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Vienna Insurance Group AG Wiener Versicherung Gruppe

EANS-News: Vienna Insurance Group right on track in the first half of 2018 Clear improvement in all key figures - ATTACHMENT

  Corporate news transmitted by euro adhoc with the aim of a Europe-wide
  distribution. The issuer is responsible for the content of this announcement.

Financial Figures/Balance Sheet

Vienna -

* Premiums rise by +3.6 percent to around EUR 5.2 billion
* Result (before taxes) up by +5.5 percent to around EUR 233 million, in spite
  of impairment in Romania
* Combined ratio further improved by -0.6 percentage points to 96.3 percent

Vienna Insurance Group's (VIG) half-year results for 2018 show further
improvement in key figures. "Stable, reliable and fit for the future is a brief
summary of our goals. We have achieved a very stable upward development for two
and a half years. The steady improvement in key figures shows we are reliable
and the targets originally planned for 2019 have already been brought forward to
this year. We are systematically using our "Agenda 2020" management programme to
remain fit for the future. In addition to this year's focus on expanding bank
distribution, the "Agenda 2020" programme is also currently looking at
increasing data by processing using artificial intelligence. In this respect,
new project in Poland has just been started", summarised Elisabeth Stadler, CEO
of Vienna Insurance Group, at the end of the first half of 2018.

Significant increase in premiums
VIG generated EUR 5,150.3 million in Group premiums, representing an increase of
+3.6 percent compared to the previous year. Excluding a further decrease in the
single-premium life business, the increase was a solid +5.7 percent. All of
VIG's business segments contributed to the significant increase in premiums.
Similarly, except for single-premium life insurance, premiums increased in all
lines of business, especially in non-life and health insurance. Poland, in
particular, achieved very satisfying double-digit growth in the non-life
business. The Baltic States recorded a +18.8 percent increase in total premium
volume. This was the result of generally very positive performance in all lines
of business, especially motor insurance. Croatia (+18.3 percent) and Serbia
(Wiener Städtische Osiguranje +11.6 percent), which belong to the Remaining CEE
segment, also recorded double-digit growth rates. Premium volume increased to
EUR 2,170.0 million in Austria, in spite of a continued restrictive underwriting
policy in the single-premium business. When adjusted for single premium
business, premiums increased by +1.3 percent.

Result (before taxes) +5.5 percent higher
The Group result (before taxes) increased by +5.5 percent compared to the
previous year to EUR 232.7 million. The increase was primarily due to
improvements in the combined ratio and financial result. Contributions from the
Czech Republic, Hungary and Serbia largely accounted for the significant
increase in the result in the first half of 2018. In Romania, the current market
trend and tense political situation prompted the management to review planning
data for future developments. Based on VIG's well-known conservative valuation
practices, a goodwill impairment of about EUR 50 million was recognised for the
Romanian companies. Without the impairment, the result would have increased by
+20.7 percent in Romania. Overall the operating earnings capacity of the Group
remains at an excellent level.

Combined ratio and other key figures improved
The Group combined ratio after reinsurance (excluding investment income)
recorded another significant improvement to 96.3 percent. Positive developments
came from Austria (95.3 percent), the Czech Republic (94.6 percent), Poland
(94.1 percent), Romania (98.6 percent) and Bulgaria (97.2 percent).

The financial result reached a value of EUR 511.3 million for the first half of
2018, a +4.7 percent increase over the previous year. This increase was impacted
by the sale of the stake in S IMMO AG and larger realised gains from investment
funds in the Czech Republic.

Group investments including cash and cash equivalents equalled EUR 37.4 billion
as of 30 June 2018, unchanged form the end of 2017.

The solvency ratio of the VIG Group was at an excellent 222 percent at the end
of the first half of 2018 (end of 2017: 220 percent).

"The results for the first half of 2018 make us very confident about the further
course of business for the remainder of the year. Our confidence is underpinned
by the continuation of significantly higher economic growth in the CEE region as
compared to the EU15 countries, as a higher standard of living is accompanied by
an increase in the need for insurance. We, therefore, expect a premium volume of
EUR 9.5 billion and a result (before taxes) in the range of EUR 450 to 470
million in total for 2018," stated Stadler, maintaining the previously announced

Expansion of bank distribution on course
The focus of the "Agenda 2020" programme in 2018 is primarily on expanding bank
distribution, and many measures have already been initiated.
One of these was an extension of the existing cooperation agreement to 2033,
which was signed with our distribution partner Erste Group in mid-May 2018. "We
continue to be on schedule with the implementation of the mergers between our
bank insurance companies and our local all-line insurers. Hungary, Slovakia and
Croatia have been completed. The merger agreement between Sparkassen
Versicherung and Wiener Städtische was signed in mid-June 2018. Approval by the
Austrian supervisory authority is still outstanding. We expect to be able to
complete the merger in autumn 2018. The final merger in the Czech Republic
should also have been initiated or completed by the end of 2018", explained
Elisabeth Stadler.

Moving towards real time pricing through increased data use
At the end of July 2018, VIG began the second round of the internal Group "VIG
Xelerate" programme aimed to promote the digital transformation. VIG Group
companies can submit their projects for the programme until the end of October
2018. Award-winning projects will receive financial support if they can
demonstrate, among other things, innovation in their local market and relevance
in terms of applicability for other VIG companies. They must also be able to
show an improvement in financial terms.

One of the winning projects from the first pitch by the Polish VIG Group company
InterRisk has now been launched. It focuses on increased data usage and the use
of artificial intelligence to develop a completely new kind of pricing
structure. The goal is, in the next few years, to move away from the current
standard pricing structure based on statistical data from the past and internal
calculation modules. Instead, it will take into account individual behavioural
characteristics of customers, as well as their specific personal requirements
and current market developments. The final stage is aimed at providing personal
pricing and product design in real time. Elisabeth Stadler: "The aim is to
optimally satisfy individual customer needs and improve profitability, which are
becoming increasingly more important in a highly competitive market. In Poland
we are starting with the motor line of business, which is very important for us.
Following the initial evaluation, we will look into developing similar models
for other lines of business. If successful, the project will be very beneficial
for the Group and can be transferred to other VIG Group companies."

Further inquiry note:
Wiener Versicherung Gruppe
1010 Vienna, Schottenring 30

Wolfgang Haas 
Head of Group Communications & Marketing, Spokesperson of the Group
Phone: +43(0)50 390-21029
Fax: +43 (0)50 390 99-21029

Nina Higatzberger-Schwarz
Head of Investor Relations
Phone: +43 (0)50 390-21920
Fax: +43 (0)50 390 99-21920

end of announcement                         euro adhoc

Attachments with Announcement:

issuer:       Vienna Insurance Group AG Wiener Versicherung Gruppe
              Schottenring 30
              A-1010 Wien
phone:        +43(0)50 390-22000
FAX:          +43(0)50 390 99-22000
ISIN:         AT0000908504
indexes:      ATX, VÖNIX, WBI
stockmarkets: Prague Stock Exchange, Wien
language:     English

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