Crédit Agricole Assurances shows growing results and a good level of solvency
Crédit Agricole Assurances generated €37.0 billion of written premiums in 2019, up more than 10% compared to 2018, and continued to diversify its product mix by redirecting net inflows to unit-linked products in savings and retirement, and through the development of property & casualty insurance and personal protection.
Savings and retirement written premiums amounted to €28.5 billion in 2019, increasing by 11% compared to 2018. Unit-linked increased by 5.8% compared with 2018 to reach 28.9% in gross inflows at end-20191. This trend was particularly observed in the fourth quarter of 2019, when unit-linked written premiums accounted for 33.4% of gross inflows, up 4.4 percentage points compared with the fourth quarter of 2018.
At the end of 2019, net inflows amounted to €9.5 billion, including the high level of €5.1 billion in unit-linked products, representing 53% of total net inflows, and demonstrating the success of the new inflow policy of Crédit Agricole Assurances: comprehensive wealth advice including personalised savings proposals tailored to the needs of savers, while leaving them free to make their own decisions.
At the same time, in October 2019, Crédit Agricole Assurances launched its individual and group PER (retirement savings plans), which enable customers to prepare for their retirement in the best possible way throughout their working life.
At the end of December 2019, life insurance outstandings amounted to €304.2 billion2, up by 6.6% compared to the end of 2018. Driven by the strong sales momentum in 2019, unit-linked outstandings rose 15.7% and represented a share of 22.8% of total outstandings at end-December 2019, up 1.8 point year-on-year.
Furthermore, Crédit Agricole Assurances continues to set up its policyholder participation reserve (PPE), which stood at €10.8 billion at end-December 2019 (+ €1 billion in 2019), representing 5.2% of Euro outstandings3.
The average rate of return on assets of Crédit Agricole Assurances group reached 2.46% in 2019, still well above the average minimum guaranteed rate (0.28% at end-2019). In addition, profit-sharing adjustment on euro-denominated contracts in the context of low interest rates helps to maintain the gap between the return on assets and the return on liabilities.
In property and casualty, Crédit Agricole Assurances continued its business growth dynamic. Written premiums reached €4.5 billion at end-2019, up 8% compared to 2018, driven both by France (+8%) and International activities (+5%). With a net contribution of more than 665,000 contracts over the year, the number of P&C contracts reached 14.1 million contracts at end-December 2019.
The growth in equipment rates of retail customers, in France in the Regional Banks (40.7%4 at end-2019, up 1.5 point year-on-year) and LCL (25.0%4 at end-2019, up 1.1 point year-on-year), and in Italy in CA Italia (15.4%5 at end-2019, +1.7 point year-on-year) confirms the strength of the business model and a still significant growth potential.
The combined ratio6 remains well under control at 95.9%, slightly up by 0.4 point year-on-year due to climatic events in the second half of the year.
Death and disability, creditor, and group insurance written premiums amounted to €4.0 billion, up around 9% year-on-year, driven by all three businesses segments. In particular, Creditor insurance written premiums recorded a strong growth of more than 10% compared to 2018.
Crédit Agricole Assurances launched in January 2019 the app “Ma Santé”, an e-health platform which offers self-care services to employees to assist them in their treatment process. This launch marks a new step in the development of Crédit Agricole Assurances in the group insurance activity, in particular with regard to the digitalisation of its offers and services.
In July 2019, in line with its international development strategy, Crédit Agricole Assurances announced the signature of a partnership in non-life insurance with the Spanish banking group Abanca, through a 50/50 joint venture, Abanca Generales de Seguros y Reaseguros S.A. This alliance brings together Abanca's knowledge of the customer base in the Spanish market with the scale acquired by Crédit Agricole Assurances in Europe. The European competition authorities approved the transaction in October 2019.
At the end of December 2018, the net income group share of Crédit Agricole Assurances reached€1,518 million7. Excluding non-recurring items8, the NIGS is up 3.3% compared with 2018 (and 14% without restatement).
At 31 December 2019, Crédit Agricole Assurances' Solvency 2 prudential ratio is at a high level of 263%. Excluding the new policyholder participation reserve (PPE) integration rules, the ratio amounts to 188%, stable compared to the end of 2018.
The Standard & Poor’s rating of the main operational entities of Crédit Agricole Assurances is A / stable outlook.
1 In local GAAP
2 Savings, retirement and death & disability
3 “Life France scope”
4 Percentage of customers having at least one contract in automotive, multi-risk household, healthcare, legal, all mobiles or accident insurance. Change in method as of Q4-19. FY 2018 pro forma rates: 39.2% (RB) and 23.9% (LCL).
5 Percentage of CA Italia’s customers having at least one contract marketed by CA Assicurazioni, non-life insurance subsidiary of Crédit Agricole Assurances
6 Ratio of (claims + operating expenses + commissions) to premium income, net of reinsurance, Pacifica scope
7 The contribution to the net income group share of Crédit Agricole S.A. amounted to €1,329 million. The difference with Crédit Agricole Assurances' net income group share is mainly due to an analytical restatement affecting the cost of the Switch guarantee to the Insurance business line (annual net impact of around €200 million).
8 Monetary compensation of €138 million after taxes paid in 2018 following the early repayment of subordinated notes to Crédit Agricole S.A.