Investors' intro pack 2018 - July 2018 Zurich Insurance Group

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Investors' intro pack 2018 - July 2018 Zurich Insurance Group
Investors’ intro pack 2018

July 2018

Zurich Insurance Group
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           Our proposition to investors

            HIGHLY CASH GENERATIVE BUSINESS MODEL SUPPORTING AN ATTRACTIVE AND GROWING DIVIDEND, SUPPORTED BY:

                 A balanced             Industry leading          Stable, consistent        Consistent growth
                 and diverse            capital levels            and conservatively        with scope to
                 global business                                  managed balance           enhance returns
                                                                  sheet                     through capital
                                                                                            re-deployment
© Zurich

           July 2018                                                                         Investors' intro pack 2018   2
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           One of few genuinely global insurers

               KEY FACTS1                                                                                          A BALANCED GLOBAL BUSINESS1

               USD 63bn total revenues

               USD 315bn total group and unit linked investments                                                                                        28%
                                                                                                                                                                              Property & Casualty
                                                                                                                      BOP BY                34%
               USD 3.8bn business operating profit (BOP)                                                                                                                      Life
                                                                                                                      BUSINESS (%)3
                                                                                                                                                                              Farmers
               USD 3.0bn net income attributable to shareholders (NIAS)                                                                               38%

               216% SST regulatory solvency ratio2

               132% Zurich Economic Capital (Z-ECM) ratio calibrated                                                                          25%                             Europe
               to ‘AA’ rating (1 in 2000 year event)                                                                  BOP BY                                                  North America (incl. Farmers)
                                                                                                                      REGION (%)3                           57%               Asia Pacific
                                                                                                                                            11%
               USD 33bn shareholders’ equity                                                                                                                                  Latin America
                                                                                                                                               7%

               USD 46bn market cap

           1    Values are for the full year 2017 unless otherwise noted. Investments, solvency ratios, shareholders’ equity and market cap are as of December 31, 2017.
           2    The Swiss Solvency Test (SST) ratio as of January 1, 2018 is calculated based on the Group’s internal model, which is subject to the review and approval of the Group’s regulator, the Swiss
© Zurich

                Financial Market Supervisory Authority (FINMA).
           3    BOP split by business excludes Group Functions and Operations, and Non-Core Businesses. BOP split by region excludes additionally Group Reinsurance.

           July 2018                                                                                                                                                       Investors' intro pack 2018          3
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           Genuinely global franchise with distinct capabilities

                                                      NORTH AMERICA                                        EMEA
                                                               #5 in commercial insurance                   #4 insurance company overall
                                                               #2 in crop insurance                                 #2 in P&C, #3 in life

                                                               #7 in US personal lines                                                                      ASIA PACIFIC
                                                                                                                    #8 in P&C, #6 in life

                Top 3                                          through Farmers Exchanges1
                                                                                                                    #5 in P&C, #12 in life

                                                                                                                    #7 in P&C, #13 in life
                                                                                                                                                                    #5 in P&C, #4 in life4

                                                                                                                                                                    #10 in P&C5
                    cross-border                                                                                                                                    #12 in P&C, #9 in life
                                                                                                                    #10 in P&C, #2 in life
                     insurer to                       LATIN AMERICA
                                                                                                                    #6 in P&C, #2 in life
                   multinational
                                                        #4 insurance company overall3
                   corporations2

                                                                                                        #3 Global Travel Insurer

           Source: Axco, Company reports and presentations, local statistics (2017 or most recent available), SNL Financial, Strategic Insight, Zurich internal data.
           1 Provided for informational purposes only. Zurich Insurance Group has no ownership interest in the Farmers Exchanges. Farmers Group, Inc., a wholly owned subsidiary of the Group, provides

             certain non-claims administrative and management services to the Farmers Exchanges as its attorney-in-fact and receives fees for its services.
           2 Estimate based on annual reports and investor presentations.
           3 Pro-forma for the acquisition of the QBE operations in Argentina, Ecuador, Brazil, Colombia and Mexico.
© Zurich

           4 #1 in individual Life, #6 in group life. Pro-forma for the acquisition of the Life insurance business of ANZ (OnePath Life).
           5 Life business not among top 20.

           July 2018                                                                                                                                               Investors' intro pack 2018        4
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           Strong capital position and cash generation

               VERY STRONG FINANCIAL STRENGTH                                                            STRONG CAPITAL POSITION, Z-ECM (%)

                                                                                                          140%                        127% 122%                               132% 133%
                                                 AA- / outlook ‘stable’                                          119%                                  121%        125%
                                                                                                          120%                114%
                                                                                                                                                                                               Target
                                                                                                          100%                                                                                 Range
                                                 Aa3 / outlook ‘stable’                                              103%
                                                                                                           80%
                                                                                                           60%
                                                 A+ (Superior) / outlook ‘stable’                            FY-10    FY-11   FY-12   FY-13   FY-14     FY-15      FY-16      FY-17 Q1-18e1

               HIGHLY CASH GENERATIVE, CASH REMITTANCE (USDbn)                                           Z-ECM RATIO DEVELOPMENT (%)
                                       3.7        3.9                  3.7
                             2.9                             2.8                   Property & Casualty
                  2.1                                                                                                                                  12%         -12%                      132%
                                       2.4        1.7                  2.5                                  125%                -2%        0%                                   -2%
                            2.4                                                    Life                                 11%
                  1.4                             0.9        2.0
                    0.6                0.9                     0.4     1.1         Farmers
                0.7            0.6              1.5
                           0.9       1.2                   1.1         1.2
                    0.5        0.0       0.1        0.5        0.1                 Group Functions          FY-16    Business Insurance   Market      Market     Dividend       Other        FY-17
                -1.1       -1.1      -1.0       -0.6       -0.8         -0.9
                                                                     -0.2                                             profit     risk      risk       change      accrual
                                                                                   Non-Core Businesses
                 FY-12     FY-13      FY-14     FY-15      FY-16      FY-17                                                                                      incl. anti
                                                                                   IFRS NIAS
                                                                                                                                                                  dilution
                  3.9        4.0       3.9        1.8        3.2       3.0                                                                                       measures
© Zurich

           1    Q1-18 Z-ECM reflects midpoint estimate with an error margin of +/- 5ppts.

           July 2018                                                                                                                                            Investors' intro pack 2018              5
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           2017-2019 Financial targets1

                                                                  BOPAT ROE2 in excess of 12% and increasing, despite higher equity base

                                                                        USD 1.5bn in net savings by 2019 compared to the 2015 baseline

                                                                                               Z-ECM target ratio of 100-120%

                                                                Cash remittances in excess of USD 9.5bn over 2017-2019 period
© Zurich

           1   BOPAT ROE target to be increased by ~50bps for OnePath Life acquisition on completion of transaction (as announced on December 11, 2017).
           2   Business Operating Profit after tax return on equity, excluding unrealized gains and losses.

           July 2018                                                                                                                                       Investors' intro pack 2018   6
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           On track to deliver our 2017-2019 targets

               BOPAT ROE (%)1                                                   Z-ECM RATIO (%)                                                    CUMULATIVE CASH REMITTANCES
                                                                                                                                                   (USDbn)
                           12.1%                   >12.0%                                     133%                                                                                           >9.5
                                                                                                                      120%

                                                                                                                      100%
                                                                                                                                                                   3.7

                            FY-17                  Target2                                   Q1-18e3               Target range                                  FY-17                 2017 - 2019 Target

               CUMULATIVE NET
               EXPENSE SAVINGS (USDm)                                                            USD 700m
                                                                                                 as of FY-17

                                      2015                      2016                                 2017                                2018                                 2019
                           Achieved
                                                                                               100%
                             Target                             ~300                                 ~700                               ~1,100                               1,500

           1    Business Operating Profit after tax return on equity, excluding unrealized gains and losses. FY-17 adjusted for the impact of the hurricanes Harvey, Irma and Maria,
                charges related to the Group’s restructuring recognized through BOP and the change to the UK capital gains tax indexation relief.
© Zurich

           2    BOPAT ROE target to be increased by ~50bps for OnePath Life acquisition on completion of transaction (as announced on December 11, 2017).
           3    Q1-18 Z-ECM reflects midpoint estimate with an error margin of +/- 5ppts.

           July 2018                                                                                                                                                      Investors' intro pack 2018        7
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           Continued delivery across all businesses

               P&C                                                             LIFE                                                             FARMERS EXCHANGES2
                                                 100.9%
                                                 reported
               COMBINED RATIO (%)1                                             BOP GROWTH (%)1                                                  COMBINED RATIO (CR) (%)
                                                                                                                                                            103.9%                     101.6%
                           98.1%                   98.2%                                                                                                     7.1%
                                                                                                         +22%                                                                           7.3%
                               2.6%                 3.1%
                        31.7%                      31.8%
                                                                                                                                                            96.8%                       94.3%
                              65.7%                64.8%

                              -1.8%                -1.4%
                                                                                            FY-16                     FY-17                                  FY-16                      FY-17
                              FY-16                FY-17

                        Cat       ER    AY LR ex-cat        PYD                                                                                        Catastrophes       CR excl. catastrophes

               LIKE-FOR-LIKE GWP GROWTH (%)                                    FY-17 APE SHARE OF NON-TRADITIONAL PRODUCTS                      GWP GROWTH (USDm)3

                                                                                                                                                                          +3%
                     FY-15                                        3%
                                                                                                                                                            19,066                      19,663
                     FY-16 -3%                                                        UL, protection
                                                                                      and Corporate
                     FY-17                          1%                                Life & Pension     89%
                                                                                                                                                             FY-16                      FY-17

           1    FY-17 adjusted for the impact of the hurricanes Harvey, Irma and Maria and the change to the UK capital gains tax indexation relief.
           2    Provided for informational purposes only. Zurich Insurance Group has no ownership interest in the Farmers Exchanges. Farmers Group, Inc., a wholly owned subsidiary of the
© Zurich

                Group, provides certain non-claims administrative and management services to the Farmers Exchanges as its attorney-in-fact and receives fees for its services.
           3    Continuing operations only, excludes discontinued operations (21st Century business outside of California and Hawaii mainly).

           July 2018                                                                                                                                                  Investors' intro pack 2018   8
Investors' intro pack 2018 - July 2018 Zurich Insurance Group
GROUP
           Indicative ROE development enhanced by OnePath life
           acquisition, US tax reform and capital return

               ILLUSTRATIVE BOPAT ROE DEVELOPMENT

                                                                                                                                                              0-1%
                                                                                                                                             ~14%
                                                                                                                            ~0.5%
                                                                                                           ~0.5%
                       12.1%                                                                ~1.75%
                                                                                                                                                                                                  12%1
                                       1.5-2%                                ~0.5%
                                                          0.5-1%

                       FY-172        Growth in        Life & Farmers        Loss ratio   Expense savings   US tax          Capital            2019        Non-operating        NIAS ROE
                                   equity base and        growth          improvement                                     allocation                          items
                                   market impacts     (incl. OnePath                                                       / Other
                                                     Life acquisition)3

           1   BOPAT ROE target to be increased by ~50bps for OnePath Life acquisition on completion of transaction (as announced on December 11, 2017).
           2   FY-17 adjusted for the impact of the hurricanes Harvey, Irma and Maria, charges related to the Group’s restructuring recognized through BOP and the change to the UK
© Zurich

               capital gains tax indexation relief.
           3   Including expected impact of OnePath Life acquisition in Australia subject to regulatory approval.

           July 2018                                                                                                                                                 Investors' intro pack 2018          9
GROUP
           We have strengthened our businesses, extracted capital from non-
           core portfolios and returned in 2017 ~USD 3.8bn to shareholders

               MAIN DIVESTMENTS AND                                             MAIN ACQUISITIONS                      TYPE OF     BUSINESS               STRATEGIC RATIONALE
               CAPITAL ACTIONS                                                                                          DEAL                                  Skills    Distribution          Scale

                             Sale of P&C business in Middle East                        Cover-More/ Halo                 M&A       P&C Retail - Travel

                             Sale of P&C business in Taiwan
                                                                                        Standard Chartered               D.A.2     Life Retail
                             Reinsurance of a closed annuity book
                2017

                                                                                2017
                             Reinsurance of an individual Life risk portfolio
                                                                                        OnePath (ANZ Life)               M&A       Life Retail - Protection
                             Sale of workplace pensions and savings business

                             Sale of a MedMal legacy portfolio                          Bright Box                       M&A       Connected cars

                             Sale of a Singapore Life portfolio                         QBE Latam                        M&A       P&C
                                                                                2018
                2018

                             Sale of Endsleigh                                          Travel Ace/ Universal Travel     M&A       P&C Retail - Travel

                             Sale of NSW CTP1 run-off                                   EuroAmerica                    M&A/P.T.2   Life Retail
© Zurich

           1   New South Wales Compulsory Third Party motor liability.
           2   D.A. = Distribution agreement. P.T. = Portfolio transfer.

           July 2018                                                                                                                                             Investors' intro pack 2018           10
Property & Casualty
PROPERTY & CASUALTY
           Leading commercial insurer, and one of the few genuinely
           global players

               FOOTPRINT                                                       BUSINESS MIX                                         CUSTOMER UNITS
                FY-17 Gross Written Premiums by region (%)1                      FY-17 Gross Written Premiums by line of business    FY-17 Gross Written Premiums by customer unit
                                                                                 (%)                                                 (%)1

                                       8%                                                             10%
                                  7%                                                                                23%

                                                  41%                                          23%
                                        USD                                                                 USD                                            USD         46%
                                       33.0bn                                                              33.0bn                                54%      33.0bn

                                44%                                                                                 26%
                                                                                                     17%

                           EMEA                 APAC                                           Motor           Special lines               Commercial insurance        Retail insurance
                           North America        Latin America                                  Property        Worker Injury
                                                                                               Liability
© Zurich

           1    The split by region or customer unit excludes Group Reinsurance and Eliminations.

           July 2018                                                                                                                                   Investors' intro pack 2018         12
PROPERTY & CASUALTY
           We have stabilized our P&C business and show continuous
           improvement in the P&C combined ratio

               AY LOSS RATIO EXCLUDING                                          OTHER UNDERWRITING EXPENSE                                        COMMISSION RATIO (%)3
               CATASTROPHES (%)1                                                (OUE) RATIO (%)3

                                          -3.4ppts
                             68.2%
                                                                                                                                                                         +1.8ppts
                                                                                                        -1.8ppts
                                           65.7%                                       16.1%                                                                                                   15.9%
                                                         64.8%2                                          15.4%                                                             14.7%
                                                                                                                           14.2%                         14.0%

                             FY-154        FY-16          FY-17

                                                                                       FY-154            FY-16             FY-17                         FY-154            FY-16                FY-17
                Cat1         3.5%           2.6%          5.8%

                PYD1         0.1%          -1.8%          -1.4%

           1    Accident year loss ratio (AY LR) excludes prior year reserve development (PYD). Catastrophes include major and mid-sized catastrophes including significant weather-related events.
           2    FY-17 adjusted for the impact of the hurricanes Harvey, Irma and Maria.
© Zurich

           3    Expense ratio also includes the insurance premium tax (i.e., 1.6% for the years in scope), not shown in this page.
           4    FY-15 has not been restated.

           July 2018                                                                                                                                                    Investors' intro pack 2018      13
PROPERTY & CASUALTY
           Combined ratio and BOP improved strongly

               COMBINED RATIO SPLIT (%)1                                                                       BOP SPLIT (USDm)1
                                                                                   100.9%
                                                                                   reported                                                                                     USD 1,546m
                                                                                                                                                                                  reported
                                                     -5.4ppts
                            103.6%                                                                                                                       2,437                       2,344
                                                       98.1%                        98.2%
                                                                                                                                                       67    127                      191
                                                                                                                                    864
                             31.7%                                                                                                   0
                                                       31.7%                        31.8%

                             3.5%                                                                                                                        1,891                       1,847
                                                       2.6%                          3.1%
                                                                                                                                2,002

                             68.2%                     65.7%                                                                                              485                         469
                                                                                    64.8%
                                                                                                                              -29     -108                -133                    -38    -124

                                                                                                                                -1,002
                             0.1%                      -1.8%                         -1.4%
                             FY-15                     FY-16                         FY-17                                      FY-15                    FY-16                       FY-17

                                                                                                                          Non-controlling interest     Realized capital gains       Underwriting result
                        Expense Ratio      Catastrophes2       AY LR (excl.   catastrophes)3   PYD                        Non-technical result         Investment income

           1    FY-15 has not been restated. FY-17 adjusted for the impact of the hurricanes Harvey, Irma and Maria and charges related to the Group’s restructuring recognized through BOP.
© Zurich

           2    Catastrophes include major and mid-sized catastrophes, including significant weather related events.
           3    Accident year combined ratio (AY CR) excludes prior year reserve development (PYD).

           July 2018                                                                                                                                                  Investors' intro pack 2018          14
PROPERTY & CASUALTY
           Reinsurance program in line with Group risk appetite

               GROUP CATASTROPHE REINSURANCE PROTECTION (USDm)

                                                                         200
                                                             105
                                      200
                                                                                              200
                                                                   750
                                      750                                                                                  200
                                                                                              750
                                                                   350                                                                                                 200
                                                                                                                           750                                         250
                                      468                          250                        250

                                                                   600                        600                          300                                         7503
                                      510
                                                                                                                           200
                                    Europe                          US                         US                Rest of World all perils                  Global aggregate cat treaty
                                   all perils1             all perils (excl. EQ)          earthquakes

                       Global aggregate cat treaty      Combined global cat treaty2      US wind swap        Global cat treaty     Regional cat treaties   Retention          10% co-participation

           1   Europe cat treaty calculated with EUR/USD exchange rate as of December 31, 2017.
© Zurich

           2   This USD 200m cover can be used only once, either for aggregated losses or for an individual occurrence or event.
           3   Franchise deductible of USD 25m, i.e., losses greater than USD 25m count towards erosion of the retention (annual aggregate deductible).

           July 2018                                                                                                                                                 Investors' intro pack 2018      15
PROPERTY & CASUALTY
           Our reinsurance has been effective in protecting earnings and
           reducing earnings volatility

               Q3-17 NET IMPACT FROM SIGNIFICANT CAT (USDbn)1                                                  LARGE LOSS VOLATILITY
                                                               U.S. P&C market     % of HY-17
                                                                  share2 (%)   Shareholders equity

                AIG                                      3.0         2.4                  5
                                                                                                                    2014/2015
                                                                                                                                                                                              8ppts
                Chubb                          1.9                   3.3                  3

                Allstate               0.9                           5.1                  3

                Zurich                0.7                            2.1                  2                          Q1-14    Q2-14    Q3-14   Q4-14   Q1-15   Q2-15    Q3-15     Q4-15

                Travelers            0.7                             3.9                  2
                                                                                                                    2016/2017
                QBE              0.6                                 0.7                  4

                                0.5                                  0.5
Life
LIFE
           Our Life business is where others want to be; low risk and
           focused on protection and unit-linked business

            FOOTPRINT                                         BUSINESS MIX                                        DISTRIBUTION MIX
              FY-17 Annual premium equivalent by region (%)    FY-17 Annual premium equivalent by line of          FY-17 Annual premium equivalent by pillar (%)
                                                               business (%)
                                                                                           Savings & Annuity
                                                                     Unit Linked
                                                                                         11%
                                                                                   26%
                             23%
                                                                                               35% Protection                       28%
                                                                                                                                                      40%
                                    USD                                            29%                                                     USD
                          4%
                                   4.9bn                                                                                                  4.9bn
                           5%                                  Corporate Pensions
                                            68%

                                                               FY-17 Technical reserves by line of business (%)                       31%

                                                                   Traditional
                                                                      & Other 41%

                                                                                             59% Unit-Linked
                        EMEA               APAC                                                  & Savings                  Corporate Life & Pensions        Others
                        North America      Latin America                                                                    Banks
© Zurich

           July 2018                                                                                                                  Investors' intro pack 2018      18
LIFE
           Revenue streams have low market dependency

            DRIVERS OF OUR IFRS PROFITABILITY (USDm)

            REVENUES
                                 Loadings & fees             2,708            775   3,483          Policy charges and fees mainly designed to cover distribution costs

                               Investment margin                                    642            Returns on our assets, plus share of returns on policyholder assets

                                Technical margin                                             946   Revenues on mortality and other ‘risk’ products, after allowing for claims costs

            EXPENSES
                                 Operating costs                                          -1,381   The costs we incur running the business

                                 Acquisition costs                   -2,488                        What we pay to distributors

                                 Deferral impacts            177                                   Accounting adjustment to spread distribution costs over policy terms

            OPERATING PROFIT
                                       FY-17 BOP     1,380

                                                      UL fund based fees
© Zurich

           July 2018                                                                                                                                Investors' intro pack 2018        19
LIFE
           Focus on translating new business growth into tangible
           measures of value

               NEW BUSINESS VALUE (USDm)                                                                         GLOBAL LIFE BOP (USDm)

                                                                                   +29% like-                                                                                       USD 1,258m
                                                                                    for-like1                                                                                         reported

                                                                          +28%                                                                                           +22%

                                                                                        999                                                                                              1,380
                                                                                                                                                                                           1
                                                                                        164                                                                 1,130
                                840                                                                                               1,079                                                   296
                                 49                          782
                                                                                                                                                             249
                                125                                                     165                                          195                                                  132
                                                             126                                                                                              76
                                                                                                                                     43
                                      112                          88                    66
                           29                           25

                                                                                                                                     892                     889                          952
                                                             541                        605
                                526

                                                                                                                               -42         -8                -85                           -2
                             FY-15                       FY-16                          FY-17                                    FY-15                      FY-16                       FY-172

                         Other          Latin America    APAC           North America         EMEA                           Other          Latin America   APAC       North America            EMEA
© Zurich

           1    Like-for-like excludes Australia and Malaysia Takaful acquisitions.
           2    FY-17 adjusted for the impact of charges related to the Group’s restructuring taken through BOP and the change to the UK capital gains tax indexation relief.

           July 2018                                                                                                                                                    Investors' intro pack 2018     20
Farmers
FARMERS
           A unique structure

               MAINLY A FEE BUSINESS TO ZURICH                                                                 FARMERS’ UNIQUE STRUCTURE

                 The Farmers Exchanges1 are a group of US insurance companies,
                 which are owned by their policyholders

                 Zurich owns Farmers Management Services (FMS), which manages the                                 Farmers Group, Inc.                                         Farmers Exchanges1
                 Farmers Exchanges on behalf of the policyholders in an arrangement                               Provides                             Services              Bear underwriting risk
                 known as an “attorney-in-fact”                                                                   administration and                                         and handle claims
                                                                                                                  management                      Fees as % of Premiums      Own distribution assets
                 FMS receives fees from Farmers Exchanges for the services it provides
                                                                                                                     Zurich owned                                                Policyholder owned

                 The fee based nature of the business model allows FMS to generate
                 stable earnings and high cash remittances                                                     FARMERS BOP HISTORY (USDm)2
                                                                                                                                                                  1,722       1,691
                                                                                                                   1,402       1,516      1,573       1,421
                 Farmers Life manufactures life products sold through the Farmers                                               125        190          61        42 202      57
                                                                                                                                                                                 220
                                                                                                                                                                                             Farmers Life
                 distribution channels
                                                                                                                   1,428                                          1,478       1,415          FRe
                                                                                                                               1,390      1,383       1,360
                                                                                                                                                                                             FMS
                 Zurich also provides capital support to the Farmers Exchanges
                                                                                                                    -26
                 through Farmers Re
                                                                                                                   FY-12       FY-13      FY-14       FY-15       FY-16       FY-17

           1    Provided for informational purposes only. Zurich Insurance Group has no ownership interest in the Farmers Exchanges. Farmers Group, Inc., a wholly owned subsidiary of the Group,
© Zurich

                provides certain non-claims administrative and management services to the Farmers Exchanges as its attorney-in-fact and receives fees for its services.
           2    With the full year 2016, Farmers Life business was moved from Life to Farmers, to reflect new management structure.

           July 2018                                                                                                                                                  Investors' intro pack 2018            22
FARMERS EXCHANGES1
           Leading player in US personal lines insurance

               PROFILE                                                                                             US PERSONAL LINES2 MARKET
                                                                                                                   2017 Personal Lines Direct Premiums
                Farmers Exchanges is the #3 personal lines1 insurer
                                                                                                                   of USD 325bn
                in 29 ‘core’ states in the Western US                                                                                                                                     Homeowners

                Split of business is predominantly personal lines,                                                                                         28%         29%                Auto Liability
                with some commercial lines product offerings for small businesses                                                                                                         Auto Physical Damage

                Primary distribution through ~13,500+ Exclusive Agents,
                under Farmers brand                                                                                                                              43%
                Growing business in Eastern US

               PERSONAL LINES2 MARKET SHARE (%)                                                                    FARMERS PREMIUM SPLIT
               Based on 2017 Personal Lines Direct Premiums of USD 325bn                                           FY-17 Gross Written Premiums
                                                                                                                   of USD 19.9bn
                 18.3                                                                                                                                                                     Auto/Personal Umbrella
                                                                                                                                                            12%
                                                                                                                                                               1%                         Homeowners
                             9.1        9.0                                                                                                               10%
                                                   7.3                                                                                                                 50%                Business Insurance
                                                              5.8         5.6        4.9        3.3                                                                                       Specialty
                                                                                                                                                           27%
                                                                                                                                                                                          Discontinued / Other
                 State   Berkshire   Allstate Progressive    USAA       Liberty   Farmers     Nation-
                 Farm                                                   Mutual                 wide
© Zurich

           1    See footnote 1 on slide 22.
           2    SNL data for 2017, as of April 20, 2018 - Personal lines defined as auto and homeowners multi peril for United States excluding territories.

           July 2018                                                                                                                                                         Investors' intro pack 2018          23
FARMERS EXCHANGES1
           Farmers vast distribution system

               FOCUS IS ON EXCLUSIVE AGENTS

                                             35,000 exclusive agents, district managers and licensed staff
                                                             34,200 independent agents
                                                         11,016 Farmers branded storefronts
                                                              Direct & Affinity Partners
© Zurich

           1   See footnote 1 on slide 22.

           July 2018                                                                                         Investors' intro pack 2018   24
FARMERS EXCHANGES1
           Customer centered, agent powered

               NET PROMOTER SCORE SURVEY RESPONSES (%)                                                    ~11K LOCAL STOREFRONTS   ~14K DIGITAL STOREFRONTS

                                                                    Average NPS

                                                                        +72
                                            Extremely satisfied
                               77%
                                            with their agent

                                                                                                          BROAD PRODUCT SUITE2

                               23%          Other                        -43
© Zurich

           1   See footnote 1 on slide 22.
           2   Life, Pet and Financial products administered by Farmers Life and third party servicers.

           July 2018                                                                                                                      Investors' intro pack 2018   25
FARMERS EXCHANGES1
           Improving underlying performance at the Farmers exchanges
           with top-line growth

               GWP GROWTH (%)                                                   COMBINED RATIO (%)                                                 SURPLUS (USDbn)

                                                                                                                                                       38.5%                                        38.7%
                                            5.1%                                                                103.9%                                               36.6%           37.0%
                                                                                                  101.9%                      101.6%
                                                                                     99.4%                        7.1%
                                                                                                   6.0%                        7.3%
                                                                                     5.2%
                              3.6%
                                                   3.3%                                                                                                                5.5             5.5               5.5
                                                          3.1%                                                                                           5.4

                                     2.4%

                                                                                                   95.9%         96.8%
                                                                                     94.2%                                    94.3%
                                                                 1.0%

                       0.0%
                  FY-14         FY-15         FY-16        FY-17                     FY-14         FY-15         FY-16         FY-17                    FY-14        FY-15            FY-16             FY-17

                   Continuing Operations2                                             Catastrophe losses                                                   Surplus ratio
                   Total                                                              CR (excl. catastrophe losses)                                        Farmers Exchanges surplus

           1   See footnote 1 on slide 22.
© Zurich

           2   Excludes 21st Century business outside of California and Hawaii reflecting the decision made in October 2015 to retire the 21st Century brand from all states excluding California and Hawaii
               and other discontinued operations.

           July 2018                                                                                                                                                       Investors' intro pack 2018           26
FARMERS EXCHANGES1
           Significant opportunities for growth

               OPPORTUNITY TO DEEPEN CUSTOMER                                ACTIVATION OF AGENTS FOR SME                             EXPANSION INTO EASTERN UNITED
               PENETRATION                                                   OPPORTUNITY                                              STATES2
               (FARMERS HOUSEHOLDS BY PRODUCT)                               (PERCENTAGE OF AGENTS, GWP)                              (GWP, USDm)

                 3 or more lines of                                                                                                                                                884
                          business

                                 15%                                                                                                                                        691

                                                                                                                                                                    486
                                                                                                                   85%
                                                   53% Monoline
                2 lines of 32%                                                                                                                              256
                 business
                                                                                           26%                                                       113
                                                                                                                                               36
                                                                                                                                          4
                                                                                      Exclusive agents           Business               FY-11 FY-12 FY-13 FY-14 FY-15 FY-16 FY-17
                                                                                                             Insurance GWP

           1   See footnote 1 on slide 22.
© Zurich

           2   As of FY-17 Eastern expansion states include Connecticut, Georgia, Maryland, New Jersey, New York, and Pennsylvania.

           July 2018                                                                                                                                  Investors' intro pack 2018         27
Investment and Capital Management
INVESTMENT AND CAPITAL MANAGEMENT
           ALM-focused and lower risk strategy delivering consistent
           and sustainable excess returns

            ASSET ALLOCATION                                ASSET QUALITY                                DURATION

              FY-17 total Group investments of USD 207bn     FY-17 Group debt investments of USD 163bn    As of FY-17, for fixed income investments only (#years)

                                       3% 7%                                    4%                                                9.6
                                               5%                                 1%                                 8.7
                                                2%                                            27%
                                                 5%
                                                                       25%

                                                                                                                                                      4.5         4.3

                                                                          17%             25%
                              79%

                                                                                                                           Life                             P&C

                         Fixed income      Equities                       AAA       BBB
                         Mortgages         Hedge funds,                   AA        Non-investment
                                                                                                                    Assets              Liabilities
                                           Private equity                           grade
                         Real estate       Cash                           A         Unrated
© Zurich

           July 2018                                                                                                              Investors' intro pack 2018            29
INVESTMENT AND CAPITAL MANAGEMENT
           Managing our risks conservatively to AA financial strength

               GROUP SOLVENCY                                                                                     CAPITAL MANAGEMENT POLICY (Z-ECM RATIO, %)

                240%
                                      217%                                                 216%
                                                                             204%
                                                  196%
                200%                                           189%
                          185%                                                                                                  >140%                Mitigating actions required

                                                                                                                              120%-140%              Mitigating actions considered
                160%
                                                                                                                                             120%-
                                                                                           132%                                              140%
                                      127%                                   125%                                             100%-120%              Target range
                                                  122%         121%
                120%      114%
                                                                                           133%
                                                                                         at Q1-182                            90%-100%               Within tolerance level on temporary basis
                                                                                                                                             100%-
                                                                                                                                             120%
                 80%
INVESTMENT AND CAPITAL MANAGEMENT
           Solvency ratios resilient to market movements

               Z-ECM SENSITIVITY IMPACT1,2                                                                           SST SENSITIVITY IMPACT1,2

                            Actual value as of FY-17                                            132%                              Actual value as of FY-17                                                 216%

                              Interest rate +100 bps                                              136%                               Interest rate +100 bps                                                223%

                               Interest rate -100 bps                                       121%                                     Interest rate -100 bps                                         195%

                            USD appreciation +10%                                                 135%                            USD appreciation +10%                                                    221%

                                      Equities +20%                                               136%                                      Equities +20%                                                  222%

                                      Equities -20%                                            128%                                          Equities -20%                                             209%

                           Credit spreads +100 bps3                                        116%                                  Credit spreads +100 bps3                                          189%

                  CS excl. Euro sovereign +100 bps3                                         121%                        CS excl. Euro sovereign +100 bps3                                            197%

           1    Sensitivities are best estimate and linear, i.e. will vary depending on prevailing market conditions at the time. Z-ECM is calibrated at 99.95% Value at Risk (equivalent to an ‘AA’ rating); SST is
                calibrated at 99.0% Expected Shortfall.
© Zurich

           2    The impact of the changes to the required capital is approximated and takes into account market and insurance risks.
           3    Credit Spreads (CS) include mortgages and including/excluding Euro sovereign spreads. Z-ECM sensitivity is net of profit sharing with policyholders.

           July 2018                                                                                                                                                          Investors' intro pack 2018          31
INVESTMENT AND CAPITAL MANAGEMENT
           Proven balance sheet flexibility through leverage
           and coverage at Aa levels

               GROUP CAPITAL STRUCTURE1                                                   MOODY’S LEVERAGE & COVERAGE

                                                                                          Financial leverage: Aa = 15-30%

                                      12%             11%              9%          9%             26.9%                                26.4%
                        13%
                                                                                                                  24.3%     24.1%                         23.7%
                                      13%             14%              19%         16%
                        14%

                                                                                          Earnings coverage: Aa = 8-12x

                        72%           76%             76%              73%         75%             9.1             9.5                   9.2                9.3
                                                                                                                             6.7

                        2013          2014            2015             2016        2017            2013            2014     2015        2016              20172

                       Senior debt   Subordinated Debt       Shareholders Equity
© Zurich

           1   Capital Structure shown using accounting view.
           2   Estimated by Zurich.

           July 2018                                                                                                                Investors' intro pack 2018    32
INVESTMENT AND CAPITAL MANAGEMENT
           Low cost of risk and balanced maturity profile

               CDS SPREAD AMONG BEST OF PEERS (USDm)1                                                             BALANCED REFINANCING NEEDS (USDbn)2

               600                                                                                                 3.0

                                                                                                                   2.5
                                                                                                                                                         2.2
                                                                                                                                                                                       2.1
               400                                                                                                 2.0                                                                 0.2
                                                                                                                                                         0.6
                                                                                                                                                                1.7

                                                                                                                   1.5             1.3                          0.5

                                                                                                                                                                       1.0                            1.0
               200                                                                                                 1.0             0.8                                                 1.9
                                                                                                                                                 0.7     1.6
                                                                                                                          0.5                                   1.2
                                                                                                                   0.5                           0.3
                                                                                                                                          0.3                                 0.3
                                                                                                                                   0.5           0.4
                                                                                                                                                                                               0.0
                 0                                                                                                 0.0
                Jan-10    Jan-11   Jan-12     Jan-13     Jan-14   Jan-15   Jan-16   Jan-17   Jan-18                      2018      2019   2020   2021    2022   2023   2024   2025    2026    2027    2028

                         Zurich         Axa            Generali      Allianz                                                 Senior       Subordinated
© Zurich

           1   5yEUR sub CDS; source: Bloomberg.
           2   As of Q2 2018; maturity profile based on first call date for subordinated debt and maturity date for senior debt.

           July 2018                                                                                                                                                     Investors' intro pack 2018          33
INVESTMENT AND CAPITAL MANAGEMENT
           We have a strongly cash generative business reflected
           in high cash remittance

               NET INCOME AND REMITTANCES 2012-20171 (USD)

                                                       P&C      LIFE    FARMERS   NON-CORE   GFO2                    GROUP

                       NIAS
                       2012-17                         12.0bn   6.2bn    6.3bn      0.3bn    -4.9bn                  19.9bn

                       REMITTED
                       2012-17                         12.5bn   4.4bn    6.6bn      1.0bn

                 Ø PAYOUT                              104%     71%      103%        nm                                95%

                       2017 – 2019                     ~90%     ~70%     ~90%      ~90%                               ~85%
© Zurich

           1   Based on 2012-17 reporting structure.
           2   Group Functions and Operations.

           July 2018                                                                             Investors' intro pack 2018   34
INVESTMENT AND CAPITAL MANAGEMENT
           We are focused on continuing to reward our shareholders

               ZURICH’S DIVIDEND POLICY                                             DIVIDEND PER SHARE (CHF)

                  NIAS payout ratio of approximately 75%

                                                                                                                                                                       18
                                                                                                               17    17     17      17       17       17      17
                  Dividend increases based                                              15
                                                                                                         16

                  on sustainable earnings growth                                                11

                  Target minimum of prior year dividend
                  per share                                                            2007    2008   2009    2010   2011   2012   2013     2014    2015     2016     20171

                                                                                              Dividend        USD/CHF1           EUR/CHF1
© Zurich

           1    Based on exchange rates around respective dividend payment dates.

           July 2018                                                                                                                     Investors' intro pack 2018           35
INVESTMENT AND CAPITAL MANAGEMENT
           Long term value creation, driven by consistent dividend policy

                  200%

                  150%

                  100%

                       50%

                       0%
                         2008          2009            2010          2011              2012   2013   2014   2015   2016            2017                2018

                                STOXX Europe 600 Insurance    Zurich Insurance Group
© Zurich

           Source: Thomson Reuters

           July 2018                                                                                                      Investors' intro pack 2018          36
Appendix
INVESTMENT AND CAPITAL MANAGEMENT
           Z-ECM and SST are more conservative than Solvency II

               PRIMARY DIFFERENCES – REQUIRED CAPITAL

                       Most onerous                     Z-ECM                             SST1                                Solvency II (Pillar 1)
                       impact on ratio

                                                        VaR 99.95% (~AA)                  ES 99% (~BBB)                       VaR 99.5% (~BBB),
                RISK MEASURE
                                                                                                                              usually < ES 99%

                                                        • Market Risk (including          • Market Risk (including            Internal model (ZIP):                  Standard Formula
                                                            investment credit)                investment credit)              • Market Risk (including               (all other entities):
                                                        •   Premium and Reserve Risk      •   Premium, Reserve and UPR Risk       investment credit)                 •   Market risk
                                                        •   NatCat Risk                   •   NatCat Risk                     • Premium, Reserve and UPR             •   Counterparty default risk
                                                        •   Life Liability Risk           •   Life Liability Risk                 Risk                               •   Life underwriting risk
                RISK-TYPES COVERED                      •   Business Risk                 •   Life Business Risk              •   NatCat Risk                        •   Health underwriting risk
                                                        •   Operational Risk              •   Reinsurance Credit Risk         •   Business Risk                      •   Non-life underwriting risk
                                                        •   Reinsurance Credit Risk       •   Receivables Credit Risk         •   Operational Risk                       (including premium, reserve
                                                                                                                              •   Reinsurance Credit Risk                and NatCat)
                                                                                                                              •   Receivables Credit Risk            • Intangible asset risk
                                                                                                                              •   Scenarios                          • Operational risk

                                                        No concept of equivalence, ZECM                                       Possibility to use local regimes for subsidiaries in equivalent third
                EQUIVALENCE                             applied to the entire Group                                           countries. Not applicable for Zurich
© Zurich

           1    Regarding Swiss Solvency Test (SST) ratio see footnote on slide 3.

           July 2018                                                                                                                                                Investors' intro pack 2018         38
INVESTMENT AND CAPITAL MANAGEMENT
           Z-ECM and SST are more conservative than Solvency II

               PRIMARY DIFFERENCES – YIELD CURVES AND TRANSITIONALS

                       Most onerous                   Z-ECM / SST1,2                                                         Solvency II (Pillar 1)
                       impact on ratio

                BASE RISK-FREE                       Swaps                                                                   Swaps
                YIELD-CURVE

                ENTRY-POINT TO                       Use all available market data                                           CHF: 25 years
                EXTRAPOLATION                        CHF: 30 years                                                           EUR: 20 years
                OF YIELD-CURVE                       EUR, USD, GBP: 50 years
                                                                                                                             USD, GBP: 50 years

                ULTIMATE                             Flat extrapolation from last observable data point                      CHF: 3.2% (as of December 31, 2017)
                FORWARD RATE                                                                                                 EUR, USD, GBP: 4.2% (as of December 31, 2017)

                                                     None (no liquidity premium)                                             -10bps (credit)
                                                                                                                             + volatility adjustment (between 9 bps (CHF) and 78bps (USD) at Q4-16)
                ADJUSTMENTS
                TO YIELD-CURVE                                                                                               + matching adjustment (currently not used by Zurich)

                                                      n/a                                                                    Various transitional measures, especially for yield-curves and technical
                TRANSITIONAL                                                                                                 provisions, lasting until 2032. Zurich does not make use of these.
                REQUIREMENTS
© Zurich

           1   Regarding Swiss Solvency Test (SST) ratio see footnote on slide 3.
           2   We applied for usage of our own yield curves in the SST, which was granted by FINMA subject to certain conditions.

           July 2018                                                                                                                                                   Investors' intro pack 2018       39
INVESTMENT AND CAPITAL MANAGEMENT
           Z-ECM and SST are more conservative than Solvency II

               PRIMARY DIFFERENCES – OTHER KEY ELEMENTS

                       Most onerous                     Z-ECM                                          SST1                                             Solvency II (Pillar 1)
                       impact on ratio

                                                        Available Capital                              Liability                                        Liability
                SENIOR DEBT

                                                        Pre-tax                                        Pre-tax                                          Post-tax
                TAX

                                                        Management view                                Legal entity view                                Legal entity view
                                                        • Internal reinsurance not relevant            • Internal reinsurance considered                • Internal reinsurance considered
                                                        • Full Group diversification taken into        • Only legal entity diversification taken into   • Only legal entity diversification taken into
                GRANULARITY                                account and allocated back to business         account                                          account
                                                           units                                       • Risk of subsidiaries included (with limited
                                                                                                          liability)

                                                        Risk Margin as part of insurance liabilities   Risk Margin as part of insurance liabilities     Risk Margin as part of insurance liabilities
                RISK MARGIN
© Zurich

           1    Regarding Swiss Solvency Test (SST) ratio see footnote on slide 3.

           July 2018                                                                                                                                                 Investors' intro pack 2018          40
Disclaimer

           Certain statements in this document are forward-looking statements, including, but not limited to, statements that are predictions of or indicate future events, trends,
           plans or objectives of Zurich Insurance Group Ltd or the Zurich Insurance Group (the ‘Group’). Forward-looking statements include statements regarding the Group’s targeted
           profit, return on equity targets, expenses, pricing conditions, dividend policy and underwriting and claims results, as well as statements regarding the Group’s understanding
           of general economic, financial and insurance market conditions and expected developments. Undue reliance should not be placed on such statements because, by their
           nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results and plans and objectives of
           Zurich Insurance Group Ltd or the Group to differ materially from those expressed or implied in the forward looking statements (or from past results). Factors such as
           (i) general economic conditions and competitive factors, particularly in key markets; (ii) the risk of a global economic downturn, in the financial services industries in particular;
           (iii) performance of financial markets; (iv) levels of interest rates and currency exchange rates; (v) frequency, severity and development of insured claims events; (vi) mortality
           and morbidity experience; (vii) policy renewal and lapse rates; and (viii) changes in laws and regulations and in the policies of regulators may have a direct bearing on the
           results of operations of Zurich Insurance Group Ltd and its Group and on whether the targets will be achieved. Zurich Insurance Group Ltd undertakes no obligation to
           publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise.
           All references to ‘Farmers Exchanges’ mean Farmers Insurance Exchange, Fire Insurance Exchange, Truck Insurance Exchange and their subsidiaries and affiliates. The three
           Exchanges are California domiciled interinsurance exchanges owned by their policyholders with governance oversight by their Boards of Governors. Farmers Group, Inc. and
           its subsidiaries are appointed as the attorneys-in-fact for the Farmers Exchanges and in that capacity provide certain non-claims administrative and management services to the
           Farmers Exchanges. Neither Farmers Group, Inc., nor its parent companies, Zurich Insurance Company Ltd and Zurich Insurance Group Ltd, have any ownership interest
           in the Farmers Exchanges. Financial information about the Farmers Exchanges is proprietary to the Farmers Exchanges, but is provided to support an understanding of the
           performance of Farmers Group, Inc. and Farmers Reinsurance Company.
           It should be noted that past performance is not a guide to future performance and that interim results are not necessarily indicative of full year results.
           Persons requiring advice should consult an independent adviser.
           This communication does not constitute an offer or an invitation for the sale or purchase of securities in any jurisdiction.
           THIS COMMUNICATION DOES NOT CONTAIN AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES; SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES
           ABSENT REGISTRATION OR EXEMPTION FROM REGISTRATION, AND ANY PUBLIC OFFERING OF SECURITIES TO BE MADE IN THE UNITED STATES WILL BE MADE BY MEANS OF
           A PROSPECTUS THAT MAY BE OBTAINED FROM THE ISSUER AND THAT WILL CONTAIN DETAILED INFORMATION ABOUT THE COMPANY AND MANAGEMENT, AS WELL AS
           FINANCIAL STATEMENTS.
© Zurich

           July 2018                                                                                                                                          Investors' intro pack 2018      41
Investing into Zurich

            SIX SWISS EXCHANGE                                    US AMERICAN DEPOSITARY RECEIPT PROGRAM

            •    Listing: SIX Swiss Exchange, Switzerland         •   Depository: The Bank of New York Mellon
            •    Product type: Swiss Blue Chip Shares             •   Nature: ADR
            •    Ticker symbol: ZURN                              •   Symbol: ZURVY
            •    Swiss security number (Valorennummer): 1107539   •   For further information:
            •    ISIN: CH0011075394
            •    Bloomberg symbol: ZURN VX Equity                     in the USA         +1-888-BNY-ADRS
                                                                      outside the USA    +1 201 680 6825
            •    Reuters symbol: ZURN.VX
                                                                      E-mail             shrrelations@bnymellon.com
            •    Trading currency: CHF                                Website            www.adrbnymellon.com
© Zurich

           July 2018                                                                                   Investors' intro pack 2018   42
For further information

            CALL US                                 VISIT OR FOLLOW US

            Investor Relations
            Richard Burden       +41 44 628 96 40
            Francesco Bonsante   +41 44 628 00 68
            Samuel Han           +41 44 625 32 57
            Gianni Vitale        +41 44 625 48 26

            Rating Agency Management
            Michèle Matlock  +41 44 625 28 50
                                                      Investor Relations website
                                                      Financial results and reports
            Events
            Patricia Heina       +41 44 625 38 44    Follow us

            Phone +41 (0) 44 625 22 99
            investor.relations@zurich.com
© Zurich

           July 2018                                                                   Investors' intro pack 2018   43
CALENDAR:

 •   August 9, 2018, Half year results 2018
 •   September 6-7, 2018, UBS Best of Switzerland Conference 2018, Opfikon-Glattbrugg
 •   September 25-26, 2018, Bank of America Merrill Lynch Conference 2018, London
 •   November 8, 2018, Update for the nine months ended September 30, 2018
 •   December 5, 2018, Investor Day 2018

© Zurich Insurance Company Ltd
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