The business model
The international activities of the Hannover Re Group in the life and health reinsurance business group are conducted under the Hannover Life Re brand name. We offer individual reinsurance solutions worldwide in the areas of life, annuity and health insurance, having consciously chosen to concentrate on assumption of the biometric risks of mortality, longevity and morbidity. We also write the accident line to the extent that it is transacted by life insurers as well as retakaful business, which is geared specially to insurance products that are in conformity with Islamic law.
Our business model is integrated into the strategy of the Hannover Re Group and promotes outstanding diversification of the portfolio. Our core business policy is based on the tried and trusted Five Pillar model: conventional reinsurance, new markets, multinationals, bancassurance and financial solutions. Each pillar is distinguished by special technical expertise, has its own individual marketing approach and is geared to different customer requirements and products. In the conventional reinsurance segment we participate selectively in attractive traditional life and health reinsurance. By way of the other four pillars we are able to offer individual, innovative and needs-oriented insurance solutions.
Conventional reinsurance traditionally accounts for the lion’s share of our portfolio. Nevertheless, particularly as a consequence of our activities in the UK private annuity market (enhanced annuities), we have been able to substantially enlarge our business volume in the area of new markets; the contribution made by this pillar to our total volume is therefore steadily growing.
The proportion of business delivered by the two leading pillars – new markets and conventional reinsurance – continued to increase in the year under review, while the shares of the other three segments decreased slightly. We nevertheless achieved a balanced mix of conventional reinsurance – with around 44% of our portfolio – and the four other pillars – accounting for roughly 56%.
Another key feature of our business model is its decentralised structure: with 23 units in 19 countries we operate on all continents in close proximity to our clients. Our international network enables us to deliver direct service tailored to the specific needs and requirements of our customers. The various locations see themselves as parts of a network that support each other and facilitate the rapid transfer of relevant information.
Along with our local presence, we attach great importance to maintaining and expanding long-term business partnerships with our ceding companies. In this regard we draw on our Customer Relationship Management (CRM), an approach that has proven itself over the years and is practised by our company worldwide. A core component of our activities is therefore our individual customer orientation, as part of which we devote particularly close attention to positive profit and growth opportunities for both sides.
Our business model is geared primarily to organic growth. Yet we remain open to acquisitions of suitable portfolios in order to gain access to new business segments and with a view to cementing our market position and achieving our medium-term growth target. Of overriding importance, however, is our striving to safeguard the profitability and quality of the business written and our desire to cultivate and preserve our long-term client relationships.