<<

...... Storebrand Key points 3rd quarter 1998

• Operating profit of NOK 1,136 million and Groups profit of NOK 510 million. Value adjusted operating profit of NOK -4,048 million

• Strong financial position and risk bearing capacity even after fall in financial markets

• Competitive yield, but weak financial income in the third quarter. The Life company has produced a book yield for the year to date of 4,4% (5,9% on an annualised basis), whilst yield including unrealised gains and losses is 0,1% for the year to date (0,1% on an annualised basis)

• Net transfer of premium-reserves to Storebrand amounted to NOK 473 million • Non-life reports growth in premiums and significantly lower claims ratio than at this time last year • Non-life insurance market share up by 0,1 percentage to 38,8% in the third quarter • Life insurance market share unchanged in the third quarter at 28%

Results 3Q 98 1

...... Storebrand Group Operating result 3rd quarter

3rd quarter NOK million 1998 1997 Net premium income 4.157 3.299 Income financial items insurance 3.949 4.201 Other income 225 252

Operating income 8.330 7.751

Insurance benefits, allocations -4.434 -3.583 Costs financial items insurance -3.338 -1.954 Insurance related operating costs -639 -647 Other costs -406 -208

Operating result -486 1.360

Results 3Q 98 2

1 ...... Storebrand Operating results by sub-group 3rd quarter

3rd quarter NOK million 1998 1997 Storebrand ASA -131 -13 Storebrand Life insurance -358 1.252 Storebrand Non-life insurance -3 151 Storebrand 8 0 Storebrand Unit Linked 0 -3 Storebrand SPAR -2 8 Storebrand Asset/Investment Management 0 0 Others/eliminations 0 -35 Operating result -486 1.360 Profit allocated to policyholders - life 411 -1.086

Group result -75 274

Results 3Q 98 3

...... Storebrand Group Operating result

01.01. - 30.09. 01.01.- 31.12. NOK million 1998 1997 1997 Net premium income 12.956 10.872 14.642 Income financial items insurance 11.915 11.030 15.490 Other income 715 613 786 Operating income 25.586 22.515 30.918 Insurance benefits, allocations -13.860 -11.718 -15.928 Costs financial items insurance -7.435 -4.880 -6.307 Insurance related operating costs -2.086 -1.801 -2.601 Other costs -1.069 -794 -1.273 Operating result 1.136 3.322 4.809

Results 3Q 98 4

2 ...... Storebrand Group Realized gains/losses and write-downs

1. KVARTAL Realized gains Realized losses and Net gains 01.01. - 31.03. write-downs 01.01.-30.09. 01.01.-30.09. 01.01.-30.09. NOK million 1998 1997 1998 1997 1998 1997 Storebrand Life insurance 6.487 6.002 -6.316 -4.124 171 1.878 Storebrand Non-life insurance 256 284 -314 -73 -58 211 Storebrand Bank 1 0 -21 0 -20 0 Storebrand ASA 21 18 -100 -5 -79 13 Storebrand Group 6.765 6.304 -6.751 -4.202 14 2.102

Results 3Q 98 5

...... Storebrand Operating results by sub-group

01.01. - 30.09. 01.01.- 31.12. NOK million 1998 1997 1997 Storebrand ASA -59 -87 614 Storebrand Life insurance 964 2.962 4.359 Storebrand Non-life insurance 416 536 684 Storebrand Bank 5 -13 -1 Storebrand Unit Linked -1 -3 -4 Storebrand SPAR 8 18 12 Storebrand Asset/Investment Management -3 3 -3 Others/eliminations -194 -94 -852 Operating result 1.136 3.322 4.809 Profit allocated to policyholders - life -626 -2.514 -3.797

Group result 510 808 1.012

Results 3Q 98 6

3 ...... Storebrand Earnings per share

3rd quarter 3rd quarter 1997 NOK million 1998 1997 Group result 510 808 1.012 Taxes -38 -38 59 Preference-dividend 0 -38 -50 Preference-surplus -11 -25 -33

Number of ordinary shares (mill.) 277 277 277

Earnings per ordinary share 1,67 2,56 3,57

Results 3Q 98 7

...... Storebrand Consolidated balance sheet 30.09. Share in % Share in % NOK million 1998 30.09.98 31.12.97 * Real estate 9.478 8 % 8 % Loans 10.136 8 % 9 % Bonds 59.161 49 % 50 % Certificates 3.827 3 % 6 % Shares and interests in partnerships 27.717 23 % 18 % Other financial assets 1.876 2 % 2 % Other assets 9.538 8 % 8 % Total assets 121.732 100 % 100 % Equity 5.133 4 % 5 % Minority interests 2 0 % 0 % Subordinated loan capital 2.965 2 % 1 % Technical reserves Life 89.445 73 % 75 % Security reserves 11.550 9 % 10 % Premium- and loss reserves Non-life 3.221 3 % 3 % Other reserves 940 1 % 1 % Debt 8.476 7 % 6 % Total liabilities and equity capital 121.732 100 % 100 % * Total assets per 31.12.97: NOK 114.434 mill.

Results 3Q 98 8

4 ...... Storebrand Group Unrealized gains

30.09.98 30.06.98 31.03.98 31.12.97 NOK million Storebrand ASA 14 25 64 27 Storebrand Life insurance 1.207 6.380 7.606 5.815 Storebrand Non-life insurance 152 587 860 707 Storebrand Bank AS 2 1 1 0 Total 1.375 6.994 8.531 6.549

Results 3Q 98 9

...... Storebrand Capital ratio

Risk weighted Net primary Capital ratio NOK million balance capital 30.09.98 31.12.97 Storebrand ASA 5.451 4.126 75,7 % 93,7 % SB Life insurance 43.393 5.445 12,6 % 10,5 % SB Non-life insurance 7.055 1.772 25,1 % 22,4 % Storebrand Bank AS 2.778 427 15,4 % 23,5 % Storebrand Group 53.606 6.894 12,9 % 14,4 %

Results 3Q 98 10

5 ...... Storebrand ASA Result ordinary operations

01.01. - 30.09. 01.01.-31.12. NOK million 1998 1997 1997 Financial income 117 163 212 Group contribution/dividend 193 58 818 Operating expenses -129 -160 -218 Financial expenses -103 -10 -14 Other costs -138 -139 -185 Result -59 -87 614

Results 3Q 98 11

...... Storebrand ASA Summary balance sheet

30.09. Share Share NOK million 1998 30.09.98 31.12.97 * Real estate 31 0 % 0 % Shares in subsidiaries 4.881 69 % 55 % Intra-group receivables 81 1 % 10 % Investments 1.609 23 % 27 % Other assets 467 7 % 8 % Total assets 7.069 100 % 100 %

Equity 4.216 60 % 63 % Bond loan 1.800 25 % 21 % Intra-group debt 664 9 % 8 % Other liabilities 390 6 % 7 % Total liabilities and equity capital 7.069 100 % 100 %

* Total assets per 31.12.96: NOK 8.545 mill.

Results 3Q 98 12

6 ...... Storebrand Bank AS Income Statement

1.1.-30.09. 31.12. NOK million 1998 1997 1997 Interest Income 173,8 33,5 57,3 Interest Expense 134,6 24,3 43,0 Net Interest Income 39,2 9,2 14,3 Non-interest Income 84,9 39,8 64,3 Non-interest Expenses 131,0 98,6 141,4 Operating Income -6,9 -49,6 -62,8 Provision for Credit Losses -2,9 -0,7 -1,0 Net Income -9,8 -50,3 -63,8

Results 3Q 98 13

...... Storebrand Bank AS Balance Sheet

NOK million 30.09.98 30.09.97 31.12.97 Cash and due from 8,2 168,1 147,1 Net loans 4.348,3 1.261,9 2.039,8 Securities available for sale 972,2 174,9 401,0 Premises, furniture and equipment, net 12,1 6,7 11,4 Shares in subsidiaries 95,9 95,8 95,8 Miscellaneous assets 95,0 25,3 47,8 Total Assets 5.531,7 1.732,7 2.742,9 Loan from banks 460,0 351,4 675,1 Certificate loans 1.999,5 300,00 850,0 Interest-bearing deposits 2.578,3 874,4 896,0 Miscellaneous liabilities 131,9 46,6 50,0 Shareholders' Equity 362,0 160,3 271,8 Total liabilities and shareholders' Equity 5.531,7 1.732,7 2.742,9

Results 3Q 98 14

7 ...... Storebrand Finans AS Income Statement

1.1.-30.09. 31.12. NOK million 1998 1997 1997 Interest income 27,9 25,3 34,4 Operating - and interest expenses 13,8 13,8 19,0 Loss on loan (allocations) 63,8 26,0 47,7 Result ordinary operations 77,9 37,5 63,1

Results 3Q 98 15

...... Storebrand Non-Life Group Key points 3rd quarter 1998 • Operating profit of NOK 416 million, a decrease of NOK 120 million compared to last year. • Financial income is NOK 594 million, a decrease of NOK 103 million compared to last year. Unrealized gains is reduced by NOK 555 million in 1998 to NOK 152 million as of 30 Septeber. • Premiums in non-marine lines have increased by NOK 519 million since 31.12.97. This is mainly due to premium increases in motor and houseowner insurance. • Book claims ratio f.o.a. is 76%. This is a 3% improvement compared to 3Q97. • Gross operating costs are increased by NOK 164 million compared to last year. The increase can be explained by higher sales, investments in internal improvement projects and IT projects. • Market share in non-marine insurance is 38,8%. This is an increase of 0,1% in the 3rd quarter.

Results 3Q 98 16

8 ...... Storebrand Skade Group Profit before allocation

01.01 - 30.09. NOK million 1998 1997 Premiums f.o.a. 5.668 5.433 Claims f.o.a. -4.298 -4.343 Technical operating costs -1.557 -1.393 Technical result -187 -304

Financial income 594 697 Other income/costs 9 143

Operating result 416 536

Change in security reserves etc. -159 -47 Result ordinary operations 257 489

Results 3Q 98 17

...... Storebrand Skade Group Summary Balance sheet

Share of total Share of total at assets at assets at NOK million 30.09.98 30.09.98 31.12.97

Intangible assets 58 0 % 0 %

Real estate 1.321 7 % 9 % Shares, interest and receivables from group companies 460 3 % 3 % Bonds and other financial investments with fixed interest 3.731 20 % 21 % Loans 40 0 % 0 % Other long-term financial assets 8 0 % 0 % Shares and interest 1.802 10 % 11 % Bonds 5.552 30 % 28 % Certificates 1.670 9 % 8 % Other financial assets etc. 229 1 % 1 % Total financial assets 14.812 81 % 81 % Other assets 3.450 19 % 18 % Total assets 18.320 100 % 100 %

Total assets at 31.12.97 were NOK million 18,279.

Results 3Q 98 18

9 ...... Storebrand Skade Group Summary Balance sheet

Share of total Share of total at assets at assets at NOK million 30.09.98 30.09.98 31.12.97

Equity capital 2.409 13 % 12 % Minority interests' share of equity capital 2 0 % 0 % Premium reserve 3.748 20 % 17 % Claims reserve 7.802 43 % 43 % Security reserve etc. 3.221 18 % 17 % Allocations other risks and expenses 481 3 % 3 % Liabilities 483 3 % 8 % Accrued expenses and prepaid income 175 1 % 1 % Total equity capital and liabilities 18.320 100 % 100 %

Total equity and liabilities at 31.12.97 were 18,279.

Results 3Q 98 19

...... Storebrand Skade Group Key figures

30.09.98 30.09.97 Return on average solvency capital 10,2 % 13,5 % Combined ratio f.o.a. 100,9 % 104,0 % Claims ratio f.o.a. 75,8 % 79,9 % Cost ratio f.o.a. 25,1 % 24,1 % Cost Portion f.o.a. 27,5 % 25,6 % Effect of run-off result 238 151 Change in unrealised gains -555 232 Solvency capital 5.629 5.555 Unrealized gains * 152 766 Solvency margin 72,2 % 76,3 % Capital ratio 25,1 % 25,8 % Claims reserve ratio f.o.a. 100,0 % 112,1 %

* Includes real estate

Results 3Q 98 20

10 ...... Storebrand Skade Group Normalized claims ratio

30.09.95 30.09.96 30.09.97 30.09.98

Booked claims ratio f.o.a. 70,9 % 76,0 % 79,9 % 75,8 %

Effect of run-off result 2,9 % 4,5 % 2,8 % 4,2 %

Effect of BISC's minimum requirements* 2,0 % -1,4 % 4,1 % -2,2 %

Normalized claims ratio f.o.a. 75,8 % 79,1 % 86,9 % 77,8 %

* The Banking, Insurance and Securities Commission

Results 3Q 98 21

...... Storbrand Skade Group Claims ratio f.o.a. by sector

118 120 110 100 95 90 86 84 75 80 72 74 68 68 70 56 60 55 50 40 30 23 20 10 0 Private Motor Business Marine Other Total 3. quarter 97 3. quarter 98 Ex. additional allocations

Results 3Q 98 22

11 ...... Storbrand Skade Group Claims ratio f.o.a. by sector

120 110 97 100 94 90 85 81 80 76 80 73 68 68 70

60 53 55 50 39 40 30 20 10 0 Private Motor Business Marine Other Total 3.quarter 97 3.quarter 98

Including additional allocations

Results 3Q 98 23

...... Storebrand Skade Group Market shares * vs competitors

100,0 5,56,0 5,5 5,85,3 5,3 90,0 8,3 7,8 7,4 7,6 7,9 7,8 Other NFF 80,0 17,9 18,0 19,0 18,8 18,9 19,1 Vår Forsikring 70,0 Vesta 60,0 27,0 27,1 28,1 29,0 29,2 29,0 50,0 Storebrand 40,0

30,0

20,0 41,4 41,2 40,0 38,9 38,7 38,8

10,0

- 1994 1995 1996 1997 30.06.98 30.09.98

* Non-marine

Results 3Q 98 24

12 ...... Storebrand Skade Group Market shares *) % 1997 30.06.98 30.09.98

45,0 43,4 43,6

40,4 39,8 39,7 38,8 38,9 39,2 40,0 38,938,7 38,9 38,8 37,9 38,7 37,0 37,2 37,1 37,0

35,0 32,5 31,6 31,6

30,0

25,2 24,9 24,8 25,0

20,0 Overall Motor Privat Business Industry Accident Workers Liability compreh. compreh. comp.

* Non-marine

Results 3Q 98 25

...... Storebrand Life Group Key points at 30.09.98

• Operating profit is 67% lower compared to the first nine months of last year.

• Premium income including transfers to the company incresed by 32% compared to last year. • Value-adjusted return on capital year to date is 0,06%, or 0,07% on an annualised basis.

• Annualised book return on capital is 5,88%.

• Increase in sales (indexed) in the private market, of 14% compared to last year.

• Good development in the corporate market, sales (indexed) increased by 144% compared to last year.

Results 3Q 98 26

13 ...... Storebrand Life Group Summary profit and loss account

01.01. - 30.09 Changes 01.01- NOK million 1998 1997 in % 31.12.97

Premiums for own account 7191 5437 32 % 7,287 -of which premiums written 5635 4787 18 % 6,437 Income of financia l investments 10480 9899 6 % 13,890 Othe r income 90 83 8 % 116 Insurance be nefits for ow n account -5005 -4504 11 % -5,954 -of which benefits excl. trans ferred prm.res -3918 -3224 22 % -4,401 Change te chnica l a lloca tions -4500 -2868 57 % -5,227 Cost of fina ncial investments -6535 -4440 47 % -5,726 -of which adm. costs -69 -65 - -88 Insurance related operating costs -527 -405 30 % -614 Other costs -230 -240 -4 % -414 Re sult 964 2962 -67 % 3, 359 Transfe rre d to policyholders -626 -2514 -75 % -2,797 -of which to statut ory insurance fund -1,000 Re sult of ordi na ry a cti vity 338 448 -24 % 562

Results 3Q 98 27

...... Storebrand Life Group Premium (incl. transfer of reserves to the Company)

01.01. - 30.09. 01.01.- NOK million 1998 1997 31.12.97

Coll ective pension 4, 769 3, 455 4, 074 Group life 313 281 345 Individua l e ndow oment 1, 612 1, 078 1, 71 Individual pension 497 623 1,158

Tota l premium income 7, 191 5, 437 7, 287

Results 3Q 98 28

14 ...... Storebrand Livsforsikring AS Resultanalysis

01.01. - 30.09. 01.01- 01.01- NOK million 1998 1997 31.12.97 31.12.96

Interest result 1,221 2,990 4,671 3,464 Riskresult 150 244 388 296 Administrationresult -63 27 -30 -39 Change security and premium reserve -345 -300 -675 -294

Result to allocation 963 2,961 4,354 3,427

Results 3Q 98 29

...... Storebrand Livsforsikring AS Key-figures

01.01.-30.09. 01.01- 1998 1997 31.12.97

Return on capital - year-to-date 4.38% 6.61% Return on capital - annualised 5.88% 8.91% 9.96% Value adjusted return - year-to-date 0,06 % 9.84% 10.45% Va lue a djuste d return - yea r-to-da te -incl. fixed bonds -0,54 % 9.90% 10.55% Solvency margin 194.8% Ca pi ta l ra ti o (SBL Group) 12. 55% 10. 08% 10. 51% Operating expenses as % of policyholders funds 0.92% 0,78 % 0.86%

Results 3Q 98 30

15 ...... Storebrand Livsforsikring AS Operating costs in % of average policyholders funds

1,2 1,15% 1,10% 1,02% 1,0 0,90% 0,86% 0,92% 0,8

0,6

0,4

0,2

0,0 1993 1994 1995 1996 1997 3.kv 98

Results 3Q 98 31

...... Storebrand Life Group Balance sheet

Share Share in % NOK million 30.09.98 in % 31.12.97

Immaterial assets 6 0 % 0 %

Real estate 8,302 9 % 8 % Long term shares and interests from group companies 221 0 % 0 % Bonds and other investments with fixed interest 17,326 18 % 16 % Mortage and other loans 5,655 6 % 9 % Other long term assets 4 0 % 0 % Shares and interests 25,682 27 % 20 % Bonds and other financial investm. with fixed interest 30,770 32 % 35 % Certificates 1,514 2 % 5 % Other short term financial assets 1,348 1 % 2 % Total financial assets 90,823 94 % 95 %

Other assets 5,324 6 % 5 % Total assets 96,153 100 % 100 %

Results 3Q 98 32

16 ...... Storebrand Life Group Balance sheet

Share Share in % NOK million 30.09.98 in % 31.12.97

Equity 2,978 3 % 3 % Other subordinated loan capital 2,965 3 % 2 %

Premium reserve for own account 74,163 77 % 77 % Additional statutory allocations 6,144 6 % 7 % Premuim/pension adjustment fund 7,560 8 % 10 % Claims reserve for own account 198 0 % 0 % Insurance fund reserves for own account 88,065 92 % 93 % Unallocated surplus to policyholders f.o.a. 626 1 % Allocations to security funds 592 1 % 1 % Other insurance related reserves for own account 89,283 93 % 94 % Allocations for other risks and expenses 204 0 % 0 % Debt 573 1 % 1 % Prepaid costs and accured income 150 0 % 0 % Total equity and liabilities 96,153 100 % 100 %

Results 3Q 98 33

...... Storebrand Livsforsikring AS Market share - total premiums* written NOK million 20,692 23,359 28,147 30,233 31,993 Vesta Liv/Skade 4 % 6 % 6 % 6 % 6 % Gjensidige 19 % 16 % 15 % 21 % 17 % 1 % 2 % 2 % 2 % Sparebank 1 1 % 17 % 19 % 17 % 16 % KLP 19 %

4 % 10 % 11 % 12 % Norske Liv 5 % Vital 19 % 17 % 16 % 14 % 14 % Vår 3 % 3 % 3 % 3 % 3 % 3 % 3 % 3 % NOR 3 % 4 %

Storebrand 28 % 25 % 26 % 28 % 28 %

1995 1996 1997 3kv97-2kv98 4kv97-3kv98 * Including transferred reserves ResultsSource: 3Q 98 Norges Forsikringsforbund 34

17 ...... Storebrand Livsforsikring AS Market share - total premiums* written NOK million 19,017 19,905 24,925 26,951 27,920

Vesta Liv/Skade 3 % 4 % 4 % 4 % 4 %

Gjensidige 18 % 16 % 16 % 16 % 16 % 2 % 2 % Sparebank 1 1 % 1 % 2 % 19 % 18 % 20 % KLP 21 % 22 %

Norske Liv 4 % 4 % 11 % 12 % 13 %

Vital 19 % 19 % 17 % 15 % 14 % Vår 3 % 3 % 2 % 3 % 2 % 3 % 2 % NOR 3 % 4 % 3 %

Storebrand 28 % 27 % 26 % 27 % 26 %

1995 1996 1997 3kv97-2kv98 4kv97-3kv98 * Except transferred reserves Source: Norges Forsikringsforbund Results 3Q 98 35

...... Storebrand Livsforsikring AS Real estate fund

Geographic allocation 01.01.- 30.09. Key figures 1998 1997 31.12.97 Shopping centres 47% The real estate fund: Gross yield *) 5.5% 5.7% 7.6% Growth in value 4.9% 4.9% 6.4%

Cities The fund's properties: 6% Operating result I **) 4.9% 5.0% 6.8% Rest of Total m2 677,000 697,000 676,000 8% Vika, Occupancy level 98.6% 97.6% 97.9% Rest of 13% Oslo 26% *) Gross yield calculation based on BISC-regulations compounded monthly **) (Sum operating income - sum operating expenses) in % of average market value

Results 3Q 98 36

18 ...... Storebrand Livsforsikring AS Loan fund Loans with security in real estate by valuation limits 01.01.- 30.09. Key figures 1998 1997 31.12.97 Within 60% of valuation: 90%

Portfolio: NOK million 5,600 8,500 7,800 Number of loans 22,400 31,200 28,900

Growth in value 4.7% 3.9% 5.3%

Defaulted loans in % 0.7% 0.6% 0.6% Change in loss prov. *) -0.04% -0.01% 0.01% Other loans: 6% *) % of average market value BetweenAbove 60-80% 80% of of valuation: valuation: 3% 1%

Results 3Q 98 37

......

Results 3Q 98 38

19 ...... Market Development As of 31.10.98

Equity returns Yields to maturity Norway and internationa Norway and international 145 7,50 %

135 7,00 % 6,50 % 125 6,00 % 5,50 % 115 5,00 % 4,50 % 105 4,00 % 3,50 % 95 3,00 %

85 jun.97 jun.98 des.96 sep.97 des.97 sep.98 mar.97 mar.98 Norway 5 y International 5 y jun.97 jun.98 des.96 sep.97 des.97 sep.98 mar.97 mar.98 Norway 6 m International 6 m (constructed) International ( MSCI W) Norwa y (TOTX)

Results 3Q 98 39

...... Storebrand Livsforsikring AS Assets under Management and Returns

Assets under Management and Returns and Benchmark Indices Growth

100 115

90 110 80 105 70

60 100

50 NOK 95 Billions 40 90 30

20 85

10 80 0 des.97 feb.98 apr.98 jun.98 aug.98 -1 0 1996 1997 3 q 98 Equities Equity Bench. Fixed Income Fixed Income Bench. Net contributions after 12/31/96 Returns after 12/31/96 AuM Life Comp. 12/31/96

Results 3Q 98 40

20 ...... Equity markets - YTD (MSCI)

40.00%

30.00%

20.00%

10.00%

0.00% Itl. UK Ire. Nzl. Fra. Bel. Nor. Jap. -10.00% Aus. USA Ger. Can. Den. Spa. Swe. Neth. Glob.

-20.00%

-30.00%

-40.00% Currency YTD Equity YTD

Equity YTD is the equity return to a local investor. Currency YTD is the appreciation or depreciation of the investment currency against NOK. A positive bar indicates a appreciation of the investment currency.

Results 3Q 98 41

...... Equity Markets - Sept. 98

10.00%

5.00%

0.00% Itl. UK Ire. Nor Nzl. Bel. Fra. Ger. Jap. USA Can. Aus. Den. Spa. Glob. Swe. Neth. -5.00%

-10.00%

-15.00%

Equity MTD Currency MTD

Equity MTD is the equity return to a local investor. Currency MTD is the appreciation or depreciation of the investment currency against NOK. A positive bar indicates a appreciation of the investment currency.

Results 3Q 98 42

21 ...... Bond Markets - YTD

20.00%

15.00%

10.00%

5.00%

0.00% Itl. UK Ire. Nzl. Bel. Fra. Nor. Jap. Aus. Ger. USA Den. Can. Spa. Swe. Neth. -5.00% Glob.

-10.00%

-15.00%

Bond Ytd Currency ytd

Bond YTD is the bond return to a local investor. Currency YTD is the appreciation or depreciation of the investment currency against NOK. A positive bar indicates a appreciation of the investment currency.

Results 3Q 98 43

...... Bond Markets - Sept. 98

5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Itl. UK Ire. -1.00% Nor Nzl. Bel. Fra. Ger. Jap. USA Aus. Den. Spa. Can. Swe. Neth. -2.00% -3.00% -4.00% -5.00% -6.00%

Bond mtd Currency mtd

Bond MTD is the bond return to a local investor. Currency MTD is the appreciation or depreciation of the investment currency against NOK. A positive bar indicates a appreciation of the investment currency.

Results 3Q 98 44

22 ...... Storebrand Livsforsikring AS Asset Allocation

31.10.98 Assett class 30.09.98 30.06.98 31.12.97 5.6% EQUITIES 23.72% 29.30% 24.91% 8.6% Tota l -of this: Norway Equi ties: 8.45% 11.21% 11.51% 2.3% 9.5% 23.77% - of this allocation -5.16% -2.48% 0.00% FIXED INCOME 59.85% 55.05% 52.21% 12.3% - of this allocation 5.30% 5.23% 0.00% 1.9% MONEY MARKE 1.92% 4.54% 5.98% 18.3% -of this allocation 0.18% 0.19% 0.00% 12.1% REAL ESTATE 8.72% 7.74% 8.30% MORTGAGES 5.93% 6.40% 8.60%

26.3% Tota l Fixed Income 38.3%

No r w Eq uit i e s Intern. Equities Other Equities Norw. Fixe d Incom e Intern. Fixed Incom e Fixed Incom e HTM M one y Marke t Real Estate M ortgage s

Results 3Q 98 45

...... Storebrand Livsforsikring AS Development - Equity Allocation and Returns

150 31% 140 29% 130 27% 120 25% 23%

Index 110

21% Allocation 100 19% 90 17% 80 15% Jul Jul Jan Jun Oct Jan Jun Oct Feb Mar Apr Feb Mar Apr Dec Sep Nov Dec Sep May Aug May Aug 1996 1997 1998

International ( MSCI W) Nor w ay Allocation

Results 3Q 98 46

23 ...... Storebrand Livsforsikring AS

Investment Management Q3-98 SBL Annualized return: 0.07% Index Return year-to-date: 0.06%

6,58 7,48 5,27 4,92 4,71 2,45 2,20 0,02 -0,05

-10,76 -13,78 Total Equities Fixed Mon ey Fi xed Real Mortgages In co me Mar ke t In co me Es tate Asset Allocation HTM Percent of total investment funds 30.09.98 35,8 35 28,9 25,6 31.12.97 18,8 16 6,4 8,7 8,3 5,9 8,6 1,9

Equities Fixed Mon ey Fi xed Real Mortgages In co me Market In co me Es tate HTM

Note: Including derivate positions, the exposure towards equities amounted to 23.72% of total investment funds, and fixed income 41.07%

Results 3Q 98 47

...... Storebrand Livsforsikring AS Equities Q3- 98

SBL Return Index Percent

9,39 6,41 5,18 4,10 3,82 1,85

Total Norway Nordic C. Europe North America Asia Other

-10,76 -13,78 -8,82 -10,30 -13,28

-30,36 -29,92 -29,92 Allocation Percent of total equities

30.09.98

46,2 31.12.97 28,8 33,2 18,8 22,6 12,8 7,6 7,3 6,7 6,0 4,9 5,1

Norway Nordic C. Europe North America Asia Other

Results 3Q 98 48

24 ...... Storebrand Livsforsikring AS Fixed Income Q3-98 9,89 Return 8,90 SBL Percent Index 5,87 6,56 5,27 3,75 3,04 2,29 2,47 2,20

To t al Norw. Intern. Money Fixed Other Fixed Fixed Market Incom e Incom e Incom e HTM Allocation Percent of total fixed income

42,35 30.09.98 33,34 27,56 33,61 28,09 31.12.97 21,70 10,48 1,57 0,77 0,87

Norwegian In te rna tio nal Mon ey Fi xed Other Fi xed Fi xed Mar ke t In co me In co me In co me HTM

Interest rate volatility: pr. 30.09.98 (31.12.97) Total based on market values: NOK 2.595mill. (2.223) (1.536) Results 3QAccountin 98g effect: NOK 1.894 mill. 49

...... Storebrand Livsforsikring AS Competitors annualized return 3Q - 98

2,0% 1,0% 0,0% -1,0% SBL Vital Liv NOR 1 Liv Vesta

-2,0% Norske Spareb. Gjensid. -3,0% -4,0% -5,0% -6,0% -7,0%

Bonds defined as hold-to-maturity are valued to book value.

Results 3Q 98 50

25 ...... Storebrand Skadeforsikring AS Investment Management Q3-98

Annualized return: 2.29% Return year-to-date: 1.71% SBS Index 14,49 9,1 6,63 7,5 4,84 1,71 0,9 2,36 2,2

-13,09-15,6 Tota l Equ ities Fix ed Mo ne y Fixed Re al Mortgages Inc ome Ma rke t Inc ome Estate HTM

Asset Allocation Percent of total investment funds 34,7 30.09.98 32,5 26,3 27,7 15,8 31.12.97 11,9 15,6 12,9 11 11,0 0,3 0,3

Equities Fixed Mon ey Fi xed Real Mortgages In co me Market In co me Es tate HTM

Results 3Q 98 51

...... Storebrand Skadeforsikring AS Equities 3Q - 98

SBS Index Return

0,68 1,06

Total Norway/Nordic C. International

-13,09 -15,57 -18,05

-25,51

Allocation 30.09.98 31.12.97 85,75 68,06 31,94 14,25

Norway / Nordic International

Results 3Q 98 52

26 ...... Storebrand Skadeforsikring AS Fixed Income 3Q - 98 Return SBS Index 9,89 8,81

4,30 4,84 4,40 3,04 2,75 2,36 2,20

Total Norwegian International Money Fixed Fixed Fixed Market Income Income Income HTM

Allocation 30.09.98 31.12.97

39,60 39,30 34,20 37,90

13,60 6,90 9,60 8,10 5,60 5,10

Norwegian International Money Fixed Other Fixed Fixed Market Income Income Income HTM

Results 3Q 98 53

......

Results 3Q 98 54

27 ...... Fair Forsikring AS

•Non-life insurance products to private individuals

•Direct company •Launches in Denmark late November 1998

•Gives valuable competence building

•A platform for establishment in new markets

Results 3Q 98 55

...... Fair Forsikring - good service and low prices

Modern Customer IT orientation •Low costs •Quick adaption •Understandable products •Great flexibility •Flexible products •Direct distribution •Prompt service •Efficient claims handeling

U/W

•Individual pricing •Take advantage of profitable “pockets” •Fast changes (correct mistakes and exploit possibilities) Results 3Q 98 56

28 ...... Why do we think we will succeed

•Correct timing

•Takes advantage of a substantial cross-subsidising in the Danish market

•Launches with a complete product-range

•Flexible and modern IT-system

•Qualified co-workers

•Based on customer preferences

Results 3Q 98 57

...... Form of distribution How did you buy your lates non-life insurance?

Denmark 100 percent = 1.000 respondents 1.000 respondents Called on own 52 57 initiativ

Personal meeting 23 6

Letter 7 6

Received a call 6 13

Don’t know 13 18

Source:Results 3Q Gallup 98 1997 Filter: all respondents have bought directly, 58 have a car and is responsible for buying insurance

29 ...... Market-potential - Denmark Figures in 1.000

1.700 30 Would you choose Fair or your own company

100 percent = 1.000 respondents Don’t know Fair 6 28 630 1.040 66

My own

Total Leasing Have not Potential number or bought customers of cars rentals direct

* Total turnover for car-leasing in 1995 was DKK 446 million, presumed average price DKK 20.000 p.a. => 22.000 cars. 8.000 rentals Source:Results 3Q Teamanalyse, 98 Gallup 1997 59

...... Analysis of the Danish motor insurance market

Percentage of total portfolio

9,0 %

8,0 % 35 percent of the market has 7,0 % an expected claims ratio

6,0 % n below 75%

5,0 %

4,0 % Andel av portefølje av Andel 3,0 %

2,0 %

1,0 %

Expected claims ratio 0,0 %

10 20 30 40 50 60 70 80 90 10 0 11 0 12 0 13 0 14 0 15 0 16 0 17 0 18 0 19 0 20 0 Forventet skadeprosent

There exists a substantial potential in better price-segmentation

Results 3Q 98 60

30 ...... Competitors pricing of motor insurance

Tell** Kg. Codan Danica Phønix Topdan Tryg- Østifterne Brand mark Baltica Type of carxxxxxxxx Production yearxxxxxxxx Claim free yearsxxxxxxxx Policyholders agexxxxx x Postal codexxxxx x Retention x x x x x Name drivers x x x New price x x x Tow hook x x x Bonus group x x x Weight x x Stereo x Milage x x The car's value x Use of the car x Alarm x Ignition block x Extra break light x Profession x Parking x

** Asks more questions

Sorce: Telephone interviews 1997, not updated and may be incomplete

Results 3Q 98 61

...... Price fixing

•More facotrs than the competitors

•Multidimentional use of pricing factors

•Tighter price range than the competitors •IT-system which makes it possible to make changes in the tariff “over night”

•A distribution concept which makes it possible to respond very quickly and collect better data

Better segmentation and lower claims ratio

Results 3Q 98 62

31 ...... Traditional pricing

Basis factor Gender Age Type of car Price

Male 1,1 20-22 1,5 GTI 1,1 3.000 * Female 1,0 * 23-30 1,2 * Corolla 1,0 4.356 31-40 1,0

The factors are independent of each other. For example will the effect of gender be the same for each combination

Results 3Q 98 63

...... Multi-dimentional pricing

Basis factor Gender Age Type of Factor Price car Male 20-22 GTI 2,1 Male 20-22 Corolla 1,8 3.000 * Male 23-30 GTI 2,0 6.000 Male 23-30 Corolla 1,6

Results 3Q 98 64

32 ...... The importance of a complete product range

Claims ratio 1996

Motor 92 Accident 86

House contents 69

Private house 62

Results 3Q 98 65

...... The importance of a complete product range (cont.)

•Differenciates us from other direct companies •Lower claims-ratio and run-off for full-service customers •The same target group as the already established companies, but more efficient and competitive

Results 3Q 98 66

33 ...... Simple and customer focused products From To Unclear and with references Logical tables and all in one place

Small Large

Legal language Plain Danish

Boring Informative and sales generating

Exception oriented Coverage oriented

Cover a minimum of To overfulfill expectations expectations Focus on single products "Red thread" through the product range

Results 3Q 98 67

...... Results

Liability insurance

Cover Do not cover What • Damage on others and their • Drivers injury property while you are • Damage on the owner's, using the car the user's or the driver's property • Damage on connected vechicle

• How much A maximum of the amount given by the law ("Færdselsloven")

Results 3Q 98 68

34 ...... Accidental damage

Type of claim Cover Do not cover Driving accidents • Yes

Theft/criminal • Yes • If the damage is not damage reported to the police

Windows • Yes Fire • Yes

Transportation and • Transportation of the car to the pick-up of car nearest repairshop. • Pick-up of car in the case of theft Rescue insurance • Terms to be found in the red abroad SOS-card, which you get for free from Fair Forsikring

Results 3Q 98 69

...... Flexible and modern IT system

The insurance application - TIA

•Flexible •User - controlled •Built-in data warehouse •Scanning and picture transfer •Work- flow based claims system •Windows based, increased user friendliness •Integrated call center solution •Reports and letters •Pop-up picturs

An advanced tool which gives full control and which takes care of commercial aspects - not an obstacle

Results 3Q 98 70

35 ...... Financial terms

•Owned by Storebrand ASA and Head & Company L.L.C -initially 10/90, then 50/50

•Total investment (100%) appr. DKK 300 million

•Break-even after 4-5years

•Positive NPV stand alone

Results 3Q 98 71

...... Head & Company L.L.C

•Investment company specialised in insurance, established in 1987

•Exercises active ownership, often greenfield investments

•Long term view on realisation of values

•18 different investments over the last ten years, with a total transaction volume of more than DKK 10 billion

•Very high IRR since 1987

Results 3Q 98 72

36 ......

Results 3Q 98 73

37