Report on the activities pursued by IVASS in the year 2017 Rome, 27 June 2018 1 Report on the activities pursued by IVASS in the year 2017 Roma, 27 June 2018 IVASS, 2018 -06-27 ADDRESS VIA DEL QUIRINALE, 21 00187 ROMA – ITALIA PHONE +39 06421331 WEBSITE WWW.IVASS.IT ALL RIGHTS RESERVED REPRODUCTION OF THIS DOCUMENT IS PERMITTED FOR EDUCATIONAL BUT NOT COMMERCIAL PURPOSES AND THE SOURCE MUST BE CITED ISSN 2284-4112 (ONLINE) ISSN 2611-5301 (PRINT) THE MAIN INSURANCE NUMBERS IN ITALY THE MAIN INSURANCE 2017 NUMBERS IN ITALY 100+3= UNDERTAKINGS 83% In Italy insurance business is pursued by 100 domestic insurance SUPERVISED BY IVASS undertakings and 3 branches of non EEA undertakings (83% of the premium income). 236.887 insurance intermediaries (agents, brokers, etc.) are authorised to carry on business. Report Fig. I.11, Tab. I.11 131+4 8% 94 BL. € GDP BL. € Premium income in Italy has reached In terms of percentage of the GDP, Claims paid amount to 71 bl. euro in 99 bl. in life business (-3.6% compared premium income in Italy amounts to 6% life business (including surrenders, to the previous year) and 32 bl. in for life business and 2% for non-life accrued capital and annuities) and 23 non-life business (+1.1%). Premiums business. In 2016 Italy ranked sixth among bl. in non-life business, equal to 72% collected abroad or reinsurance the OECD countries in terms of importance and 67% of premium income. premiums amount to 4 bl. of the life sector compared to the GDP, and Report, Tab. I.17, Tab. 15 in the Appendix Report Tab. I.15 only 24th for non-life business Report Fig. I.6, I.7 and I.16 LIFE NONLIFE ASSURANCE BUSINESS 99 50% MOTOR BL. € POLICIES 18% IMMOVABLE PROPERTY In life business 61% of the premiums 64% WITH PROFIT are collected through banks and post 17% HEALTH offices, 22% through agencies and 34% UNIT LINKED 9% GENERAL LIABILITY 15% through financial promoters. Report Tab. I.21 Report Fig. I.14 Report Tab. I.18 32 697 2,4 BL. € BL. € In non-life business 79% of the Investments of insurance Italian insurance undertakings hold premiums are collected through undertakings, excluding representative own funds 2.4 times the Minimum agencies, 10% through brokers, assets for index and unit-linked Capital Requirement; composite and 6% through banks and financial contracts, amount to 697 bl. euro, 52% life undertakings are better promoters and 5% through direct sale. of which in government bonds, 20% in capitalised than non-life ones Report Tab. I.24 corporate bonds, 12% in particpations (2.5, 2.2 and 1.8 times). and 10% in units in UCITS. Report Tab. I.54 Report Tab. I.44 THE MAIN INSURANCE 2017 NUMBERS IN ITALY 103+985= FOREIGN 28 17% MLD € INSURERS Authorization to pursue business in In 2016 premiums collected Italy has been granted to 103 amounted to 28 bl. euro (23 in life branches of EEA insurance and business, 5 in non-life business). reinsurance undertakings and to Report Tab. I.8 IN ITALY 985 foreign EEA undertakings by way of free provision of services. They collect 17% of premiums. Report Fig. I.11, Tab. I.8 425€ 268€ MOTOR LIABILITY For cars, the average premium for motor liability policies is 425 € (-5% compared to 2016). Claims represent 6.6% of the policies, with an average cost of 4,163 €. INSURANCE For motorbikes and motorcycles, the average premium for motor liability policies is 268 € (-2% compared to 2016). Claims represent 3.7% of the policies, with an average cost of 6,437 €. Report Tab. II.2 e Tab. II.3 BLACK ANTI CARD BOX FRAUD Since 2007 the CARD system of direct The computerized systems installed on Insurance undertakings have intensified compensation in motor liability insurance the vehicle record mileage and driving their anti-fraud activity in motor liability has allowed drivers not liable for the behaviour. 20% of motor liability insurance: claims reported amount to claim to receive compensation in a policies taken out between October and 2.9 ml. over 41.3 ml. policies (+1% shorter time directly by their company. December 2017 envisage a black box, compared to the previous year). Savings This system has provided compensation with a consequent reduction of the for averted fraud register a significant for 81% of claims occurred in 2017 (47% premium. growth (+15% in 2016). in terms of amounts). Report Fig. II.8, Statistical Bulletin no.4/2018. Report Tab. II.20. Report Tab. II.5 TABLE OF CONTENTS I. - THE INSURANCE MARKET ................................................................................................. 13 1. - The international insurance market ...................................................................................... 13 1.1. - The global insurance market ................................................................................................................13 Life business ................................................................................................................................14 Non-life business .........................................................................................................................16 Profitability .................................................................................................................................17 Percentage of GDP ......................................................................................................................18 1.2. - The European insurance market .........................................................................................................20 2. - The Italian insurance market: structural aspects.................................................................. 26 2.1. - Market structure .....................................................................................................................................26 2.2. - The premium income of foreign undertakings in Italy and the international activity of Italian undertakings ..........................................................................................................................................28 2.3. - Premium income and investments of the undertakings supervised by IVASS based on shareholdings and on the main activity of the parent group ........................................................31 2.4. - Insurance and reinsurance intermediaries ..........................................................................................33 Intermediaries registered in the Single Register (RUI) ...................................................................33 3. - Premium income and costs ................................................................................................... 36 3.1. - Market concentration ............................................................................................................................36 3.2. - Overview .................................................................................................................................................36 3.3. - Premiums for life business ...................................................................................................................38 General performance of life premium income .................................................................................38 The premiums of individual life assurance products .......................................................................39 3.4. - Premiums for non-life business ..........................................................................................................40 3.5. - The distribution and the related costs ................................................................................................45 The distribution and costs of life business ......................................................................................45 The distribution and costs of non-life business ...............................................................................46 4. - Financial accounts (Local gaap) ........................................................................................... 50 4.1. - Balance Sheet ..........................................................................................................................................50 4.2. - Shareholders’ equity ..............................................................................................................................51 4.3. - Dividend distribution ............................................................................................................................51 4.4. - Economic-financial operations ...........................................................................................................52 4.5. - Added value, profitability and efficiency by ownership structure and size of the insurance companies .53 Measurement of the sector’s insurance value added and employees in the National Accounts ..........53 The insurance value added by ownership structure and company size .............................................53 Structure, profitability and efficiency of Italian insurance companies, 2008-2017 ..........................55 4.6. - Management of life classes ...................................................................................................................60 Segregate funds.............................................................................................................................62 The new life assurance premium rates ...........................................................................................64 4.7. - Management of non-life classes ..........................................................................................................66