ALM. Brand A/S Q3 2023 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : I have 4 questions. I'll take them one at a time. If I may start on the premium side, obviously been fluctuating quite a bit throughout the year. And I fully understand the IFRS 17 changes that you made last year, but still it's 5% in Q1, 2% in Q2, 4% in Q3. And if I look at your different business lines, it seems like private has stabilized around 4%, 4.5%, while your commercial seems to jump from 3% to 0% to 4%. So maybe a little bit of guidance on your side in terms of what should we expect for Q4 on the premium side. And going into next year, what do you actually see in terms of repricing and other measures that we should be aware of on the premium side?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : So basically, just to make sure I understood you correctly for next year. So basically, you would expect your premiums to grow in line with indexation plus a little bit of repricing in addition to that? Or should we also have some sort of churn in that number, so the net number would be 4.5-ish?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : Okay. Fair enough. On your underlying claims ratio in private, if you look at the Excel sheet, it's 2.8% higher year-over-year. I understand that the real figure is somewhat lower than that, around 2.3%, if I understood correctly. But you seem to -- you mentioned motor frequencies is one big driver. How big a driver is that of 2.3? And what do you actually see maybe not for Q4, because I guess you still have some headwinds there. But going into next year, would you expect that pattern to turn around and maybe be neutral to slight positive? Or what kind of repricing measures versus claims prevention measures should we expect on the private line going into next year?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : And is that taking into consideration also future motor frequency deterioration? Or is it just based on the numbers that we've seen or you've seen today?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : Okay. Fair enough. If I remain on the group side, the 70 basis points of deterioration in the underlying undiscounted claims ratio year-over-year. If I understand, you have 100 basis points of headwinds from reinsurance repricing, or price hikes going into this year. So, I guess I have 2 questions. One being, what do you expect in terms of reinsurance price hikes going into next year? I guess you haven't tapped into your reinsurance program, so you should be better than most of your peers on that measure? And then how much of the repricing to mitigate reinsurance now we are 11 months into this year? How much do you actually expect to get through in terms of repricing towards claims? How much of the 100 basis points should we expect you to mitigate over -- and I guess there's a very little impact so far from this?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : But doesn't that also mean this is commercial clients that you have already seen quite a big impact of those 100 basis points by now?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : Okay. Yes, yes. So basically, the 100 basis points is a net number and close to the growth number as well, I guess? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 09, 2023 / 10:00AM, ALMB.CO - Q3 2023 ALM. Brand A/S Earnings Call

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : Okay. Fair enough. And just on the repricing going into next year, if I look at the 100 basis points for this year, considering what you just said in terms of property being the only area where you saw something, what would that 100 basis point be in terms of repricing your expected impact for '24 all else equal?

Question: Asbj°rn Nicholas M°rk - Danske Bank A/S, Research Division - Analyst : Of course. Okay. Final question from my side. If I look at your guidance for this year, we had DKK 44 million of runoff gains in Q3. So all those equal, of course that, should have helped you in your guidance. On the other hand, we had DKK 60 million or so of higher weather claims a little bit lower large games. So largely, that would offset each other, or offset the runoff gains explain why we didn't get a guidance upgrade. But then if I look at your communication relating to weather claims in October, if I understand you correctly, it's around 2% extra claims on the weather side in Q4 quarter-to-date, which is DKK 60 million. So I guess you could have lowered your guidance today by around DKK 60 million and you don't. So what is delivering better on the underlying that, is mitigating this impact of -- since you don't lower your guidance or is it just that large claims have been favorable in October.