Reinsurance

Christian Mumenthaler CEO Reinsurance Swiss Re’s largest Business Unit delivers strong results

1 Economic Net Worth • Wholesale reinsurance leader offering products and related services L&H in property and casualty, as well as in life and health 31% • Foundation of Swiss Re Group’s strength

49% P&C • Strong performance over the last years and YTD

Combined ratio and operating margin Return on Equity

in % in % 80.7 83.8 83.7 84.8 26.7 26.0 26.7 23.3

17.0

8.9 6.4 10.7 8.6 5.8 2.6 -7.9

FY 12 FY 13 FY 14 9M 15 FY 12 FY 13 FY 14 9M 15

P&C: Combined ratio L&H: Operating margin P&C L&H

1 Share of Swiss Re Group’s Economic Net Worth deployed across Business Units (excl. Group Items), 30 June 2015 Investors' Day | Rüschlikon, 8 December 2015 84 Reinsurance – Agenda

I systematically allocate capital to risk pools / revenue streams

II III broaden optimise and diversify client resources and base to increase platforms to support access to risk capital allocation

IV emphasise differentiation

Investors' Day | Rüschlikon, 8 December 2015 85 I

II III

IV Since 2006 we have a Group-wide process for business steering and underwriting which is successfully applied in Reinsurance

Swiss Re - Steering Framework Key success factors:

•1 Integrated economic framework to steer both P&C and L&H Reinsurance businesses, including planning, pricing

4 Learning Strategy and reserving •2 Active portfolio steering between and 2 within P&C and L&H Reinsurance Portfolio- 1 EVM Capital businesses & perform- allocation ance & •3 Separation of pricing and costing to measure- Target ment setting enable transparent decision making •4 Feedback loop allows to optimise costing 3 Decision making

Investors' Day | Rüschlikon, 8 December 2015 86 I

II III

IV We shifted the portfolios in line with our underwriting framework and growth strategy

P&C Reinsurance portfolio composition1 L&H Reinsurance portfolio composition1

US GAAP Gross Earned Premiums US GAAP Gross Earned Premiums

7% 7% 7% 7% 8% 9% 14% 15% 15% 18% 20% 21% 4% 19% 20% 23% 11% 12% 25% 28% 9% 9% 31% 14% 10% 9% 11% 10% 17% 8% 11% 11% 13% 14% 15% 15% 13% 17% 10% 9% 10% 10% 74% 73% 17% 70% 67% 18% 18% 17% 64% 60% 15% 15%

22% 24% 22% 22% 19% 16%

2010 2011 2012 2013 2014 9M 2015 2010 2011 2012 2013 2014 9M 2015

HGM (excl. Motor China) Casualty (excl. Motor) Property Non-Prop HGM (Motor China only) Specialty HGM Health Life Motor Property Prop / Fac • P&C: High Growth Markets driver for growth; reduction of Property since 2013 due to price developments • L&H: continuous growth of Health and business in High Growth Markets 1 Data before external retro and other items; average Q3 2015 FX rates used for all years; Line of business split does not include High Growth Markets business Investors' Day | Rüschlikon, 8 December 2015 87 I

II III

IV Transactions become increasingly important

Development of transactions1 • EVM underwriting profit substantially increased over the EVM underwriting profit in USD bn All figures as priced past 5 years 0,8 • Increasing solvency and capital standards support transactions, especially L&H Reinsurance 0,6 deals • We benefit from trend towards +27% 49% large and tailored transactions 0,4 47% 57% 12% 51%

0,2 20% 51% 88% 53% 49% 43% 80%

0,0 2010 2011 2012 2013 2014 9M 2015 L&H P&C

1 Data before external retro and other items, FX not restated; Transactions include structured deals and large transactions Investors' Day | Rüschlikon, 8 December 2015 88 I

II III

IV P&C – Swiss Re has been consistently outperforming the

market with regards to profitability Market share of top 7 reinsurers Swiss Re P&C Reinsurance revenues and operating income2 share vs other

reinsurers 40% 50%

40%

30%

20%

10%

0% 2009 2010 2011 2012 2013 2014 9M 2015 Revenues1 Operating income2 • Average revenue share of 21% In 2011, the industry experienced extraordinary high natural catastrophe losses. Swiss Re was hit to a • Average profit share of 30% lesser extent than peers.

1 Revenues exclude net realised investment gains 2 Operating income is income before tax and before interest for financial debt, excluding net realised investment gains (losses) Top 7 reinsurers include: Swiss Re, Munich Re, Hannover Re, PartnerRe, SCOR, Everest Re, Alleghany Source: Swiss Re Economic Research and Consulting Investors' Day | Rüschlikon, 8 December 2015 89 I

II III

IV L&H – Swiss Re with significant portion of profit pool

Market share of top 6 reinsurers Swiss Re L&H Reinsurance revenues and operating income2 share vs other reinsurers 40% 70%

30%

20%

10%

0%

-10% 2009 2010 2011 2012 2013 2014 9M 2015 Revenues1 Operating income2 2014 was impacted by Swiss Re’s decisive • Average revenue share of 23% management actions in respect of pre- 2004 US YRT business and the unwind of a • Average profit share of 25% funding structure.

1 Revenues exclude net realised investment gains; limited comparability due to different accounting standards of peer group; Top 6 reinsurers include Swiss Re, Munich Re, Hannover Re, PartnerRe, SCOR, RGA 2 Operating income is income before tax and before interest for financial debt, excluding net realised investment gains (losses) Source: Swiss Re Economic Research and Consulting Investors' Day | Rüschlikon, 8 December 2015 90 I

II III

IV L&H Reinsurance shows strong underlying results – well on track to achieve 2015 ROE target Operating income adjustments • 2014 results impacted by decisive management actions, setting the in USD m FY 2014 9M 2015 foundation for profitable growth Operating income of which approximately 331 986 • 9M 2015 operating income and • Mortality/morbidity experience vs. expected 138 -16 margins have developed within • Model/assumption changes1 -87 81 expected range • VA/GMDB/B361 -1 12 • Mortality/morbidity experience vs. expected is also tracking within • Other one-offs -623 0 our expected volatility Operating margin, % 2.6 10.7

Return on Equity • L&H Reinsurance well on track to achieve its ROE target of 10-12% in % 17.0 • Management of in-force blocks of 11.812.6 ROE, reported business continues to be a key 6.5 priority 5.7 ROE, adjusted2

ROE, adjusted on USD 5.5bn equity3 -7.9 FY 2014 9M 2015

1 Model/assumption changes in relation to VA/GMDB/B36 are shown as part of “Model/assumption changes” 2 Adjusted for realised gains/losses and model-/assumption-updates, and large one offs, net of tax 3 Same as described in footnote 2 and for USD 5.5bn equity capital base, announced in the June 2013 Investors’ Day Investors' Day | Rüschlikon, 8 December 2015 91 I

II III

IV Four focus areas to broaden and diversify client base to increase access to risk

Regionals & Nationals (R&N) Significant growth in volume and number of clients since start of initiative

Casualty We actively manage the Casualty business according to the pricing cycle

Health Addressing the health-protection need of the ageing population

High Growth Markets Continue to expand geographically, and be the global leader

Investors' Day | Rüschlikon, 8 December 2015 92 I

II III

IV R&N – strong growth in volume and number of clients since start of initiative in 2011

Premium development R&N (P&C only)1 • Since the start of our R&N initiative more than 100 new US GAAP Gross Earned Premiums (USD bn) P&C clients have been added on 6 average per year +7% • At the same time retention of 5 existing clients has improved

41% • In 2014, the P&C part of the 4 42% 38% R&N initiative contributed about 47% 44% 46% 22% to Reinsurance EVM 3 Underwriting Profit1 25% 27% 26% 2 2 • R&N with higher profitability 17% 23% 23% compared to average of overall

1 P&C business 33% 32% 36% 36% 33% 31%

0 2010 2011 2012 2013 2014 9M 2015

Europe, Middle East & Africa Asia Americas

1 Data before external retro and other items, average Q3 2015 FX rates used for all years 2 EVM profit margin 2014 (as priced) = EVM Underwriting profit / EVM capital Investors' Day | Rüschlikon, 8 December 2015 93 I

II III

IV Casualty – we pro-actively manage the Casualty business according to the pricing cycle

Premium development Casualty1 • In 2014, Casualty contributed around 11% to Reinsurance EVM US GAAP Gross Earned Premiums (USD bn) Underwriting Profit1 7 • EVM profit margin2 in 2014 at +17% 6 ~7%; further reduction of low- 12% margin business expected (China

5 21% Motor QS) 27% 12% 37% • We pursue a profitability-focused 4 26% 27% expansion, taking into account 18% 3 21% 31% relevant factors, e.g. 10% 10% 16% 13% 33% – rate developments 4% 10% 2 10% 12% 12% 5% – macro economics 16% 12% 15% 5% 5% 4% 1 15% 4% – social, regulatory and legal 5% 27% 26% 29% 36% 18% 18% developments 0 2010 2011 2012 2013 2014 9M 2015 – cession rates

Motor EMEA Motor Americas Casualty Asia Motor Asia Casualty EMEA Casualty Americas

1 Data before external retro and other items, average Q3 2015 FX rates used for all years 2 EVM profit margin 2014 (as priced) = EVM Underwriting profit / EVM capital Investors' Day | Rüschlikon, 8 December 2015 94 I

II III

IV Health – addressing the health-protection need of the ageing population

Premium development Health1 • Increasing demand for primary health products, particularly in US GAAP Gross Earned Premiums (USD bn) Asia and the US 4 • Cessions to the reinsurance market are expected to increase +21% in line with growth in the primary 3 market 58% • In 2014, Health business represented about 12% of 2 65% 59% Reinsurance EVM Underwriting 68% Profit1 69% 67% 2 1 • Profitability of Health book 35% slightly above average of overall 28% 34% 24% 21% 25% reinsurance profitability 9% 9% 8% 7% 8% 0 8% 2010 2011 2012 2013 2014 9M 2015

Europe, Middle East & Africa Asia Americas

1 Data before external retro and other items, average Q3 2015 FX rates used for all years 2 EVM profit margin 2014 = EVM Underwriting profit / EVM capital Investors' Day | Rüschlikon, 8 December 2015 95 I

II III

IV High Growth Markets – continue to expand geographically

Premium development HGM1 • Significant growth achieved over past years, especially in Asia US GAAP Gross Earned Premiums (USD bn) • Volume reduction of low-margin 6 China Motor QS due to C-ROSS2 +17% 3 5 • Profitability of remaining High 35% Growth Markets business in line

4 28% with overall book 37% 26% 16% • Our current focus 3 34% 19% 17% – Establish high performing 15% 16% local teams 2 19% 27% 39% 41% – Further enhance client 35% 44% 34% 1 42% loyalty in selected segments – Support efforts to increase 16% 13% 12% 12% 10% 12% 0 overall market penetration 2010 2011 2012 2013 2014 9M 2015 Motor China Asia Europe, Middle East & Africa Americas

1 Data before external retro and other items, average Q3 2015 FX rates used for all years 2 C-ROSS = China Risk Oriented Solvency System 3 EVM profit margin 2014 (as priced) = EVM underwriting profit / EVM capital Investors' Day | Rüschlikon, 8 December 2015 96 I

II III

IV High Growth Markets – shift of resources ongoing

Allocation of Reinsurance origination1 staff

1 503 1 584 1 691 1 728 1 740 2% 2% 2% 2% 2% 2% 3% 4% 5% 5% Since inception of our 11% High Growth Market 13% (HGM) initiative in 16% 2011 we have 17% 17% systematically re- allocated client facing functions to growth 85% areas 82% 79% 77% 76%

2011 2012 2013 2014 H1 2015 HGM - Africa HGM - LatAm HGM - Asia Mature Markets

1 Client Markets and Underwriting/Products Investors' Day | Rüschlikon, 8 December 2015 97 I

II III

IV R&N – substantial productivity gains

Market underwriter concept Fitting offering

Launched globally

20 markets

• Market underwriter concept, launched • Client buying preferences have been in 2010, is currently applied in 20 assessed in detail markets globally; further roll-out in • Goal is to deliver appropriate offerings progress based on individual client needs • Number of programmes led by market 840 client facing staff members have 1 • underwriters grows in all regions been trained on the learnings from the • Market underwriters contribute ~25% assessment to EVM underwriting profit of overall R&N in-force P&C treaty portfolio

1 e.g. for P&C treaty business from 2013 to 2015: +37% in Americas, +21% in Asia, +33% in EMEA Investors' Day | Rüschlikon, 8 December 2015 98 I

II III

IV Platforms – consolidation of applications and system landscapes progressing well

Service and Accounting and Integrated end-to-end approach Origination along the value chain control reporting

2007 - 2017: P&C Application and Approximately USD 240m invested to globalise and rationalise landscape processes in one robust architecture consolidation • 3 regional landscapes reduced to 1 • 558 business applications reduced to 175 • Additional improvements expected in next 2 years

L&H Approximately USD 300m invested to globalise and rationalise processes in one robust architecture • 10 system landscapes reduced to 3 • Landscape allows better decision making and reduces risks • Only 1 remaining system landscape expected in 2017

Investors' Day | Rüschlikon, 8 December 2015 99 I

II III

IV Our differentiation is based on three key pillars

Financial • Very strong capital position (e.g. SST 1/2015 for SRZ: 217%) strength • SRZ rating: S&P AA-, Moody’s Aa3, A.M. Best: A+; all stable outlook • Leading and highly diversified global reinsurer

Client relationships • Highly interactive client relationship model • Long lasting and sustainable relationships • Franchise value further improved

Knowledge company • Employees combine a wide range of technical expertise • Commitment to sharing knowledge • Wide spectrum of products and value-added services

Investors' Day | Rüschlikon, 8 December 2015 100 I

II III

IV Client relationships – we have a “high touch” interaction model

Visualisation of an interactive client relationship NPS in line with client interactions increase

Number of client interactions NPS score Global Client 90000 45 42 41 80000 40 70000 40 36 60000 35 50000 40000 30 30 30000

20000 25 10000 0 20 H1 2011 2012 2013 2014 Swiss Re 2015

14+ interactions over last 5 years Net Promoter Score (NPS) Phone calls Meetings

• We have documented more than 3 interactions a • From 2011 to 2014, we have quadrupled our day between Swiss Re and a Global Client over documented client interactions and improved the past 5 years our Net Promoter Score (NPS) from 30 to 41 • This involved 291 employees from Swiss Re and • Strong franchise value confirmed by Flaspöhler that Global Client ratings: Swiss Re moved up to #1 or #2 in all markets from 2011 to 2015 (except #3 in Latin America P&C Reinsurance)

Investors' Day | Rüschlikon, 8 December 2015 101 I

II III

IV Client relationships – we maintain long lasting and stable relationships with our clients

Development of 100 largest P&C and • Business from long lasting and L&H Reinsurance clients stable client relationships contributes to a large part of our EVM premiums, 2010-2014 overall result

• Remarkable retention and ~75% of total premium growth rate illustrate premiums on average the success of our dedicated client focus

99% retention rate

~8% annual premium increase

Investors' Day | Rüschlikon, 8 December 2015 102 I

II III

IV Knowledge company – our employees and their range of backgrounds enable us to develop unique solutions

Reinsurance has dedicated experts in a multitude of areas – a few examples:

Ageing Atmospheric Trend Spotter Societies Perils Expert Retakaful Expert Medical Specialist Researcher L&H Telematics Transactions Specialist Emerging Structurer ILS Risk Structurer FinTech Specialist Terror Risk Expert Expert Behavioural Prospective Researcher Nuclear Risks Modeller Driverless Expert Disaster Risk Sustainable Cars Financing Flood Expert Specialist Specialist Development Data Insights Advisor Analyst Infrastructure External Run- Investment ILS Trader Cyber Risks Off Specialist Specialist Expert

P&C Retrospective Transactions Big Data Solutions Medical Doctor Structurer Expert Expert

Investors' Day | Rüschlikon, 8 December 2015 103 I

II III

IV Knowledge company – full service support to clients with wide spectrum of products and services Supporting clients with traditional and innovative reinsurance solutions

Directly supporting clients, e.g. • New/ co- product development (e.g. senior cancer products) Mutual • Portfolio/risk analysis, cat modelling advisory growth • Solvency II consulting • Rating exposure support

Wide range of client workshops and training, e.g. • Training for insurers (e.g. Insurance Management Simulation): >600 single Knowledge participants from over 40 countries in classroom courses and >800 in eLearnings by year end 2015 sharing • Product development workshops (e.g. accident and health products) • Emerging risks workshops and risk engineering services (on-site)

Unique systems and simulation tools, e.g. • CatNet – natural hazard information and mapping system Unique • SwiftRe – online self-service facultative reinsurance platform tools • Magnum – automated underwriting system for L&H • L&H Guidelines – internet based underwriting manuals and claims guide

Investors' Day | Rüschlikon, 8 December 2015 104 I

II III

IV Knowledge company – financial benefits from our differentiation approach

Differentiation example for Globals Differentiation benefits built on 3 sources

~40% of Globals EVM underwriting profit originated as result of differentiation 1. Preferential terms & conditions

2. ~60% ~40% Private deals

3. Share of wallet above defined Share of contribution margin from differentiation threshold

Data is limited to Treaty only (2014)

Investors' Day | Rüschlikon, 8 December 2015 105 Reinsurance – Agenda

I systematically allocate capital to risk pools / revenue streams

II III broaden optimise and diversify client resources and base to increase platforms to support access to risk capital allocation

IV emphasise differentiation

Summary and Q&A

Investors' Day | Rüschlikon, 8 December 2015 106 Reinsurance Strategy remains valid and strongly contributes to the Group’s strategic framework

• Reinsurance is a key contributor to the overall Group performance • Proven track record in portfolio steering – consistent outperformance • Significant growth achieved in targeted areas – High Growth Markets, R&N, Health, Casualty and Transactions Conclusion • Productivity gains – resource shifts to HGM, consolidation of platforms in P&C and L&H, simplified underwriting for R&N • Differentiation at the core of Reinsurance strategy – results measured and proven

• P&C environment will continue to be challenging – we will stay disciplined and committed to profitability • Growth aspirations focused on selected areas – dedicated strategic Outlook & initiatives in place priorities • Differentiation continues to be key – financial strength undisputed, client interaction model unique, knowledge company approach continuously professionalised

Investors' Day | Rüschlikon, 8 December 2015 107 Investors' Day | Rüschlikon, 8 December 2015 Corporate calendar & contacts

Corporate calendar

2016 23 February Annual Results 2015 Conference call 16 March Publication of Annual Report 2015 and EVM 2015 22 April 152nd Annual General Meeting Zurich 29 April First Quarter 2016 Results Conference call

Investor Relations contacts

Hotline E-mail +41 43 285 4444 [email protected]

Philippe Brahin Jutta Bopp Chris Menth +41 43 285 7212 +41 43 285 5877 +41 43 285 3878 Simone Lieberherr Iunia Rauch-Chisacof +41 43 285 4190 +41 43 285 7844

Investors' Day | Rüschlikon, 8 December 2015 Cautionary note on forward-looking statements

Certain statements and illustrations contained herein are forward-looking. These statements (including as to plans objectives, targets and trends) and illustrations provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to a historical fact or current fact. Forward-looking statements typically are identified by words or phrases such as “anticipate“, “assume“, “believe“, “continue“, “estimate“, “expect“, “foresee“, “intend“, “may increase“ and “may fluctuate“ and similar expressions or by future or conditional verbs such as “will“, “should“, “would“ and “could“. These forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause Swiss Re’s actual results of operations, financial condition, solvency ratios, capital or liquidity positions or prospects to be materially different from any future results of operations, financial condition, solvency ratios, capital or liquidity positions or prospects expressed or implied by such statements or cause Swiss Re to not achieve its published targets. Such factors include, among others:

• further instability affecting the global financial system and developments related • the cyclicality of the reinsurance industry; thereto; • uncertainties in estimating reserves; • deterioration in global economic conditions; • uncertainties in estimating future claims for purposes of financial reporting, • Swiss Re’s ability to maintain sufficient liquidity and access to capital markets, particularly with respect to large natural catastrophes, as significant including sufficient liquidity to cover potential recapture of reinsurance uncertainties may be involved in estimating losses from such events and agreements, early calls of debt or debt-like arrangements and collateral calls due preliminary estimates may be subject to change as new information becomes to actual or perceived deterioration of Swiss Re’s financial strength or otherwise; available; • the effect of market conditions, including the global equity and credit markets, and • the frequency, severity and development of insured claim events; the level and volatility of equity prices, interest rates, credit spreads, currency • acts of terrorism and acts of war; values and other market indices, on Swiss Re’s investment assets; • mortality, morbidity and longevity experience; • changes in Swiss Re’s investment result as a result of changes in its investment • policy renewal and lapse rates; policy or the changed composition of its investment assets, and the impact of the timing of any such changes relative to changes in market conditions; • extraordinary events affecting Swiss Re’s clients and other counterparties, such as bankruptcies, liquidations and other credit-related events; • uncertainties in valuing credit default swaps and other credit-related instruments; • current, pending and future legislation and regulation affecting Swiss Re or its • possible inability to realise amounts on sales of securities on Swiss Re’s balance ceding companies, and the interpretation of legislation or regulations by sheet equivalent to their mark-to-market values recorded for accounting purposes; regulators; • the outcome of tax audits, the ability to realise tax loss carryforwards and the • legal actions or regulatory investigations or actions, including those in respect ability to realise deferred tax assets (including by reason of the mix of earnings in of industry requirements or business conduct rules of general applicability; a jurisdiction or deemed change of control), which could negatively impact future earnings; • changes in accounting standards; • the possibility that Swiss Re’s hedging arrangements may not be effective; • significant investments, acquisitions or dispositions, and any delays, unexpected costs or other issues experienced in connection with any such • the lowering or loss of one of the financial strength or other ratings of one or more transactions; Swiss Re companies, and developments adversely affecting Swiss Re’s ability to achieve improved ratings; • changing levels of competition; and • operational factors, including the efficacy of risk management and other internal procedures in managing the foregoing risks.

These factors are not exhaustive. Swiss Re operates in a continually changing environment and new risks emerge continually. Readers are cautioned not to place undue reliance on forward-looking statements. Swiss Re undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events or otherwise. This communication is not intended to be a recommendation to buy, sell or hold securities and does not constitute an offer for the sale of, or the solicitation of an offer to buy, securities in any jurisdiction, including the United States. Any such offer will only be made by means of a prospectus or offering memorandum, and in compliance with applicable securities laws.

Investors' Day | Rüschlikon, 8 December 2015