ASR Nederland sees net result recover


ASR Nederland achieved a net result of EUR 255 million in 2009. Solvency rose to 232%. At the same time, major steps have been taken to realise the strategic priorities: a reduction in balance sheet risks, strengthen our customer focus and lower costs.

Key figures

(EUR million)



Net result












Total equity *



Number of FTEs

4,454 FTEs

4,540 FTEs

* Total equity including revaluation of real estate.

Progress in realising strategic priorities

Focus on customers

  • New product philosophy in Life and Non-life implemented
  • Central position given to improving customer experience
  • Name recognition improved

Financially solid

  • Equity exposure decreased
  • Interest-rate risk reduced
  • Subordinated bonds restructured to become Tier 1 capital

Increase efficiency

  • Cost savings of EUR 70 million realised, excluding costs of split and reorganisation
  • New cost-saving measures initiated
  • Changes in the organisation implemented

Commentary by Jos Baeten, Chairman of ASR Nederland Executive Board

“We are satisfied with our financial results in view of what we have been through. Despite challenging market conditions, the recovery of results seen in the first six months was maintained. Our balance sheet position is also much improved. It is important for us that our solvency has improved, both in the light of what we have seen with the credit crisis and with a view to the requirements that will be made by Solvency II.

The disentanglement from Fortis is completed and was a major operation. Our balance sheet now has a different structure. We have launched our new brand names. Corporate staff departments that used to be shared at the Fortis concern level have been reformed to serve ASR Nederland as a separate company. IT is once again being handled entirely in-house. This has all had far-reaching consequences for staff. The consequences are reflected in our figures, for instance in the costs and the change in the number of FTEs. Naturally, our employees have been affected by the process of having to take leave of an international corporate environment, in which we had increasingly become firmly integrated, in combination with uncertainty about the longer-term future. What is more, they too have been personally affected by the shock of the credit crisis and the poor reputation the financial sector has acquired.

Our good performance despite all this demonstrates the resilience of our employees, and accordingly of our company. This gives us the confidence to face the major challenges awaiting us. The financial sector needs to reinvent itself, as it were. In this context, we at ASR have now made some radical choices. However, the general economic trends do not show much sign of a real improvement in the short term. In this regard, the fall of the Government is exceptionally inopportune for our sector. As insurers, we have a particular interest in the shape taken by structural reform processes such as that regarding the Dutch disability system. They will now be subject to delays. Moreover, the political outlook is unclear. Quite apart from that, there are evaluations ongoing that are looking at regulatory aspects and the Financial Supervision Act, for example, that could have an impact in the form of legislation and supervision. These could have far-reaching consequences for our sector. There needs to be time for implementation and thus a certain degree of predictability. That now seems to be further away than ever.”

Financial results

Net result in 2009 was EUR 255 million. This is an enormous improvement when compared with the historical low of 2008 (EUR -640 million). A major factor was the tentative recovery in the financial market from the second quarter onwards. At the same time, it should be noted that one-off factors had a big impact in both these years. In 2008 it was the provision for the settlement regarding investment insurance policies. In 2009 it was the restructuring of subordinated capital and the one-off costs of the split.

Total equity has increased from EUR 1,757 million to EUR 2,975 million, including the revaluation of the real estate. Solvency was 232% at year-end 2009. This too is a considerable improvement on 2008 (170%). The sensitivity of solvency to exogenous factors has been reduced substantially by reducing the interest rate risk and exposure to equities.

Net result 2009 attributable to our shareholders will be added to our buffer capital. Therefore ASR Nederland will not pay any dividend over this net result.

A subordinated bond (TOPrS), which had been arranged using an American structure, was restructured halfway through the year. 91% of the investors agreed to the conversion to hybrid Tier 1 loans issued directly by ASR Nederland. They are listed on Euronext. Shareholders’ capital has been held by the since 3 October 2008. The does not provide any capital support, guarantees or loans.

The view ASR Nederland takes of market developments and the prospects for the longer term has led the company to aim for a structural, substantial reduction in the ratio of costs to gross written premiums (GWP). A start was made with this last April with the introduction of a cost-saving programme designed to save EUR 100 million on the budget for the period to mid 2010. Part of the programme involves 700 job redundancies.

The planned cost reduction of EUR 70 million per the year-end was realised. The savings are not fully reflected in the operating costs, because of various one-off costs for the split and the reorganisation. The announced reduction in the workforce is ongoing, but is only partially visible in the 2009 figures. In the meantime, new cost-saving measures have been announced that will have an effect in due course.


Demand for insurance products was under pressure throughout the market. To a large extent, this is due to the stagnating economy and consumer confidence levels that are still not showing much sign of recovery. That led to a fierce battle for market share, resulting in a fall in premium levels across all product lines. Less demand and lower premiums are reflected in the developments in GWP.

The fall in ASR Nederland’s GWP in life insurance (-28%) was primarily due to lower sales of single premiums in addition to the stagnating mortgage and group life markets. Our market share in mortgages has fallen substantially. In addition to the demand-side developments, there was also an adverse effect due to the problems in attracting funding for mortgages. Furthermore, ‘bank saving products’ were competing increasingly successfully with life insurance products.

Increasing numbers of business rationalisations led to a reduction in the demand for insurance in non-life commercial lines. GWP in non-life personal lines stayed in line with 2008 despite the increased competition. Overall, GWP rose by 3%.

Value Added New Business (Life) and combined ratio (Non-life)

The production in life insurance was under considerable pressure during 2009. This production has a normalised Value Added New Business (VANB) of EUR 9 million. The cost norm was exceeded because of the low production levels. Full cost allocation to the 2009 production gives a VANB of EUR -2 million. At this moment, various operations are implemented to bring production and the associated costs more in line with each other.

The combined ratio for Non-life rose to 102.1%. This was mainly due to higher claims for disability and car insurance and to one-off non-life incidents such as the storm in May and a number of large fires. Measures have been taken to improve the combined ratio. The development of the combined ratio will continue to be a point of interest in 2010.

New identity for ASR in the Netherlands

ASR Nederland aims for a balance between the interests of its stakeholders. The background to this is the new economic reality, the rearrangements within the financial sector, the changes in society and last but not least, the changes in consumer behaviour. The lessons from the past, that is the investment-linked insurance affair, the credit crisis and the fall apart of the former parent company Fortis, also form part of that reference framework.


A new generation of products has been launched for both life and non-life insurance. Their structure, transparency, comprehensibility, costs, contract periods and commissions meet present-day criteria. These are very different from the past. Initial reactions make it clear that this modernisation is seen as a fundamental change. It means a period of familiarisation is required in the sales process. Now campaigns have been initiated aimed at raising awareness among consumers to support distribution via intermediaries.

ASR Nederland was able to introduce a new, competitive mortgage product at the end of the year due to the multi-funding strategy, which was made possible by the split with Fortis. In addition, Fortis ASR Bank was bought back from Fortis Bank Nederland. Consequently, ASR Nederland once again has a bank for investment and savings products that will also be offered through intermediaries.

Customer experience

All kinds of structural and one-off activities have been undertaken to give the customer experience a more central position in the organisation. The end-user with his needs and emotions has been ‘brought inside the organisation’ as it were through dedicated consumer research and customer focus groups. The customer experience has been given a place in the appraisal and remuneration system for management, using the so-called net promoter score.


More than 80 percent of ASR Nederland’s product sales are through independent brokers. Brokers are under considerable pressure. Incidents and growing criticism from consumer organisations have generated negative publicity. This has fanned negative attitudes among politicians, which have reached considerable heights, and in turn led to the wave of new legislation. This, together with the stagnating economy, has accelerated the process of rationalisation that was already underway. ASR Nederland believes independent brokers have a role to play and will continue to do so in the future. Many insurance consumers will continue to require expert, personal advice and assistance in a modern form. Consequently, ASR Nederland has, and will continue to have, every interest in ensuring a future-proof system of brokers organised along modern lines. ASR Nederland is making the case for this in the market too. ASR Nederland is putting in an effort to help the individual brokers it works with to modernise their business models. A number of different initiatives have been taken to achieve this. The brokerage sector has named ASR Verzekeringen the best all-round insurer of 2009.

Throughout the market, Internet sales are gaining ground, particularly for routine simple risk non-life personal insurance. As part of its multi-channel strategy, ASR Nederland aims also to serve customers who prefer to arrange their insurance affairs themselves. To achieve this, it launched Ditzo in 2008 with a striking branding campaign. The follow-up turned it into a widely-recognised name. Both the growth in GWP and various awards are an acknowledgement of the innovative concept Ditzo offers customers.

Brand recognition

ASR Verzekeringen was introduced in 2009 as a new brand alongside ASR Nederland. A publicity campaign started mid 2009 with the slogan: “We are ASR. And who are you?” In it, ASR Verzekeringen explains that it is the most personal insurer in the Netherlands and that is precisely why it chooses to work with independent insurance advisors. This campaign was well received. To improve brand recognition, the company took over the sponsorship contract for 2009 with the Feyenoord football club from Fortis. It has recently been announced that ASR Nederland will also be sponsoring Feyenoord for the next two years. This decision is partly based on research into the effects of football sponsorship.

Company reorganisation

The focus in the reorganisation of the company is on creating the right preconditions necessary for optimum implementation of the strategy and realisation of efficiency improvements. ASR Nederland has replaced its label-led organisation with a market-led organisation. The product lines have been dissociated from the three distribution organisations (ASR Verzekeringen, De Amersfoortse and Ditzo). There are also two independent specialists (De Europeesche and Ardanta). There is now a single point of control managing the back offices for both ASR Verzekeringen and De Amersfoortse. Falcon, the unit-linked insurer, will be integrated into ASR Verzekeringen at the end of this year.

With the exception of De Europeesche in Amsterdam and Ardanta in Enschede, the offices will be concentrated at one location. This change will take place in phases. The different labels and business units, which were spread across the country in 15 buildings at 11 different locations, will be housed at one central location in the Utrecht region by 2015 at the latest. At this moment, 3 locations (Amersfoort/Mondriaan, Woerden, Odijk) already have been closed. The operational excellence programme is aimed at ensuring all business processes are certified for quality and efficiency. Additional efficiency programmes have now also been announced. They focus on such matters as a reduction in complexity and a review of support staff activities. It has recently been announced that the board structure dating from the Fortis period will be amended. This includes replacing the Management Board by an Executive Board. The number of Board members has been reduced from six to four.

The future

Since 3 October 2008, ASR Nederland has been wholly owned by the . Unlike a number of other financial institutions, ASR Nederland has not received any Government support in the form of capital injections, guarantees or loans. As the Government has said from the very first, the intention is for ASR Nederland to be transferred back to the private sector. Naturally, the way to do this and the timing of the privatisation are the subjects of discussion.