Vision in action

Thanks to its accelerated development in Life and P&C reinsurance, SCOR now belongs to the top tier of global reinsurers. Continuing on from “Back on Track”, “Moving forward”, “Dynamic Lift”, “Strong Momentum” and “Optimal Dynamics”, “Vision in Action” is the sixth strategic plan drawn up and implemented by SCOR under the chairmanship of Denis Kessler. SCOR confirms its capacity to combine growth, profitability and solvency, with ambition and determination.

"VISION IN ACTION" (2016 – 2019) IS FOCUSED ON ITS TWO STRATEGIC TARGETS: PROFITABILITY AND SOLVENCY

With “Vision in Action”, SCOR has two targets:
a return on equity above 800 basis points over the 5-year risk-free rates over the cycle*;
a solvency ratio in the optimal 185-220% range (percentage of SCR**).

“VISION IN ACTION” relies on three dynamics to enhance its profitability and its solvency:

BUILD ON CONTINUITY AND CONSISTENCY: SCOR’s strategy implemented in the previous plans has proven to be relevant. The Group’s four historical cornerstones (strong franchise, high diversification, robust capital shield and controlled risk appetite) are still fundamental in the current environment. The Group, whose focus will remain on the reinsurance business, intends to pursue its diversified strategy, which combines Life and P&C business;
EXPAND AND DEEPEN THE FRANCHISE: over the 2016-2019 period, SCOR plans to grow organically and profitably, leveraging on existing and new platforms. Gross written premiums are expected to grow organically between approximately 4% and 7% annually on average over the plan;
NORMALIZE THE ASSET MANAGEMENT POLICY as market conditions allow over the plan by aligning it to the upper mid-level risk appetite of the Group, reducing the very high level of prudence that currently characterises the investment portfolio.

* Based on a 5-year rolling average of 5-year risk-free rates
** This is the ratio of Eligible Own Funds over the Solvency Capital Requirement (SCR)

SCOR Global P&C is on track with the execution of the “Vision in Action” plan. The P&C division has continued to build its franchise in the U.S. through its global Tier 1 reinsurer status. It has consolidated its market position in international markets, leveraged SCOR Business Solutions and expanded the Channel 2015 Lloyd’s Syndicate. The division has also developed an MGA platform to promote new business opportunities.
SCOR Global P&C expects to reach a gross written premium compound annual growth rate in the range of 3% to 8% over the plan. At the same time, the division expects to deliver a normalized net combined ratio of ~95% to 96% over the plan.

SCOR Global Life is successfully executing the “Vision in Action” plan, reinforcing the power of a diversified franchise and growing a solid, healthy and high-performing in-force book. The division is expanding its Protection footprint, strengthening its leadership positions in the Americas and EMEA and reinforcing its presence in markets with strong potential, particularly in Asia. It continues to diversify its risk profile by growing its longevity and health lines. SCOR Global Life is also investing in technology to enhance its value proposition and help clients grow consumer demand.
In the first year of the “Vision in Action” strategic plan, the Life division opened a branch in Japan and entered the rapidly expanding U.S. Health market, further deepening its franchise.
SCOR Global Life expects to reach a gross written premium compound annual growth rate of between 5% and 6% over the plan and anticipates a technical margin of around 6.8% to 7.0% p.a.

In an improved economic environment compared to 2016, with global rates and markets better oriented overall, SCOR Global Investments is on track with the execution of “Vision in Action”.
Consistent with commitments taken for “Vision in Action”, SCOR Global Investments has significantly improved its ESG approach.
SCOR Global Investments pursued the repositioning of the investment portfolio throughout 2017. As a result, liquidity, defined as SCOR’s share of cash and cash equivalents and short-term government bonds (with maturities above three months and below twelve months) and bank overdrafts, was significantly decreased towards the target level of 5% of invested assets. The duration of the fixed income portfolio was increased progressively.
Under current market conditions, SCOR Global Investments expects the annualized return on invested assets to be in the upper part of the 2.5% - 3.2% range over “Vision in Action”.

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