UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): May 19, 2014
REINSURANCE GROUP OF AMERICA, INCORPORATED
(Exact Name of Registrant as Specified in its Charter)
| Missouri | 1-11848 | 43-1627032 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification Number) |
1370 Timberlake Manor Parkway, Chesterfield, Missouri 63017
(Address of Principal Executive Office)
Registrant’s telephone number, including area code: (636) 736-7000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 7.01 | Regulation FD Disclosure. |
As previously reported in Reinsurance Group of America, Incorporated’s Currents Report on Form 8-K furnished on May 15, 2014, the company announced that it will host a conference for institutional investors and analysts at the Grand Hyatt Hotel in New York City on Tuesday, May 20, from 8:30 a.m. to 12:30 p.m. Eastern Time. A live audio webcast of the presentation will be available online at http://www.media-server.com/m/p/jd6xk3ry and on RGA’s website at www.rgare.com. Copies of the slides used in the presentation will be available on the company’s web site at www.rgare.com (through the link on the Investor Relations page) and are attached as Exhibit 99.1 and incorporated herein by reference.
The information in this Item 7.01 and the exhibit attached hereto will not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of such section, nor will such information or exhibit be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as may be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits |
| (d) | Exhibits. The following documents are filed as exhibits to this report: |
| 99.1 | Copy of slide presentation for RGA 2014 Investor Day |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| REINSURANCE GROUP OF AMERICA, INCORPORATED | ||||||
| Date: May 19, 2014 | By: | /s/ Jack B. Lay | ||||
| Jack B. Lay Senior Executive Vice President and Chief Financial Officer | ||||||
EXHIBIT INDEX
| Exhibit |
Description | |
| 99.1 | Copy of slide presentation for RGA 2014 Investor Day | |
| Exhibit 99.1
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Exhibit 99.1
Global • Growing • Unique
Investor Day 2014
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
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RGA: A Global Leader
Reinsurance Group of America, Incorporated® (NYSE: RGA) is a
FORTUNE 500 company with approximately $2.9 trillion of life reinsurance in force and assets of $39.7 billion as of December 31, 2013. RGA is one of the largest life reinsurers in the world.
From our beginnings in 1973 through more than 40 years of steady global expansion, RGA has grown to become one of the world’s largest and most highly respected reinsurers, recognized for our superior risk management and innovative solutions. RGA reinsures one of the largest in-force blocks in the life insurance industry, and has built an extensive database of mortality information. This knowledge forms the basis for RGA’s continued leadership in the competitive pricing of risk.
At RGA, our teams of actuarial, underwriting and claims professionals draw upon historical data and experience to develop expert solutions tailored to meet our clients’ needs. We share our expertise to benefit clients in multiple ways: • Superior understanding of mortality and morbidity risks, built on RGA’s extensive database • World-class facultative underwriting, specializing in large cases and substandard risks, enabling insurers to write more policies • Shared medical underwriting knowledge, developed from leading-edge research and experience • Expert claims handling to reduce costs • Innovative product development to support business growth • Competitive pricing to transfer mortality risk and reduce capital requirements
Benchmarking studies and seminars that build and leverage market intelligence Capital-motivated reinsurance to help insurers meet financial objectives and manage capital more efficiently
E-underwriting and e-commerce solutions that enable reliable, rapid decisions and streamline processes Training programs and seminars that provide clients with access to RGA’s global team of industry experts Clients appreciate that RGA listens and continually strives to bring fresh approaches and innovative ideas to help them meet challenges and achieve success.
RGA Core Products and Services
Individual life and health Asset-intensive (annuity) reinsurance reinsurance Group life reinsurance Facultative underwriting
Living benefits (critical illness, Electronic underwriting longevity, health, and long-term Risk management care) reinsurance Product development Financial reinsurance
Global • Growing • Unique 2
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Global Presence
RGA achieves superior stability through geographic operational diversity and a strategic mix of products and services. Allocation of 2013 net premiums1:
55% 33% 12%
derived from derived from derived from U.S. operations International operations Canada operations
Worldwide Operations
RGA serves clients around the world from operations in 26 countries:
Australia Ireland South Africa
Barbados Italy South Korea
Bermuda Japan Spain
Canada Malaysia Taiwan
China Mexico Turkey
France Netherlands United Arab Emirates
Germany New Zealand United Kingdom
Hong Kong Poland United States
India Singapore
1Excludes Corporate and Other segment
Global • Growing • Unique 3
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Ratings
Financial Strength Ratings Senior Debt Ratings: Reinsurance Group of America, Incorporated
A+ Superior
A.M. Best Company
RGA Reinsurance Company
RGA’s principal operating subsidiary in
A1 Good
Moody’s Investors Service
the United States
AA- Very Strong
Standard & Poor’s Insurance Rating Service
A+ Superior
RGA Life Reinsurance
A.M. Best Company
Company of Canada
RGA’s Canadian operating subsidiary
AA- Very Strong
Standard & Poor’s Insurance Rating Service
RGA Reinsurance Company
of Australia Limited
AA- Very Strong
Standard & Poor’s Insurance Rating Service
(RGA’s Australian operating subsidiary)
RGA International Reinsurance
Company Limited
AA- Very Strong
Based in Ireland, supports business
Standard & Poor’s Insurance Rating Service
operations outside North America
RGA Global Reinsurance
Company, Ltd.
AA- Very Strong
Based in Bermuda, supports business
Standard & Poor’s Insurance Rating Service
operations outside North America
A.M. Best Company a- (Strong)
Moody’s Investors Service Baa1 (Medium)
Standard & Poor’s Insurance A- (Strong)
Rating Service
Global • Growing • Unique 4
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Recent Awards and Recognitions
RGA continues to lead industry rankings in terms of client satisfaction and reputation. Recent awards and recognitions acknowledged during 2013 include:
2013 Flaspöhler Cedant Survey Best Overall Life Reinsurer
RGA was rated “Best Overall Life Reinsurer” in the 2013 Flaspöhler Survey™ (Direct Writers Evaluate Reinsurers/
Life N. A.) by cedants. This is the fifth consecutive time RGA has been rated best overall in this biennial survey. FLASPOHLER
RESEARCH GROUP
NMG Consulting Studies #1 in Business Capability Index
In 2013 NMG Consulting studies, RGA was ranked #1 globally on the Business Capability Index. In national studies, RGA was ranked #1 on the BCI in the Canada, Hong Kong, Indonesia, Italy, Malaysia, Mexico, Singapore, South Africa, Taiwan, Thailand and Vietnam markets. This index measures feedback from insurance executives across more than 700 companies and 40 countries.
2013 Worldwide Reinsurance Awards Life Reinsurance Company of the Year
RGA was the recipient of the “Life Reinsurance Company of the Year” award from the 2013 Worldwide Reinsurance
Awards. This is the fifth time in eight years the competition has honored RGA with this prestigious award.
2013 CIO 100 Awards Recipient
RGA was a recipient of the annual “CIO 100 Award” by CIO magazine, for creating business value through the effective and innovative use of IT.
Best’s Review Recognizes RGA Innovation Innovation Showcase
Best’s Review Innovation Showcase, an annual forum sponsored by A.M. Best Company, recognized RGA for forward thinking and innovation for our “Automated Underwriting for Impaired Annuities” solution. This is the third consecutive year RGA has been recognized by this forum.
Global • Growing • Unique 5
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A. Greig Woodring fsa
President and Chief Executive Officer
Greig Woodring is President and Chief
Executive Officer and a Director of Reinsurance
Group of America, Incorporated. Prior to becoming President, Greig served as Executive Vice President of General American Life Insurance Company (now GenAmerica Financial L.L.C.), in charge of all reinsurance business.
Greig joined General American in 1979 as an actuary, and assumed responsibility for General American’s reinsurance business in 1986.
Prior to joining General American, he was an actuary at United Insurance
Company in Chicago, Illinois.
Greig’s leadership and experience have been pivotal in helping to make RGA one of the world’s leading life reinsurance companies, with approximately $2.9 trillion of life reinsurance in force.
Greig is a Fellow of the Society of Actuaries and a Member of the American Academy of Actuaries. He received a Bachelor of Science (B.S.) degree in Mathematics from the University of Michigan, a Master of Science (M.S.) in Mathematics from the University of Illinois, and an M.B.A. from Washington University in St. Louis. He serves as a director and officer of many RGA subsidiaries.
Jack B. Lay
Senior Executive Vice President and
Chief Financial Officer
Jack Lay, Senior Executive Vice President and
Chief Financial Officer of Reinsurance Group of America, Incorporated, is responsible for
RGA’s financial and capital management as well as for its financial reporting functions.
These functions include: oversight of enterprise financial management and controls, including: long-term corporate planning; capital market issuances by the company; development and submission of all filings required by the
Securities and Exchange Commission and other regulatory bodies; and communication of corporate and financial information to the rating and investment communities.
Prior to joining RGA in 1994, Jack spent three years with General American Life Insurance Company. Before that, Jack was a partner in the financial institutions practice of KPMG, in its St. Louis office.
Jack is a member of RGA’s Executive Council. He received his Bachelor of Science in Business Administration (B.S.B.A.) degree from the University of Missouri—Columbia.
Global • Growing • Unique 6
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John P. Laughlin
Executive Vice President Global Financial Solutions RGA Reinsurance Company President RGA Financial Group, L.L.C.
John P. Laughlin is Executive Vice President of Global Financial Solutions (GFS), a unit of RGA
Reinsurance Company, and President of RGA Financial Group, L.L.C., a subsidiary of Reinsurance Group of America, Incorporated. He is a member of RGA’s Executive Council.
The GFS unit is responsible for all of RGA’s financial reinsurance, asset-intensive reinsurance and bulk longevity business worldwide. GFS works closely with RGA offices around the world to create customized reinsurance solutions for annuities and other interest-sensitive products, and to support client capital needs for life, health and annuity products.
John came to RGA in 1995 when the company acquired the joint venture that ultimately became RGA Financial Group, L.L.C. RGA Financial, the unit where RGA’s broker-generated business is also housed, became a full subsidiary of RGA Reinsurance Company in 2000.
He began his career with Liberty Financial Management. In 1979, he joined ITT Financial Corporation, and in 1983 led the establishment and development of its financial reinsurance market. By 1985, ITT Financial was the largest provider of financial reinsurance in the U.S.
John received his Bachelor of Science (B.S.) degree in Business Administration and Accounting from the University of Missouri—Columbia, and his Master of Science (M.S.) degree in Finance from Saint Louis University.
Anna Manning fsa, fcia
Executive Vice President,
Head of U.S. and Latin American Markets
Anna Manning is Executive Vice President, Head of U.S. and Latin American Markets of Reinsurance Group of America, Incorporated (RGA). She is responsible for all operations within RGA’s United States, Mexico and South American markets. Anna is a member of RGA’s Executive Council.
Before assuming this role in January 2011, Anna was Executive Vice
President and Chief Operating Officer for RGA’s international business, overseeing international operational functions including marketing, pricing, underwriting, claims, and administration.
Anna, who joined RGA in 2007, has more than three decades of leadership experience in the insurance industry. Before coming to RGA,
Anna spent two decades with the Toronto office of Towers Perrin’s
Tillinghast insurance consulting practice. She provided consulting services to the insurance industry in mergers and acquisitions, value-added performance measurement, product development, and financial reporting.
Anna is a Fellow of the Society of Actuaries (FSA) and of the Canadian Institute of Actuaries (FCIA). She received a Bachelor of Science (B.Sc.) degree in Actuarial Science from the University of Toronto. Anna is a member of the ACLI’s CEO Steering Committee on Financial Services, and has served as a member of the ACLI’s Reinsurance Executive Roundtable Program Committee.
Global • Growing • Unique 7
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Alain P. Néemeh cpa, ca
President and Chief Executive Officer
RGA Life Reinsurance Company of Canada Executive Vice President, Australia and Canada
Alain Néemeh is President and Chief Executive
Officer of RGA Life Reinsurance Company of Canada (RGA Canada), a wholly-owned subsidiary of Reinsurance Group of America, Incorporated. He is also Executive Vice President, Australia and Canada, of Reinsurance Group of America, Incorporated, with executive reponsibility for RGA’s Australian operations. He is a member of RGA’s Executive Council.
Alain joined RGA Canada in 1997, with initial responsibility for the finance area. He became RGA Canada’s Chief Financial Officer in 1998; in 2001 its Executive Vice President, Operations and Chief Financial Officer; and in 2006, President and Chief Executive Officer.
He came to RGA Canada after eight years at KPMG where, as a Senior Manager, he oversaw the delivery of audit and other services to a variety of clients in the financial services, manufacturing, and retail sectors.
Alain received his Bachelor of Commerce (B. Comm.) degree with a concentration in Accountancy from McGill University in Montreal. He is a member of the Ordre des Comptables Professionnels Agréés du Québec, and is a past Chairman of the Board of Directors of the Canadian Life and Health Insurance Association (CLHIA), an industry association counting 99% of Canada’s life and health insurance companies as members.
Allan E. O’Bryant
Executive Vice President Head of Asia Markets
Allan E. O’Bryant, Executive Vice President, Head of Asia Markets, Reinsurance Group of America, Incorporated, heads RGA’s business and marketing operations throughout Asia, in Japan, Hong Kong, Korea, Taiwan, China, India, Singapore, Malaysia, Thailand, Indonesia, Vietnam and the Philippines. Allan is also the executive leader of several significant RGA organizational initiatives, each focused on strengthening the company’s infrastructure and supporting its continued expansion and development. He is a member of RGA’s Executive Council.
Allan has over 20 years of experience in the financial services industry. Prior to joining RGA in 2010, Allan was President and Chief Executive Officer of Yunzei Capital, L.L.C., a private equity firm based in both Seattle and Tokyo. He also served as a Senior Advisor to Lehman Brothers Inc. in Tokyo. Before then, he served as President of Aflac International Inc., Deputy Chief Financial Officer of Aflac, Inc., and Chairman and Chief Executive Officer of several of Aflac’s international subsidiaries. Earlier in his career, he filled a variety of roles with KPMG and was a professor of Accounting and Finance at Sophia University in Tokyo.
He received a Masters of Accountancy degree from the Marriott School of Management, Brigham Young University, and a Bachelor of Science (B.S.) degree in Accounting, also from Brigham Young University.
Allan is Emeritus Chairman of the Board of Directors and a member of the Board of Trustees for the American School in Japan, and is also on the Board of Directors of Novinium Inc. and Access Technology Solutions Inc. He also sits on, or is a member of: the Program on International Financial Systems at Harvard Law School; the President’s Leadership Council at Brigham Young University; the National Advisory Council of the Marriott School at Brigham Young University; the American Chamber of Commerce in Japan; and the American Institute of Certified Public Accountants.
Global • Growing • Unique 8
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Paul A. Schuster fsa, maaa
Senior Executive Vice President Head of EMEA Markets
Paul A. Schuster is Senior Executive Vice President, Head of EMEA Markets, Reinsurance Group of America, Incorporated (RGA). He is responsible for leadership of RGA’s Europe, Middle East and Africa businesses. He is a member of RGA’s Executive Council.
His career with RGA began in 1991, when he joined General American
Life Insurance Company’s reinsurance division as Second Vice President and Reinsurance Actuary. He came to RGA in 1993 with the initial public offering that created RGA from General American’s reinsurance division. In 2000, Paul was appointed Executive Vice President of RGA’s U.S. and Latin American divisions, and in 2006, was promoted to Senior Executive Vice President and head of RGA’s U.S. life, group, and health reinsurance businesses. From 2011 until year-end 2013, Paul headed Global Products.
Paul is a Fellow of the Society of Actuaries (FSA) and a Member of the American Academy of Actuaries (MAAA). He received his Bachelor of Arts (B.A.) degree in Chemistry from Williams College, Williamstown, Massachusetts.
Donna H. Kinnaird
Senior Executive Vice President and
Chief Operating Officer
Donna H. Kinnaird, Senior Executive Vice President and Chief Operating Officer of Reinsurance Group of America, Incorporated (RGA), leads RGA’s global and corporate functions. Global units include Global Accounts, Global Products, and Global R&D.
Corporate functions encompass IT, Legal, and Human Resources. She is a member of RGA’s Executive Council.
Donna, who joined RGA in April 2012, has more than two decades of strategic leadership experience with major global life insurance organizations as well as a strong background in life insurance acquisitions. Before coming to RGA, she was President of Swiss Re Life and Health
America Inc. and President and Chief Executive Officer of its Reassure America Life Insurance Company. She has also held Chief Financial Officer and Chief Operating Officer roles in life insurance companies.
She received a Bachelor of Science (B.S.) degree in Accounting from Indiana State University, and an M.B.A. from Butler University. Active with industry associations, Donna has served on the board of the American Council of Life Insurers (ACLI) and was Chairman of the ACLI’s Executive Round Table and Chairman of the ACLI’s Governance Committee. She was also a member of the ACLI’s CEO steering committees for Financial Services, Retirement and Security, and of its Executive Task Force on Global Solvency. Donna currently serves on the board of LL Global (LIMRA/LOMA) and is chairman of LL Global’s Audit Committee. She is a member of the American Institute of
Certified Public Accountants.
Global • Growing • Unique 9
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Todd C. Larson
Executive Vice President Corporate Finance and Treasurer
Todd C. Larson is Executive Vice President, Corporate Finance and Treasurer of Reinsurance Group of America, Incorporated (RGA). His responsibilities include: coordination of all external reporting, including filings to the Securities and Exchange Commission; regulatory filings; and the annual report to shareholders. He is also responsible for internal management of financial reporting for RGA’s various operating segments and subsidiaries, capital management, and the treasury function.
Prior to joining RGA, Todd was Assistant Controller at Northwestern
Mutual Life Insurance Company. He started his career with KPMG Peat Marwick LLP in Chicago, where he was a senior manager in the audit practice.
Todd received his Bachelor of Science (B.S.) degree in Accountancy from Northern Illinois University.
Scott Cochran fsa, maaa, cera
Executive Vice President Global Acquisitions
Scott Cochran is an Executive Vice President of Reinsurance Group of America, Incorporated, and a member of RGA’s Executive Council. He is responsible for the oversight of RGA’s Global Acqusitions team, which provides support for risk, capital and strategic needs to clients across all of RGA’s markets.
Scott first joined RGA in early 2005, and until January 2011, was responsible globally for enterprise risk management and various actuarial areas at RGA. Until January 2011, he was also RGA’s Chief Risk Officer, and until April 2013, was also responsible for oversight of RGA’s Global Financial Solutions team.
He has more than 19 years of experience with a range of insurance and reinsurance markets and product lines. Prior to joining RGA, Scott served numerous product development and management roles for CNA/Swiss Re and other organizations.
Scott is a Fellow of the Society of Actuaries, a Member of the American Academy of Actuaries, and a Chartered Enterprise Risk Analyst. He received his Bachelor of Science (B.S.) in Actuarial Science from Ball State University in Muncie, Indiana, and his M.B.A. from Washington University in St. Louis, Missouri’s Olin School of Business.
Global • Growing • Unique 10
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J. Jeffrey “Jeff” Hopson CFA
Senior Vice President Investor Relations
J. Jeffrey (“Jeff”) Hopson is Senior Vice President, Investor Relations, for Reinsurance Group of America, Incorporated (RGA). He is responsible for managing RGA’s financial communications with the investment community.
Jeff, who arrived at RGA in September 2013, has several decades of experience in the field of investment analysis, following a wide range of life and property-casualty insurance and asset management firms. A ten-time All-Star Analyst in The Wall Street Journal’s annual Best of the Street poll, Jeff is also a member of the Journal’s Analysts Hall of Fame.
Prior to joining RGA, Jeff was Managing Director and Senior Analyst of the St. Louis brokerage and investment firm of Stifel, Nicolaus &
Company. Previously, he served in a variety of roles with the St. Louis-based regional brokerage firm of A.G. Edwards & Sons, Inc., culminating as Vice President, Senior Analyst and Group Leader, Financial Services.
Jeff’s Bachelor of Arts (B.A.) and M.B.A. degrees in Finance are from Saint Louis University. He is a Chartered Financial Analyst (CFA).
Global • Growing • Unique 11
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RGA 2014 Investor Day
Jeff Hopson
Senior Vice President, Investor Relations
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
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Safe Harbor
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements relating to projections of the earnings, revenues, income or loss, future financial performance and growth potential of Reinsurance Group of America, Incorporated and its subsidiaries (which we refer to in the following paragraphs as “we,” “us” or “our”). The words “intend,” “expect,” “project,” “estimate,” “predict,” “anticipate,” “should,” “believe,” and other similar expressions also are intended to identify forward-looking statements. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results, performance and achievements could differ materially from those set forth in, contemplated by or underlying the forward-looking statements.
Numerous important factors could cause actual results and events to differ materially from those expressed or implied by forward looking statements including, without limitation, (1) adverse capital and credit market conditions and their impact on the Company’s liquidity, access to capital and cost of capital, (2) the impairment of other financial institutions and its effect on the Company’s business, (3) requirements to post collateral or make payments due to declines in market value of assets subject to the Company’s collateral arrangements, (4) the fact that the determination of allowances and impairments taken on the Company’s investments is highly subjective, (5) adverse changes in mortality, morbidity, lapsation or claims experience, (6) changes in the Company’s financial strength and credit ratings and the effect of such changes on the Company’s future results of operations and financial condition, (7) inadequate risk analysis and underwriting, (8) general economic conditions or a prolonged economic downturn affecting the demand for insurance and reinsurance in the Company’s current and planned markets, (9) the availability and cost of collateral necessary for regulatory reserves and capital, (10) market or economic conditions that adversely affect the value of the Company’s investment securities or result in the impairment of all or a portion of the value of certain of the Company’s investment securities, that in turn could affect regulatory capital, (11) market or economic conditions that adversely affect the Company’s ability to make timely sales of investment securities, (12) risks inherent in the Company’s risk management and investment strategy, including changes in investment portfolio yields due to interest rate or credit quality changes, (13) fluctuations in U.S. or foreign currency exchange rates, interest rates, or securities and real estate markets, (14) adverse litigation or arbitration results, (15) the adequacy of reserves, resources and accurate information relating to settlements, awards and terminated and discontinued lines of business, (16) the stability of and actions by governments and economies in the markets in which the Company operates, including ongoing uncertainties regarding the amount of United States sovereign debt and the credit ratings thereof, (17) competitive factors and competitors’ responses to the Company’s initiatives, (18) the success of the Company’s clients, (19) successful execution of the Company’s entry into new markets, (20) successful development and introduction of new products and distribution opportunities, (21) the Company’s ability to successfully integrate and operate reinsurance business that the Company acquires, (22) action by regulators who have authority over the Company’s reinsurance operations in the jurisdictions in which it operates, (23) the Company’s dependence on third parties, including those insurance companies and reinsurers to which the Company cedes some reinsurance, third-party investment managers and others, (24) the threat of natural disasters, catastrophes, terrorist attacks, epidemics or pandemics anywhere in the world where the Company or its clients do business, (25) interruption or failure of the Company’s telecommunication, information technology or other operational systems, or the Company’s failure to maintain adequate security to protect the confidentiality or privacy of personal or sensitive data stored on such systems, (26) changes in laws, regulations, and accounting standards applicable to the Company, its subsidiaries, or its business, (27) the effect of the Company’s status as an insurance holding company and regulatory restrictions on its ability to pay principal of and interest on its debt obligations, and (28) other risks and uncertainties described in this document and in the Company’s other filings with the Securities and Exchange Commission.
Forward-looking statements should be evaluated together with the many risks and uncertainties that affect our business, including those mentioned in this document and described in the periodic reports we file with the Securities and Exchange Commission. These forward-looking statements speak only as of the date on which they are made. We do not undertake any obligations to update these forward-looking statements, even though our situation may change in the future. We qualify all of our forward-looking statements by these cautionary statements. For a discussion of the risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements, you are advised to review the risk factors in our most recent Form 10-K.
Agenda 2
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Non-GAAP Measures
RGA uses a non-GAAP financial measure called “operating income” as a basis for analyzing financial results. This measure also serves as a basis for establishing target levels and awards under RGA’s management incentive programs. Management believes that operating income, on a pre-tax and after-tax basis, better measures the ongoing profitability and underlying trends of the company’s continuing operations because that measure excludes the effect of net realized capital gains and losses, changes in the fair value of certain embedded derivatives and related deferred acquisition costs. These items tend to be highly variable primarily due to the credit market and interest rate environment and are not necessarily indicative of the performance of our underlying businesses. Additionally, operating income excludes any net gain or loss from discontinued operations, which management believes is not indicative of the company’s ongoing operations. The definition of operating income can vary by company and is not considered a substitute for GAAP net income.
Additionally, the Company evaluates its stockholder equity position excluding the impact of “Other Comprehensive Income”.
This is also considered a non-GAAP measure. The Company believes it is important to evaluate its stockholders’ equity position to exclude the effect of Other Comprehensive Income since the net unrealized gains or losses included in Other Comprehensive Income primarily relate to changes in interest rates, credit spreads on its investment securities and foreign currency fluctuations that are not permanent and can fluctuate significantly from period to period.
Reconciliations of non-GAAP measures to the nearest GAAP measures are provided at the end of this presentation.
Agenda 3
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Agenda
Opening Remarks Jeff Hopson, Senior Vice President, Investor Relations
Overview A. Greig Woodring, President, Chief Executive Officer, and Director
Global Financial Solutions John P. Laughlin, Executive Vice President, Global Financial Solutions
U.S. and Latin America Anna Manning, Executive Vice President, Head of U.S. and Latin American
Traditional Markets
Canada Alain P. Néemeh, Executive Vice President, Australia and Canada
Australia and New Zealand
20-Minute Break
Asia Allan E. O’Bryant, Executive Vice President, Head of Asia Markets
Europe, Middle East and Africa Paul Schuster, Senior Executive Vice President, Head of EMEA Markets
(EMEA)
Financial Overview Jack B. Lay, Senior Executive Vice President and Chief Financial Officer
Q&A Session A. Greig Woodring, President, Chief Executive Officer, and Director
Agenda 4
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Global Growing Unique
A. Greig Woodring
President and Chief Executive Officer
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
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Key Messages
RGA is a major global competitor Growth opportunities are still abundant RGA is a unique company Solid top line growth, attractive returns
Overview 6
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RGA Is a Major Global Competitor
One of the top-tier reinsurers that dominate the global landscape
RGA, established in 1973, emerged as a leader in the early
expansion period of the industry (1985-2000)
International expansion is not new – a 20-year effort has produced
a well-established and seasoned operation
Leading market share in many key markets
Global build-out is basically complete – we expect to leverage
scale and capabilities in the years ahead
Overview 7
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Growth Opportunities Are Still Abundant
Core U.S. mortality business has matured, but we expect it to provide a solid base of profits and excess capital Canadian segment continues to produce solid growth and strong profitability Demand for reinsurance solutions across a range of geographies, products, and clients remains strong Expanded capabilities create full “solution set” to serve clients comprehensively and effectively Ongoing regulatory uncertainty creates opportunities for a wide range of organic solutions, in-force block deals, traditional M&A Global Financial Solutions (GFS) is a distinct growth driver and an important part of the solution set offered to clients Emerging opportunities in longevity, alternative distribution and closure of the protection gap of an under-insured U.S. middle class
RGA is well-positioned in key markets
Overview 8
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RGA Is a Unique Company
The only pure-play, publicly traded life/health reinsurer
Consistently recognized for high client satisfaction, facultative
underwriting expertise, reputation for quality
Entrepreneurial, innovative, collaborative culture
Deep and experienced management team
Innovative technology solutions, cutting-edge actuarial/medical
research
Global flexibility to put marginal capital in areas with the strongest
demand and highest risk-adjusted returns
Our North American insurance in-force is a valuable asset –
intrinsically (embedded value) and strategically
In the right places, with the necessary skills
Overview 9
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A Truly Global Competitor
Substantial presence in almost every market where our multinational clients have significant operations
Canada Ireland United Kingdom Netherlands Poland Germany France Italy United States Turkey China Japan South Korea Spain Taiwan Hong Kong United Arab Emirates India Singapore Malaysia Bermuda Australia New Zealand Barbados Mexico South Africa
RGA is a global leader serving multinational and domestic clients in more than 60 countries
Overview 10
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Top 10 Global Life and Health Reinsurers
Ranked by 2013 Net Earned Premiums
($ Millions as of December 31, 2013)
Rank Reinsurer Net Earned Premiums
1 Munich Re1 13,802
2 Swiss Reinsurance Company 9,967
3 Reinsurance Group of America 8,254
4 SCOR Global Life Re2 7,142
5 Hannover Re 7,130
6 London Re3 3,750
7 General Re4 2,977
8 China Life Re5 2,381
9 Partner Re 957
10 PacLife 896
1Does not include Munich Health.
2Pro Forma assuming a full year of Generali U.S. 3Includes premiums for Irish Life.
4Does not include BHRG results. 5Figure is for 2012.
Sources: Annual filings, A. M. Best insurance reports. Overview 11
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Experienced Executive Management Team
Name Position Years in Years
Industry¹ with RGA
A. Greig Woodring President, Chief Executive Officer, and Director 38 35
Jack B. Lay Senior Executive Vice President and Chief Financial Officer 23 20
Paul A. Schuster Senior Executive Vice President, Head of EMEA 37 23
Donna H. Kinnaird Senior Executive Vice President and Chief Operating Officer 30 2
Scott D. Cochran Executive Vice President, Global Acquisitions 19 9
John P. Laughlin Executive Vice President, Global Financial Solutions 31 19
Anna Manning Executive Vice President, Head of U.S. and Latin American Markets 32 7
Robert M. Musen Executive Vice President, Chief of Staff 36 14
Alain P. Néemeh Executive Vice President, Australia and Canada 17 17
Allan E. O’Bryant Executive Vice President, Head of Asia Markets 26 4
Depth of experience differentiates RGA
1Includes experience in life insurance and life reinsurance industries. Overview 12
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NMG Consulting Studies, Business Capability Index – 2013
Average: 67.8 (2012); 69.4 (2013)
D E
B A
C
As at December 31, 2013 RGA was again the top-rated reinsurer on BCI globally. The average BCI rating lifted by 1.5 points (significant given the size of the respondent sample).
Two competitors now have a BCI rating above 70 points.
65 70 75
Global
Market Penetration (%)
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
[2013: 1162 (862)]
Note: Figures in [ ] show no. of respondents and no. of insurers in ( ), respectively. Overview 13
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Estimated Market Size and Shares – Individual and Group
Contestable Cessions to June 30, 2013
Tier 1 Reinsurers
Munich Re, RGA, Swiss Re
Defined by:
Global servicing capacity Ability to lead at global accounts Proposition breadth
Tier 2 Reinsurers
Hannover Re, Gen Re, SCOR
Defined by:
Nearly global, multi-regional Ability to service complex buyers
Tier 3 Reinsurers
Partner Re, Pacific Life Re, …
Defined by:
Relative size Narrower proposition Limited coverage
Individual New Cessions
(US$2.3b, % market share)
Group Total Cessions
(US$6.3b, % market share)
1.4b 1.3b 2013 2014
3.4b 3.5b
60% 58% 56% 56%
25% 27% 15% 15%
22% 23% 22% 21%
Tier 1 Tier 2 Tier 3
Tier 3 Tier 2 Tier 1
Anticipated market share by reinsurer tier was derived from contestable cessions ceded by insurers within the sample. Overview 14 Source: NMG Consulting, Life & Health Reinsurance Programme 2011-12, Global Overview.
Tier 1 reinsurers account for 60% of contestable cessions for individual business within our sample, with broadly equal shares. The ‘Global Six’ account for ~85% of global contestable individual new cessions, and nearly 80% of total contestable group cessions. Tier 2 competitors saw a lift in retail share.
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Strategic Rationale – International Expansion, Added Capabilities
Maturation of the U.S. life segment, stronger life insurance growth and demand for reinsurance in international markets Multinational clients need help and support as they enter new markets U.S. and RGA specific skills, expertise, technology, and product development are in demand and easily transferable Demographics are driving an increased interest in living benefits on a global basis Natural linkages between mortality and morbidity, given RGA’s expertise in medical/health issues and trends Expansion of our Financial Solutions business into a global effort (GFS) is a natural response to strong client demand
Overview 15
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Expanding Global Presence
Non-U.S. Premiums as a Percent of Consolidated Premiums
USA 13% 20% 32% 42% 45%
1973 1992 1994 1995 1996 1997 1998 1999 2002 2005 2006 2007 2008 2009 2011 2013
Year of Office Opening
Canada Spain Hong Kong Japan Australia Malaysia South Africa United Kingdom Mexico
Taiwan South Korea India China Poland France Italy Germany Netherlands U.A.E Turkey
Note: Figures exclude Corporate segment. Overview 16
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Timely Topics
Increased competition in U.S. mortality – perspective on its impact to RGA
Australia – is developing in line with expectations; we remain diligent and active in seeking to improve our results and change the industry dynamics; we are preparing for any opportunities that emerge First quarter 2014 results – a spike in mortality claims, but EPS held up reasonably well; seasonal effect on claims more extreme, but no detectable systemic problems; GFS and Asian operations performed well with overall premium growth at high end Global Acquisitions
We continue to be active, but disciplined, in our decision-making We continue to win smaller, under-the-radar transactions, but most of our top-line growth is organic
Overview 17
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RGA – A Long Track Record of Success
Book Value Per Share (ex-AOCI)1
($ Millions) $80 $69.66
$70 $64.95
$60 $57.25 $52.80
$50 $41.01 $45.86 $40.36
$40 $36.59 $34.06 $31.08
$30 $27.73 $20 $10 $0
4Q03 4Q04 4Q05 4Q06 4Q07 4Q08 4Q09 4Q10 4Q11 4Q12 4Q13
10-year CAGR 9.6% 5-year CAGR 11.1%
1 Continuous increase in value
Book value excludes other comprehensive income.
Periods prior to 4Q06 not restated for 2012 DAC accounting change. Overview 18 Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
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RGA Today
U.S. mortality is at our core, but we have successfully expanded our geographic reach and capabilities over time Our traditional lines and geographies have matured, provide a stable base of earnings and excess capital, and offer select opportunities (LTC, impaired annuities, longevity) The building of the global platform and associated support and infrastructure is largely complete We have very strong client relationships, and offer a full solution set and holistic approach to serving clients We have faced considerable macro-challenges: a mature U.S. life industry, extended period of lower interest rates, an underperforming block, and a weakened Australia Group market We have dealt with these issues and still performed well
Overview 19
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Going Forward
We are optimistic – RGA is well-positioned in key global markets, and we see strong overall demand for our products and services We are leveraging our knowledge, skills, and full solution set across our global platform GFS is a key part of our solution set, and is expected to continue to be an important element of our overall success We can be opportunistic and flexible in shifting marginal capital and emphasis to areas of greatest demand and highest risk-adjusted returns We will focus on execution – RGA is intent on delivering an attractive, balanced combination of growth, profitability, and shareholder returns
Overview 20
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Global Financial Solutions
John P. Laughlin
Executive Vice President, Global Financial Solutions
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
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Overview
Comprising three lines of business
Globally managed
Closely integrated with geographies
Large, complex transactions that add significant income Require deep analytical and regulatory expertise High-return businesses Solid income growth Continued client demand
Global Financial Solutions 22
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Global Financial Solutions
Lines of Business Objectives
Capital-Motivated Provide tailored capital Reinsurance and risk solutions to Asset-Intensive clients Reinsurance Create uncorrelated Longevity Reinsurance income through innovation and execution Leverage deep client relationships and product experience Leverage expertise across global markets
Global capital and risk solutions
Global Financial Solutions 23
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Senior Management Team
Name Position Years in Years
Industry¹ with RGA
John P. Laughlin Executive Vice President, Global Financial Solutions 31 19
David Boettcher Executive Vice President and Chief Operating Officer 31 16
Larry S. Carson Senior Vice President, Chief Pricing Actuary 21 16
Brian Haynes Senior Vice President, Chief Risk Officer 16 3
Gary Seifert Senior Vice President, North America 25 19
Greg M. Goodfliesh Senior Vice President, Asia Pacific 22 18
Paul Sauvé Vice President, Europe, Middle East, Africa 22 8
Hamish Galloway Vice President, U.K. 27 15
Darlene Desroches Vice President, Administration 26 19
Experienced team – difficult to replicate
1Includes experience in life insurance and life reinsurance industries. Global Financial Solutions 24
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Global Financial Solutions
Environment Trends Opportunities RGA Advantage
Increased regulation Increased demand for Provide expertise, capital, Deep client relationships efficient capital and risk risk-sharing
Long partnerships
Increased capital management requirements Asset-Intensive across client
Rebalancing of risk and coinsurance organizations
Accounting changes repositioning capital-heavy products Embedded-value Historical
Low interest rates transactions understanding of
Increased focus on clients’ products and Capital-motivated institutional longevity reinsurance objectives protection
Full solution set; ability to
Longevity transfer solutions accept and retain all insurance risks
Strong expertise and experience
Credibility with regulators
Industry reputation for executing
Environment, trends, creating opportunities
Global Financial Solutions 25
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Capital-Motivated Reinsurance
Current State Strategies Expected Results
Seasoned experts Expand strategic 8%—14% well-positioned in accounts in developed intermediate-term North America, Asia markets: U.S., Japan growth in operating and Europe and Canada income1 Leading presence in Combine financial Continued expansion U.S. and Japan structuring expertise in international Pressure on efficient with strong local client markets capital management relationships in targeted markets Deep understanding of clients’ products due U.S. Group and Health to decades of Taiwan reinsuring France
China
Barriers to entry
Expanding market-leading expertise into targeted global markets
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Global Financial Solutions 26
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Asset-Intensive Reinsurance
Current State Strategies Expected Results
Established business Reinsure products in 10%—15% in U.S. favorable environments intermediate-term Strong pricing and risk Target well-designed growth in operating products from quality income1 management skills direct writers Balanced portfolio of Ability to review and support all investment Expand in established income and risks products markets: U.S. and Diversification from Japan biometric risks Doesn’t require distribution force or fixed Deploy resources into Valuable review partner admin expenses new markets: U.K., to clients Canada, and Hong Defined appetite allows Kong selective participation in profitable opportunities Actively manage in-force to maximize Flexibility as economics profitability change
Optimally positioned to deliver profitable growth
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Global Financial Solutions 27
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Longevity
Current State Strategies Expected Results
Established provider in Expansion into targeted 10%—15% U.K., Canada markets: U.S. and intermediate-term Netherlands growth in operating Solid analytical and risk Continued production, income1 management expertise profits in established Hedge to large mortality Very strong current and markets position projected demand Combine Longevity and Organic profits on in-force Asset-Intensive business solutions Selectively target markets with good underlying data
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Global Financial Solutions 28
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Capital-Motivated Reinsurance
Pre-tax Operating Income1
($ Millions) $125
$100 $75 $50
$25
Actual Projection
$0
2009 2010 2011 2012 2013—2016
Capital-Motivated U.S. Capital-Motivated International
29% CAGR CAGR 8-14%
Steady growth in developed markets and target markets; expansion strategies continue
14 new transactions in 2013, up 27% year over year
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Global Financial Solutions 29
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Asset-Intensive Reinsurance
Pre-tax Operating Income1
($ Millions) $240
$200 $160 $120 $80
$40 Actual Projection
$0
2009 2010 2011 2012 2013—2016 Other FA/BOLI VA EIA
Significant, diversified profit growth Balanced portfolio of risks
35% CAGR CAGR 10-15%
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Global Financial Solutions 30
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Longevity
Pre-tax Operating Income1
($ Millions) $60
$50 $40 $30 $20
$10 Actual Projection
$0
2009 2010 2011 2012 2013—2016
Growing source of diversified income; hedge to large mortality position 4 new transactions in 2013, up 33% year over year
51% CAGR CAGR 10-15%
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Global Financial Solutions 31
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Global Financial Solutions 32
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U.S. and Latin America Traditional
Anna Manning
Executive Vice President, Head of U.S. and Latin American Markets
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Overview
Key Messages
Market leader, premier reinsurer focused on client needs Predictable, long-term, substantial profits Facultative leadership Successful product line expansion Market-leading services, capabilities, expertise and innovation Substantial value embedded in the in-force Downward trend in interest rates has been a headwind, CAGR reduced 2%—4%
Pre-Tax Operating Income1
($ Millions) 600
500 400 300 200
100
Actual Projection
0
2009 2010 2011 2012 2013 … 2016 Individual Mortality LTC Group Latin America
Long-term solid earnings
2.9% CAGR 4-6% CAGR
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. U.S. and Latin America Traditional 34
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Financial Results
Pre-tax Operating Income1
($ Millions) ($ Millions) 190 380
150 300
110 220
Quarterly 70 140 Annual
30 60
-10 -20
2009 2010 2011 2012 2013
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Individual Mortality LTC Group Latin America “Annual (second axis)”
Long-term stability, some short-term volatility
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. U.S. and Latin America Traditional 35
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Net Premiums
Strengths
Consistent approach to the market through all cycles Leading brand, leader in client satisfaction Top-tier market share in all business lines Strong appetite and capacity for attractive block opportunities Experienced management team
($ Millions) Net Premiums
6,000
5,000
4,000
3,000
2,000
1,000
Actual Projection
0
2009 2010 2011 2012 2013 … 2016
Individual Mortality LTC Group Latin America
8.2% CAGR 4-6% CAGR
Solid growth
U.S. and Latin America Traditional 36
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Senior Management Team
Name Position Years in Years
Industry¹ with RGA2
Anna Manning Executive Vice President, Head of U.S. and Latin American Markets 32 7
Group
Michael L. Emerson Executive Vice President, U.S. Group Reinsurance and Latin America 29 14
Jim Rathburn Senior Vice President, U.S. Group Life, Accident and Disability 24 24
Steven J. Abood Senior Vice President, Quota Share Healthcare Reinsurance 33 5
Michelle Fallahi Senior Vice President, Excess Healthcare Reinsurance 32 14
Dean Abbott Senior Vice President and Chief Actuary, U.S. Group 27 11
Mortality
Tim Rozar Senior Vice President, Global Research and Development 18 18
Douglas J. Knowling Senior Vice President, Chief Actuarial Officer, Mortality 28 12
Dave P. Wheeler Senior Vice President, Chief Underwriting Officer, Mortality 33 33
Paula Boswell-Beier Senior Vice President, Chief Operations Officer, Mortality 21 21
Kathryn Cox Vice President, Head of Business Development, Mortality 23 23
Long Term Care
Wayne Adams Senior Vice President, U.S. Individual Health 32 32
Bruce Stahl Vice President and Actuary, U.S. Long Term Care 36 7
Latin America
Scott Rastin Senior Vice President, Head of Latin America 20 15
Jorge Campa Managing Director, Mexico 24 5
1 Deep and experienced management team
Industry includes life insurance and life reinsurance experience. 2Includes experience with RGA’s predecessor, the reinsurance division of
General American Life Insurance Company and ING Group U.S. and Latin America Traditional 37
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Reinsurance Cession Rates
U.S. Ordinary Individual Life Sales`
($ Billions) ($ Billions) 2,000 Growth Decline Stability 2,000 1,800 1,800 1,600 1,600 1,400 1,400 1,200 1,200 1,000 1,000 800 800 600 600 400 400 200 52% 62% 59% 61% 60% 56% 47% 40% 36% 35% 34% 30% 27% 26% 27% 200
0 0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Amount Reinsured Amount Retained % Reinsured Total Volume Trend Amount Reinsured Trend
Recent stabilization of reinsurance cession rates
Source: Munich America/Society of Actuaries Reinsurance Surveys/LIMRA. U.S. and Latin America Traditional 38
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U.S. Individual Mortality – Reinsurance Consolidation
Individual Ordinary Recurring New Business – Market Share
100% 80% 60% 40% 20% 0%
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
28.2%1
1st 2nd 3rd 4th 5th 6th All Others
RGA
12013 consolidation of the number 3 and 4 reinsurers as measured by new business market share – Scor acquired the U.S. business of Generali
Continued reinsurer consolidation
Source: Munich America/Society of Actuaries Reinsurance Surveys.
U.S. and Latin America Traditional
39
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U.S. Individual Mortality – Reinsurance Cessions
Individual Ordinary Recurring New Business
($ Billions)
1,200
1,000
800
600
15%
12% 11%
400
11% 20% 17% 12%
19%
200
22% 23% 24%
22% 26% 22% 20%
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
1st 2nd 3rd 4th 5th 6th All Others
RGA
Pricing discipline in competitive markets
Source: Munich America/Society of Actuaries Reinsurance Surveys.
U.S. and Latin America Traditional
40
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Update on Underperforming Era
Key Messages
Experience consistent with previous results and management expectations
Stable results over last 2 years
We anticipate that the impact will continue to shrink over time
Premiums by Era
2013
Projected 2023
Pre-1999
1999-2004
2005+
Claims study Experience for 1999-2004 Era Business1
($ Billions)
1.2
0.6
0.0
2007
2008
2009
2010
2011
2012
2013
Original Pricing
Actual Experience
Performance remains consistent with management expectations
1Experience study results on approximately 85% of era business.
U.S. and Latin America Traditional
41
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Update on Value Embedded in In-force
Key Messages
Sizeable block of in-force business
Significant source of future earnings already embedded in the business
New business expected to contribute additional value
Actuarial Liabilities – U.S. GAAP vs. Best Estimate
(In force as of December 31, 2013)
Considerable projected future value
($ Billions)
6
3
0
2013
2023
2033
2043
2053
2063
2073
2083
Projected Future Value
US GAAP Liabilities
Best Estimate Liabilities
Significant future value from the existing business
U.S. and Latin America Traditional
42
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Extensive Package of Differentiators
Relationship
Client and industry recognition (Flaspöhler, NMG, Best’s Review)
Strong multilevel client relationships
Client outreach and focus
Deep and well-established relationships
Innovation
Product offerings
Underwriting
Services
Research and development
Service
Responsiveness
Competitive offers
Special programs
Administration
Claims partnership
Education and training
Technical Expertise
Capacity
Underwriting specialties
Industry participation
Actuarial insights
Technology
Use of big data
Long-term client focus, delivering value through key differentiators
U.S. and Latin America Traditional
43
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Special Programs – The ROSE® Savings Equation
Consulting and Education Services
Perinatal and Neonatal Case Management
Transplant Networks
Claims Repricing and Negotiations
In 2013, the ROSE® program helped 93 clients manage their catastrophic health care claims while supporting quality outcomes for insureds
Over $17.5 million in savings achieved in 2013
The ROSE® program is a key value-added service differentiator for RGA
Value-added services produce tangible financial results
U.S. and Latin America Traditional
44
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Research – Industry Collaboration
Key Messages
Objectives
Strengthen RGA’s brand as leading industry research authority
Continue RGA’s recognition as expert on post-level term
Build industry consensus on post-level term lapse and mortality
Communication
Publications and presentations through SOA channels
RGA webcasts, publications and industry presentations
Frequently referenced by industry peers and competitors
Benefits
Reduce assumption gaps between RGA and clients/competitors
Help educate industry and move industry thinking on level-term products
Support in-force optimization opportunities
Research and development leading to enhanced opportunities
U.S. and Latin America Traditional
45
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Innovation – Use of Big Data
Key Messages
Existing client data can be mined to identify suitable customers for cross-sell opportunities
Models utilize internal client data as well as an extensive array of third-party data
Models identify subset of customers for conditionally pre-approved life insurance offers
Improves cross-sell rates to existing customers
RGA models the data and receives a percentage of the risk on business generated from the models
Existing Customer Database
Underwriting Pre-Screen Model
Pre-Screened Target Market
Propensity to Buy Model
Target Applicant Pool
Conditional Offers
Applicants
Confirmatory Underwriting
Cases
Innovative solutions creating data-driven growth opportunities
U.S. and Latin America Traditional
46
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Expanded Capabilities, Expanded Opportunities
Mortality
In-force block opportunities
Continue to leverage our facultative underwriting expertise
Use of predictive analytics, data and risk selection expertise to fuel data-driven growth
Large protection gap; combining distribution, product development, risk selection and technology
Group
Expanded opportunities due to changes in the market, largely prompted by healthcare reform
Product development and underwriting application opportunities in the voluntary market among employee benefits carriers
Opportunities to grow quota share coverages, turn-key markets, specialty products, voluntary markets and health-related products
2013 Net Premiums
Mortality
LTC
Group
Latin America
Long-Term Care
Increased penetration among top writers
Product development to address affordability in an effort to expand the market
Expanded partnerships to support new entrants as products become less risky and demographics expand
U.S. and Latin America Traditional
47
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Summary
Solid growth of 4% to 6% is expected over the intermediate term
Individual mortality has matured, and provides a base of stable earnings and capital generation
Significant value embedded in the in-force is anticipated to generate predictable long-term earnings
Product line expansion expected to continue to contribute growth and risk diversification
Pricing discipline and approach will remain consistent across all markets
Underwriting, analytics, and innovation leadership will continue to support growth opportunities and benefit our clients
Quality and breadth of our services and capabilities are differentiators and will continue to set us apart from the competition
U.S. and Latin America Traditional
48
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Canada
Alain P. Néemeh
Executive Vice President, Australia and Canada
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Overview
Key Messages
Market leader with solid
growth and profitability
2013 met expectations
following exceptionally
strong 2011 and 2012
Projection includes effect
of currency and low
interest rates
Substantial value
embedded in the in-force
Expanding capabilities to
maintain growth
Seasoned management
team
($ Millions)
$250 $200 $150 $100 $50 $0
Pre-tax Operating Income1
2009 2010 2011 2012 2013 … 2016
Individual Life Group Creditor Group Life and Health Individual Living Benefits Longevity
13.8% CAGR
8-10% CAGR
Actual
Projection
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
Canada
50
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Net Premiums
Key Messages
Strong core business
Successfully diversifying our product offering
Leveraging global expertise
Individual life premiums expected to grow 6% in original currency
Projected 2016 net premium includes effect of currency
($ Millions)
Net Premiums
11.9% CAGR
5-8% CAGR
$1,400 $1,200 $1,000 $800 $600 $400
$200
Actual Projection
$0
2009 2010 2011 2012 2013 … 2016
Individual Life Group Creditor Group Life and Health Individual Living Benefits Longevity
Canada
51
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Senior Management Team
Years in Years
Name Position Industry¹ with RGA
Alain P. Néemeh President and Chief Executive Officer 17 17
Micheline Dionne Senior Vice President and Chief Actuary 36 14
Brian Louth Senior Vice President, Development and Chief Marketing Officer 32 11
Alka Gautam Senior Vice President and Chief Financial Officer 14 14
Gary Walters Senior Vice President, Pricing and Group Reinsurance 31 10
Elizabeth Boulanger Vice President and Appointed Actuary 26 8
1Includes experience in life insurance and life reinsurance industries.
Canada
52
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Individual Life Market
Key Messages
Solid growth helps RGA maintain its leading market share for the 7th consecutive year
Stable reinsurance demand
Expect life reinsurance penetration to decrease slightly over time
($CAD Billions) $250
34.4%
33.1% 33.1%
32.1% 31.9%
Sales $200 Life $150
$100
Individual 74.0%
71.3% 70.3%
65.3% 64.7%
Ordinary $50
$0
1
2009 2010 2011 2012 20131
40%
35%
30%
25% Share
20% Market
15%
10% RGA
5%
0%
Amount reinsured Amount retained
RGA market share (2nd axis)
Source: Munich American/Society of Actuaries Reinsurance Surveys. 12013 Individual Sales Estimate per CLHIA.
Canada
53
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Individual Life
Individual life premiums projected to grow 6%, half of which is from the in-force
#1 in the NMG study for fifth consecutive year:
Highest market penetration
Strongest client portfolio quality
Strong, multilevel client relationships
Facultative underwriting leader
Significant value embedded in the in-force
Potential future growth reflecting breakthrough in the underserved middle market not incorporated in our projections
Canada
54
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Update on Value Embedded in In-force
Key Messages
Sizeable block of in-force business
Significant source of future earnings already embedded in the business
New business expected to contribute additional value
Actuarial Liabilities – U.S. GAAP vs. Best Estimate
(In force as of December 31, 2013)
($ Billions)
6
3
0
2013
2023
2033
2043
2053
2063
2073
2083
Projected Future Value
US GAAP Liabilities
Best Estimate Liabilities
Considerable projected
future value
Significant future value from the existing business
Canada
55
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Expanded Capabilities, Expanded Opportunities
Group Life and Health
Expertise and client service excellence validated by #1 ranking in NMG study
Leveraging global experience
Living Benefits
#1 in NMG study with key decision-makers
Approximate one-third market share of new critical illness reinsurance (face amount)
Longevity
Continuing interest from both pension plans and insurance companies
Leveraging our success in other markets
Opportunistic transactions due to regulatory and capital changes
Recently closed innovative group in-force structure
Coinsurance solutions and alternate structures provide opportunity to reinsure more than just mortality risk
Canada
56
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Summary
Strong track record of profitable growth
Established leader across all product lines with strong multi-level client relationships
Solid growth rates of 5%-8% premiums and 8%-10% earnings expected
Substantial value embedded in the in-force
Strategic and disciplined diversification
Well-positioned for opportunistic transactions leveraging our successful GFS platform
Canada
57
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Canada
58
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Australia and New Zealand
Alain P. Néemeh
Executive Vice President, Australia and Canada
|
|
Overview
Key Messages
Comfortable with current level of reserves
Expecting breakeven/ modest profitability for 2014
Claims can be lumpy, creating some quarterly volatility
Industry still needs to rationalize
Early signs of positive change in the Group market
1Excludes corporate overhead expenses.
Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
($ Millions)
$50
$25
$0
$-25
$-50
$-300
2009
2010
2011
2012
2013
Pre-tax Operating Income1
Australia and New Zealand
60
|
|
Net Premiums
Key Messages
Premium growth not an objective until market changes
Material price increases in the Group renewals
Premium volumes will fluctuate with renewal rate increases offset by cancellations
Net Premiums
13.8% CAGR
($ Millions) $900
$800 $700 $600 $500 $400 $300 $200 $100 $0
2009 2010 2011 2012 2013
Group Lump Sum Group Disability Individual Lump Sum Individual Disability
Australia and New Zealand
61
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Drivers of Poor Results
Very competitive direct and reinsurance markets
Generous underwriting limits and fewer requirements
Complex product designs
Weakening claims experience
Long and lengthening TPD reporting delays
Increasing legal activity encouraging claims many years after initial incident
Australia and New Zealand
62
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Industry Net Profits
Net Industry Individual Profitability
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
Premiums) of % (as
Margin Profit
2008 2009 2010 2011 2012 2013
-5.0%
-10.0%
Financial Year
Individual Individual Disability Lump Sum Income
Net Industry Group Profitability
15.0%
10.0%
5.0%
0.0%
-5.0%
Premiums) of % (as
Margin
Profit
2008 2009 2010 2011 2012 2013
-10.0%
-15.0%
Financial Year
Group Group Disability Lump Sum Income
Quarterly Life Insurance Performance Statistics.
Australian Prudential Regulatory Authority, March 2009 to December 2013.
Challenging profitability is an industry issue
Australia and New Zealand
63
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Recent Industry Headlines
APRA seeks sustainability in group insurance
“Insurance will be a key focus for APRA; we are concerned about the current pricing level and the approach in tenders in the group insurance market”
The Insto Report, December 10, 2013
FSC pushes for disability time limit
“The FSC will seek amendments to legislation to introduce a seven-year limitation on group insurance disability claims”
Insurance News, April 7, 2014
Australia problems hit Swiss Re Life profit
“The further reserve strengthening was due to additional data we received and the conclusion of internal and external reviews”
Insurance News, February 26, 2014
TPD policies run ‘risk of becoming too expensive’
“If the definitions are left unchanged, TPD insurance policies will become completely unaffordable”
The Australian, March 4, 2014
AMP tells insurers to adapt or fail
“Simply put, the current business model for life insurance in Australia needs to change”
Australian Financial Review, May 9, 2014
Claims growth pushes TAL payouts to $843m
“The huge increase in the amount of life insurance payments made to customers in 2013 reflected an industry trend of rising claims as people become more aware of their life insurance policies”
Australian Financial Review, April 3, 2014
Australia and New Zealand
64
|
|
Senior Management Team
Name Position Years in Years
Industry¹ with RGA
Mark Stewart Managing Director 20 7
Duncan Rawlinson Chief Financial Officer and Chief Risk Officer 25 2
André Dreyer Head of Business Development 18 8
Martyn Gilling Vice President, Special Projects and Chief Pricing Actuary 25 3
Nadine Gooderick Chief Operating Officer 18 17
Lydia Aguerre Human Resources Director 7 7
Ian Enright Senior Vice President and Chief Legal Counsel 30 4
1Includes experience in life insurance and life reinsurance industries.
Australia and New Zealand
65
|
|
Group Market
Actions Taken
Suspended TPD quoting on new treaties
Completed “lessons learned” exercise
Promoted product change with industry participants
Initiated claims management paradigm shift
Initiatives Underway
Continuing claims management paradigm shift and promoting industry change
Focusing on improvements needed to underwrite profitable business
Selectively quoting – where TPD product design has changed
Renewing quotes on changing terms and/or material price increases
Australia and New Zealand
66
|
|
Individual Market
Actions Taken
Repriced 45% of the portfolio
Lost some treaties not meeting our hurdle rate as a consequence
Discussed with industry participants to promote product change
Initiatives Underway
Reviewing our pricing basis to reflect emerging experience
Repricing as required
Contributing to industry sustainability dialogue
Strengthening claims adjudication through the claims management paradigm shift
Australia and New Zealand
67
|
|
Australian Life Reinsurance Market Overview
Reinsurance Market Size and Trend – Individual and Group Premiums1
($ Millions)
Key Messages
One of the largest life and health reinsurance markets globally
Highly competitive market
Material product changes being discussed that could result in different growth patterns
Individual New Reinsured Premiums
Group Total Reinsured Premiums
21.5% CAGR
19.4% CAGR
1,613
337
307
1,413
263
1,142
220
965
188
902
141
696
Actual Projection Actual Projection
2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014
No. of Cedants
27 28 32
32 31 31
17
15 18
17
16 16
1NMG Consulting, Life & Health Reinsurance Programme 2013-14, Australia & New Zealand
Australia and New Zealand
68
|
|
Summary
Early indications that industry is stabilizing
Improving the claims process and shifting the paradigm, both internally and with clients
RGA prepared to re-engage, subject to market rectification
Focus on profitability, not premiums
Targeting moderate profitability post-2014
Australia and New Zealand
69
|
|
Australia and New Zealand
70
|
|
Allan E. O’Bryant
Executive Vice President, Head of Asia Markets
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
|
|
Overview
Key Messages
Innovative products generating high and increasing returns Growing high net worth business in Southeast Asia is performing well Global Financial Solutions business in key markets continues to grow Claims experience in Asia continues to be better than expected Leading franchise and footprint
Pre-tax Operating Income1
15.7% CAGR
15-20% CAGR
($ Millions)
250 200 150 100 50 0
2009 2010 2011 2012 2013 2016
Actual
Projection
Accelerating growth from well-diversified businesses
1Excludes Corporate Overhead and Australia.
Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
Asia
72
|
|
Pre-tax Operating Income
Pre-tax Operating Income1
($ Millions)
Quarterly
60 40 20 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
($ Millions)
140 120 100 80 60 40 20 0
2009 2010 2011 2012 2013
Quarterly Annual (second axis)
Minimal long-term volatility against a background of sustained growth
1Excludes Corporate Overhead and Australia.
Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
Asia
73
|
|
Net Premiums
Key Messages
Economic growth and demographic trends leading to rapid growth in insurance market, protection and living benefits
Accelerating demand for high net worth products due to increase in per-capita wealth
Use of more advanced reinsurance solutions in mature markets
Japan and Korea pipelines recover, helped by advanced e-underwriting solutions, product development
Net Premiums1
($ Millions)
5.8% CAGR
10-15% CAGR
1,000
800
600
400
200
0
Actual
Projection
2009 2010 2011 2012 2013 2016
Asia primed for strong sustained growth
1Excludes Australia.
Asia
74
|
|
Net Premium by Product Line
2013 Distribution by Product Type
Financial Solution $ Other
Living Benefits
Critical
lIIness
Group
Individual life
100%
80%
60%
40%
20%
0%
Hong Kong & SE Asia
Japan
India
Korea
Taiwan
Individual Life
Critical lllness
Financial Solutions & Other
Group
Living Benefits
Regionally balanced portfolio of locally diversified businesses
Asia
75
|
|
Office Locations and Dates of Entry
China1 2005
India 2002
Japan 1995
South Korea 2002
Taiwan 1999
Hong and Southeast Asia 1995
1Representative office established in 2005.
Well-established, market-leading footprint
Asia
76
|
|
Senior Management Team
Name Position Years in Years
Industry¹ with RGA
Allan E. O’Bryant Executive Vice President, Head of Asia Markets 28 4
Enda Murphy Managing Director, RGA International Reinsurance Company Limited 28 7
and Executive Vice President and Chief Operating Officer,
International Operations
Jonathan Porter Senior Vice President and Chief Pricing Actuary, International Markets 22 5
Tony Cheng Chief Executive Officer and Senior Vice President, Head of Asia 19 15
Yusuke Asai Chief Executive Officer, Japan 10 1
Shih Nin Low Chief Executive Officer, Taiwan 23 3
Jason Ou Chief Representative, China 23 11
Amit Punchhi Managing Director, India 24 3
Michael Shin Chief Executive Officer, Korea 27 2
Peter Tan Chief Executive Officer, Emerging South East Asia Markets 28 5
A strong management team of industry leaders with diverse backgrounds
1Includes experience in life insurance and life reinsurance industries.
Asia
77
|
|
Value Embedded in In-force
Key Messages
In-force block is a large contributor to RGA’s total value Best estimate liabilities are negative due to high proportion of business assumed on a risk premium basis Robust new business growth rates would contribute strong additions to future earnings
Actuarial Liabilities – U.S. GAAP vs. Best Estimate
(In force as of December 31, 2013)
($ Billions)
0.4
0.1
-0.2
-0.5
-0.8
2013
2023
2033
2043
2053
2063
2073
2083
Projected Future Value
US GAAP Liabilities
Best Estimate Liabilities
Considerable projected future value
Significant future value from the existing business
Asia
78
|
|
Differentiation from Competition
Relationship
Client and industry recognition –
#1 NMG ranking and product development awards
Strong multilevel client relationships
Client outreach and focus
Consistent entrepreneurial philosophies
Innovation
Product development
Focus on high net worth
Research and development
Broad collaboration
Service
Responsiveness
Competitive offers
Specialized underwriting initiatives
Education and training
Technical Expertise
Local resources
Underwriting specialties
Actuarial insights
Technology
Use of big data
Industry innovator
Asia 79
|
|
Special Underwriting Initiatives
Advantage Program
Introduced program to Japanese market in 2013
Program enables underwriters to issue specific substandard cases at predetermined rates
Relies on RGA’s strength as a facultative underwriter
Reduces cost through faster underwriting process and improves placement rates on policies
Resulting business volumes will help fuel short-term growth in Japan
Asia
80
|
|
Product Development
Early Stage Critical Illness
Comprehensive Early Stage Critical Illness (ESCI) product developed in Singapore in 2010
RGA dominates this best-selling product and introduced the product with innovative upsell and cross-sell underwriting campaigns
Expanded the sale of this product, tailored for the local market, to Indonesia in 2011, Malaysia 2012, Hong Kong 2013, Korea 2014
RGA continues to analyze and assess the resulting data in order to monitor profitability, manage the business quality, learn and adapt next generations of this product
RGA’s 360o Commitment
Measure and Analyze
Comprehensive Voice of the Customer (VOC)
Analysis and recommendation
Second-generation plan
New product proposal
Monitor and Refine
Refine product/strategy Monitor performance Schedule full VOC review
Plan
Market research and analysis
Product portfolio review
Voice of clients
Customer base analysis
Execute
Product design workshop
Rate development
Filing support
Underwriting review and training
Product launch plan
Asia
81
|
|
Focus on High Net Worth
High Net Worth Expansion in Asia
Pioneered the reinsurance of this product in 2003 in Asia and leveraged its first-mover advantage into a dominant market share in 2013
Major services are underwriting and pricing of mortality, which are two of RGA’s core competencies
Led the evolution and spread of this product from Hong Kong to Singapore and now to China, Indonesia and Korea
Another example of RGA’s winning formula of innovation, distribution, analysis and evolution of new product and underwriting solutions
Asia
82
|
|
Expanded Capabilities, Expanded Opportunities
Product Development
Living Benefits
Strongest footprint in Asia
Award-winning product development
Aging population
Emerging middle class
High Net Worth
Strong underwriting DNA
Pioneer and dominant market share Continuous growing wealth in Asian market
Global Financial Solutions
Understanding of International regulatory environment Optimizes local capital efficiency
Repatriating profits places strain on regulatory capital
Increasing interest in asset-intensive solutions from insurers
Data Analytics
Trust from clients allows access to data
Strong footprint provides understanding of clients’ needs
Local commercialization of global expertise
Simplify consumer and distributor experience for clients
Asia
83
|
|
Summary
Expected growth rates of 15% - 20% pre-tax operating income1, 10% - 15% net premiums
Substantial projected embedded profits in the in-force business
Experienced management team that fosters a culture of entrepreneurialism, collaboration and innovation
Growth opportunities within the region are abundant, and RGA is well-positioned in key markets
Regional structure in place to promote communication of ideas within the region and with other parts of RGA
Strong customer reputation for excellence in execution of new product development activities
Capital solution opportunities in selected markets
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
Asia
84
|
|
Europe, Middle East and Africa (EMEA)
Paul A. Schuster
Senior Executive Vice President, Head of EMEA Markets
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
|
|
Overview
Key Messages
U.K. dominates financial results, but Continental Europe provides attractive growth as the market recovers
South Africa, the #2 market in the region, continues to grow, largely driven by innovative products and distribution
GFS-related transactions to contribute to solid growth
U.K. claims, particularly critical illness, remain slightly volatile and seasonal, but broadly within original pricing targets
Pre-tax Operating Income1
($ Millions)
120
100
| 80 |
|
| 60 |
|
| 40 |
|
| 20 |
|
0
24.1% CAGR
14-17% CAGR
2009 2010 2011 2012 2013 2016
Actual
Projection
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
EMEA
86
|
|
Net Premiums
Key Messages
Biometric risk opportunities
continue to grow in
Continental Europe despite
recession
Continued support of large
multi-national clients to
contribute to growth
GFS-related transactions to
drive premiums due to new
certainty of Solvency II
U.K. protection market is
stabilizing, but remains highly
competitive
U.K. annuity market will be impacted by recent legislation, but impact to RGA is likely to be minimal
($ Millions)
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
Net Premiums
13.3% CAGR
7-12% CAGR
Actual
Projection
2009 2010 2011 2012 2013 2016
EMEA
87
|
|
Distribution of Premium
EMEA - 2013 Premium Distribution by Product
1%
11%
10%
12%
20%
46%
Life
Critical Illness
Longevity Swaps
Longevity Enhanced
Group
Health
EMEA
88
|
|
EMEA Executive Management Team
Name Position Years in Years
Industry¹ with RGA
Paul A. Schuster Senior Executive Vice President, Head of EMEA Markets 38 23
Enda Murphy Managing Director, RGA International Reinsurance 28 7
Company Limited and Executive Vice President and Chief
Operating Officer, International Operations
Jonathan Porter Senior Vice President and Chief Pricing Actuary, 22 5
International Markets
Olav Cuiper Senior Vice President, Head of Europe and Africa 30 5
Simon Wainwright Managing Director, U.K. and Ireland 30 2
1Includes experience in life insurance and life reinsurance industries. EMEA 89
|
|
Value Embedded in In-force
Key Messages
Sizeable block of in-force business Significant source of future earnings already embedded in the business New business expected to contribute additional value
Actuarial Liabilities – U.S. GAAP vs. Best Estimate
(In force as of December 31, 2013)
Considerable projected future value
($ Billions)
0.6 0.3 0.0 -0.3 -0.6
2013 2023 2033 2043 2053 2063 2073 2083
Projected Future Value US GAAP Liabilities Best Estimate Liabilities
EMEA 90
|
|
U.K.
EMEA 91
|
|
Executive Management Team
Name
Simon Wainwright Richard Verdin James A. Galloway Gary S. Finkelstein Louise E. Hawkins Peter R. Barrett Calvin J. Cole
Position
Managing Director, U.K. and Ireland Chief Marketing Officer
Senior Vice President, Global Financial Solutions Senior Vice President, European Acquisitions Vice President, U.K. Operations Global Head of Claims Head of Underwriting and Claims, U.K. and Ireland Head of Underwriting, Europe
Years in Industry¹
30 26 28 26 12 30 31
Years with RGA
| 2 |
|
1 16 2 |
10 12 11
1Includes experience in life insurance and life reinsurance industries
EMEA 92
|
|
Current Profile
Profile
Office established in 1998 3rd largest market in the world Reinsurance license granted in 2000 Located in the city of London, near St.
Paul’s Cathedral Over 100 employees #2 in new business and #3 in in-force
Activities
Business Development
Traditional Financial Solutions
Actuarial Pricing
Traditional Financial Solutions
Underwriting and Claims
Traditional
EMEA Center of Excellence
AURA Development
Traditional
Underwritten annuities
Research & Development—Enabling Infrastructure
Operations Valuation Finance HR IT
Legal
EMEA 93
|
|
Outlook – Protection
Today
New business, industry-wide, is contracting For reinsurers, highly commoditized, pressures on margins
Trends
Life insurer taxation changes have lowered barriers to entry Annuity market changes have increased insurer focus on Protection market Technology is increasing innovation in the underwriting process
U.K. Industry Sales – Individual Protection New Business Premium (€m)
New business premium (€m)
0 200 400 600 800 1000 1200
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Calendar year of sale
EMEA 94
|
|
Outlook – Annuities
Today
Significant regulatory change in the 2014 budget will reduce overall demand for annuities Increased flexibility should increase the proportion of annuities that are underwritten Demographics still favorable for retirement markets
The projected increase in the UK population 2008-2033 is concentrated in older groups
By five year age bands
0-4 5-9 10-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80-84 85-89 90-94 95-99 100*
0 2 4 6
2008
Addition by 2033
Millions Government Acturary’s Department
Trends
Those who do annuitize likely to do so at an older age Ability to underwrite annuities even more important, given increased anti-selection Bulk annuities and longevity swaps likely to continue recent high levels of activity
EMEA 95
|
|
Expanded Capabilities, Expanded Opportunities
Protection
New and different entrants are expected Business models will change
Electronic underwriting Electronic health records “Big data” Learning algorithms
RGA still has data-driven analysis, better biometric pricing decisions
30,000 life claims
31,000 critical illness claims
Emerging longevity mortality (nearly 45,000 deaths, 860,000 lives)
EMEA 96
|
|
Expanded Capabilities, Expanded Opportunities
Annuities
Product innovation addressing changing retirement income options Solid market continues for underwritten annuities; demographics are nearly ideal Recent regulatory changes have no impact in defined benefit pensions; active longevity swap market will continue
EMEA 97
|
|
Expanded Capabilities, Expanded Opportunities
Financial Solutions
Solvency II forcing a restructure of the industry as of January 1, 2016
Significant potential reinsurance opportunities as companies rethink their balance sheets and capital Asset-intensive transaction opportunities as 80% of Solvency II capital is asset-based Direct insurer risk appetite limits will create opportunities for reinsurance, removing market and biometric risk above these limits
EMEA 98
|
|
U.K. Summary
Protection market expected to remain very competitive Continuing attractive opportunities for enhanced annuities and longevity swaps supporting bulk annuities Significant product development activity in life and annuities “Next generation” distribution initiatives will emerge with new underwriting and products to support these Solvency II will force a restructuring of the industry resulting in numerous reinsurance opportunities
EMEA 99
|
|
Europe, Middle East and Africa
EMEA 100
|
|
Executive Management Team
Name
Olav Cuiper Rosa Alegria Ashraf Al-Azzouni Ark Bandosz Tjaart Esterhuyse Klaus Mattar Lionel Périnel Gökhan Özüm Johan Tuijp
Position
Senior Vice President, Head of EMEA Managing Director, Spain Managing Director, Middle East Managing Director, Italy Managing Director, South Africa Managing Director, Germany and CEE Managing Director, France General Manager, Turkey Managing Director, Netherlands and Nordics
Years in Industry¹
30 13 20 19 25 21 18 17 18
Years with RGA
5 4 4 13 5 6 7 1 4
1Includes experience in life insurance and life reinsurance industries.
EMEA 101
|
|
Local Offices
Office
Madrid Cape Town Paris Milan Cologne Amsterdam Dubai Istanbul
Year
1994 1998 2007 2007 2008 2009 2011 2013
Countries
Spain, Portugal South Africa France, Belgium Italy
Germany, Poland, Switzerland and CEE Netherlands, Nordics UAE
Turkey
EMEA102
|
|
Current Profile
Over 150 employees in the region
Principally pricing, underwriting and business development Growing local Global Financial Solutions staff
Enabling infrastructure support for:
Operations
Finance and Valuation HR
Legal IT
EMEA 103
|
|
Europe, Middle East and Africa
Expanded Capabilities, Expanded Opportunities
Established in all key countries with a well-known brand; the most client-focused life and health reinsurer Strong biometric business growth at 14%; Italy and South Africa have led the way Longevity reinsurance opportunities (supported by U.K. team) are significant, specifically in the Netherlands and Spain Solvency II will fundamentally reshape the European industry, effective January 1, 2016; significant reinsurance opportunities will emerge over the next few years as companies adjust to the new regulation Large, near-term opportunities will result from “Solvency 1.5” as companies react to and prepare for Solvency II
Develop turn-key solutions to partner with new distribution parties Establish alternative distribution agreements partnering with clients in Turkey and South Africa
EMEA 104
|
|
Europe, Middle East and Africa Summary
Very different reinsurance markets within the region Attractive biometric risk growth opportunities continue New opportunities likely to emerge reflecting the changing demographics and economic realities resulting in reinsurance support for longevity, long term care, and other “senior” life and health products “Next generation” distribution is already emerging; likely to see dramatic innovation in underwriting and product designs to support this Solvency II will force restructuring of the European industry, resulting in numerous reinsurance opportunities
EMEA 105
|
|
EMEA 106
|
|
Financial Overview
Jack B. Lay
Senior Executive Vice President and Chief Financial Officer
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
|
|
Financial Overview
I. Historical Financial Performance and Metrics II. Capital Management and Structure III. Current Positioning IV. Unique Opportunity
Financial Overview 108
|
|
I. Historical Financial Performance and Metrics
Financial Overview 109
|
|
Strong Revenue Growth
Key Messages
Consistent growth Total revenues reflect strong growth in Global Financial Solutions businesses Premiums expected to grow 5%—8% in intermediate term
($ Millions) 12,000
10,000 8,000 6,000 4,000 2,000 -
2009 2010 2011 2012 2013
Premiums Other Revenues
Premiums 9.6% CAGR
Total Revenues 9.9% CAGR
Financial Overview 110
|
|
Consolidated Operating Income per Share1
Key Messages
Long track record of producing strong earnings 2013 reflects charge in Australia Intermediate projected growth rate assumes continued low interest rate environment
$10.00 $9.00 $8.00 $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $-
2009 2010 2011 2012 2013 … 2016
7.9% CAGR2
5-8% CAGR
$5.51 $6.23 $6.55 $6.96
$7.482 Australia Charge $4.95
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. 2Excludes $184 million after-tax charge in Australia (2Q13).
Financial Overview 111
|
|
Operating Return on Equity1
Key Messages
Strong, stable operating ROE trend prior to 2013 2013 reflects charge in Australia Intermediate target range 11% -12% Potential tailwinds GFS transactions International growth Improving portfolio yields
14% 12% 10% 8% 6% 4% 2% 0%
2009 2010 2011 2012 2013 2014-16
Actual
Projection
Intermediate Target Range 11% - 12%
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Financial Overview 112
|
|
Low Interest Rate
Environment Is Manageable
Diminishing impact to ROE, EPS
Interest rates expected to move upward over time Appropriately positioned portfolio
Stable asset classes No significant changes to asset profile/mix
Average Annual Portfolio Yields1
7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00%
2009 2010 2011 2012 2013
Average Quarterly Portfolio Yields1
6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00%
2012 2013 1Q
2014
Cash flows associated with large traditional mortality block are relatively long; enables flexibility to invest in less liquid investments
1Excludes funds withheld and other spread-related business.
Financial Overview 113
|
|
II. Capital Management and Structure
Financial Overview 114
|
|
Capital Management Philosophy
Maintain solvency
Maintain liquidity at holding company and operating companies
Holding company funds total approximately $700 million currently
Maintain desired credit and financial strength rating levels Meet regulatory capital requirements of operating companies Maintain efficient capital base for attractive returns
Optimal mix of debt, equity and hybrid securities
Deploy excess capital back into the businesses or return to shareholders
Provide flexibility to take advantage of business opportunities
Financial Overview 115
|
|
Deployable Excess Capital Priorities
Organic growth at target returns or higher Block/M&A transactions
Winning smaller in-force transactions
Large, headline transactions more difficult to predict Target deployment of $200 million annually
Share repurchases
Repurchased 5.6 million shares, or $374 million (2013 through 1Q14) Authorization in place to purchase up to $300 million in shares
($113 million purchased through March 31, 2014)
Shareholder dividends
Significant shareholder dividend increases in recent years Increased focus on dividend payout ratio
Balanced approach that considers opportunities to deploy or return excess capital
Financial Overview 116
|
|
Dividend Payout Ratio – RGA vs. Life Insurance Industry
18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0%
2009 2010 2011 2012 2013 1
Life Insurance Industry RGA
Source: Evercore.
1Excludes $184 million Australia charge in 2Q13.
Financial Overview 117
|
|
Buyback Payout Ratio – RGA vs. Life Insurance Industry
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
2010
2011
2012
20131
2014 Pro forma
RGA $220M buyback would match projected industry ratio
Life Insurance Industry RGA
Source: Evercore.
1Excludes $184 million Australia charge in 2Q13.
Financial Overview 118
|
|
Total Payout Ratio – RGA vs. Life Insurance Industry
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
2010
2011
2012
2013 1
2014 Pro forma
Life Insurance Industry RGA
RGA $320M return of capital would match projected industry ratio
Source: Evercore.
1Excludes $184 million Australia charge in 2Q13.
Financial Overview 119
|
|
Total Capitalization Levels
(Excluding Other Comprehensive Income)1,2
($ Millions)
$8,000
Hybrid Capital
$7,144
$7,186
80%
$7,000
Debt
$6,617
$719
$719
Shareholders’ Equity
70%
$6,000
Debt to Total Capital
$719
Hybrid to Total Capital
$5,615
$1,496
$1,496
60%
$319
$5,249
$1,097
$5,000
$478
$4,722
$1,096
50%
$478
$898
$4,930
$4,971
$4,000
$4,801
$897
40%
$4,201
$3,000
$3,873
$3,347
30%
20.8%
$2,000
20%
$1,000
10.0%
10%
$0
0%
2009
2010
2011
2012
2013
1Q14
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
2$492 million Timberlake Notes/collateral finance facility not included.
Financial Overview 120
|
|
Current Capital Structure1
Excess
Hybrid Capital
Capital
10%
8%
Shareholders’
Equity
(ex-AOCI)
Debt
65%
21%
March 31, 2014 Capitalization (ex-AOCI) $7.2 Billion
Debt is a flexible yet permanent component of RGA’s capital structure Appropriate laddering of debt maturities Coverage and leverage ratios within target limits Debt 68% and hybrid capital within target limits
Approximate capacities
Sr. Debt None Hybrids $300 million
1Excludes accumulated other comprehensive income.
Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation.
Financial Overview 121
|
|
Debt and Hybrid Maturities
Efficient Laddering of Debt and Hybrid Securities
( $ Millions)
$ $ $ $ $
$
$
$
$
0$
50 100 150 200 250 300
350
400
450
2017
5.625% Fixed rate
2018
2019
6.45% Fixed rate
2020
2021
5.00% Fixed rate
2022
2023
4.70% Fixed rate
2042
6.2% Fixed-to-floating in 2022
2065
6.75% Fixed-to-floating in 2015
Senior Notes
Hybrid Securities
Financial Overview 122
|
|
2014 Excess Capital Pro-forma
($ Millions)
$1,400
$1,200
$1,000
$800
$600
$400
$200
$0
Representative Excess Capital Roll-Forward
($325) $565
($200) $600
($90) $550
2013 Generated Deployed Share Shareholder 2014 Capital Capital Repurchases Dividends
Reinsurance Operations Capital Management
Expect to generate >$300 million annual excess capital Long-term target cushion roughly $300 million
Financial Overview 123
|
|
III. Current Positioning
Financial Overview 124
|
|
Current Positioning
RGA is a major global competitor Growth opportunities are still abundant RGA is a unique investment opportunity
Financial Overview 125
|
|
RGA Is a Major Global Competitor
One of the top life reinsurers in the world
Leading new business market shares in the biggest markets in the world Well-regarded by clients
NMG, Flaspöhler survey results
Experts at executing a variety of risk transfer transactions
Financial Overview 126
|
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Global Build-out Is Virtually Complete
We’ve been in this phase for 20+ years
We are continually leveraging capabilities and expertise across the global enterprise
1992 1973 1998
1998 2009 2006 2007 2008 1994 2007 2013
1998 2011 2002 1997 2005 2002 1995 1999 1995 1997 1996
Serving clients in more than 60 countries
Circled dates represents year of office opening. Financial Overview 127
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Growth Opportunities Are Still Abundant
Why We Are Confident
Expertise in all areas (critical skills)
Mortality risk Asset-intensive reinsurance Morbidity risk Financial reinsurance Longevity risk Block transactions
Regulatory changes have historically
provided opportunities for growth
We expect that to continue We are flexible and prepared
Our most promising growth opportunities
International operations primarily Asian markets
Global Financial Solutions widespread opportunities in multiple markets
Block opportunities currently focused in the U.S. and Europe
Positioned in the right places with the expertise to capitalize on new opportunities
Financial Overview 128
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Growing Importance of International and GFS Businesses
Two decades of strategic geographic and product expansion have significantly enhanced RGA’s enterprise value Combined international and GFS pre-tax operating earnings1 contributions have surpassed 50% of the consolidated level in recent years We expect those contributions to increase as we continue to leverage capabilities across our global platform Through innovation and enhanced capabilities, RGA has enjoyed steady growth and ongoing success by taking advantage of market opportunities
1Please refer to “Reconciliations of Non-GAAP Measures” at the end of this presentation. Financial Overview 129
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IV. Unique Opportunity
Financial Overview 130
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RGA Is a Unique Insurance Investment Opportunity
Different risk profile, focus and approach versus primary insurers Lower equity and interest rate sensitivity Mortality focus – more predictable than equity and interest rate movements Built-in, long-term, high-quality earnings Strong performance track record Efficient mix of mature and growing businesses Experienced management team Footprint virtually complete; leveraging operations
Opportunity to diversify within the insurance space
Financial Overview 131
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What to Expect Going Forward
Pursuit of industry opportunities
A balanced capital management strategy
Strong international and GFS growth A shift toward asset-based products An active block transaction environment
Strategic positioning will benefit us for years to come
Financial Overview 132
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Global Growing Unique
Q&A
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
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Q&A 134
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Appendix
Reinsurance Group of America, Incorporated | Tuesday, May 20, 2014
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Financial Performance
Reconciliation of Pre-Tax Income to Pre-Tax Operating Income ($ Millions)
U.S. & LATIN AMERICA TRADITIONAL OPERATIONS
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses Change in MV of Embedded Derivatives (1) Pre-tax Operating Income
ASSET INTENSIVE—U.S. & INTERNATIONAL
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses (1) Change in MV of Embedded Derivatives (1) Pre-tax Operating Income
FINANCIAL REINSURANCE—U.S. & INTERNATIONAL
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses Pre-tax Operating Income
LONGEVITY—U.S. & INTERNATIONAL
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses (1) Pre-tax Operating Income
(1) Net of DAC offset
2009 2010 2011 2012 2013
248.3 380.8 367.3 374.4 377.6 84.2 (25.1) (41.8) 0.3 (3.1)
— —(2.4) 2.0 (1.9) 332.5 355.7 323.1 376.7 372.6
2009
2010
2011
2012
2013
42.3
143.0
37.0
235.6
204.0
6.4
(4.7)
1.8
(79.8)
(14.9)
2.2
(63.2)
31.4
(45.7)
(23.0)
50.9
75.1
70.2
110.1
166.1
2009 2010 2011 2012 2013
32.0 37.0 48.0 64.9 87.0
— — — — -32.0 37.0 48.0 64.9 87.0
2009 2010 2011 2012 2013
7.6 15.6 25.7 27.9 39.1
— —(0.4) (0.6) (0.1) 7.6 15.6 25.3 27.3 39.0
Appendix 136
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Financial Performance
Reconciliation of Pre-Tax Income to Pre-Tax Operating Income ($ Millions)
CANADA OPERATIONS
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses Pre-tax Operating Income
EUROPE, MIDDLE EAST & AFRICA OPERATIONS
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses Pre-tax Operating Income
ASIA-PACIFIC OPERATIONS
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses Pre-tax Operating Income
Australia and New Zealand Pre-tax Operating Income Asia (ex Aus/NZ) Pre-tax Operating Income Corporate Overhead Asia-Pacific Pre-tax Operating Income
(1) Net of DAC offset
2009 2010 2011 2012 2013
106.2 121.7 165.0 187.0 164.3 (18.5) (8.7) (21.8) (27.7) (16.6) 87.7 113.0 143.2 159.3 147.7
2009 2010 2011 2012 2013
31.6 62.0 69.3 61.0 74.6 (1.8) (1.9) (5.9) (11.1) (3.5) 29.8 60.1 63.4 49.9 71.1
2009 2010 2011 2012 2013
76.9 80.9 52.7 52.0 (226.6) 1.2 (5.4) (3.2) (8.4) 8.3 78.1 75.5 49.5 43.6 (218.3)
2009 2010 2011 2012 2013
40.3 32.6 (0.7) (21.5) (292.3) 70.0 82.4 94.7 114.4 125.5 (32.2) (39.5) (44.5) (49.3) (51.5) 78.1 75.5 49.5 43.6 (218.3)
Appendix 137
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Financial Performance
GAAP / Operating Income and EPS Reconciliations ($ Millions)
RGA CONSOLIDATED
GAAP Pre-Tax Income—Cont Ops Realized Capital (Gains) / Losses (1) Change in MV of Embedded Derivatives (1) Gain on Debt Repurchase Loss on Retirement of PIERS
Pre-tax Operating Income
GAAP After-Tax Income—Cont Ops Realized Capital (Gains) / Losses (1) Change in MV of Embedded Derivatives (1) Gain on Debt Repurchase Loss on Retirement of PIERS
After-tax Operating Income
CONSOLIDATED EPS RECONCILIATION
Per Diluted Share Basis
GAAP Net Income
Realized Capital (Gains) / Losses Change in MV of Embedded Derivatives Gain on Debt Repurchase Loss on Retirement of PIERS
Operating EPS from Cont. Operations
(1) Net of DAC offset
2009 2010 2011 2012 2013
540.6 806.2 763.6 919.2 635.3 69.3 (76.1) (101.5) (129.5) 122.9 21.4 (30.7) 74.7 (43.7) (167.1)
(38.9) — (65.6) — (46.5)
— — 4.4 — -592.4 699.4 675.6 746.0 544.6
2009 2010 2011 2012 2013
373.0 535.7 546.0 631.9 418.8 42.5 (50.3) (69.2) (87.1) 78.4 14.0 (20.0) 48.6 (28.4) (108.6)
(25.3) — (42.6) — (30.2)
— — 2.8 — -404.2 465.4 485.6 516.4 358.4
2009 2010 2011 2012 2013
$ 5.09 $ 7.17 $ 7.37 $ 8.52 $ 5.78
0.57 (0.67) (0.94) (1.18) 1.09 0.20 (0.27) 0.65 (0.38) (1.50) (0.35) — (0.57) — (0.42)
— — 0.04 — -$ 5.51 $ 6.23 $ 6.55 $ 6.96 $ 4.95
Appendix 138
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Financial Performance
Stockholders’ Equity Reconciliation ($ Millions)
GAAP Stockholders’ Equity FAS 115 Equity Adjustment Foreign Currency Adjustment Unrealized Pension Equity Excluding OCI
GAAP Stockholders’ Average Equity FAS 115 Average Equity Adjustment Foreign Currency Adjustment Unrealized Pension Average Equity Excluding OCI
Operating ROE—GAAP Stockholders’ Equity Operating ROE—Excluding OCI
2009 2010 2011 2012 2013
$3,639.8 $4,765.4 $ 5,818.7 $ 6,910.2 $ 5,935.5 104.5 651.4 1,419.3 1,877.6 820.2 204.0 255.3 229.8 267.5 207.1 (16.1) (14.6) (31.0) (36.2) (21.7) $ 3,347.4 $ 3,873.3 $ 4,200.6 $ 4,801.3 $ 4,929.9
$ 2,963.5 $ 4,254.6 $ 5,140.1 $ 6,328.0 $ 6,308.9
(266.3) 462.4 914.6 1,636.9 1,290.2 104.7 218.1 249.1 252.3 216.8 (14.6) (15.7) (17.4) (31.2) (32.4) $ 3,139.7 $ 3,589.8 $ 3,993.8 $ 4,470.0 $ 4,834.3
14% 11% 9% 8% 6% 13% 13% 12% 12% 7%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Book value per share $ 31.33 $ 36.50 $ 41.38 $ 43.64 $ 48.70 $ 33.54 $ 49.87 $ 64.96 $ 79.31 $ 93.47 $ 83.87
Less: effect of FAS 115 2.74 3.92 5.92 5.46 5.05 (7.62) 1.43 8.88 19.35 25.40 11.59 Less: effect of CTA 0.86 1.50 1.40 1.77 3.43 0.35 2.80 3.48 3.13 3.62 2.93 Less: effect of Pension Benefit — — — (0.18) (0.14) (0.20) (0.22) (0.20) (0.42) (0.50) (0.31)
Book value per share excluding OCI $ 27.73 $ 31.08 $ 34.06 $ 36.59 $ 40.36 $ 41.01 $ 45.86 $ 52.80 $ 57.25 $ 64.95 $ 69.66
Periods prior to 2006 not restated for 2012 DAC accounting change.
Appendix 139
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Appendix 140