Consumption
Architecture
data data Digital Identity

2 Munich Re Data Lake – The open enterprise

approach for the reinsurance group globally
Data innovation Time to digital market Service diversity
USER
Int2 INTERFACE
Int1
Internal/ LOGIC
external data Ext1 SPEED UP
and algorithms
AND SHORTEN DATA
SHARED PROCESSES
KNOWLEDGE TECHNOLOGY
Reach highest level of data innovation Shorten time to insight and product Layers of expertise, professionalism
by community-driven digitalisation by centralising and cataloguing and enterprise readiness
 Share data, knowledge and  Find data fast using a catalogue  Service development in every layer
algorithms  Clean, prepare and merge of the value creation process
 Very fast prototyping and innovation centrally  Multi-dimensional customer base
 Easy access and self service  Lots of horsepower
2 Munich Re Data Lake –

Leading-edge infrastructure
Intelligent shortcut using best-in-class
solutions to build a superior overall system
Cost-efficient Analytics
implementation Hadoop and data lake tools SAS Mobile BI tools
HANA
Browser
SAS Visual Analytics Terminal server

SAS Enterprise Guide
SAS Enterprise Miner MS Office Add-in
SAS Contextual Analytics
Access to SAS Data Loader
HANA
Existing HDFS file system SAS LASR

HANAs Long-term unstructured and structured data Data for ad-hoc
Structured transactional in-memory analytics
business data
Project folders
In-memory user folders
Access to Oracle/
SQL Server
technology SAS autoload Access to Hadoop/ Central
embedded process
folders
accelerates storage
processes facility

3 Turning data into value
Platform open to every Often initial focus on data extraction

Munich Re employee to be solved to enhance available data
 Dynamically visualise data of Explorative Multivariate effect  Figure out how certain factors
any size analysis analysis influence a target variable
Advanced Regression
 Get a quick and easy overview visualisation and machine
 Influence of age, gender,
of data by using heatmaps, techniques learning models disease, etc. on claimed amount
correlation matrices, etc.
Advanced
analytics
 Analyse large amounts of
 Predict outcomes based on AI, unstructured text, pictures,
certain explanatory factors Predictive text mining, speech, …
 Predict claimed amount per modelling deep learning  Extract key topics from claims
Regression Singular-value
individual based on age, and machine decomposition, NLP,
reports, insurance-specific
gender, disease, etc. learning models neural networks computer vision
Support new developments, e.g. Facilitates quick and

text mining (NLP) and telematics in-depth analysis of problems
4 Example: Risk assessment to improve efficiency –

Digitally augmented underwriting: Tariffs using artificial intelligence
Tariffs are key – But hard, slow, and costly

 Experts using portfolio-specific data
Primary insurance
 GLMs1 as state-of-the-art risk models
 Various individually estimated factors for tariff adjustment Benefits
 Speed/timeliness
Automatic  Cost reduction
Munich Re AI methods and individual
 Improved risk selection
AI-based tariffs
Additional
external data ETL2
 Large repository of proprietary global
Claims, tariff and risk data
Model contract data
 Access to high-quality external data sources
Munich Re selection
Fitting,  Exceptional data science and domain
data and
tuning, expertise
insights
evaluation  Cutting-edge data and artificial intelligence
technology
1 Generalised linear models. 2 Extract, Transform, Load. Investor Day 2017 41
4 Example: Risk assessment to generate more business –

Identify cross-selling potential for a client
Identify pools with high cross-selling potential Improve sales efficiency and profitability
$$  Improve transparency on existing customers, e.g.:
 Clusters with high buying potential
 Geocoded distribution of customers per
Result clustering: insurance policy
Data collection Machine
and testing learning Profit potential  Potential analysis per distribution channel
 Efficient usage of sales force capabilities
Geocoded result visualisation
 Better customer relationship management
 Forecast insured’s policy type
with 90% success ratio  Swift deployment of service: complete analysis
cycle can be done within 4–8 weeks
 Identify customers with high
potential to buy additional  No system integration needed
insurance by region
High potential to buy additional insurance
Source map: Munich Re Investor Day 2017 42

Cyber insurance
Daljitt Barn

Cyber insurance
Our approach
History Ambition Growth Resonance
We have been Munich Re would Organic through Our heritage of

writing cyber for like 10% market quota-share, plus managing complex
over 10 years share by the end white-label and risk whilst being
of 2020 primary markets innovative in the
cyber market
Munich Re Syndicate Limited

Cyber insurance
Global trends
Cyber penetration in the US: ~20% Cyber penetration in rest of world: <5%
 Strong growth in certain industries:  Lloyds have circa 60 syndicates writing cyber
Manufacturing, transportation, life sciences,  Strong growth predicted in EU for SME and
power and utilities growing markets in Asia, especially Japan
 Ransomware attacks in 2016:  Cedants wanting support from Munich Re
Increase of 100%–400%, making it the “year (quota-share or facultative) to understand the
of the ransomware” gaps between writing SME and moving to
 More IoT-leveraged attacks in 2017, like the industry
“Dyn event”  Automated underwriting and MGA models
 Attacks on cloud services will be more key for distribution
prevalent, e.g. business interruption.
We will therefore see more primary cyber
policies being written

Cyber insurance
Cyber incident – WannaCry

Executive summary
 Example of a ransomware worm that encrypts files on the
compromised computer and demands a ransom payment
for decryption (~US$ 300–600 paid in bitcoins)
 Attack has hit over 200,000 systems in 150 countries since
12 May 2017
 All Windows versions before Windows 10 are vulnerable to
WannaCry if not patched for MS-17-010
 Finally WannaCry scans for other vulnerable Windows
computers to spread very quickly
A turning point for cyber insurance?

 Raised awareness globally of this type of peril, i.e. it
impacted people’s lives
 Did not impact cyber policies because of waiting periods,
and with this and Petya, the ransom is below retention limits
 Business interruption is the more prevalent impact
Cyber insurance
Cyber insurance landscape –

What do we think?
Current market size Global distribution of cyber Munich Re GWP in 2016
~US$ 3.6bn 85% US$ 263m

At the end US market by 38% growth
of 2016 end 2016 (versus 26% market)
Size of the opportunity EU growth Munich Re low loss ratios
US$ 8–10bn GDPR1 Profitable

By the end Mandatory breach For the class
of 2020 reporting for cyber of business
1 General Data Protection Regulation. Investor Day 2017 47

Cyber insurance
Cyber risk in the insurance industry –

Cyber as a peril
Rapidly evolving Inhomogeneous Cyber crime is Risk Cyber past does

landscape big business quantification? not predict cyber
future
Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: Getty Images

Cyber insurance
Implementing cyber security –

Cyber as a control
Budget and Risk mitigation Security controls How much What is the RoI?
teams often focused must work at all security is
aligned with IT times enough?
Image: Getty Images Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: Getty Images Image: used under license from shutterstock.com

Cyber insurance

Cyber as a product
Coverage versus Managing the We’re in the risk No quantum of Accumulation

pace of change risk, and pricing management cyber claims
in technology accordingly business data
Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: used under license from shutterstock.com Image: Getty Images Image: used under license from shutterstock.com

Cyber insurance

Commonalties between the two worlds
PERIL PRODUCT
People Lack of skilled cyber resources Lack of cyber skills in cyber underwriting
Regulation No mandatory breach notification 85% of global market is US focused,

outside US but EU to follow
Technology Digitisation – connecting the old Distribution opportunities

with the new
Confidence is increasing within our industry, but more work needs to be done on both sides
Cyber insurance
Cyber (re)insurance market –

Strong and long-term growth to be expected
GWP global cyber insurance market1 US$ bn GWP Munich Re cyber portfolio US$ m
10 Rest of world Reinsurance
USA Primary insurance 263
191
5 126 135
0
2015 2016 … 2019 2020 2013 2014 2015 2016
Reinsurance: First-mover and global market leader Primary insurance: Specialised single-risk taker
 Dynamic growth through joint projects with cedants  Hartford Steam Boiler: Established player in the US
 Steady growth in the US for SMEs and individuals
 Strong accumulation models  Corporate Insurance Partner: Focus on large corporate
clients – Cooperation with IT providers, and Beazley
With our leading-edge expertise and strong global market presence, we will cautiously participate
in the growth of this market segment
1 Estimates based on different external sources (Marsh & McLennan, Barbican Insurance, Allianz). Investor Day 2017 52
Cyber insurance
Cyber (re)insurance outlook –

Significant expansion of coverage types possible
Already in the market ... first offerings ... not yet
Loss or Privacy Cyber Property (Contingent) Product Reputational Loss of

theft of data breach extortion damage business liability damage intellectual
protection interruption property
Data destroyed or Consumer data Threat of loss or First- or third-party BI/CBI resulting Third-party Loss of profits due Loss of profits due
stolen; covered in stolen or lost, or destruction of own property damage from a cyber event property damage to reputational to stolen trade
private, commercial non-compliance or customer data resulting from a or bodily injury damage as a secrets, or other
and industrial lines with privacy cyber event caused by software result of a commercially
legislation by failure within a cyber event sensitive
a company product information
Increasing exposure and complexity of coverages
Cautious evolution of market offerings

Cyber insurance
Munich Re cyber accumulation scenarios –

Overview
Accumulation Self-reproducing Data Corrupted software Failure of
scenario IT viruses breach in core module external networks
Description  Untargeted cyber attack  Many insureds affected  Randomly falsified data  Includes power outage
on multiple computer (exploit of common over a longer period of and internet outage
systems vulnerability by hackers) time  Property damage, BI/CBI
 Large number of systems  Top-down PML estimate  Data compromise across and liability losses
infected by one event for breach of cloud service multiple clients and
 First-party business provider in 2014 industries
interruption and data  Privacy breach and cyber  Business interruption and
losses liability, cyber extortion data losses
Munich Re risk  PML calculation model  Monitoring of limits of  Lower top-down PML  High loss potential
management and guideline in place exposed (cyber) assessment as compared  Mandatory exclusion for
since 2012 participations to other scenarios cyber/IT coverages
 Regular revision of model  Probabilistic PML model  No bottom-up PML  Internet outage scenarios
parameters (2015, 2016) under development and to methodology required are currently investigated
be implemented in 2017  Monitoring of full limits in
case of dispensations

Cyber insurance
Cyber insurance underwriting guidelines

covered systems and networks
Can be
covered as To be
Covered
IT outsourcing excluded
provider
Insured’s computer system: Cloud computing Failure of:

 Internal computer systems (SaaS, PaaS, IaaS) 1. Electricity supply networks,
under the operation or direct  E-mail service provider 2. Telecommunication networks,
control of the insured  Web-hosting provider including the internet
 Cloud provider
Internet services:
 Internet service provider (ISP)
 DNS service provider
 Internet exchange provider
Cyber insurance
Munich Re’s value-add –

Where can we offer support?
Experience and expertise Continuous improvement Innovation

We bring well-established We continuously monitor We are actively identifying and
experience to the table with changes to the cyber developing cyber initiatives to
experts who can operate in all environment, seek to improve improve our customers’
industries and organisations, our understanding of the risk, experience and enhance
from large corporates to SMEs and then adapt our cyber underwriting
and personal lines products to ensure we remain
relevant to our customers

Canadian multi-channel distribution
Mary Forrest

Munich Re Canada Life at a glance
Munich Re is a premium reinsurer in the Canadian life market and the biggest mortality risk carrier %
Individual life reinsurance market1 Group reinsurance market2
Peer 5 Peer 1 Other Munich Re
6 27 9 79
Peer 4
10 TOTAL SUM INSURED Peer 2 TOTAL GWP
Peer 3
Can$ 160bn 4 Can$ 0.8bn
13
Peer 2 Munich Re Peer 1
18 26 8
Market becoming more competitive Based on our strong market position, we are exploring new
opportunities to grow a currently saturated market
1 Share by volume in 2016. Source: SOA Reinsurance Survey. 2 Share by premium in 2016, based on traditional group only. Source: OSFI. Investor Day 2017 58
What will we achieve?
$$$
Open an Enlarge product Develop a new
untapped market offering for clients revenue stream

Canadian group benefits market
$40 billion
Market
35 million
Canadians
20 million
Mandatory insureds
2–3%
Voluntary insureds

What is our innovation strategy?
MANDATE Solve problems that are plaguing our industry by developing turnkey solutions
we can bring to our partners to drive reinsurance reach and growth
! PROBLEM ! PROBLEM ! PROBLEM ! PROBLEM ! PROBLEM
Lengthy policy Policy behaviour and Claims adjudication Wellness and living Overall poor
underwriting meeting customer complexity a healthy life customer experience
timelines product needs
GUIDING SPEED TO MARKET COST EFFECTIVE MODULAR OWN THE IDEA

PRINCIPLES Iterative development Deliver a MVP cost Ability to integrate Proactively take
to prove concept effectively with multiple partners ideas to partners
STRATEGIC Become one of Canada’s Develop an end-to- Create a multi- Establish a preferred
OBJECTIVES largest group insurance end technology channel distribution partner network
consolidators platform network

Our innovation strategy is creating value

for all “players” in the insurance sales chain
MEMBER SPONSOR BROKER CARRIER
Improve the user Create a platform that Creates a NEW stream A way to sell new
experience by making it IMPROVES BENEFITS of REVENUE for existing insurance products that
EASIER to buy insurance for my employees and clients with LOW EFFORT is LOW EFFORT, COST
with IMMEDIATE makes ON-BOARDING for the customer’s EFFECTIVE and QUICK
FULLFILMENT EFFORTLESS lifetime TIME TO MARKET

Video

A customer-centric platform that allows the customer to research,

buy and manage their insurance products and investments
THE SOLUTION
LIFEInsurance
Life insurance P-CInsurance

Munich Re
P-C insurance core expertise
CRITICALIllness
Critical illness
Health insurance HEALTHInsurance
Wealth
management WEALTHManagement External
partnerships
 One platform Student loans
 Multiple products FUTUREProducts New insurance
 Any brand Deals and perks
The platform handles all aspects of the insurance

sales cycle creating a “Virtual Insurance Company” …
THE SOLUTION
Life insurance
Analytics and insights

Claims adjudication
Administration and
customer support
P-C insurance
Cross-selling
Policy issue
Enrolment
Marketing
CARRIER PARTNER
Payment
Underwriting
Critical illness risk acceptance
Health insurance
Wealth
management
Munich Re NV
Combining the platform with Munich Re partners can provide a complete, Plug-in
turnkey insurance solution for any company or brand administration
… while improving customer experience

and convenience
THE SOLUTION
Quick access to all products

Claim status and submission
and services
Insurance | Investment | Vitality
Upsell and cross-sell product

suggestions based on
A live feed of all activity
customer behaviour and life
around products including
stage
ALERTS, PAYMENT,
PURCHASES and CLAIM
STATUS
Bundling and discounting to
Payment and renewal drive loyalty and engagement
reminders to encourage
accounts in good standing

We are creating a modular platform that allows any brand

to participate, leveraging the Munich Re partner network
DIGITAL MARKETING
DIGITAL MARKETING PLATFORM PLATFORM (WHITE LABEL)
Acquire and engage customers
TRANSACTION AND MEMBER PLATFORM
PRODUCT Life Home Auto Critical illness Basic Wealth INSURANCE PORTAL
insurance insurance insurance insurance health management (WHITE LABEL)
Customer can purchase a
TASKS Research Purchase Manage Claim Loyalty Content policy with a credit card and
get immediate coverage
PRODUCTS CARRIER POLICY ADMIN CUSTOMER ADJUDICATION

 Insurance  Any carrier  Any TPA SERVICE  Carrier INTEROPERABILITY
 Wealth  Any geography  Any carrier  Third party Ability to “plug in” any aspect of
management the insurance sales cycle or use
 Munich Re existing Munich Re partners for
 Perks a turnkey solution
 Vitality

With our platform and DIGITAL AGENCY we can work

with ANY CARRIER, ANY BROKER and ANY BRAND
Munich Re has created a DIGITAL

INSURANCE agency
We can work with ANY CARRIER, ANY

BROKER or ANY BRAND to create a
branded end-to-end experience
We provide and manage all aspects of

the insurance process including:
Marketing Administration
Customer service Payment and billing
Adjudication Policy issue
$$$
Our platform and innovation strategy will help us become
an even larger player in the Canadian insurance space
Objectives
Manage Can$ 1.6bn in Group

insurance premium within the Become a significant and relevant player in
next 5 years the Group insurance market in Canada by
helping our partners expand the current market
by providing leading-edge tech, distribution and
product solutions to our clients, partners and
Generate earnings via reinsurance,
stakeholders
distribution and administration fees
YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 7 YR 8 YR 9 YR10

$$$
We have seen early success in our controlled critical
illness pilot, running since January 2017
FORECAST ACTUAL RESULTS DIFFERENCE
CONVERSION
RATE 3% 35% +1,100%
Canadians purchase TPA new customers
voluntary benefits purchased a CI product
ANNUAL
PREMIUM Can$ 150 Can$ 250 +66%
Munich Re forecast for Average annual premium
average annual premium among TPA new customers
ENROLMENT
30 days 2 days –28 days
Average enrolment time Average enrolment time

$$$
Our strategy provides
significant benefits for Munich Re
New
insurance
premiums
Administration Minimum
fees 50/50
reinsurance
Deeper New
relationships partners
with clients
Data
warehouse

ERGO Mobility Solutions
Mobilising growth as strategic partner
of the automotive/mobility industry
Karsten Crede

ERGO Mobility Solutions – Overview
ERGO Mobility Solutions (EMS)

entering the B2B2C automotive segment
History  Founded in January 2017 as strategic response to future automotive and

EMS insurance mobility opportunities
 Originated from ERGO Strategy Programme (ESP)
 Strong mandate regarding governance, infrastructure and investments
Team  Dedicated team with automotive and insurance experience

 Integrated teams between ERGO and Munich Re
 Leveraging diverse assets and expertise of Munich Re/ERGO Group
Strategy  Positioned as strategic/international partner of the automotive industry

 Collaboration as core value in a B2B2C business model
 Expertise along automotive and insurance value chain
 EMS with comprehensive key account function to the automotive industry
Images: used under license from fotolia.com Investor Day 2017 73

Motor insurance with its majority market share

also remains the strongest growth driver
German P-C market share per line of business German motor insurance market per sales channel
% 2016; 5-year growth trend % 2015; 5-year growth trend
Private property Non-private property Other Brokers
15 13 7 18
Other
6
Aggregators
Legal protection Agents
5 15
42
Accident
10
Liability Motor Direct OEM/Dealer
12 39 10 8
Motor dominating segment with total GWP of ~€25.9bn in 2016  Automotive channel stagnates, but strong replacement potential
of non-strategic players – “second source approach”
 Online and direct providers are winning market shares
Motor is the combustion engine of the insurance industry
Source: KPMG; GDV, ERGO Mobility Solutions Investor Day 2017 74

Challenging environment for both industries –

Automotive and insurance
Automotive industry trends Insurance industry trends
… …
 Connected cars  Internet of Things

 Autonomous driving  Artificial intelligence
Technological evolution
 Sharing economy  Legacy IT
 Electric vehicles  Data analytics
 Low-cost products
 “Using”, not “owning”
 Seamless processes
 Peace-of-mind offerings Customer demand
 Omnichannel
 (Intermodal) mobility solutions
 Flexible and easy coverage
 Massive investment efforts needed  Stressed profit pools

 Challenging political social conditions  Low interest rates
Market environment
 Environmental issues (NOX)  Low growth in mature markets
 Dependency on few growth markets  Weak infrastructure in growth markets

However, significant interdependency between

insurance and automotive core profit pools
Expected profit pools 2025 – Automotive, global, without inflation €bn
373
26
138 Automotive
insurance
products1
Claims
151 manage-
ment
58
Complementary to
Total Automotive Financial After- Mobility/ automotive profit pools
sales services sales connectivity
(new and used)
1 Motor, payment protection/GAP/warranty, Source: Oliver Wyman, Ritzenhoefer & Company research Investor Day 2017 76
Becoming an integrated player in the mobility ecosystem
Mobility ecosystem ERGO value contribution to

Connected car Inter- OEMs/mobility providers
Mobility modal
as a concepts  Reduce total cost of mobility
Smart vehicle service Big data/
(TCM)
telematics
Vehicle  Support penetration of new
Car
sharing mobility concepts
Virtual
assistant  Optimise aftersales revenue
Ride
sharing
 Increase customer retention
Usage-based
Image: used under license from shutterstock.com
insurance  Increase financial products
Motor and penetration
Autonomous
ancillary driving  Stem investments as strategic
products
co-investor
Evolving from traditional … to become an integrated

motor insurance provider … player in mobility ecosystem(s)
Images: used under license from fotolia.com. Source: ERGO Mobility Solutions Investor Day 2017 77
EMS to add value along the entire mobility value chain
Selective measures along automotive value chain

Research and Production Sales and Dealer Financial After-
Mobility
development and IT marketing network services sales
ADAS1 ADAS1 Non-asset- After-sales

Dedicated IT Omnichannel Support
effectiveness product based claims
platform distribution car sharing
research bundling business concepts
Level III + IV
Electric car/ Few-click
autonomy Data Bundled Life-cycle Mobility as
battery digital
insurance management packages management a service
covers solutions
principles
Battery Support
(guarantee) used-car
research strategy
1 ADAS = Advanced Driver Assistance Systems. Source: ERGO Mobility Solutions Investor Day 2017 78
Using R&D partnerships to develop innovative

product offerings
EXAMPLE 1
ERGO FLEET
CYBER SECURITY
E-MOBILITY PROTECTION
R&D partnership with …
AFTER-SALES ADAS
EFFECTIVENESS
CONNECTIVITY SERVICES
Images: used under license from Ford Investor Day 2017 79
After-sales/claims management concepts help all parties to

stabilise profit pools and increase customer satisfaction
EXAMPLE 2
OEM + Increase parts turnover and contribution margin
+ Stabilisation of own repair shop network
+ Secure customer contact/customer satisfaction
Customer
AFTER-SALES STEERING
+ Reduced claims costs: + Higher repair quality

Hourly rates and parts + Higher residual value
+ Defined cost frame + Increased satisfaction
+ Customer satisfaction Repair Shop
and loyalty
+ Additional service utilisation
+ Improved contribution margin
+ Customer acquisition/upselling potential
Building strong base capabilities and competitive edge
Strategic pillars of ERGO Mobility Solutions
Mobility Solutions Differentiators

Automotive insights Low-cost capabilities
Omni-sales approach Bargaining power and claims steering
Growth
Advanced data management Collaboration approach
Digitalised core processes
Digitalisation
Customer groups
Technical Dealer Inter- End
OEM
excellence groups mediaries customer
Collaboration Comprehensive/competitive Dedicated International

product/service offer IT/operations footprint
Base capabilities
ERGO Mobility Solutions – Collaboration
Joining forces internally between Munich Re

and ERGO to create unique expertise
ITERGO Köln Operations

 Interlocked business
Product
Fleet manage- Asse- model mobilises the
kuranz Claims …
business ment manage-
ment diverse assets and
Actuarial Finance entire expertise of
office Munich Re/ERGO
Auto-
motive Sales & Strategy, Group
Technical
business area finance &
develop- ops/IT
Motor ment
insurance Corporate  International reach and
Consulting Insurance market knowledge of
Unit Partners
particular importance
for successful
Data expansion
Analytics Capital Re-
insurance
Partners  Open up all sustainable
Digital … business opportunities
Partners
and optimise business
mix
EMS ERGO Munich Re

ERGO Mobility Solutions – Technical excellence
Dedicated IT platform as differentiator

with flexible customer front-ends
Key characteristics Main benefits
Digital Customer and dealer interaction

Highly flexible
interaction customer-  Appealing user interfaces Simple,
Short
front-end …  “Agile development” approach innovative
interaction layer add-on features
time-to-market
System of record (single truth) Intuitive Low-cost

… based on Standard back- modern system
 High-quality delivery of standard
stable, well- end platform business processes, incl. usability integration
proven and
 Pricing
standardised
back-end  Contractual changes
 Printing Effective
Optimised
 Billing analytics and
… forecasting
processes
 “Stick to standard” approach

ERGO Mobility Solutions – Digitisation
Exploiting digitalisation potential

and improving the customer experience
Customer Perception Detection Information Purchase Usage Renewal
journey
App: App: Customer
Reviews Advertising self-service
Multi-channel On-demand
Social media/ App:
Digital online campaigns sales inter-
products
touchpoints Search tools Direct action Claims notification
App
offer via app
addressing
Lead
Forums mgmt. Context-based services
Digital/
digitalised
services Digitalised Big data for Lifecycle Integrated Digital claims
(exemplary) multi-channel fast offer marketing mobility management/
sales creation automation services fraud prevention

Leveraging advanced data management to provide

essential customer value via new services and products
Advanced Data Management integration [exemplary]
Claims Accident data, first

data notice of loss, …
Battery usage
Electric cars
(charging, …)
EMS-advanced Big data and AI
Connected (Semi)-auto- ADAS1 system data management advanced-analytics
Customer mated cars operating data platform
Connected Trip data/

car driving style
EXAMPLES
Contextual enrichment of driving style Machine learning regarding ADAS1 effectiveness
Targeted product/modules via customer insights Intelligent product offering based on geodata
1 Advanced Driver Assistance Systems Investor Day 2017 85

ERGO Mobility Solutions – Growth
Intelligent business models to optimise

strategic fit with automotive industry
Business development/ Joint financial

sales cooperation services
Development Mobility
cooperation service provider
Strategic cooperation Reinsurance/

primary insurance retrocession
Joint
risk carrier
Images: used under license from fotolia.com Investor Day 2017 86

ERGO Mobility Solutions – Growth
Germany, China and India as anchor markets

and innovation hubs will be pursued first
EMS wave I markets1 Key characteristics Car sales2 Market potential
+5%
 One of the top 4 automobile 3.7m  Main market for new mobility
manufacturers in the world 3.5  Demand for new corporate
Germany  Growing popularity of shared 3.4
mobility solutions
mobility  Testing ground for innovations
2014 2015 2016
 Exemplary developed market
+9%
 29% of total car sales worldwide 28.0m

 E-mobility lead market
 Globally sizeable Chinese 24.6
23.5  Future global innovation hub
China OEMs (SAIC #4 globally)
 Growing shared mobility market
 Profitable motor insurance 2014 2015 2016
market
+7%
 High growth rates in both new 3.7m  ~10% sales growth until 2020
and especially used car sales 3.4
3.2  Growing online sales channel
India  Exceedingly profitable motor  Large number of uninsured cars
insurance business
2014 2015 2016
1 Other key markets to be covered by partners. 2 Sales of new vehicles; source: Organisation Internationale des Constructeurs d'Automobiles (OICA). Investor Day 2017 87
Strategic milestones to achieving ambitious growth targets
2018 ONWARDS 2019 ONWARDS 2020 ONWARDS

Winning strategic
Establish core business Extend core business Extend business model
partnerships to
 First-stage  Second-stage  Extend value chain
mobilise growth
collaborations collaborations  Enter new partnerships
 Build up infrastructure  Increase profit pools  Offer additional
 Achieve low-cost  Leverage scales and mobility services
capability synergies

Digitalisation as a “must-do” to master
high-volume, low-value policies in India
Ritesh Kumar

Mass customisation in India
Introduction to HDFC ERGO (India) –

Joint venture of HDFC (51%) and ERGO (49%)
Gross written premium1,2,3 €m Net income1,2,3 €m
CAGR
839 38
~44%
21
334
34
–2
FY2008 FY2013 FY2017 FY2008 FY2013 FY2017
Product mix, FY2017 (FY2008)1,2,4 % Market share of leading private-sector insurers1,2,4%

Other Motor own damage 8.4
ICICI Lombard
6 (12) 17 (51) 11.3
Bajaj Allianz 6.0

8.1
Motor third-
Crop 4.9
party liability HDFC ERGO
33 (0) 12 (14)
0.8
IFFCO Tokio 4.4 FY2017

4.2
Fire/engineering Accident/health 3.3 FY2008
TATA AIG
11 (9) 21 (14) 2.7
1 FY2017 stands for period from April 1, 2016 to March 31, 2017 and likewise for other financial years.
3 €1 = INR 75. 4 Source: General Insurance Council.
2 Figures for HDFC ERGO for FY2017 include HDFC General. Investor Day 2017 90
India – Favourable demographics and increasing internet

access through smartphone
Growing young population1,2 … … with high internet connectivity, esp. smartphones
Youth population % Share of
total population
Smartphone utilisation (m)4
(15–34 years) in m1 1,200
35% 432 477
34% 34%
32% 300 340 369 402
366 35% 123 204
298 34% 76
236 2013 2014 2015 2016 2017e 2018e 2020e 2030e
178
% of internet accessed via mobile5
90% 90%
76%
1970 1980 1990 2000 2010 2020e 54% 57%
By 2020, the average age of Indians is expected

to be 29 years vs. 37 for China, 38 for USA and
47 for Germany3 2013 2014 2015 2016 H1 2017
India has the second-biggest smartphone user base after China and ahead of US4
1 Source: The World Bank DataBank, population estimates and projections. 2 Source: World Population Prospects: The 2015 Revision, Population Database, United Nations Population Division.
3 Source: United Nations Data Retrieval Systems. 4 Source: https://www.statista.com/statistics/467163/forecast-of-smartphone-users-in-india/, 2030: India Brand Equity Foundation,
Wikipedia, http://businessworld.in 5 Internet and Mobile Association of India, IMRB Research
Non-life market in India – Strong need for digitalisation for

cost-efficient delivery of products and services
Gross premium1,2,3,4,5 €bn Non-life penetration, 2017 (% of GDP)6
CAGR CAGR
~18% ~15% 2.8
56
18 1.9
4 10
FY2008 FY2013 FY2017 FY2025e
0.8
No. of policies (m) and average ticket size (€)1,2,3,4 0.2
World Asia India Rural India

NOP (m) Ticket size (€) 161m
109m  High-volume, low-value business with significant
57m growth potential
€111
€69 €86  Overall low penetration, much lower in rural India
FY2008 FY2013 FY2017 and low-value segments
Given higher cost of policy issuance via manual mode,

digital mode is critical to improve viability of small-ticket business
1 FY2017 stands for period from 1 April 2016 to 31 March 2017 and likewise for other financial years. 2 Figures for HDFC ERGO for FY2017 include HDFC General. 3 €1 = INR 75.
4 Source: General Insurance Council. 5 Source: McKinsey. 6 Source: Munich Re Economic Research, FICCI – India General Insurance “Improving penetration and driving market creation”.
HDFC ERGO has achieved multifold increase in scale of

operations and pan-India reach by embracing digitalisation
Customer density
High Low
HDFC ERGO’s wide reach … Scale of operation
~30,000 locations across  Issuing ~12 policies per min
~5,000 cities and villages  Servicing ~1 claim per min
 Handling ~2 incoming calls per minute,
across 10 languages
3,214 km
Delivering excellence by focusing on

 Quality of offering
… despite limited  Speed of response
physical presence of  Better engagement
112 branches offices
and 100 virtual offices
2,993 km
Image: used under license from google.com Investor Day 2017 93
Using digital technologies to drive efficiencies
Key operating levers
1 2 3 4 5
Automation Mobile-first Self-service Predictive Digital

architecture analytics innovations
Maximising Increasing Consistency Improving Exploring
Straight-through convenience for across channels portfolio quality emerging
processing customers and and identifying technologies
sales forces growth potential (RPA1, chatbots,
voice)
1 RPA: Robotic process automation. Investor Day 2017 94

1 Automation – Plug and play architecture facilitating

straight-through processing (STP) to drive efficiencies
Distribution mix, FY2017 (FY 2008)1,2 % 87% of policies issued in straight-through process ...
Online Direct Total policies 5.6
2 (0) 43 (61) in STP mode 4.9 87%
Agency 2.8
2.3 82%
17 (13)
0.3 0.2 29%

Bankassurance Brokers
19 (4) 19 (22) FY 2009 FY 2012 FY 2017
Agile digital platform cater to all customer segments ... incl. 1m digital policies (online sales and renewals)
with different buying behaviour across
 banks and financial institutions, 1.0
0.7
 agents and brokers, 0.4
 OEMs,
 online and web aggregators. FY2009 FY2012 FY2017
Having no legacy issues positions us well for hybrid customers
1 FY2017 stands for period from 1 April 2016 to 31 March 2017 and likewise for other financial years. 2 Figures for HDFC ERGO for FY2017 include HDFC General. Investor Day 2017 95
2 Mobile-first architecture – A host of feature-rich mobile apps

digitally enable distribution, customer service and claims
Sales force Claims field force
 Sales portal  Motor claims survey
 Point of sale on mobile  Motor pre-inspection
 Micro insurance  Microinsurance
 Office in a bag (crop, cattle)  Crop survey
Partners Community
 Agency management system  Customer discussion forum
Customers Insurance Portfolio Motor claims

Organiser app survey app
 Insurance Portfolio Organiser (IPO)
 IPO on Apple Watch

Video

3 Self-service –
Digital service model for new-age customers
12% of requests serviced in self-service mode1 Example of self-service features on our website
12%
9%
6%
4%
2%
Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17

E-Mail Policy Tax Certificate for Update Contact Make Transfer of
Health Insurance Details Changes Insurance – Motor
% Private car own-damage claims intimated via garage portal/mobile app

% of private car renewed online
57% Create Service
Request
Upload
Document
Cancellation
of Policy
Track Interaction
Status
Claim
Status
46%
20%
18%
24% 28%
FY2015 FY2016 FY2017
1 In % of total requests. Interactive Voice Response (IVR) and mobile, website using one-time password mechanism, no need to login Investor Day 2017 98
4 Predictive analytics helping in portfolio steering,

optimising sales campaigns and fraud control
Portfolio steering Customer analytics Analytics-based
to drive profitability for renewal and cross-selling fraud control engines
 Predictive models to estimate the  Predictive model to improve motor Comprehensive measures supported by
impact of various decisions on renewal performance  Predictive analytics engine for health
performance  Up-sell/cross-sell targeted and motor
 Scenario-analysis-based portfolio campaigns  Integrated workflow
steering  Social analytics tool
Estimated loss ratios (ELR) for motor Target intervention on bottom 3 deciles for renewal
GWP Total ELR % 72
62 69%
57
49 57%
53%
44 Decile 8 to 10
39 Decile 4-7
Decile 1-3
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
'16 '16 '16 '16 '16 '16 '16 '16 '16 '17 '17 '17 April '16 Sept '16 March '17
5 Digital innovation – Continuously striving to improve

customer engagement and drive growth
Chatbot Robotics Voice

“Aby” analytics
 Helping call-centre agents address  RPA 1 Rambo implemented to  Voice analytics of calls to generate
customer calls effectively automate manual processes and insights on call-centre performance
achieve operational efficiencies
 Initial results on select scenarios  Customer insights, business
 Initial results on select scenarios issues and improve contact centre
 ~8,500 requests assisted by Aby in
performance
two and a half months  ~260,000 transactions
processed in two months  Targeted coaching for agents by
 18% reduction seen in average call
analysing their performance
time  87% reduction in transaction
processing time
 Better consistency in customer
response across floor
Continuously exploring and piloting emerging technologies like robotics, chatbots, voice analytics
1 RPA – Robotics Process Automation. Images: used under license from shutterstock.com Investor Day 2017 100
Internet of Things
Greg Barats

Internet of Things
Introduction to Hartford Steam Boiler (HSB) –

Market leader for equipment breakdown in North America
GWP US$ m Combined ratio1 % Technical result US$ m HSB – Key facts
 Founded in 1866: “the first
173 company in America devoted
1,113 84.7 85.3
83.1 primarily to industrial safety”
1,089
161  Global fee engineering
presence and the largest
authorised inspection
agency for its niche
1,013 146  More than half of 2,500
employees are engineers,
inspectors and technicians
 Established HSB Strategic
2014 2015 2016
Corporate Ventures in 2014,
2014 2015 2016 2014 2015 2016
funded with $50m to invest
in emerging technologies
Engineering services, both packaged with insurance and directly for a fee,
are significant differentiators for HSB
Internet of Things
Specialty solutions for emerging risks globally –

With 20% GWP from innovative specialty products in 2016
Gross revenues Product and services inventory Recent highlights
Fee engineering Commercial and PS S I D
services1 industrial equipment
Commercial/industrial equipment breakdown Power generation
breakdown and
13% engineering lines Full suite of engineered lines
uptime insurance
US$ 1.28bn 69% Specialty energy

GWP plus Machinery inherent defects coverage
fee revenue
Cyber and privacy
Specialty liability
Specialty products1 Farmowners’ equipment breakdown (EB)
18% Homeowners’ EB and service line
IoT advisory
Pressure vessel inspections
services
CAGR 2012 to 2016 Management consulting: industrial/energy
IoT stack, machine
Benchmarking: energy learning, AI
2.9 Property inspections
ISO certifications
22.0
–1.7 Product key P Portfolio products typically distributed via other insurance companies I Investment D Developing
S Single-risk products typically distributed via agents and brokers
1 Indicates anticipated growth areas. Investor Day 2017 103
Internet of Things
HSB leads the Munich Re IoT strategy
MUNICH RE Global team driving IoT for Munich Re

IoT Steering Committee  70 FTEs (60% of these resources came from outside HSB/Munich Re
for technical expertise and/or software development skills)
GLOBAL IOT LEAD  Commercial/industrial focus (from SME to Industry 4.0)
Greg Barats, HSB  Pursuing both retrofit and integrated IoT solutions
 Testing technologies, platforms, business models and partners,
customer experience, cost-benefit outcomes and more
North America North American  Coordinated ecosystem development
Industrial and SME
Europe Front-end app Insurance product Hardware
development development development
COLLABORATION Ecosystem Training Operations
Business model Marketing

development collateral
Regular talent exchange, as individuals travel between Munich, Hartford and Austin
European
Industrial and SME
Globate mandate to drive IoT strategy for Munich Re (Group)

Internet of Things
IoT: The interconnection (via the internet) of computing devices

embedded in everyday objects, enabling them to send and receive data
IoT creates massive opportunity … Manufacturing and industrial

Estimates of global IoT economic impact applications offer the biggest Industrial IoT technologies
 US$11.1tn by 2025 (McKinsey) early opportunity enable and enhance the delivery
 US$14.2tn by 2030 (Accenture) of key business outcomes …
 US$151bn Industrial IoT
market by 2020  Reduced downtime
 Increased productivity
… and new revenue sources  Improved quality
Estimates of IoT revenue from hardware, software, services  Lower costs
 US$124bn total Industrial IoT
 Higher flexibility
 US$470bn by 2020 (Bain) market by 2021
… and the insurable risk
 US$344bn by 2020 (AT Kearney) landscape will be modified by
 €250bn by 2020 (BCG) IoT activities
Customer transformations will provide opportunities for increased efficiencies,

production and new revenue streams
Source: “Winning with the Industrial Internet of Things”, Accenture, 2015; “Unlocking the potential of the Internet of Things”, June 2015, McKinsey Global Institute;
“How Providers Can Succeed in the Internet of Things”, Bain, 2016; “Winning in IoT…”, BCG, 2017
Internet of Things
Insurance will transform by expanding

beyond traditional coverages
New IoT-based financial products $
New IoT-based Assuring business outcomes from IoT investments
$ financial products  Providing warranties and other vehicles to assure that positive business
outcomes from IoT implementations are achieved
New IoT-enabled
services New or enhanced cyber for IoT
 IoT installations create new risks of “smart” devices being accessed,
attacked or exploited
Total insurance Total traditional  New insurance products designed to manage unique IoT-based exposures
industry insurance
premiums industry
premiums New IoT-enabled services
 IoT monitoring  Performance insights and anomaly detection
 Uptime management  Risk management
Today Within  Efficiency and optimisation  Repairs optimisation
10 years
Traditional insurance premiums will shrink as increased customer-data access and risk understanding drive
expectations of better (lower) pricing and/or demand to buy insurance only for specific risks or a limited duration
Internet of Things
SME example:
IoT drives strategic and bottom-line results for insurer
Problem Goals Approach Results
 Large claims  Lower frequency  Proof of concept  Phased approach allowed
due to burst pipes in Using temperature sensors 20 churches – In a single client insurer to understand
houses of worship they on key water pipes, winter, it helped avert the programme and
insured; venues often remotely monitoring water 100% of probable freeze implications for roll-out
unoccupied during temperature; sends alerts losses  Mobile platform provides
periods of the week and instructions to locations  Pilot opportunity to have different
 Need to differentiate of at-risk areas Expanded to 250 churches conversation with customer
and increase value  Lower severity the following winter,  Client insurer pays cost of
proposition Water sensors were placed averted numerous losses equipment and monthly
in potential exposure areas  Production monitoring fee
of a building; limiting leaks 10,000 churches  HSB provides warranty on
quickly means that there is scheduled over three years exposures, where
less water damage and (to date, 4,000 churches appropriate
cleanup, and smaller losses enrolled)  To date, the programme
 Reverse trend  Developed algorithms has averted losses
toward commodity pricing specific to exposures exceeding its cost
Internet of Things
Example:
Projected IoT technology impact on manufacturing1
Real-time production dashboards
Remotely monitor, optimise, and control production –
better visibility, faster decision-making and improved yields
Production and supply-chain optimisation Auto-sensing equipment

Continuous remote monitoring of people, practices Equipment settings are self-adjusted based on
and equipment2. Real-time data from suppliers. ambient conditions and product being made
Possible
IoT use Condition-based maintenance
Self-directed vehicles cases in Sensors continuously monitor machine
Intra-factory transportation factories health, predictively scheduling maintenance
path and priority optimisation
and reducing unscheduled downtime
Automatic quality control Health and safety

Based on sample specification – and Sensors preemptively alert and react to hazards
provides support for regulatory reporting (worker too close to machinery, for example)
1 SOURCE: McKinsey Global Institute analysis. 2 Inventory, tool status, machine utilisation, and repairs. Investor Day 2017 108
Internet of Things
HSB/Munich Re has significant market opportunity
HSB/Munich Re competitive advantage for IoT Importance of pursuing IoT strategy

 Software and technology will play an increasingly larger
Complex financial and insurance capabilities
role in our everyday lives and our customers’ businesses
Sophisticated data analytics  Technology will change the behaviour of our customers
and associated risk exposures
Occupancy knowledge and failure data  Our business solutions need to have an expanding
technology component to position ourselves for success
Services are a core capability in the future, HSB/Munich Re are leveraging technology
partners
Engineering-based technical insights
 Our strategy gives HSB/Munich Re and its clients the
Equipment is a competitive advantage ability to add new diversified service-revenue streams
and profit pools as well as a clear advantage on writing
Ecosystem integration into solutions emerging exposures
Greatest opportunities for companies that can combine technology capabilities

and domain knowledge with risk management
Internet of Things
IoT presents a long-term strategy that began four years ago

with practical experimentation and ecosystem development
17,800 sensors deployed IoT summary

 IoT is a threat as it will reduce
5,900 locations, 13,000 additional locations scheduled risks currently insured
58 alerting algorithms from concept to production stage  IoT will significantly impact our
16 SME occupancies installed current industrial/commercial
book of business
Numerous SME applications available  IoT presents a significant market
Multiple Industry 4.0 market approaches being tested opportunity to companies that
can combine technology
4 IoT investments capabilities with risk
management capabilities
1 pending (AI)
1 IoT acquisition Investor Day 2017 110
Digital Partners
Andy Rear

Digital Partners
Digital Partners at a glance
Founded May 2016
30 employees operating as a single global team from London, Palo Alto and Cincinnati
Experienced management team, with insurance, technology, consulting and

programme management backgrounds
Working closely with our partners at Munich Re who offer us expertise and
support services
Global mandate across all retail and small-company business classes
Mission: To develop a new “digital wholesale” business field for Munich Re –

accessing distribution that neither our primary or reinsurance business fields access currently
Digital Partners
Digital Partners seeks to exploit three disruptions
From … Reinsurer “Enterprise insurer” Brokers Customer

 Policy admin systems  Personal
 Enclosed data (Personal)
lines
 Large customer-service teams
 Commercial
(Commercial)
lines
MICRO-SERVICES PRODUCTION CHAIN

… to Automated
Capital Data cloud-based Channel
policy admin
Micro-services changing the Data in the cloud enabling a Sharing economy mixing
1 cost of insurance technology 2 frictionless customer experience 3 personal and commercial

Digital Partners
Our proposition
EXAMPLE PARTNERSHIPS
 USA, then Asia and Europe ex UK
 Trov technology
 Munich Re led Series D
Global multiline Product design
capacity and data  UK then overseas expansion
 Munich Re technology
AGILE  Munich Re invested in Series A
DELIVERY
 UK
 Munich Re technology
Venture capital Technology  No investment
 Global, starting in US
 Slice technology
 Munich Re invested in Series A

Digital Partners
We partner with disruptors who are changing the way

insurance is experienced by customers
What makes a good partnership
Established
company
2  Large total addressable market – big enough
opportunity to reward success
 Credible team – capable of building a business to

address the opportunity
12
 Testable proposition – learning comes at an
9
acceptable price
Start-up
 Sustainable partnership – with barriers to entry for
Live In build cheaper capacity
Establish relationships with new potentially strong players in the market and learn/develop new capabilities that
can be transferred to traditional clients later on
Digital Partners
Digital Partners – Strategic investment activities
Investment thesis Investment approach Current portfolio

 Participate in upside  Minority stakes of <20%  US$ 35m invested in
 Accelerate growth  Stage-agnostic US and UK
 Strengthen relationship  Sweet spot US$ 2–5m –  Technology companies with

will do seed investments and MGA business model
 Increase strategic value of
up to US$ 20m  Digital and data-driven
partnership
 Active investors: Lead or follow, customer experience
 Fund ecosystem development
board seat or observer required  Consumer and small business
for Munich Re and industry
lines of business
Key element of Digital Partners’ strategy is to invest in selected partners

as strategic business owner for investments by Munich Re/HSB Ventures
Digital Partners
Trōv app enables people to easily insure things they love,

for whatever duration, entirely from their smartphone
How it works Major elements of the partnership
How does Trōv benefit?

 Product, underwriting and pricing are experimental
and needed to support the Trōv customer
experience
 Munich Re’s international footprint and venture
capital funding facilitates quick global expansion
1. Easily collect details about your things
2. Swipe to protect just what’s important to you How does Munich Re benefit?
3. Choose the price that’s right for you  Investor and board member of innovation-leader
4. Swipe to claim for damage, loss or theft  Capacity provider in multiple countries
5. Claims are as easy as sending a few text messages  Learning how to manage on-demand insurance

Digital Partners
Slice Labs – Insurance for the sharing economy
How does Slice benefit?

 This product combines commercial and personal
lines so required new underwriting thinking
 Munich Re’s international footprint and venture
capital funding facilitates quick global expansion
 Munich Re rating supports B2B2C channels
1. Reach Slice directly or through white-label channel
(e.g. Progressive.com and 1-800-Progressive)
How does Munich Re benefit?
2. Go through simple underwriting process in advance
 Investor and board member of innovation-leader
3. Turn on insurance on the app or by text when you
need it  Access to channels not otherwise available
 Developing deeper understanding of sharing
economy

Digital Partners
Bought by many – Insurance tailored

to individuals with specific needs
How does BBM benefit?

 Flexible mix of Munich Re and BBM technology
 Experimental product design and pricing
 Venture capital
 International scale
1. BBM uses Facebook to determine your interests and

match these to relevant insurance products How does Munich Re benefit?
2. Products are tailored to, and with, groups with a  Detailed data on customer behaviour
particular interest
 Investor in, and insurer to, platform with
3. BBM focus on groups for whom a specific matching exceptionally high net promoter score
product does not exist: “insurance for the long tail”
 Understanding of social media marketing
4. Initial evidence suggests lower acquisition costs, and
higher retention than “untailored market”
Digital Partners
Drover – Enabling Uber drivers and creating a new asset

class for investors
Fleet owner How does Drover benefit?
 Insurance via API: fully automated digital customer
API experience
 Simple interface to Drover platform
Driver  Rating to attract larger fleet owners
1. Fleet owner makes cars available on Drover platform How does Munich Re benefit?
2. Driver rents on flexible terms  Profitable and growing business line
3. Both owner and driver are insured via Digital  Data on sharing-economy driver behaviour
Partners API
 Ability to add further distribution to the platform

Digital Partners
Building sustainability – Digital Partners in 5 years
40 live partnerships
US$ 250m VC investments
€70–100m operating investment OUR AMBITION
To build a global digital-wholesale
Global, multi-line proposition insurance platform with a largely
Unique frictionless and automated fixed cost base and a substantial
underwriting and claims capabilities bottom-line contribution
Maintained technology advantage

Shareholdings and board seats in partners

nexible
John Paul Pieper

nexible
The relative investment into nexible is low – But a clear

commitment to target a niche and new way of working
ERGO strategy programme

 Overall investment to build
Fit … Digital ... Successful!
nexible in Germany and
another market until 2020
1 Sales – Elimination of 5 Foundational IT – 8 Fundamental optimisation
redundant structures Reliable service of product portfolio <€50m (gross)
2 Administration – 6 Digital IT – Flexible and 9 Integrated offerings for
Efficiency improvement quick implementation hybrid customers
 Limited budgets for ramp-up
3 International – 7 Processes – 10 Solutions for pure
Strengthen set-up Strengthen resilience online customers and running will trigger
and automation
4 Life Germany –
11 Strengthening of international creative solutions to solve
commercial/industrial business
Separation of traditional
back book and new
problems
12 International B2B2C
business partnerships
13 International growth  Relatively low fixed costs do
lead – with acceptable scale –
Net investment of ~€1bn (2016–2020)
to very competitive expense
€400m €400m €200m
ratios in the market

nexible
We see an untapped demand for pure online insurance
Customer need? Reality?

Go online and find the Customers are faced
best insurance – fast, with complex products and
easy and low-priced lengthy questionnaires
Be confident about having Pure online Customers look for lowest prices
the right cover and customers in aggregators as the
paying the right price only “hard measure”
Have transparency, Customers experience system

convenience and “full control” discontinuities, forget passwords
of own insurance cover and coverage and wait for feedback
Yet, no player within the market has given full control over insurance cover to the customer
nexible
Starting conditions for nexible have been validated
Service quality of motor insurers in Germany?1 Acceptance for pure online sales, claims, service?2
“Inadequate” “Good” “Yes, I consider it”
10% 21% 40%
“Sufficient” “OK”
31% 38%
1 Source: DISQ Studie KFZ Versicherer 2017 and Fanfocus Deutschland 2017. 2 Source: feedback of 4,000 target customers via YouGov in 2017. Investor Day 2017 125
nexible
The innovator’s dilemma within large corporations
“Lead customers” determine resource allocation
Niche markets do not satisfy large corporations
Disruptive market changes can not be analysed
LARGE Existing processes and values are limiting success

CORPORATION
Technology often confused with customer demand

nexible
That’s why nexible is well-positioned to innovate
DISRUPTIVE We are targeting a niche market only

INNOVATION
We appreciate our market opportunity
We build, measure, learn to find sweet spots
LARGE A SPIN-OFF We create new processes and values

CORPORATION ORGANISATION (but take advantage of
corporate resources)
DARE TO Make our customers love what we do

CANNIBALISE

nexible
nexible is set up with a clear value proposition
We built nexible to focus and No paper, no phone queue, Get insured in

best serve cancellable monthly less than 90 seconds
pure online customers
Competitive pricepoints for Get claims settled in
We came to stay, being part our customers because hours and relax
of two huge insurance we have low costs
Change your details and
companies
Get fast help by using the your policy whenever and
We are expanding in digital channels you prefer wherever you want
products and countries
We’re a spin-off All we do is digital We’re fast and easy

nexible
The customer impact is tangible:

It’s simply made to fit
Sarah
Sandira
90 sec to price Claim settled Change contract
for one all-in and paid in and coverage –
package <2 hours where-/whenever

nexible
Duty first: We start with what’s most important,

and work on excitement by experimenting
From duty … … to excitement

 State-of-the-art pricing … be in control of Always-available service by the digital
We have a great  Worry-free coverage packages a complex subject channels you prefer, full transparency
product …
 Reliable (with ERGO and Munich Re)
… enjoy a UX1 that Intuitive design, slick and easy, with a
… that easily fits  Pay monthly, cancel monthly feels great twinkle in the eye that makes you smile
your changing  Customise your coverage, decide yourself
life and …  Low-effort self-service saves you time … have a bit of fun e.g. provide incentive for desired
and get rewarded behaviour or gamification elements
 We are mobile first
… it’s digital, but  We are a brand with edge, character, humour
feels personal … feel unique by e.g. co-creation with existing
 Trust through the team and testimonials embracing passion communities to build the perfect product
A purely digital insurance … ... which is more than you think.
Focus in 2017 Ongoing customer-affinity tests and user experience experiments

1 User experience Investor Day 2017 130
nexible
“Einfach online versichern” is our motto –

A low cost operation offering a great customer experience
All-in-one tarif
Keep it
simple Cancellable every month
Pure online touchpoints, great user experience

Do it
online Risk factors adjustable anytime (repricing)
Einfach
Lots of standard, avoid exceptions
Design
online to cost Continuous automation step by step
versichern Be Gain momentum with existing online channels
edgy Drive brand awareness by edgy experiments

= Simply insured online
Potentially challenging for competition

nexible
nexible DE has built an API-centric platform for more speed

and flexibility
API-centric technology approach
External
front-end front-end  State-of-the art API-centric platform – efficient
build-up of new business models using API to
connect to third parties
 Efficient business model due to automation of
core processes avoiding low-level manual tasks
performed by humans
digital insurance engine  Dynamic pricing capabilities for fast-paced product
building and development
 Further efficiency and effectiveness realisable by
integrating machine learning capabilities based on
end-2-end insights gathered all the way through
Partners and External an integrated business model
risk carrier services back-end
Risk carrier = nexible Versicherung AG

MGA (e.g. platform, front-end) = nexible GmbH
nexible
nexible is aiming to offer a simple product for an attractive

price in selected segments
“Basic” “Comfort” “Premium” “ONE tariff”
Other insurers
vs.
“Make money “Be easiest and

with complexity” grow profitably”
 Up to 20 criteria with 2–4 options, each differentiated in  Best and relevant coverage picked
typical motor tariffs to form one tariff that fits every typical need
 Hard for consumers to understand what’s in and what’s  Pricing fully risk-adequate and very competitive in
out, what’s needed and what’s not selected customer segments
 Pricing inflated by sales channel considerations and  Customer can choose from options easily, but we
unclear discounts only present options with “wallet-impact”

nexible
We focus on motor first for volume and learning –

And leverage experiences for services, products and markets
Phase 1 Phase 2
Roadmap to success
Illustrative
Website
Further Further
products markets
E.g. travel
insurance E.g. further
with 20% Enrich EU countries
discount customer
self-service
Aggregators
 Start with online motor insurance product  Leverage experiences from motor MVP to enrich customer
(highly transactional, big volume market) self-service
 Focus on aggregators for launch in busy season of 2017  Build further products based on feedback gathered and
 Build-up of customer base crucial to drive customer-centric increase customer profitability through cross-/upsells
cross-selling and value-added services along the journey  Scale offerings to further markets

nexible
nexible benefits from its position within Munich Re (Group)
Support from functions

Artificial intelligence services
(e.g. HR, Legal)
Data science know-how Data science know-how

and capabilities DEFENCE VS. and capabilities
DISRUPTION
Joint real-time advertising Branding
LOW-RISK
TESTING ABILITY
Procurement power and Consultancy, e.g. Munich Re
operations scalability ADAPT NEW
PRACTICES Motor Consulting Group
International market International market
BUILD UP
know-how and access know-how and access
REAL DATA
Broad insurance customer GROW IN Broad expert network

base and know-how NEW MARKETS

nexible
The nexible team brings in all required capabilities
MANAGEMENT TEAM PROJECT TEAM (WITHIN ERGO)

Former ERGO
employee
Business Transformation
CEO CFO Former different
development back into ERGO industry or company
Part-time support
ERGO
COO (Interim) Public relations Human resources
MARKETING PRODUCTS AND SERVICES OPERATIONS CLAIMS AND SUPPORT TECHNOLOGY
Operations and Claims Chief Product Owner

Digital Branding Chief Actuary
Business Intelligence Management
Performance Marketing Product Management Operations Claims Process and Architecture and
and Analytics and Underwriting Processes Customer Experience Technology
Product Owner
Social Media Perfor- Operations and Claims and Partner
Frontend and User
mance Marketing Customer Service Management
Experience
Technology-Partner
Actuary (Interim) Data Science

nexible
We learned that a few things are key to being successful
1. We trust in the brand we create and fill it with life
2. We stick to our beliefs, but do not shy away from massive pivots
3. Pure digital means pure digital – as far as we can get
4. Unleashing the power of two giants, we benefit from being part of ERGO and Munich Re
5. We balance leveraging corporate resources and establishing true autonomy
6. Speed beats perfectionism – we fail fast and learn more
7. Development and learning cannot be a silo – we systematically share back with ERGO

Shareholder information
Financial calendar
2018
6 February Preliminary key figures 2017 and renewals

Balance sheet press conference for 2017 financial statements
15 March Analysts’ conference in Munich with videocast
25 April Annual General Meeting 2018, ICM – International Congress Centre Munich
8 May Quarterly statement as at 31 March 2018
8 August Half-year financial report as at 30 June 2018
7 November Quarterly statement as at 30 September 2018

Shareholder information
For information, please contact
Investor Relations Team

Christian Becker-Hussong Thorsten Dzuba Christine Franziszi
Head of Investor & Rating Agency Relations Tel.: +49 (89) 3891-8030 Tel.: +49 (89) 3891-3875
Tel.: +49 (89) 3891-3910 E-mail: [email protected] E-mail: [email protected]
E-mail: [email protected]
Britta Hamberger Ralf Kleinschroth Andreas Silberhorn

Tel.: +49 (89) 3891-3504 Tel.: +49 (89) 3891-4559 Tel.: +49 (89) 3891-3366
E-mail: [email protected] E-mail: [email protected] E-mail: [email protected]
Ingrid Grunwald Angelika Rings

Tel.: +49 (89) 3891-3517 Tel.: +49 (211) 4937-7483
E-mail: [email protected] E-mail: [email protected]
Münchener Rückversicherungs-Gesellschaft | Investor & Rating Agency Relations | Königinstraße 107 | 80802 München, Germany
Fax: +49 (89) 3891-9888 | E-mail: [email protected] | Internet: www.munichre.com

Disclaimer
This presentation contains forward-looking statements that are based on current assumptions and forecasts of the
management of Munich Re. Known and unknown risks, uncertainties and other factors could lead to material differences
between the forward-looking statements given here and the actual development, in particular the results, financial situation and
performance of our Company. The Company assumes no liability to update these forward-looking statements or to make them
conform to future events or developments.

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INVESTOR DAY

Munich Re driving digital transformation

Munich, 21 November 2017

Munich Re (Group) Cyber insurance Internet of Things

ERGO Digital Ventures Canadian multi-channel Digital Partners

Reinsurance ERGO Mobility Solutions nexible

Data and analytics Mass customisation in India

Investor Day 2017 2

Investor Day 2017 3

Digital business models have been penetrating

Insurance industry in the midst of digital transformation

Images: used under license from shutterstock.com Investor Day 2017 4

Insurance industry perspective –

REINSURANCE  New risks, extended insurability,  Changing front ends

Investor Day 2017 5

To remain a winner in the future, “digital ingredients”

RESULT FOCUS DIGITAL FOCUS LEADERSHIP FOCUS

To achieve concrete results from innovation and

Investor Day 2017 7

1 We have invested in building a global foundation

Invest in data analytics Invest in

Investor Day 2017 8

2 We turn ideas into business potential based on

Execution or early exit

Investor Day 2017 9

3 We take an active role to continuously transform and extend

Business transformation Business extension

Cyber insurance Sensor-driven business models

DISTANCE TO THE CORE

Investor Day 2017 10

3 We realise innovation synergies from our set-up as RI

Create a strategic advantage from primary insurance and reinsurance set-up

Investor Day 2017 11

Investor Day 2017 12

We live in a time of technological change

Devices and sensors Data Computing power Artificial intelligence

30 billion 90% of data 1,202 CPUs A new world

Changing behaviour is driving digital opportunities for primary insurance business

Our origin and mission:

Strategy 9 Integrated offerings for hybrid customers

fit digital successful 11 Strengthening internat. comm./indust. business

Net investment of ~€1bn (2016–2020) 12 International B2B2C partnerships

€400m €400m €200m 13 International growth

Founding of ERGO Deutschland ERGO Digital Ventures ERGO International

Our mission Ensure successful  P&L responsible for >€1bn GWP

1 As at 31 December 2016 including ERGO Direkt. Investor Day 2017 14

Framework for digitalisation at ERGO

Improving Disrupting Establishing

Digital culture – a new way of working and global exchange

Investor Day 2017 15

The online market for insurances is growing strongly

Insurances – Online share

2005 2010 2015 2020

Investor Day 2017 16

We aim at the modern customer and

Service Empowering ERGO in online business

Investor Day 2017 17

We empower ERGO to deliver best-in-class

as part of ERGO’s global IT