Table of Contents

Annual Report 2016 - Overview

Company Overview

It starts with a single charge that runs through every aspect of our business – from our company values, to the hard work of our team of talented professionals, to our relationships with our partners and clients.

Statutory Bodies

Supervisory Board
Board of Directors
Audit Committee
Audit Committee
Karl Fink
Elisabeth Stadler
Hynek Vodička

Changes after 31 December 2016:

Resigned from the office of Audit Committee as of 30 April 2017:

Hynek Vodička

Supervisory Board
Karl Fink
Wolfgang Eilers
Elisabeth Stadler
Peter Höfinger
Gary Wheatley Mazzotti
Vladimír Bakeš
Peter Thirring

Changes after 31 December 2016:

Resigned from the office of Supervisory Board as of 31 December 2016:
Wolfgang Eilers

Resigned from the office of Supervisory Board as of 31 May 2017
Gary Wheatley Mazzotti

Board of Directors
Dušan Bogdanović
Member of the Board of Directors
Show Responsibilities
Actuarial Analytics
VIG Re Subsidiaries
Ivana Jurčíková
Member of the Board of Directors
(Since 1 September 2016)
Show Responsibilities
Finance, Investments
Planning & Controlling
Reinsurance Accounting
Claims Management
Johannes Martin Hartmann
Chairman of the Board of Directors
Show Responsibilities
Human Resources
Public Relations & Communication

Changes after 31 December 2016:

Nominated Member of the Board of Directors as of 1 March 2017:
Tomasz Rowicki

Meet Our Team

Actuarial Analytics
Financial, Accounting & Claims
Actuarial Analytics
Marek Krajča
Associate Non-Life Actuary
Michal Bošeľa
Non-Life Actuary
Iveta Macho
Life Actuary
Jan Hrevuš
Head of Department
Financial, Accounting & Claims
Tina Kubes
Claims Specialist
Petra Vrkočová
Accounting Specialist
Milan Přibyl
Head of Department
Financial, Accounting & Claims
Ondřej Broukal
Accounting Specialist
Sylwia Krause
Accounting Specialist
Lucie Holomelová
Accounting Specialist
Nikola Klimešová
Accounting Specialist
Operations - Board Office
Zuzana Nulíčková
Compliance Officer
Lukáš Dvořák
Risk Manager
Lenka Havránek Malenková
Head of Department
Operations - Board Office
Markéta Musilová
Board Office Coordinator
Barbora Labíková
Assistant to the Board
Natálie Karanová
Assistant to the Board
Zuzana Bendová
Assistant to the Board
Kateřina Dostálová
Controlling Associate
Jakub Věříš
Controlling Specialist
Operations - Business Processes
José Francisco Felío-Montes
Business Processes Manager
Luboš Machata
Business Processes Assistant
Kamil Kováč
Business Processes Assistant
Ondřej Hyneš
Business Processes Associate
Data Architect
Katarína Bartošová
Administrative Support
Martina Lefkaničová
Administrative Support
Underwriting – Non-Life
Fabian Christoph
Head of Germany, Austria, Switzerland
Viera Horáková
Treaty Underwriter
Aneta Stloukalová
Associate Treaty Underwriter
Olaf Dietrich
Head of Department
Underwriting – Non-Life Treaty
Alexander Melnik
Treaty Underwriter
Alena Pak
Assistant Underwriter
Petko Koev
Treaty Underwriter
Underwriting – Non-Life Treaty
Jakub Šandera
Assistant Underwriter
Adéla Stollinová
Assistant Underwriter
Marek Polec
Treaty Underwriter
Petr Štěpán
Treaty Underwriter
Underwriting – Non-Life Facultative
Petr Mareš
Facultative Underwriter
Monika Půhoná
Associate Facultative Underwriter
Lukáš Srp
Facultative Underwriter
Jan Hynek
Assistant Underwriter
Underwriting – Life
Eva Vrbková
Martin Tesařík
Associate Underwriter
Underwriting – Accident & Health
Ondřej Roztomilý
Anna Vedyushenko
Assistant Underwriter
Michal Teplý
Retrocession Specialist
Tomáš Benko
Retrocession Associate
Annual Report 2016 - Overview


As a company, we get our energy from the people that drive our business.

It’s essential for us that our entire team identifies and actively supports the company’s values, vision and strategy. We encourage discussions and differences in opinions, and it’s vital to us that our team stays curious, is eager to learn, and sees more than one way to solve a problem or create a new opportunity.

Flexible Working Time

We accommodate and foster flexible working hours, part-time employment and home offce in response to the increasing demand of our employees to organise their working time and place in a flexible way.

Personal Development

Personal development of our team members is one of our core values.

Each employee receives regular feedback from their manager in regards to their performance and professional development. This is documented in the annual appraisal process. Technical and finance training for reinsurance, language courses and soft-skills seminars are part of each team member’s yearly development plan. We support employees in qualified professional programs, including participation in international conferences and seminars.

In 2016, we introduced the “Expert” concept for functions of strategic importance to the company. Apart from further promoting the professional skill set, it provides employees who do not strive for a management position with the opportunity for an alternative career path.

In the same year, we also introduced the VIG competence model, which defines the core competencies for all employees as well as additional competencies for experts and managers that we believe are essential for the professional performance and teamwork of our employees.

More About Us

Annual Report 2016 - Overview

Market Overview


The majority of international economic research institutes predict continued growth for the economies of Central and Eastern Europe, which should benefit from the various European infrastructure and regional development programs. Especially for major economies such as Poland (+3.5%) and Czech Republic (+2.4%), WIIW (Wiener Institut für Internationale Wirtschaftsvergleiche) forecasts an acceleration in growth, which has recently been hampered by the sluggish economic development of Western European economies. In addition, for Hungary, the outlook is now more positive and growth – after two challenging years – is expected to recover by 0.6 percentage points to 2.6%. The institute expects only three CEE countries to experience a slowdown in growth in 2017, namely Romania (2017: +3.5%), Turkey (2017: +3.0%) and Slovakia (2017: +3.1%), all countries that already have shown robust growth in 2016. Smaller CEE countries such as Bulgaria (+3%), Croatia (+2.7%) or Baltic states (avg. + 2.5%) are expected to grow at slightly slower, but stable rates.

Global Challenges

Amongst the biggest challenges lying ahead are the continuous global uncertainties and the cohesion of the European Union. In 2016, the decision of the UK to exit the European Union, as well as the outcome of the presidential elections in the US, with its subsequent change of policy, has taken many by surprise. The outcome of various major elections in European countries in 2017 remains to be seen. Obviously, the re-nationalisation of global and European economies will also have an impact on the international terms of trade. The global economy will likely be impacted by the US Fed’s quantitative easing coming to an end. As a consequence, the first signs of increasing yields on bond markets can be observed and commodity prices, such as crude oil, remain at persistent low.

Financial markets are expected to show a high level of volatility.

Annual Report 2016 - Results

Financial Results

Stable performance is one of the most important key indicator for VIG Re and its shareholders. In 2016, the number of VIG Re clients passed 300 for the first time. Our gross written premium income increased by 7% to EUR 383 million. Due to relatively benign loss activities in the year and as a result to our continued strict underwriting policy, we achieved an excellent net combined ratio of 93.2% and consequently a very strong underwriting result.


Millions EUR


Millions EUR of GWP
Contributed P&C


Millions EUR of GWP
Contributed L&H


% Combined Ratio


Millions EUR Investments


Millions EUR Profit
Before Taxes

Based on Individual Financial Statements.

Annual Report 2016 - Results

Premium Income

Gross Written Premium for 2016 was EUR 383 million, of which P&C contributed EUR 339.3 million and L&H EUR 43.7 million. In order to maintain profitability under the challenging market conditions, VIG Re adhered to its strict underwriting discipline, withdrawing from business where the renewal terms were not in line with VIG Re’s technical standards. On the other hand, the strong franchise of VIG Re in its core markets and increased marketing activities with selected clients enabled VIG Re to originate new business at sufficient technical margins. On the other hand, premium income was negatively impacted by the depreciation of foreign currencies such as the Turkish Lira and Ukrainian Grivna.

GWP Split GWP Split
P/C per Line of Business GWP Property/Casualty per Line of Business
P/C per Country GWP Property/Casualty per Country
% Show Percentage
123 Show Values
*) Other represents the following countries: Albania, Armenia, Bosnia, Bulgaria, Estonia, Georgia, Great Britain, Italy, Kosovo, Latvia, Lithuania, Luxemburg, Macedonia, Moldova, Montenegro, Russia, Slovenia, Switzerland and Ukraine.
Annual Report 2016 - Results

Large Losses

In 2016, VIG Re was not affected by any large natural catastrophe loss. Of the regional events, flooding occurred in Germany in May 2016 (”Elvira”), with gross claims of EUR 25.5 million for VIG Re. Other notable events were a landslide in the Kazbegi district in Georgia, a hailstorm in Plovdiv, Bulgaria, a flash flood in Macedonia and the Earthquakes in Italy on August 24, 2016, and October 26, 2016, none of which exceeded a loss of EUR 2 million for VIG Re’s share.

The largest manmade loss in 2016 was reported for a wood processing plant in Chirk, Wrexham. As a result of the explosion at the power station and the following business interruption, a gross loss of EUR 8 million was reported for VIG Re’s share.

The total burden of large losses (VIG Re’s gross share above EUR 1 million) decreased in 2016 compared to 2015. For 2016, 10 large claims were reported for VIG Re with a total net loss of EUR 9.2 million, compared to 17 large losses in 2015 with a total net loss of EUR 16.7 million.

Annual Report 2016 - Results

Financial Investments

In an environment of historically low interest rates and volatile bond and equity markets as seen in 2016, VIG Re achieved a solid investment income of EUR 11.3 million. The 2016 result was mainly driven by ordinary investment income and adversely impacted by a stop-loss on equity funds accounted in January 2016 (- EUR 0.9 million).

Due to the structure of the investment portfolio, the bond portfolio, with a total income of EUR 7.5 million, was the main contributor to investment income. An additional EUR 4.5 million contributed funds deposited with cedents in respect of Life and Health Reinsurance contracts. Equity and fund investments accounted for a total minor loss of EUR 0.1 million.

No extraordinary gains were realized in the year 2016.

Conservative Investment Strategy

Low market yields and volatile equity markets make the investment outlook even more challenging than before. Planned investment yield has been adjusted in order to stick to our policy of always maintaining a conservative risk/return profile of diversified portfolio and disciplined risk management.

Protection Programme

VIG Re takes a prudent approach to buying reinsurance and excels the VIG Group’s rule of not retaining more than 3% of equity on any underwritten risk while Natural catastrophe coverage is secured on a 250-year event basis. Our well-diversified reinsurance panel is carefully chosen based on our security guidelines and avoids concentrating risk on single counterparties.

Annual Report 2016 - Results

Risk Management

VIG Re operates on principles that fall within the framework of a conservative risk policy, in accordance with Solvency II and in line with the VIG Risk Policy. These principles ensure effective performance of all activities at VIG Re and form the basis of a general culture in which risk management plays an essential role.

These principles are:

  • integrity and ethical value
  • avoiding conflicts of interests
  • unique allocation of responsibilities
  • aligning motivation with the Company‘s objectives
  • the four eyes principle

These principles are applied in all activities the Company needs for its operation regardless of whether such activities are carried out directly by the Company or are outsourced.

The internal structure of the risk management system is laid out in three lines of defence that reflect and require compliance with the Company’s principles. The essence of this structure lies in transparent segregation of employee responsibilities into each line of defence, i.e. avoiding conflicts of interests, preventing the Company from risks and setting of effective controls.

The main focus of risk management in 2016 was implementing risk management policies, conducting the ORSA process, and the further improving the SCR calculation process, including further development of a partial internal model.

Annual Report 2016 - Activities

Wiener Re

Assigned Markets

Since its founding in 2008 as VIG Re’s reinsurance company, Wiener Re Belgrade has established business relationships with a significant number of insurance companies in Serbia and western Balkans. It is currently active in Serbia and neighbouring countries Bosnia and Herzegovina, Montenegro and Macedonia.

Market Leader

Since 2013, Wiener Re has become the number one reinsurer in Serbia, with more than 40% market share, more than EUR 40 million in GWP and more than 20 cedents from the region, most importantly Wiener Städtische Insurance Belgrade, Wiener Insurance BiH, Uniqa Insurance RS, Axa Life and Non-life Insurance RS, Triglav Insurance RS, Dunav Re, Sava RS and Lovčen MNE.

Continued Growth

Wiener Re achieved continued, constant growth in gross written premiums as a result of its increasing number of clients, providing a wide range of reinsurance services to regional insurance companies.

Wiener Re Financial Performance in 2016

2016 continued to be a successful year for Wiener Re Belgrade, which saw a 5% increase in GWP to EUR 40.5 million and an even further improved combined ratio of 92.2% (compared to 92.9% in 2015). Profit remained almost stable at more than EUR 0.5 million. More than 40% of its business came from companies outside of VIG.

More About Wiener Re

Annual Report 2016 - Activities


Environmental Protection

The nature of our business places a minor burden on the environment. In 2016, VIG Re implemented the first modules of a workflow system aimed at creating a paperless office. The Company meets all environmental requirements prescribed by Czech law.

Units Abroad

VIG Re maintains no organizational units abroad.

Research and Development

We focus development on incorporating new information technologies and forms of communication when providing reinsurance services.


In order to further improve the quality of reporting, risk management and data quality a number of new IT solutions and automated processes have been introduced, mainly:

  • a set of non-life underwriting pricing tools and underwriting administration systems have been in production since 2016,
  • in reinsurance accounting, an automated workflow process for payment management went live in 2016, while an IT solution for supporting quarterly closings and claims management started being used for transactions since December 31, 2016,
  • Unified Database – a base for reporting data that enables VIG Re to report efficiently and meet increased reporting demands,
  • a revised Life model for SCR calculation under Solvency II.

We refine all our business processes and standards, and are continually developing the skills and extending the knowledge of each of our team members. Further automation will follow during 2017.

Annual Report 2016


Growth Ahead

The rising purchasing power of a growing middle class will trigger an increased demand for insurance solutions from private households, which will consequently increase insurance density. As a result, mid- to long-term macroeconomic trends provide strong growth potential for insurance and reinsurance companies in the region. However, the future development of the insurance market will also depend on CEE countries implementing national reforms. And while many countries are indeed planning reforms in social, health and pension insurance, political decision-making and actual implementation still often lag behind.

VIG Re Strategy 2020

Although VIG Re, in the first years after its foundation, focused on accepting business from VIG companies, from the beginning it has built a value proposition for clients outside of VIG Group. As a result, third-party business has been gaining momentum since 2013. While still adhering to the same underwriting areas, VIG Re has been gradually building its franchise beyond VIG core insurance markets, such as Germany, Italy, Russia and Turkey. As part of its revised strategy, VIG Re aims to strengthen its underwriting activities in Germany and to enter additional, mainly continental European, markets in a careful and controlled way. There, VIG Re will focus on those business segments and client relations that provide opportunities for profitable and sustainable growth with selected clients. In combination with the further development of its established business segments, the Company is aiming to grow its underwriting profits by 10% annually until 2020. The focus on underwriting results will enable the Company to offset the forecasted lower ordinary investment results driven by the continued low-interest environment.

Emerging Landscape

In addition to the above political and economic factors, the evolving risk landscape is impacted by the global technology trends of rapid digitalization and automation. While these represent emerging risks, it should be emphasized that these trends ultimately may represent significant opportunities for reinsurance to extend its value proposition and further improve the efficiency of the industry.
The health insurance and reinsurance elds are poised to become one of the most rapidly evolving segments in the CEE region in the future and VIG Re is ready to offer reinsurance protection and services to meet the rising demand. VIG announced that the health sector will be one of its strategic priorities in the next year and VIG Re is taking an active role in the execution of the Group strategy.

Strict Underwriting and Investment Discipline

Terms and conditions for most lines of reinsurance business have been developing in favour of reinsurance buyers in recent years, mainly driven by an abundance of capital in the reinsurance industry and relative benign loss activity. VIG Re expects that reinsurance market terms will stabilize on the current level. The continued high level of competition and absence of any market defining events will likely not allow for adjustments in terms and conditions, especially in those lines of business that have shown solid performance in recent years. While interest rates on bonds appear to slowly be picking up, interest rates remain at a historically low level and equity markets show significant volatility. In this context, focus on underwriting profitability and continued strict underwriting discipline remain key.

In 2017 and beyond, VIG Re will adhere to its conservative investment and protection policy in line with its A+ stable outlook rating by providing the operational flexibility, the broad risk solutions across all main lines of business, and the strong financial security that are crucial for seizing opportunities in this emerging landscape.

Annual Report 2016


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