| Wiener StädtiSche VerSicherung Ag AnnuAl report 2011 ... · ing place on our health care system...

Showing ForeSight.

ForeSight Shown.

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AnnuAl report 2011 | Wiener StädtiSche VerSicherung Ag


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Austria’s largest insurance network: 140 business offices, nine provincial headquarters, approximately 2,000 advisors

ALWAYS There, Where YOU NeeD US

A n n uA l R e p o R t 2011 | W i e N e r S Tä D T i S c h e

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highLighTS & MANAgeMeNT | CoMpAnY & StRAteGY | MAnAGeMent RepoRt 2011 | AnnuAl FInAnCIAl StAteMentS 2011



highLighTS 2011

eXceLLeNT reSULTS iN SPiTe OF DiFFicULT MArKeT SiTUATiON. profitability increased once again. Profit before taxes increased further. Combined ratio improved again to 95%. Securityoriented investment a key factor in stability. Assekuranz Award Austria 2011, insurance award for “Business Class” com-mercial insurance. Mobile phone storm alert system for desired locations. Market leader in Austria. TV commercial receives 2011 Werbespot Award for advertising.


eDiTOriAL

Offer the best security for every situation in life.

We consider this to be our main duty at Wiener Städtische. Long-term security and the right advice are more important than ever in difficult economic times. We are a reliable partner for our customers, operating the greatest number of local advisory offices country-wide to offer optimal solutions, custom-tailored products and straightforward claims settle-ment. Wiener Städtische develops many innovations to meet its customer needs to provide for the future, and is always one step ahead, because to us “showing foresight” means taking social change seriously, working for reforms and changing our products and services to adapt to changes in living condi-tions. This is based on our long-term risk-conscious business policy that customers can rely on today and in the future in every life situation. As the number 1 in Austria, we have shown foresight for 187 years, day after day, in and throughout Austria.

Robert LasshoferChairman of the Managing Board of Wiener Städtische

ShOWiNg FOreSighT


FOr A BeTTer OVerVieW

highLighTS & MANAgeMeNT

Highlights 2Showing foresight (editorial) 3excellent profit performance (interview) 6Wiener Städtische Managing Board 12A day with the Managing Board 14

cOMPANY & STrATegY

Key figures 22leading in Austria 24Vienna Insurance Group 26Clear objectives and strategy 30Skilled employees ensure success 34Sustainable security 38Carefree in all life situations 44Campaigns with foresight 50

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MANAgeMeNT rePOrT 2011

Business development in 2011 54Risk report 59outlook 61proposed distribution of profits 63

ANNUAL FiNANciAL STATeMeNTS 2011

Balance sheet 66Income statement 72notes 2011 79Auditor’s report 105Declaration by the Managing Board 107Supervisory Board report 108

SerViceprovincial advisory boards 110provincial head offices 113Contact information and addresses 114Glossary 123

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Wiener Städtische Ag Managing Board (l. to r.): Judit havasi, erich Leiß, general Manager robert Lasshofer, ralph Müller, christine Dornaus.

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Mr Lasshofer, 2011 was not a particularly easy year for the economy in general, or for the insurance industry. How did Wiener Städtische do?

Lasshofer: Wiener Städtische performed extraordinarily well, in spite of the diffi-cult environment. We increased our result from ordinary activities to EUR 236 million, which is outstanding under the current economic conditions. We did, however, suffer a decline in premiums, mainly due to single-premium life insurance. This was due to an increase in the tax lock-in period from ten to 15 years. Elderly people in par-ticular do not want to be locked-in for such a long period of time. This is why we are actively promoting a more realistic and, therefore, better solution. We were very successful in this product area in previ-ous years, and were therefore all the more strongly affected by the change in the law.

And how did the business perform in the other classes?

Leiß: We recorded growth in all other classes in 2011, in some cases consid-erable growth. There was a significant turnaround, for example, in motor vehicle insurance. This was partly due to a con-siderable increase in new vehicle regis-trations last year – an increase of 8.4%. However, there was also a recovery in the general discounting trend, for all policy types, making the motor vehicle business more profitable again.

Our premiums increased by close to 3% for the non-motor vehicle class (i.e. prop-erty insurance without motor vehicle insur-ance). This was primarily because people are becoming considerably more serious about providing for the future, also with re-spect to their belongings. Insurance is be-ing increasingly used in this way to cover risks that require protection. This is the case, for example, with catastrophe cover-age, where we became the first mover by offering appropriately designed supple-mentary modules.

Havasi: We recorded a 2.3% growth in health insurance in 2011. Some of the products in this class were updated, and some even redesigned completely, all while a very heated public debate was tak-ing place on our health care system and its funding. We introduced two health care products in 2011 that show once again that we are serious about our responsibility to provide affordable insurance products. Given that people’s financial resources diminish as they age, we are now offering a supplementary variant of our special class health care insurance that reduces premiums by 25%, or even 50%, start-ing at age 65. We are also a first mover in private nursing care provision, which we introduced as a supplementary module last year. We have also taken up this topic in the public debate, as we feel the funding gap is widening here.

Lasshofer: The same is true of pension pro-visions, where we are working to maintain

An interview with the members of the Managing Board of Wiener Städtische Versicherung AG, General Manager Robert lasshofer, Christine Dornaus, Judit Havasi, erich leiß and Ralph Müller.

“... We cAN LOOK BAcK ON A YeAr OF eXceLLeNT PrOFiT PerFOrMANce iN 2011 ...”


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government funding, and we feel that a similar funding should be provided for pri-vate nursing care. When they think about private provisions for the future, people also generally think of a combination of pension and nursing care provisions. In our view, the government-sponsored old-age provi-sion product should be improved by moving in the direction of investments with a very small weighting on shares and, so, with a guaranteed interest rate.

How were you able to raise profits signifi-cantly in spite of a fall in premiums? The conditions on the capital markets were not particularly favourable ...

Dornaus: Given the environment, we can be truly proud of the profits we achieved. This was due, on the one hand, to highly capable asset management, which is gen-erally conservative and security-oriented. In addition, we also pay close attention to the creditworthiness of the issuers when choosing investment securities, result-ing in a high weighting of bonds with AAA and AA ratings in our investment portfolio. I say this, however, being fully aware of the scepticism needed when talking about rat-ings today, which is why this is just one of the criteria we use to choose investments. For 2012, we have set ourselves a goal of expanding our real estate portfolio in order to further increase the stability of our in-vestments.

Havasi: A high level of cost-efficiency also had a positive effect on our profits. The re-structuring measures we have introduced in recent years, in particular combining all administrative responsibility for personal insurance, property insurance, and col-lections in three service centres, reduced costs substantially. We are also taking ad-vantage of many synergies within the VIG Group, particularly with respect to back office areas and reinsurance programs. The only area in which we are purposely not cutting back is our employees. We are saving by reducing the complexity of our processes.

Leiß: Thanks to highly disciplined cost management, we were able to further

reduce our combined ratio to 95% in 2011. One has to keep in mind, however, that the reduction in claims figures for 2011 made it a year of very low losses. No natural ca-tastrophes occurred in our area of opera-tions, which was good for our profits, but does not mean that the risk of natural catastrophes is declining, and we never-theless recorded a few large claims by our industrial customers.

2011 was your first year of complete inde-pendence after the spin-off of Vienna Insur-ance Group Holding – did everything work out well?

Lasshofer: Focusing on our business op-erations in Austria proved to be a good move. With 3,500 employees, including approximately 2,000 directly involved in customer service, and around 1.3 million customers, we continue to be number 1 in the country and were able to increase pre-miums in all classes – except, as previous-ly mentioned, in life insurance, where the legal framework for single-premium poli-cies simply changed to our disadvantage. We were nevertheless able to considerably increase our economic profit as compared to the previous year.

Müller: We continue to systematically im-plement a regional approach for our 140 business offices, some of which were es-tablished in 2011. We are currently building a new provincial headquarters for Lower Austria, while simultaneously creating new business offices in locations such as Tulln and Herzogenburg. We are therefore in-vesting heavily in Austria, especially in the locations where we are generating most of our premiums. The stability we enjoy in the VIG Group is a great help in all of this.

You said earlier that you are not cutting costs where employees are concerned. What does this mean in concrete terms?

Müller: It means that we see our employ-ees as the key factor for the success of our regional approach, which is aimed at creat-ing close customer relationships. Our goal therefore continues to be increasing the number of employees in customer service,

“The MOTOr VehicLe BUSiNeSS BecAMe MOre PrOFiTABLe AgAiN iN 2011.”Erich Leiß

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and thereby also increasing customer satis-faction. We are therefore investing and add-ing new employees, particularly new field staff, even though these are difficult times. We are also currently training around 150 trainees under our trainee initiative, making us the leading Austrian insurance company in this area.

We are looking for dedicated, outstanding individuals in this program – qualifications, expertise and motivation are extremely im-portant to us. The training and advanced training that each individual needs are therefore an important part of our annual employee performance reviews. We also place great importance on uniform princi-ples and ethical conduct, which is why we reviewed our Code of Conduct last year and made it mandatory for all employees.

Havasi: For us, equal opportunity is a mat-ter of course – 40% of Wiener Städtische’s employees are women, and 34% of man-agers are women. In 2011 we established an “Idea Exchange” that gives female employees a good opportunity to become more involved with the Company. De-signed as an internet platform, it not only allows suggestions to be submitted and re-warded, but also facilitates mutual support by allowing employees to work together to find solutions to real problems they are facing. This significantly promotes the ex-change of knowledge and team spirit.

What is happening in terms of customer service, products, and services?

Havasi: 2011 was definitely a year of prod-uct innovation. We brought 14 new prod-ucts to market, compared to a normal rate of three to five a year. These products covered all classes, and both private and business customers. Two examples were previously mentioned above, namely pri-vate nursing care and special-class pre-mium reduction after the age of 65. Other examples of new products brought to market are a new life insurance product offering guaranteed interest for children, a single-premium product with inflation pro-tection, and a supplementary module al-lowing hospital deductibles to be reduced.

Leiß: In the area of mobility, we added a second bonus level to our highly successful motor vehicle climate bonus, a new insur-ance package for electric bicycles, and a product providing security against vehicle lease payment defaults. This underscores the self-image we have as a first mover in the Austrian insurance industry. We also consider it important to use all available channels to our customers, while remain-ing constantly up-to-date and innovative. In so doing, we also naturally make use of new technologies and are placing increas-ing emphasis on applications for smart-phones. A not unimportant result is better customer access when a loss occurs, such as regular SMS information on the status of claims processing. Another example is a storm warning initiative we started in May 2011 as an important measure for effective loss prevention. Our WetterService mobile warning system provides free storm warn-ings to our private and business customers via an application or SMS for individually specified locations throughout Austria.

How is the cooperation with Erste Bank Sparkassengruppe going?

Lasshofer: We also continued to expand and intensify our efforts in this area last year, and will continue to do so in the future. This form of close cooperation be-tween an insurance company and a bank is unique in Austria. It allows us to offer customers full service for all their financial needs. Due to the added value this cre-ates, it is also well received by our mutual customers.

There were a few changes and reassign-ments in the Wiener Städtische Managing Board in 2011 …

Lasshofer: Yes, changes were made and we also further optimised our manage-ment organisation by reassigning several areas of responsibility.

Mr Ralph Müller joined our team on 1 April 2011 and is responsible for sales, market-ing and advertising, areas that were previ-ously mine. Peter Höfinger, on the other hand, withdrew from the Managing Board

“We PAY cLOSe ATTeNTiON TO iSSUer creDiTWOrThiNeSS iN OUr iNVeSTMeNTS.”Chr is t ine Dor n aus


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on 30 June in order to dedicate himself more intensively to his duties in VIG. His former areas of responsibility, reinsurance and corporate customers, have now been assigned to Erich Leiß.

Responsibility for human resources passed over to me from Judit Havasi at the end of 2011. In turn, she assumed responsibility for business organisation and IT from Erich Leiß, which gave him the freedom needed for the strategically very important corpo-rate customer business. In addition, IT is particularly important in personal insur-ance, which is one of Judit Havasi’s areas of responsibility.

Mr Müller, what areas are you focusing on as a new member of the Managing Board?

Müller: My goal is to ensure that custom-ers feel they are getting excellent service. Based on the principle of “no customer without an advisor”, we will increase our efforts even further in the future to create the closest possible relationships with our customers. Our sales employees and dis-tribution partners both have an extremely important role to play in this. We must successfully defend and expand our po-sition as market leader in all areas of our broad portfolio of product offerings. This requires great commitment, as custom-ers are rightfully more demanding today. Personal service, transparent product offerings, innovative solutions for all situ-ations in life, and the power of our brand are central factors in this. We want to apply these strengths of our Company even more effectively. In late autumn, we also used an advertising awareness campaign to underline this with the themes: “Showing Foresight”, “Be Able to Listen”, and “Talk in Plain Language”.

With respect to transparency, which is also an important topic in connection with Solvency II, how are the preparations com-ing along?

Dornaus: We started full force on the im-plementation of all necessary measures in 2011. The original plan was, after all, for the new rules to enter into force at the

beginning of 2013 – although based on the current situation it now looks likely to be delayed. Solvency II brings a higher level of transparency with respect to our ability to fulfil our benefit commitments at any time and with respect to whether the Company is sound and solvent today and in the fu-ture. On the whole, therefore, the trend is in the direction of more careful, sustain-able management. In addition, transpar-ency also creates a greater level of trust. We therefore also feel this is a constructive change, even though a few provisions are still under discussion. It means more ef-fort for us, and also requires a change to our management culture, since risk con-siderations have to play a greater role in all decision-making. The biggest hurdles are continuity of documentation, and the preparation and processing of associated reports and their integration into the day-to-day life of the Company.

You just mentioned sustainability and trust, which brings me to the topic of social re-sponsibility. What are your thoughts in this area?

Havasi: Social involvement has always been very important to us. We have worked together with organisations like the Red Cross, Caritas, Hilfswerk, and Volkshilfe for many years. It is, after all, normal for an insurance company to help others who are not doing so well – in essence, that is what our business is about. However, we also contribute to art and culture by spon-soring, for example, the Bregenz Festival, children and youth, or sports and exercise.

Müller: In the spirit of our many years of commitment, we brought the Social Active Day to life in 2011. The idea was incred-ibly popular, with 200 employees volun-teering for the initiative in just the first five weeks. This provides additional support for the sponsored parties that were just mentioned, and our employees are also free to make their own suggestions. In this way, we also demonstrate internally that social involvement is one of our central concerns, while at the same time motivat-ing our employees. This means that we not only provide monetary support, but

“We BrOUghT A TOTAL OF 14 NeW PrODUcTS TO MArKeT iN 2011.”Judi t Havas i

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also make a personal contribution. It also fits in with our commitment to a regional approach, as there are projects receiving support throughout Austria. In addition, it is also fascinating to see what this creates internally. Employees talk with each other about what they are doing, considerably strengthening the bonds between employ-ees and to the Company. The members of the Managing Board, by the way, have also taken part in this initiative. For example, I myself helped in the integration kinder-garten in Brigittenau, the 20th District of Vienna, and was impressed by the enthu-siasm of the children.

Let us finish with a look into the future. What strategy will Wiener Städtische follow?

Lasshofer: Even though conditions may have changed, our goals and strategy re-main the same. First and foremost, we want to maintain and further expand our leading position in the Austrian insurance market. In addition to products and services that continue to set the trend for the future, the road to our goals is built on nationwide advice and service, top efficiency, an even closer partnership with Erste Bank and the Sparkasse savings banks, and a conscious commitment to our social responsibility.

And what are the prospects for 2012?

Müller: We began laying the foundation in our work plan for 2012 under the motto “inspire our customers”, which is aimed at further intensifying the level of advice provided, promoting the theme of old-age provision as a growth area, gaining new distribution partners, and positioning Wiener Städtische as the partner for bro-kers, agents, and financial service provid-ers. Customer satisfaction is a key success factor we are putting our full efforts into.

Lasshofer: We are doing everything pos-sible to continue our record of good eco-nomic profits. The October 2011 forecast by the Austrian Association of Insurance Companies (VVO) predicts market growth of 1.8% over all classes in 2012. We would very much like to outperform this fore-cast for the overall market. In order to also increase our profits, we are naturally also working toward further improving our com-bined ratio.

Thank you for the interview.

“We WiLL FOcUS ON FUrTher iNcreASiNg cUS TOMerOrieN TATiON iN SALeS.”Ralph Müller

“SePArATiNg FrOM Vig AND cONceNTrATiNg ON BUSiNeSS OPerATiONS iN AUSTriA hAS PrOVeN TO Be The righT DeciSiON.”Robert Lasshofer


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Judit havasierich Leiß christine Dornausrobert Lasshofer ralph Müller

WieNer STäDTiSche MANAgiNg BOArD

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erich LeiSSMember of the Managing Board

Born in 1956

erich leiß joined Donau Versicherung in 1976. In 1999 he became head of the property/casualty department. In 2007 he was appointed to the Managing Board with responsibility for the area of actuarial practice. erich leiß was a member of the Wiener Städtische Austria Committee of the Vienna Insurance Group Managing Board starting as of 1 January 2009 before his appointment to the Manag-ing Board of Wiener Städtische Versicherung AG.

Areas of responsibility: General liability insurance, property insurance, legal protection insurance, private and commercial business, motor vehicle insurance, special damages, corporate and large customer business, reinsurance, property insurance service centre

JUDiT hAVASiMember of the Managing Board

Born in 1975Studied law

Judit Havasi has been employed by the Vienna Insurance Group since 2000. She began as an internal audit employee in unIon Biztosító, and became the head of this company in 2003. Judit Havasi was a member of the Wiener Städtische Austria Committee of the Vienna Insurance Group Managing Board and a member of the Managing Board of unIon Biztosító in Hungary before her appointment to the Manag-ing Board of Wiener Städtische Versicherung AG in 2008.

Areas of responsibility:Company law, sponsoring, business organisation, It management and provider management, life insur-ance, casualty insurance, health insurance, personal insurance service centre

rOBerT LASShOFerGeneral Manager, Ceo

Born in 1957Studied social sciences and economics

Robert lasshofer first worked for the Group at union Versicherung AG in 1986. After that, he be-came managing director of AWD Gesellschaft für Wirtschaftsberatung and was appointed to the Managing Board of Donau Versicherung in 1998. He became a member of the Managing Board of Wiener Städtische Versicherung AG in 1999. In october 2007, he was appointed “Deputy General Manager”. He has been General Manager of Wiener Städtische Versicherung AG since 3 August 2010.

Areas of responsibility:Management of the Com-pany, strategic matters, media and public relations, internal communications, erste Bank Sparkassen-gruppe partnership, human relations and personnel development, general secretariat, communication with the Supervisory Board, representative vis-a-vis the supervisory authority, insurance associations and trade associations

rALPh MüLLerMember of the Managing Board

Born in 1968Studied law

Ralph Müller was a mem-ber of the Managing Board of AWD Holding AG with responsibility for Austria and the Cee region before being appointed to the Managing Board of Wiener Städtische Versicherung AG on 1 April 2011. From 2000 to 2004, he was managing director of Bank Austria Finanzservice. He was head of sales starting in 2005, and subsequently a member of the managing board of Bank Austria responsible for the private and commercial customer areas.

Areas of responsibility:Marketing and advertising, central sales management, primary distribution, secondary distribution, commercial client busi-ness, corporate and large customer sales, provincial headquarters

chriSTiNe DOrNAUSMember of the Managing Board

Born in 1963Studied commerce

Christine Dornaus began her career at Wiener Städtische Versicherung AG in 2002 as assistant man-ager of the investment management and loans department, which she has managed since 2005. Before this, she followed a 10-year banking career by setting up the controlling department in Invest equity Beteiligungs AG. She was a member of the Wiener Städtische Austria Commit-tee of the Vienna Insurance Group Managing Board and a member of the extended Board before being ap-pointed to the Managing Board of Wiener Städtische Versicherung AG in 2009.

Areas of responsibility: Securities and funds, equity investment manage-ment and loans, real estate, finance and accounting, collections service centre

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7:55 A.M.Erich Leiß is already talking with a field employee early in the morning about the solution for a claim in the Large Customer segment. He always makes time to talk with sales staff.

Erich Leiß’ area of responsibility includes, among other things, property insurance for private and business customers, as well as corporate and large customers. Claims processing is of key importance to his everyday work. Cooperative garages, for instance, allow efficient time-saving organi-sational structures that directly benefit customers. A Wiener Städtische adjuster can simply drive to such a garage to assess the claim. This saves customers travel time, waiting time and formalities.

A DAY WiTh The WieNer STäDTiSche MANAgiNg BOArD

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8:00 A.M.Judit Havasi checks the agenda for the day with her assistant and takes the documents for today’s Idea Exchange meeting, one of Wiener Städtische’s many employee initia-tives.

9:15 A.M.Ralph Müller (centre) calls a quick sales meeting in his office. He discusses current issues with Walter Wichtel, head of Corporate Sales (left), and Gerhard Heine, head of Alternative Sales.

The focus is on objectives and sales measures for 2012. The latest sales figures are analysed and agreement is reached on main priorities and the implementation of planned measures over the next few weeks. An initiative to expand both distribution channels is planned for 2012.

“Our 2012 work programme is all about intensifying our sales activities. our main goal is to provide excellent service that further increases customer satisfaction.”

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10:00 A.M.Christine Dornaus, responsible for the investment area, talks on the phone with an employee about the details that still need to be clarified regarding a possible real estate investment.

In accordance with its conservative investment policy, Wiener Städtische is planning to expand its real estate portfolio in 2012.

10:55 A.M.Ralph Müller informs Robert Lasshofer about current sales results.

Wiener Städtische continues to follow the principle of regionalism, even in difficult economic times. Having a nationwide presence in Austria is a fun-damental decision that allows customer contact to be further intensified in the future and the best possible advisory services to be offered.

“Wiener Städtische is a reliable partner for its customers. our motto is: ‘An advisor for every customer.’ We want our customers to be enthusiastic about our expertise and innovative products. those are our stated goals for 2012.”

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11:30 A.M.The Idea Exchange committee: Robert Redl, Robert Bilek, Chairman Judit Havasi, Franz Urban, Ralph Müller (l. to r.)

The committee meets periodically to discuss and evaluate ideas submit-ted by employees and to decide on their implementation. The suggestions cover a wide range extending all the way from minor improvements in the workplace to Group-wide innovations.

“More than 250 ideas submitted since the beginning of September 2011, more than 400 comments, and more than 10,000 visitors show the great interest generated by the Idea exchange.”

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1:30 P.M.Erich Leiß receives the latest figures on the mobile phone storm warn-ing from co-worker Astrid Frisch.

“We work continuously to optimise loss prevention by integrating stateoftheart technologies. the storm warning initiative that began in 2011 to deliver warnings by SMS or app has been very well received by our customers. they greatly value the opportunity to receive storm warnings not only for the location where they live, but for any location in Austria.”

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2:15 P.M.Judit Havasi talks with Sabine Weiss, who is responsible for advertising and sponsoring, about activities for Social Active Day 2012.

Wiener Städtische is once again promoting employee social involvement to help the needy and disadvantaged in our society in 2012 by making a work-ing day available to all employees who want to volunteer their time.

“Social responsibility is a key theme that is consciously and actively promoted within our company. the impressive suc-cess of the Social Active Day shows that our employees are highly dedicated to volunteer activities.”

2:45 P.M.On the way to a meeting with other members of the Managing Board, Robert Lasshofer meets Doris Janik, head of the General Secretariat, and hears about the latest developments in the Austrian insurance market.

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3:35 P.M.Erich Leiß and Annemarie Ulbing, head of the Property Insurance Service Centre, discuss the new customer satisfaction study.

In order to increase customer satisfaction, Wiener Städtische focuses not only on quick and easy claims processing, but also on opti-mising measures for loss prevention.

4:15 P.M.Christine Dornaus chairs the investment meeting with Reza Kazemi- Tabrizi, Robert Burger, Christian Buchmayer and Anton-Leonhard Werner (l. to r.).

The meeting begins with a discussion of the current market situation. Christine Dornaus examines investment valuations and discusses with her team the next steps to be taken for the planned transactions. In ac-cordance with the policy of risk-conscious business management, the focus is on security-oriented investments.

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6:15 P.M.Robert Lasshofer is on his way to the 20th floor to a discussion meeting.

“Stability and security have top priority in every decision. We ensure this by making selected investments in sound projects that guarantee reliability for our customers even in economically difficult times.”


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KeY FigUreS WieNer STäDTiSche VerSicherUNg Ag

in eUr million 2010 2011

gross premiums written 2,432.8 2,274.6property/casualty insurance 1,046.5 1,066.2life insurance 1,058.5 872.9Health insurance 327.8 335.4

Financial result 388.4 388.9result from ordinary activities 187.6 235.5Total investments 12,510.6 12,323.0

Investments 10,286.6 10,107.1Investments for unit-linked andindex-linked life insurance 2,234.0 2,215.9

Underwriting provisions (excluding unitlinkedand indexlinked life insurance) 8,294.9 8,531.3Underwriting provisions for unitlinkedand indexlinked life insurance 2,141.4 2,164.9equity capital 881.7 903.3Number of employees 3,497 3,462

office employees 1,546 1,543Field sales representatives (incl. trainees) 1,951 1,919


HIGHlIGHtS & MAnAGeMent | cOMPANY & STrATegY | MAnAGeMent RepoRt 2011 | AnnuAl FInAnCIAl StAteMentS 2011

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2011 PreMiUMS BY SegMeNT 2011 iNSUrANce PAYMeNTS* BY SegMeNT

STrUcTUre OF iNVeSTMeNTS 31 Dec 2011*2011 reSULT FrOM OrDiNArY AcTiViTieS BY SegMeNT

* Investments as at 31 December 2011 excluding investments for unit-linked and index-linked life insurance: euR 10,107.05 million

* Incl. costs of claims processing

life 38.4%

Health 14.7%

property/Casualty46.9%

life 12.9%

Health 12.9%


life 43.7%

Health 15.8%


equity investments 18.2%

loans 14.0%

Real estate 2.7%other 0.5%

Securities 64.6%


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In an excellent position even in financially difficult times: as a reliable partner with foresight, Wiener Städtische offers

security and stability, along with the experience of a company that has been well established for 187 years. other key success factors

for Wiener Städtische’s market leadership in Austria are its financial strength, know-how, innovative insurance solutions and

top-level consulting competency.

With a market share of about 14% and a premium volume of about EUR 2.27 bil-lion most recently, Wiener Städtische Versicherung is the leading Austrian in-surance company. It is also the largest individual company in the international Vienna Insurance Group (VIG). It has its registered office in Vienna and is focused on activities within the Austrian market. As an insurance partner, it is responsible for more than 1.3 million customers across all lines of business. In addition, Wiener Städtische has branch offices in Italy and Slovenia.

Consistent customer orientationWith provincial headquarters in all nine federal states, about 140 business offices and approximately 2,000 advisors, Wiener Städtische is clearly focused on having a nationwide presence in Austria in order to provide the best possible advisory services and ensure proximity to its customers. The consistent implementation of the principle of regionalism is the basis for the ongoing optimisation of customer relationships, comprehensive professional support throughout Austria and prompt claims set-tlement. Clear customer orientation is the crux of Wiener Städtische’s success and

will continue to be one of the main pillars of its strategic orientation. This is also the core strength of all employees and distri-bution partners.

Reliable partner in all situationsAs an innovative insurance company, Wiener Städtische offers individual, flexi-ble insurance solutions for every personal life situation as well as customised pack-ages for businesses in all lines of business (property/casualty, life and health insur-ance). Banking products are also becom-ing increasingly important. In 2008, Wiener Städtische addressed the growing need of its customers for comprehensive support by entering into a distribution agreement with Erste Bank Sparkassen-gruppe. Continuous investments into this partnership expand and improve the ser-vices offered on an ongoing basis in order to be able to offer customers one-stop solutions in all financial matters.

Source of economic stimulusThanks to its long-standing business his-tory and strong market position, Wiener Städtische is one of the most important investors and sources of stimulus for the business hub Austria.

LeADiNg iN AUSTriA


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Wiener Städtische is one of the most im-portant institutional real estate investors in the country and regularly adds pro-perties to its investment portfolio. Also when it comes to investments, Wiener Städtische always acts with a view toward maximum security and a high return for the policy holders. As an equitable part-ner for industrial enterprises and large corporations, Wiener Städtische also makes a major contribution to the stabili-ty and growth of the Austrian economy.

Stability and securityTargeted investments in solid projects as well as the Company’s long-standing experience and success provide stability even in economically difficult times. In addition, a high equity ratio and integra-tion into the broadly positioned Vienna Insurance Group (VIG) provide security. VIG, which is listed on the Vienna Stock Exchange’s leading index, occupies a leading position on the market in Central and Eastern Europe and makes a signifi-cant contribution to Austria as a financial centre.

Already today, Wiener Städtische is well prepared for the new risk regulations

and capital requirements for insurance under the terms of the EU Directive “Sol-vency II”.

FAcTBOX R With a market share of about 14% and

1.3 million customers, the leading insurance company in Austria

R new provincial headquarters, about 140 business offices and 3,500 employees, of which 2,000 are advisors, ensure the provision of services nationwide

R Strong financial position due to solid capital resources and integration into the Vienna Insurance Group

“We Are rePreSeNTeD ThrOUghOUT AUSTriA.”Judit Havasi


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With a premium volume of approximately euR 9 billion and around 25,000 employees, Vienna Insurance Group (VIG) is one of the

leading insurance groups in Austria and Central and eastern europe (Cee). Innovation, strong customer relationships and an

emphasis on customer service create a high quality product portfolio offering attractive solutions in both the life and non-life

insurance segments.

VIG’s clearly focused strategy for expan-sion in the CEE region enabled it to make a transition from being an Austrian insur-ance company to an international group at an early stage. Today, VIG is represented by approximately 50 insurance companies in 25 countries. VIG stands for financial stability, and offers a high level of security to customers, shareholders, partners and employees. One of the key reasons is its conservative investment policy. This is re-flected in its A+ rating with a stable out-look, which makes Vienna Insurance Group the best-rated company in the ATX leading index of the Vienna Stock Ex-change. VIG has also been listed on the Prague Stock Exchange since 2008.

In addition to economic considerations, the Group also places great importance on an involvement with social concerns and helping to create a future society worth living. In this way, Vienna Insurance Group remains true to its fundamental goal of value-oriented growth.

Core market: AustriaVienna Insurance Group is the largest in-surer in Austria, where it holds an excel-lent position with its group companies Wiener Städtische, Donau Versicherung and s Versicherung. The strength shown in this core market since 1824 is one of the reasons for the successful realisation of VIG’s internationalisation strategy.

VieNNA iNSUrANce grOUP


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Major player in the CEE regionVienna Insurance Group started its ex-pansion in 1990, making it one of the first Western European insurance companies to expand into Central and Eastern Eu-rope. Today the Group is one of the most important players in this region and earns more than 50% of its total Group premi-ums in the CEE region. It has group com-panies and branches in the following countries in this region: Albania, Belarus, Bulgaria, Croatia, Czech Republic, Esto-nia, Georgia, Hungary, Latvia, Lithuania, Macedonia, Montenegro, Poland, Roma-nia, Russia, Serbia, Slovakia, Slovenia, Turkey and the Ukraine. VIG has also been represented in Bosnia-Herzegovina since 2011. Due to many years of experi-ence and excellent knowledge of the mar-kets in this region, and to its expertise in all insurance matters, VIG is optimally po-sitioned to continue benefiting from fu-ture increases in the standard of living in the CEE region and from the accompany-ing increased need for insurance.

Vienna Insurance Group is also represent-ed in Germany, Liechtenstein and Italy.

A common goal: to offer security to customersEvery customer is unique. They differ in their need for insurance and retirement provisions, living circumstances and the way they like to receive advice. Vienna In-surance Group is aware of this. There is no “standard” insurance customer for VIG, it therefore pays close attention to special local characteristics, and main-tains a presence with more than one brand name and broad distribution net-works in many of its markets. There is one thing, however, that all Vienna Insurance Group companies have in common: the goal of providing security to customers.

VIG companies have offered a complete range of insurance solutions in Austria for many decades in both the non-life and life segments. Although the markets in Cen-tral and Eastern Europe are currently still at a different economic level, they are increasingly moving in a similar direction. While demand in this region in the period following 1989 was initially strongest for motor vehicle insurance, and then

household and homeowner insurance as well, today retirement provisions, savings and investment products in the form of life insurance policies are enjoying rising popularity.

With the establishment of VIG RE, the Group has also had its own reinsurance company since 2008. The location of the company’s registered office in the Czech Republic underscores the importance of the CEE region as a growth market for VIG.

Strategic partnership with Erste GroupErste Group is a strong partner for Vienna Insurance Group. It also operates inde-pendently, has the same values and fol-lows a similar growth strategy. The two companies benefit equally from a long-term cooperation agreement concluded in 2008 for Austria and the CEE region. Erste Group distributes VIG insurance products, whereas VIG companies offer Erste Group banking products in re-turn. The cooperative arrangement gave Vienna Insurance Group access to a well-established bank distribution network.

Skilled employees bring successEmployees play a particularly important role in the success of a service company. Here too, in addition to dedication, pro-fessional advice, and excellent service, Vienna Insurance Group places great im-portance on understanding local markets and close customer relationships.

Further information on Vienna Insurance Group is available at www.vig.com or in the VIG Group Annual Report.

“A cLeAr DiViSiON OF reSPONSiBiLiTieS WiThiN The grOUP ALLOWS FULL cONceNTrATiON ON AUSTriA.”Rober t Lasshofer


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AVOiD The PrOBLeMS OF TOMOrrOW TODAY. PrOViDe FOr The FUTUre.


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“Take care of tomorrow, while still being able to enjoy today. our ‘prämienpension’ and ‘Garantiepension’ pension products offer flexible retirement provision models at a reasonable price, and help provide a secure standard of living even after the end of your professional life.”

What we can offer youDon’t worry about getting old. Our “Extra-Pflegegeld“ nursing care insurance adds many benefits that enhance the basic government insurance, closing a big gap in your retirement provisions.


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Wiener Städtische’s overarching strategic objective is clear and seemingly simple:

continuing to develop its position as the leading insurance company in Austria.

Radical change continues in insurance markets. Regulatory changes, a new risk perception as a result of the financial and economic crises and changes in custom-er behaviour pose major challenges to insurance companies. Better informed and knowledgeable consumers create a competition in trust. On the other hand, as a result of people’s increasing need for security, the crisis brings new business opportunities, especially in consulting as well as in the pension and property insur-ance business.

OBJecTiVeS

Developing a leading market positionWith a market share of about 14% and a premium volume of EUR 2.27 billion, Wiener Städtische easily remained number 1 in the Austrian market in 2011. Approxi-mately 1.3 million private and business customers rely on the first-class service provided by Wiener Städtische in the life insurance, health insurance and property and casualty segments.

Wiener Städtische’s primary strategic ob-jective is not only to maintain this leading position but also to continue to develop it. As a reliable partner to its customers in all life situations, it focuses on open dia-logue, a high degree of transparency and a business perspective that extends be-yond the “here and now”.

With these objectives in mind, it has de-veloped a series of operational objectives

that are to contribute to the long-term security and enhancement of the Com-pany’s success.

> Best possible consulting services for the customers

> Targeted personnel development> Innovation of products and services> Increasing profitability> Sustainable development of the

Company’s management and investments

> Developing the partnership with Erste Bank

STrATegY

Several strategic cornerstones serve to implement these objectives – always with a view to the wellbeing, security and peace of mind of the customers. Credibil-ity and trust, customer satisfaction and quality of service, responsibility and ini-tiative as well as appreciation and respect are the fundamental values. The motto chosen for 2012 – “Inspire our clients!” – perfectly conveys the central strategic approach.

Best possible service nationwideDue to the consistent implementation of the principle of regionalism, Wiener Städtische is represented and close to its customers throughout Austria. Estab-lished components of this proximity are the provincial headquarters in all nine fed-eral states, the approx. 140 business of-fices throughout Austria and the approx.

cLeAr OBJecTiVeS AND STrATegY

“OUr gOAL iS TO eNSUre SUSTAiNeD cOMPANY PerFOr

MANce OVer The LONg TerM.”

Rober t Lasshofer


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2,000 advisors in the Company. Even in economically turbulent times, Wiener Städtische holds on to its wide regional base and invests in establishing and ex-panding its locations.

Constant innovation When it comes to the development of in-novative insurance products and services that are tailored to meet customer needs, Wiener Städtische has traditionally been the trendsetter in Austria. The Company will continue to maintain and develop this position. Optimisation, simplification and individualisation are the most significant challenges in this regard. For example, in 2011 storm alert services were provided to all customers free of charge via an app.

Developing the partnership with Erste Bank SparkassengruppeThe successful partnership, which has been going on since 2008 and which allows customers to obtain comprehen-sive advice on a full range of financial and insurance matters, will be further devel-oped and strengthened, as both compa-nies have customer potential that has not yet been fully exploited.

Improving efficiency and cost control Long-term success requires solid figures and high efficiency. Accordingly, Wiener Städtische’s aim is for targeted growth in premium volume as well as further opti-

misation of administrative services and synergies to continuously improve the combined ratio and result from ordinary activities. The Company also deliberately pursues a conservative investment policy.

Social responsibility Since its foundation 187 years ago, Wiener Städtische has upheld values, such as joint or sustainable management. This fundamental attitude is a permanent process that is firmly anchored in the cor-porate culture. Reliable customer support is just as much part of it as equal treat-ment, caring for employees, respect for the environment, social involvement or promoting sports, arts and culture.

Targeted personnel developmentWiener Städtische employees primarily advise customers. Employee develop-ment and training of young employees are, therefore, crucial for lasting success in personal advisory services.

“We WANT TO iNSPire OUr cUSTOMerS iN 2012.”Ralph Müller


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“Business class is right for your business. professional service and advice – even for complex requirements. We take care of all of your insurance needs, so that you can concen-trate on your business.”

What we can offer you Flexible custom-tailored protection with special “Plus-Risk” packages. In addition to “extended cover”, you can even obtain cover for natural hazards with our “unidentified hazards” and “natural hazards” packages.

OUr cUSTOMerS UNDerSTAND Their BUSiNeSS. We UNDerSTAND OUrS.


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experience, skills and the involvement of its employees are key factors for success in Wiener Städtische’s leading position on the Austrian insurance market. First-class educational and

training programmes, as well as initiatives to motivate employees contribute significantly to customer satisfaction and optimal

customer consulting.

Jobs for about 3,500 employeesDuring its 187 years in business, Wiener Städtische has become the largest em-ployer in the Austrian insurance industry. Of the approx. 3,500 staff members, about 2,000 work as advisors. Open communication and a “Code of Conduct”, which is based on Wiener Städtische’s corporate values, are of central impor-tance to all the employees in their daily

interactions. The corporate behaviour to-wards the employees, customers and shareholders is guided by honesty and sustainability, leadership in matters large and small, customer satisfaction, diver-sity and equal opportunity. In addition, values, such as respect, fairness and ap-preciation, characterise the corporate culture.

Largest apprentice trainer in AustriaAs the number 1 apprentice trainer, Wiener Städtische employs about one third of all apprentices that are trained as insurance advisors throughout Austria. About 250 young people from all over Austria have completed their apprentice-ship with Wiener Städtische over the past five years. In 2011, Wiener Städtische continued to focus on the promotion of young talent and offered again training with open-ended career opportunities to about 100 young people as part of the apprentice recruitment. Thus, in addition to a sound training, the apprentices also obtain the necessary equipment for a promising professional career. Approxi-mately 150 apprentices, of which 36% are women, are currently undergoing training.

Personnel development in focusIn addition to general education and training, which are central elements of personnel policy, group-wide analyses of potential form the basis for a targeted,

SKiLLeD eMPLOYeeS eNSUre SUcceSS

Trainees: Matthias Krischke, JoanaNina Matejka, Jessica Sedlacek, Dominik Salomon, Lisa Dolezal and Fabian Leidenfrost (l. to r.).


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needs-based support programme for the purpose of imparting know-how and cor-porate values on an individualised basis. Wiener Städtische continuously invests in training and support programmes in order to offer its employees growth oppor-tunities and career perspectives.

An important focus of personnel develop-ment is a three-level training programme for executives, which systematically sup-ports the target groups – future/young executives, department heads and group leaders – in customised internal courses. The goal is to strengthen the leadership skills of the participants. In addition, the Company makes a conscious effort to promote the exchange of information and the continuous transfer of best practices among all employees. In doing so, Wiener Städtische contributes significantly not only to the personal and professional de-velopment of its employees, but also to the long-term security of its corporate success.

Exchange of ideas – creativity pays off

Employees can demonstrate their faith in their own ideas on Wiener Städtische’s Ideas Exchange. All employees are invit-ed to submit via this online platform their ideas, beliefs and experiences in order to improve processes, products or work-place design. They can also actively support the new and onward develop-ment of products and services. A com-mittee under the direction of Judit Havasi meets on a regular basis and evaluates every single idea that has been submit-ted.

Equal treatment in practiceIn the course of its long tradition, Wiener Städtische has attached great impor-tance to equal treatment, as well as find-ing a balance between life at work and home. With two women and mothers in

the five-member Managing Board and 35% women in middle management posi-tions, the Company puts this principle into practice.

In addition, since 2005, Wiener Städtische has been a quick starter with respect to the so-called “Daughters’ Day”, as part of which all Viennese girls between the ages of eleven and sixteen are invited to take a look behind the scenes of a typical work-day of Viennese companies. In 2011, 40 girls took this opportunity to learn about the responsibilities of an insurance advisor at Wiener Städtische.

As one of the most family- and female-friendly companies in Austria, Wiener Städtische has already received several awards. As early as 1974, it played a pio-neering role as one of the first employers in Austria to introduce a company kinder-garten in Vienna. Today, 104 children of employees are looked after in these facili-ties. The possibility of flexible working time and work organisation models, as well as the return of 90% of the em ployees from maternity leave, demonstrate the success of the measures for the benefit of a work-life balance.

Naturally, Wiener Städtische also prac-tices equal treatment when it comes to persons with special needs and the topic of immigration. It has 102 disabled em-ployees, which is more than what is legally required. In addition, Wiener Städtische supports multilingualism as an important element when it comes to customer infor-mation and English is part of its minimum requirements in all areas.

die Id

eenborse

Employee statistics as of 31 December 2011

Number of employees

2010As of

31 Dec

2011As of

31 Dec change

Administration 1,546 1,543 –3Headquarters 1,030 1,076 +46

provincial headquarters (including business offices)

516 467 –49

Sales 1,802 1,778 –24Sales representatives 1,598 1,570 –27

organisational employees 204 208 +4

Apprentices 149 141 –8Total 3,497 3,462 –35

The decrease in the number of personnel by 35 employees is mainly due to natural turnover and the integration of duties during the structural reorgani-sation of the Company.


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DON’T JUST TALK ABOUT reSPONSiBiLiTY. TAKe SOMe, TOO.

What we can offer you Many years of social involvement. Approximately 200 employees were involved in helping the dis-advantaged during just the first five weeks of the “Social Active Day” initiative.


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Wiener Städtische actively assumes social responsibility vis-à-vis its employees, customers and society. Values, such as social

involvement and sustainable management, are integral parts of corporate governance.

Social Active DayFor many years, Wiener Städtische has been socially committed to and has cooperated with aid organisations, such as Caritas, Hilfswerk, Kinderfreunde, Diakonie, the Red Cross, Volkshilfe, the Samaritans and Integrationshaus. In 2011, the European Year of Volunteering, Wiener Städtische sent another powerful message of the high importance attribut-ed to social issues within the Company with the so-called “Social Active Day”. The Social Active Day initiative was intro-duced in order to actively support the pro

bono involvement of its employees. Already in the first five weeks, about 200 employees used Social Active Day in around 50 projects for the benefit of disadvantaged members of our society. They were able to get involved with aid or-ganisations, with which Wiener Städtische had a pre-existing partnership, or with projects suggested by them. The range of activities was comprehensive and includ-ed giving soup to those in need, caring for the elderly, working with persons with special needs, caring for children from socially disadvantaged families, as well as replenishing the shelves at social super-markets.

The Managing Board also participated in this activity. Robert Lasshofer spent a day accompanying the residents of the nurs-ing ward of a retirement home. Judit Havasi spent time with children with spe-cial needs and helped out at the “Am Himmel” nursery, which provides curative education, while Ralph Müller visited the Kinderfreunde Kindergarten in Engerth-straße, where he demonstrated his talent as a storyteller.

Sustainable products with foresightWiener Städtische also meets its respon-sibility for providing sustainable and long-term security to its customers through af-fordable products as part of the government-sponsored pension plan and individually customisable models for a company pension plan. Thus, Wiener Städtische covers both elements that are recommended within the scope of the

SUSTAiNABLe SecUriTY

Judit havasi dedicated her time to the “Am himmel” remedial nursery on her Social Active Day.


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three-pillar model as a supplement to government pension with attractive offer-ings.

Products tailored to the needs of persons with special needsIn 2011, Wiener Städtische developed, together with the Behindertensportver-band Salzburg (Disabled Sports Federa-tion of Salzburg), a unique, tailor-made insurance concept for group health and accident insurance. Previously, the ap-proximately 7,000 members of this feder-ation had difficulty in obtaining or had limited access to insurance solutions as a result of their physical impairment. This obstacle could only be overcome with the help of Wiener Städtische – a significant step towards equal treatment in the in-surance field. The framework agreement offers comprehensive insurance cover-age in the event of an accident or illness, including spouses or domestic partners as well as children of members of the Dis-abled Sports Federation. Accident insur-ance also includes insurance coverage for participation in national competitions as well as the option of co-insurance for international competitions.

Micro-insurance – celebrating five successful yearsSocially disadvantaged groups are more exposed to risks, such as illness, acci-dents or loss of property, than the aver-age population. Thus, Wiener Städtische was the first insurance company in Austria and in the European Union to ad-dress the issue of micro insurance. In 2011, the cooperation with the “Zweite Sparkasse”, the “Bank für Menschen ohne Bank” (“the bank for those without a bank”), has already celebrated its fifth anniversary. “Zweite Sparkasse” provides people in need with particularly favour-able banking and insurance services free of charge. Included within the scope of this cooperation, Wiener Städtische gives customers of “Zweite Sparkasse” basic insurance coverage with free legal advice once every three months, as well as free accident insurance. Wiener Städtische Versicherungsverein – Vermögensver-waltung – Vienna Insurance Group pro-vided support for this activity.

Sponsorship for art and cultureBy supporting art and cultural projects, Wiener Städtische significantly contributes

ralph Müller with children from the Kinderfreude Kindergarten.

“PrOViDiNg SUPPOrT TO SOciALLY DiSADVANTAgeD grOUPS iS ONe OF WieNer STäDTiSche’S FUNDAMeNTAL VALUeS.”

Rober t Lasshofer


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to the diversity and attractiveness of Austria’s cultural landscape. For many years Wiener Städtische has been the sponsoring partner of institutions, such as Burgtheater Wien, Volkstheater Wien, Theater in der Josefstadt, Ver-einigte Bühnen Wien, Opernfestspielen St. Margarethen, Bregenzer Festspiele, Carinthischer Sommer and Viennale – to name just a few examples.

Activities for children, adolescents and familiesWiener Städtische is also a reliable part-ner for supporting children and adoles-cents taking part in sports activities, cre-ative projects and initiatives on the issue

of safety. It supports, for example, Kinder-freunde, the Zoom Kindermuseum, and the KinderuniWien.

Supporting sports and exerciseSports are an important contributing fac-tor in maintaining one’s health. The cor-rect preventive health care, vitality and a healthy body are essential requirements for a happy and fulfilled life. As sponsor of various Austrian sports associations, Wiener Städtische supports numerous projects, such as the Vienna City Mara-thon, the Wachau Marathon, the Vienna Capitals and the Wiener Käfigmeister-schaften.

hermann Fried, Wiener Städtische Provincial Director, christine Dornaus, Member of the Wiener Städtische Managing Board, and Thomas irschik and gerhard Fida, Managing Directors of Wien energie Fernwärme, at the awarding of the cO2 certificate by the Vienna University of Technology (l. to r.).


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Careful handling of resourcesWiener Städtische also takes environ-mental protection very seriously as part of its activities. The Company focuses primarily on campaigns on raising the awareness of its employees as well as on the ongoing optimisation of energy effi-ciency in the entire building and office op-erations, including the IT infrastructure. This also includes the use of environmen-tally friendly materials as well as energy- efficient lighting systems.

In addition, Wiener Städtische, as a co-operation partner, gives the IT hardware that it no longer uses to the non-profit organisation AfB (Arbeit für Menschen mit Behinderungen, Work for People with Disabilities). AfB collects the IT equip-ment from its cooperation partners, tests it, repairs it, if necessary, and re-sells it with a twelve-month warranty. AfB has set out to create workstations for persons with special needs at its facility and has thus established the first non-profit IT system house in Europe.

When it comes to supplying its office buildings with heating, Wiener Städtische increasingly uses district heating, and thereby contributes significantly to the reduction of the greenhouse gas CO2. The new provincial headquarter in St. Pölten, which is still under construction, will be built according to the most modern en-ergy technology principles and will be supplied with district heating. By using this environmentally friendly, reliable and efficient technology, Wiener Städtische saved a total of 1,575 tons of CO2 at three office locations in Vienna in 2011. In the coming years, a climate protection part-nership with Wien Energie Fernwärme is expected to help to further increase dis-trict heating and lower the emission levels more than before. The CO2 savings will be confirmed by a certificate issued by the Vienna University of Technology.

FAcTBOX Wiener Städtische as Sponsor

Rchildren & adolescents: Sponsoring projects, including Kinder-Sicherheits-olympiade or Zoom Kindermuseum, and collaboration with child-oriented organisations.

RSocial involvement: Cooperation with “Zweite Sparkasse”, the “Bank für Menschen ohne Bank”, and with many aid organisations.

RArts & culture: Wiener Städtische supports cultural projects, theatre productions, as well as film and music festivals.

RSports & exercise: With the right pension plans and as a sponsor of the Austrian sports associations, Wiener Städtische uses measures to maintain and support health. In this regard, it also supports large events such as the Vienna City Marathon.

“AcTiVe cLiMATe PrOTecTiON iS AN iMPOrTANT eVerY DAY PriNciPLe OF SUSTAiNABiLiTY FOr US.”Christine Dornaus


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“Fighting an illness already takes enough energy. You shouldn’t also have to worry about the cost of the treatment.”

What we can offer you Pay significantly lower premiums starting at age 65. With our new “ZukunftsPlus” supplementary insurance for “TopMed” health policies, you can choose to reduce your premiums by 25% or even 50%.

YOU hAVe TO geT BeTTer BY YOUrSeLF. We’LL DO The reST.


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With customised, flexible products and individual services, Wiener Städtische’s customers can obtain optimal provision for

all life situations.

The needs and satisfaction of the custom-ers are the focus of all of the Company’s activities – in 2011, 14 product innovations set new standards in this regard. The focus was on pension and business products.

PeNSiON iNiTiATiVe

Security is Wiener Städtische’s core busi-ness and especially in economically diffi-cult times the need for long-term security is greater than ever. Also in the field of pri-vate pensions, Wiener Städtische owes its pioneering role and market leadership not least to its foresight in socio-political themes and issues. Most recently, in November 2011, it presented, together with the Institut für Strategieanalysen (Institute for Strategy Analyses [ISA]), a security radar that analyses the “con-cerns” of 1,800 insured parties in Austria. The information gained from this study is incorporated into the concept of new products and guarantees a precise align-ment with customer needs. 47% of those surveyed indicate financial security in old age to be the number 1 concern. This confirms that Wiener Städtische made the right choice with the pension initiative it started in 2011 and its commitment to reforms in the government incentive system permitting greater freedom of choice. Therefore, these will be contin-ued at full force in 2012.

Wiener Städtische provides its customers with the right provision in all phases of life and, if the needs of the customers change, adjusts its insurance offerings in a flexible manner to new life situations. The product portfolio includes pension

insurance, life insurance, accident insur-ance, nursing care and building society savings.

On the security radar, financial security in old age was followed by concern about property and fear of natural disasters. In 2011, Wiener Städtische invested in prod-uct innovations and preventive measures also in these areas – an overview of the key innovations is provided below.

iNNOVATiONS iN LiFe iNSUrANce

The classic life insurance continues to be a favourite when it comes to security- oriented pension. Benefits that argue in favour of this are guaranteed interest and, in the case of the Garantiepension pen-sion product, calculation of the pension payment according to the pension table that applies at the time the contract is entered into. This means a higher pension in the case of continuously increasing life expectancy, because a shorter average payment period is assumed at the time a policy is purchased.

Double pension with the “Start-ins-Leben” package for childrenThe Start-ins-Leben package combines insurance coverage and capital formation in one product of the classic life insurance. With a guaranteed interest of 2%, a solid financial basis can be created for the future of the insured child, since at the time of the determined payout, a starting capital is created for key milestones in life – professional training, education, dwell-ing or driving licence. Even in the event of death of the premium payer, the insured

cAreFree iN ALL LiFe SiTUATiONS

“creATe A SOLiD FOUNDATiON FOr

The FUTUre.”Judit Havasi


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sum plus the gains accrued after expiry of the agreed term of insurance will be paid out. Wiener Städtische also assumes pay-ment of outstanding contributions. How the profits are invested (classic, dynamic or progressive) and the monthly contribu-tions can be freely selected with this product.

In addition, the Junior’s Best future provi-sion plan for children or grandchildren and the special insurance package TAKE IT EASY for students and young people offer further customised, advantageous pension models for young people.

Limited Edition 15/10 & SicherSave for 15 years, but pay only for ten years – this is the clear benefit of the Limited Edition 15/10 & Sicher (secure), a product of the classic endowment insur-ance. In the case of survival, at the end of the term, Wiener Städtische pays 104.5% of the gross premium amount, plus profit sharing. The payment is exempt from income tax and investment income tax.

PiONeer iN PeNSiONS AND NUrSiNg cAre

The state-supported pension provision – or premium pension – for closing the pension gap has developed into one of Wiener Städtische’s most successful pension products. In 2011, it celebrated its 240,000th state-supported premium pension customer – and the trend of sup-ported pension provision continues. Compared to the previous year, in 2011, Wiener Städtische was able to record more than 5% growth in premium from premium pension contracts.

New PflegeBONUS with payment at intervalsAs the number 1 insurance company in Austria, Wiener Städtische has also recognised the high importance of private nursing care, which will continue to gain importance in light of demographic and social developments, and develops inno-vative products for it. For example, in 2011 it brought the attractive additional policy PflegeBONUS to the market for

the event when no benefit claims are made. If no need for care arises, as of age 65, the customer benefits from a premi-um payment every five years. The new policy can also be taken out in addition to any existing contracts.

Reduction in deductibles when in hospitalWith the Selbstbehaltsretter deductible saver product, Wiener Städtische offers a new additional policy that is unique in Austria, which lowers the financial burden in the event of a hospital stay. The policy guarantees reduction in the deductible payable as of the second calendar year gradually by 20%. If no claims are submit-ted for five calendar years, there will be no deductible payable in the sixth year in the event of a hospital stay. The “Selbst-behaltsretter” policy can be taken out as a supplement to the special class policies with deduction.

Special class premium reduction as of age 65 with ZukunftsPLUSIncome usually decreases on reaching retirement. With ZukunftsPLUS, a sup-plemental insurance for special class TOP MED, customers can reduce their premi-um by 50% or 25% when they reach 65. Until the age of 60, this additional policy can be taken out without any medical examination. The customer’s high level of freedom of choice is also a unique fea-ture. In the event the contract is terminat-ed at the age of 65, the customer receives an attractive one-time payment instead of the above-mentioned reduction in premi-um. In the event the policy is terminated prior to the claim for a reduction of the premium, the entire actuarial reserve of the additional policy is paid out.

AWArDWiNNiNg BUSiNeSS cLASS

As a strong partner for the economy, Wiener Städtische strives to satisfy the continuously increasing security require-ments of small and medium-sized opera-tions (approximately 40,000 customers at present) with continuous product in-novations. In 2011, Wiener Städtische received the “Assekuranz Award” with a


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“very good” classification for once again bringing additional diverse products and services onto the market for Business Class commercial insurance last year. This enabled it to offer its customers even more precise insurance protection and comprehensive services, including skilful advisory for complex requirements.

The nine components of contents insur-ance, assistance, liability insurance, building insurance, legal expenses insur-ance, machine commercial insurance, electronics comprehensive insurance, transport insurance and freezer container insurance cover all the insurance needs of businesses. In addition, Wiener Städtische is the only insurance company in Austria to include claims management free of charge.

iNNOVATiONS iN MOBiLiTY AND LegAL PrOTecTiON

Strong environment triple in the motor vehicle businessWith the Climate Bonus and Environ-ment Bonus, Wiener Städtische intro-duced preferential premium policies for motor vehicles six years ago in order to support forward-looking technologies for the reduction of pollutants. By doing so, it was the first Austrian insurance company to promote the use of environmentally friendly vehicles. Every other customer of Wiener Städtische already benefits from this attractive policy. The climate bonus promotes conventionally powered vehicles if they have lower CO2 emissions. The envi-ronment bonus, in turn, promotes vehicles that run on natural gas, hybrid vehicles as well as other alternative drive concepts.

In 2011, the climate bonus was expanded by a second bonus level. Whereas the premium savings in the case of a CO2 emission of up to 160 g/km in the motor vehicle liability insurance amount to 10%, now 20% of the policy amount can be saved in the case of an emission of up to 120 g/km.

In addition, in 2011, Wiener Städtische brought a new insurance package for electric bicycles onto the market.

In all, more than 580,000 customers put their trust in the extensive cover provided by Wiener Städtische’s third-party liability motor vehicle insurance and more than 230,000 customers in its comprehensive motor vehicle insurance. This is largely the result of the innovative additional of-ferings, such as the family bonus in third-party liability and comprehensive insur-ance, which provides a more favourable classification by up to three stages for each additional vehicle within the family.

Through the leasing company Wiener Städtische – Donau Leasing, Wiener Städtische also offers its customers lease financing models with many additional benefits. As of 2011, customers can in-sure themselves with the new insurance concept Leasing-Protect against a pay-ment default on their motor vehicle lease agreement.

The well-established travel insurance for care-free travel offers protection against motor vehicle damage at home or abroad and can simply be taken out by means of a payment slip policy. In 2011, this insur-ance was expanded by a new leisure package for sports, hunting and fishing. It also insures private property and is of interest primarily to those who would like to temporarily expand their coverage for a trip.

Legal protection Wiener Städtische’s legal protection in-surance is an ideal product for both em-ployees and the self-employed. In addi-tion, as of 2011 it offers many innovations: premium-free and worldwide assistance abroad for criminal law protection, higher insured sums, legal protection in inheri-tance and family law matters, stalking, employment law matters as well as in the event of mobbing and workplace sexual harassment, general contract law protec-tion and social insurance legal protection, which also offers coverage for proceed-ings at the highest courts. Particular ben-efits to the customer are instant protec-tion, protection for the entire family, free choice of a lawyer as well as a premium discount of 15% if the customer decides to take out a policy with a 10% deductible.

FAcTBOX Business class

R “Classic” and “premium” versions complete and efficient basic protection or complete all-round protection can be freely chosen for each segment

R Commercial third-party liability insurance with flexible sum selection, choice of deductible payable and comprehensive clause package

R numerous extras for special require-ments as well as free apps and free collection service

R Flexible solutions for business interruptions with individual sums, liability periods, pension solutions

R plus Risk package: flexible extra protection for unidentified risks, flood or earthquake, which can be taken out individually

R Individual motor vehicle packages for each segment

R outside business packages: compre-hensive protection for outdoor property, e.g. umbrella bars, lamps, company signs, swimming pools or outdoor furniture


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MODerN – MOBiLe – UPTODATe

cUTTiNg eDge SerViceS

The security of and service to its custom-ers, along with the intelligent use of the most recent technologies, are at the core of Wiener Städtische’s diverse innovative developments in the service sector. The company website, as the central plat-form, offers the best service and opti-mised user friendliness: here, both pri-vate and business customers can promptly find all the desired information and can obtain information on all of Wiener Städtische’s insurance solutions – including online calculation and quote generation. Naturally, online claim notifi-cation is also available. The well-struc-tured service area offers information about all the key contact platforms, ser-vice numbers and assistance services, and the website also offers valuable tips on loss prevention.

Wiener Städtische’s ombudsman, whose office can be reached by phone, e-mail or through the website, provides feedback on customer satisfaction and is of course also available for personal customer con-tact. Prompt service and a minimum wait-ing time for replying to complaints ensure that customers receive a response re-garding further procedure within a few hours, including when contact is made via e-mail. The ombudsman’s office also receives a lot of positive customer feed-back and shows that the constant further development of the service contributes significantly to maximising customer satisfaction. With this in mind, all com-plaints submitted are deemed to be an opportunity to improve the customer rela-tionship and are, therefore, analysed in a very detailed manner, verified for feasibil-ity and communicated to all departments concerned.

Successful storm alertIn May 2011, Wiener Städtische initiated an important measure to effectively pre-vent losses with its storm alert initiative. The new WetterService mobile weather alert system is available free of charge to both private and business customers as

an app for all smart phones or via SMS. Thus, storm alerts reach customers auto-matically and accurately directly over their mobile phone, wherever they are in Austria. Secured data quality in conjunc-tion with cutting-edge technology now guarantees safety and reasonable pre-vention in the event of a storm. In addi-tion, as of August 2011, the alert service can be subscribed to not only for one but three locations. Business customers can even select up to 30 operating sites. By the end of 2011, more than 265,000 alerts have been sent locally, regionally and nationally.

The app for all eventsWiener Städtische’s free Schaden-Service-App (loss service app) for iPhones and Android mobile phones of-fers via a loss form, check lists and first aid measures as well as an emergency call, valuable tips and quick help in a case of emergency number – regardless of whether the loss is caused by a storm, fire, burglary or motor vehicle. Not least, this service offers all customers the op-tion of an uncomplicated and time-saving claim settlement. In addition, the current status of the loss event will, upon request, be communicated at any time via SchadenSMS service.

“We eNSUre ThAT OUr MOBiLe SerViceS Are AS USerFrieNDLY AS POSSiBLe.”Erich Leiß


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AgAiNST BUMPS AND ScrAPeS TO The SOUL. AND eLSeWhere.

What we can offer youA trio of excellent environmental products in the motor vehicle segment. Our environmental bonus benefits vehicles with alternative drive technologies (natural gas, hybrid, super ethanol or electric), and our two-level climate bonus benefits vehicles with low CO2 emissions.

“You drive better with allaround cover. And if something actually does happen, you are in the best of hands with us, because we cover all mobility risks with attractive modules with flexible components.”


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Clear advertising messages and, as ever, best impact values for the “Dear neighbours” from the well-known tV campaign ensure a strong and successful presence in the media for

Wiener Städtische. true to the motto: “We wish your problems were ours”, the Wiener Städtische brand appeared with

messages for customised insurance solutions and skilful advisory in a wide range of media. the advertising portfolio as

of the end of 2011 has been supplemented with a highly acclaimed poster campaign.

NeW POSTer cAMPAigN

Showing foresight – be able to listen – talk in plain languageHand in hand with numerous product in-novations, in 2011, Wiener Städtische also focused on a new impetus in its ad-vertising. With the new poster campaign launched throughout Austria in October 2011, it focuses on its skills and strengths as a partner and advisor. Three visuals in close-ups place emphasis on the follow-ing central themes “Showing Foresight”, “Be Able to Listen” and “Talk in Plain Language”. With these, Wiener Städtische memorably conveys the message that it always provides its customers with the best possible advice and addresses their personal needs with customised, individ-

ually tailored products and services. The fact that Wiener Städtische also demon-strates “foresight” is emphasised by its solid and long-term commitment to busi-ness policy, on the basis of which it will be able to reliably serve its clients in all life situations.

TV cAMPAigN

“Dear Neighbours” still a hitThe best stories are true stories – with this concept, Wiener Städtische not only conquered viewers’ hearts, but also suc-cessfully conveys, in addition to product messages, values, such as trust, reliabili-ty and proximity. With the TV campaign about the likeable neighbours, Wiener Städtische also demonstrated foresight

cAMPAigNS WiTh FOreSighT


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for its media appearance. The trailer that presents three protagonists (single moth-er with teenage daughter, new neighbour) was broadcast for the first time in Novem-ber 2009. The continuation of the cam-paign, which in 2010 had been selected as a double-“impact winner”, proved to be very successful in 2011 as well. In the TV spot, the female protagonist guides her neighbour into a parking space. Dis-tracted by her daughter, she gives an er-roneous signal, as a result of which the neighbour causes damage. The episode humorously conveys to the viewer that the customers of Wiener Städtische are cov-ered against all mobility risks. Other spots that were broadcast in 2011 addressed the topic of pension provision in general (“Morning Hygiene”) and the personal advisory to premium pension (“The New One”).

The Neighbours introduce themselvesIn 2011, it was time to give names to the popular protagonists from the advertising spots – they have been around long enough to develop a relationship with each other as well as with the viewers. For that reason, Wiener Städtische initiated a name-finding campaign among its 3,500 employees, who were very enthusiastic about participating and submitted 1,180 suggestions and 787 different names. In the end, the competition came down to the most frequently submitted names. In the future, the mother can be addressed

as Sophie, the daughter as Lisa and the neighbour as Peter.

iMAge AND PriNT cAMPAigNS

From the poster campaign, the subject “Showing Foresight” has also been used since the autumn of 2011 as an adver-tisement in various print media and has been combined with the well-known slo-gan “We wish your problems were ours”. In addition, the performers of “Dear Neighbours” appeared again on print advertisements also in 2011, in line with the respective TV spot and the associated products. As part of a uniform marketing appearance, Wiener Städtische’s prod-uct folders will also be designed with the corresponding photographs from the campaign.

The “Say only one Word” campaign was also continued in 2011. In this sequel, Wiener Städtische conveyed its message by focusing on the essential point. Catch-words, such as “Security”, “Pension”, “Care”, “Trust”, and even loss events, such as, “Burst Pipe” or “Car Body Dam-age” conveyed strong values and clear messages about the products.

“OUr MeSSAge FOcUSeS ON OUr STreNgThS AS A PArTNer AND ADViSOr.”Ralph Müller

Lisa, Peter and Sophie – The “Dear Neighbours” in the TV campaign.

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eQUiPMeNT cAN cOMe APArT AT The SeAMS. BUT OUr iNSUrANce hOLDS.


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“Make your home a carefree zone. We have the right solution for all needs and types of losses – from garden sheds to multi-family properties. After all, the best way to handle losses is together.”

What we can offer youComprehensive, custom-tailored protection for an all-round secure feeling in your home.

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A N N U A L R E P O R T 2 0 1 1 | W I E N E R S T Ä D T I S C H E

ECONOMIC CONDITIONS

Financial market development in 2011 Capital market development was influenced by a wide range of political, economic and even environmental factors in the year just ended.

Dramatic political changes in North Africa and the Middle East were the focus of attention at the beginning of 2011. A number of autocrats were forced to leave the stage and make room for democratic movements. In one case, this was brought about by a civil war, with the rebels receiving inter-national support. This reshaping of the political landscape in the Middle East and North Africa affected the international financial markets, mainly through the resulting fluctuations in the price of oil.

A natural disaster in Asia caused massive damage to the Fukushima nuclear power plant in Japan, leading to a high level of market turbulence. In addition to the environmental contamination caused by high levels of radiation, this was also a serious setback for Japanese industry, and a great deal more time is still needed to remedy the effects on the economy.

The core European countries, in particular Germany and Austria, provided a positive surprise in terms of economic performance in the first half of the year, while the peripheral countries continued to battle with stagnation and even re-cession. The data published in the USA were also rather disappointing.

The biggest test, however, was still to come for international capital markets.

Excessive levels of sovereign debt became the dominant topic of discussion during the course of the summer. In addi-tion to Greece and Portugal, attention also turned to Italy and Spain. International rating agencies unleashed a wave of credit downgrades for European countries and banks. Stan-dard & Poor’s even downgraded the AAA status held by the USA. Risk premiums for southern European countries ex-ploded to record levels.

At the same time, yields on German government bonds fell to all-time lows. The DAX and ATX indices, for example, lost more than 30% of their value in a relatively short time during this phase. The financial sector in particular suffered dra-

matically from growing risk aversion and a lack of confidence in its stability.

Resolutions aimed at solving the "euro crisis" were adopted at many EU crisis summits, rescue funds were set up, and new capital requirements were put into place for European banks. However, none of these measures were able to re-duce tension over the long term. All of these efforts were also hindered by an economic slowdown that was gradually be-ginning to affect core European countries, too. The European Central Bank then attempted to remedy the situation by reducing its key interest rate from 1.5% to 1% in the last two months of the year.

The end effect was very sobering on balance for the capital markets. European equity markets were more strongly af-fected than, for example, the USA. The DAX ended the year with a loss of 15.4%, and the EURO STOXX 50 closed with a loss of 14.5%. The market in Austria, where the ATX index recorded a loss of 34.9%, was one of the most strongly af-fected by these negative developments.

In contrast, the US S&P 500 index managed to end the year unchanged.

Economic situation in Austria The economy slowed considerably after recording a good first quarter in 2011. Only slow growth of 0.2% was recorded in each of the second and third quarters. The Austrian econ-omy nevertheless did grow strongly in 2011. The latest fore-cast by the Austrian central bank (Österreichische National-bank – OeNB) predicts real GDP growth of 3.3% in 2011. The labour market also did surprisingly well in 2011. Inflation rose, however, to 3.5% due to large increases in the price of energy, services and food.

THE AUSTRIAN INSURANCE MARKET

According to preliminary statistics from the Austrian Asso-ciation of Insurance Companies at the end of February 2012, the Austrian insurance industry recorded a 1.7% reduction in total premiums in 2011 to EUR 16.464 billion (2010: +2.0%). Premium income from life insurance declined by 7.5% to EUR 6.989 billion (2010: +1.9%). Life insurance with regular premiums rose by 1.6% to EUR 5.612 billion (2010: +1.4%), while single-premium life insurance fell by 32.2% to EUR 1.376 billion (2010: +3.2%). This was primarily due to an increase raising the minimum lock-in period to 15 years.

MANAGEMENT REPORT 2011

HIGHLIGHTS & MANAGEMENT | COMPANY & STRATEGY | MANAGEMENT REPORT 2011 | ANNUAL FINANCIAL STATEMENTS 2011


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Health insurance premiums grew by 3.6% to EUR 1.697 billion (2010: +3.0 %).

Premiums written for property and casualty insurance grew by 2.9% to EUR 7.778 billion (2010: +2.0%) thereby outper-forming 2010.

BUSINESS DEVELOPMENT IN 2011

OVERALL BUSINESS DEVELOPMENT

Wiener Städtische is one of the leading insurance companies in the Austrian insurance market. It operates in the prop-erty/casualty, life and health insurance segments. Wiener Städtische also has branch offices in Italy and Slovenia. These branch offices sell products in the non-motor vehicle and life insurance classes. The Slovenian branch office is located in Ljubljana and has 30 employees. Wiener Städ-tische has operated in Italy since 1999. The Rome branch office has 16 employees.

Wiener Städtische is a 99.9% subsidiary of VIENNA INSUR-ANCE GROUP AG Wiener Versicherung Gruppe, whose A+ rating was reconfirmed with a stable outlook by the interna-tionally recognised rating agency Standard & Poor's in 2011.

Premium income Wiener Städtische generated a premium volume of EUR 2,274.55 million in financial year 2011, representing a de-crease of 6.5% compared to 2010. The decrease is due to a sharp decline in premium income from single-premium life insurance policies. EUR 2,265.78 million of these total pre-miums were generated from direct business and EUR 8.77 million from indirect business. EUR 1,786.41 million of the gross premiums written was retained by Wiener Städtische, and EUR 488.14 million ceded to reinsurance companies.

Property/casualty insurance contributed EUR 1,066.18 million in premiums, representing 46.9% of total premium income, while life insurance contributed EUR 872.93 million, or 38.4%, and health insurance EUR 335.44 million, or 14.7%.

Property/casulty46.9% (43.0%)

PREMIUMS 2011 BY SEGMENTS

Life 38.4% (43.5%)

Health 14.7% (13.5%)Figures for 2010 in brackets

Expenses for claims and insurance benefits Including the change in the mathematical reserve, gross expenses for claims and insurance benefits fell by 22.4% in 2011 compared to the previous year, to EUR 1,748.43 mil-lion. This was primarily due to the volatility of the single-premium business and price losses in unit- and index-linked life insurance.

Operating expenses Administrative expenses were EUR 421.50 million, repre-senting a decrease of 0.4% compared to the previous year. Workflow efficiency was examined and improved during the organisational changes made under corporate law in 2010, including the Vienna Insurance Group Holding spin-off. For example, joint use is made of back-office departments, such as accounting. Group-wide systems are also being used in the IT area.

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Key figures for Wiener Städtische

in EUR million 2010 2011 Gross premiums written 2,432.80 2,274.55 Thereof property/casualty 1,046.52 1,066.18 Thereof life 1,058.52 872.93 Thereof health 327.76 335.44 Gross premiums written, direct 2,419.86 2,265.78 Thereof property/casualty 1,037.09 1,060.88 Thereof life 1,055.08 869.57 Thereof health 327.69 335.33 Gross premiums written, indirect 12.94 8.77 Thereof property/casualty 9.43 5.30 Thereof life 3.44 3.36 Thereof health 0.07 0.11 Financial result 388.39 388.87 Gross expenses for claims and insurance benefits1 -2,252.97 -1,748.43 Result from unrealised gains and losses from unit- and index-linked life insurance 174.83 -143.14 Gross administrative expenses -423.40 -421.50 Result from ceded reinsurance -104.08 -74.92 Other income/expenses (net) -28.01 -39.92 Result from ordinary activities 187.56 235.51 Thereof property/casualty 123.34 174.72 Thereof life 40.63 30.50 Thereof health 23.59 30.29 Investments2 12,510.59 12,322.99 Underwriting provisions3 10,990.58 10,882.89

1) Incl. the change in the mathematical reserve. 2) Incl. unit-and index-linked life insurance. 3) Incl. unit- and index-linked life insurance and deposits from ceded

reinsurance business.

Combined ratio far below 100% The combined ratio is a figure showing the ratio of adminis-trative expenses and insurance payments to net earned premiums in the property/casualty area. Wiener Städtische's 2011 net combined ratio of 95% (after deducting reinsurers' shares) was once again significantly less than 100%. Solvency in accordance with VAG Solvency is the equity capital available to an insurance com-pany, i.e. free and unencumbered assets. Insurance com-pany solvency is governed by § 73b(1) VAG (the Austrian Insurance Supervision Act), which is intended to ensure that policyholder claims are secure even in the case of unfavour-able developments. Wiener Städtische has equity capital of EUR 1,027.24 in the form of free and unencumbered assets. The solvency requirement is EUR 438.08. This means that Wiener Städtische has a cover ratio of 234.48%. The higher the level of capital available (solvency), the better these claims are covered.

Financial result Wiener Städtische's financial result increased to EUR 388.87 million in 2011. This was mainly due to an increase in the extraordinary financial result, which in turn was due to the realisation of loan-related gains, and from realised secu-rities-related gains and losses.

Investments Investments were EUR 12,322.99 million as at 31 December 2011, including EUR 2,215.94 million attributable to invest-ments for unit- and index-linked life insurance. Investments without including unit- and index-linked life insurance were EUR 10,107.05 million at the end of 2011.

Investments at the end of 2011 (not including investments for unit- and index-linked life insurance) consisted of 64.58% in securities, 18.19% in participations, 14.04% in loans, 2.67% in real estate and 0.52% in other investments.

STRUCTURE OF INVESTMENTS 31/12/2011*

Securities 64.58%

* Balance of investments excluding unit-linked and index-linked life insurance was EUR 10,107.05 mn as at 31 December 2011

Real estate 2.67%

Loans 14.04%

Ownership interests 18.19%

Others 0.52%



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Result from ordinary activities Wiener Städtische earned a result from ordinary activities of EUR 235.51 million in 2011, calculated according to the requirements of the Austrian Commercial Code (UGB). This corresponds to an increase of 25.6% over the value of the previous year (EUR 187.56 million). This increase was mainly due to a reduction in expenses for claims and insurance benefits.

74.2% of the result from ordinary activities came from the property/casualty segment, 12.9% from life insurance, and 12.9% from health insurance.

Property/casualty74.2% (65.7%)

RESULTS FROM ORDINARY BUSINESS BY SEGMENTS 2011

Life 12.9% (21.7%)

Health 12.9% (12.6%)

Figures for 2010 in brackets

Research and development Due to the nature of the business, research and development plays a secondary role for Wiener Städtische. Development work in the most general sense is done as part of product pricing during product development, for example in the area of demographics or risk-related parameters, or in terms of preventive measures.

BUSINESS DEVELOPMENT IN DETAIL

Property and casualty insurance Wiener Städtische recorded a premium increase of 1.9% over the previous year to EUR 1,066.18 million in the prop-erty and casualty business (direct and indirect). This was mainly due to positive performance in the non-motor vehicle classes. Indirect property and accident premiums fell by 43.8% to EUR 5.3 million. This was due to Group-wide rein-surance programs using VIG RE in Prague. Direct premiums written, on the other hand, rose by 2.3% to EUR 1,060.88 million.

Direct premiums written by Wiener Städtische in the non-motor vehicle classes rose by 3.1% to EUR 741.70 million. In 2011, the motor vehicle classes recorded an increase of 0.6% in direct premiums to EUR 319.18 million. The insur-ance market is showing a slight recovery in this class, primar-ily due to an increase of 8.4% in new registrations (+27,582) compared to the previous year. In the non-motor vehicle classes (direct business), high growth rates were recorded in the storm damage (+7.0% to EUR 32.43 million), water pipes (+5.5% to EUR 73.01 million) and casualty insurance (+3.4% to EUR 96.05 million) areas.

Premium volume for storm damage insurance rose as a result of continuing demand for coverage against natural catastrophes, which is in turn due to increased public awareness of the need for insurance coverage in this area.

The steady increase in public awareness about the risks of everyday life and the need to increase insurance protection beyond the coverage provided by social security is responsi-ble for the increase in new accident insurance policies.

Key figures – property/casualty insurance

in EUR million 2010 2011 Gross premiums written 1046.52 1,066.18 Financial result 90.42 130.51 Gross expenses for claims and insurance benefits -682.05 -708.77 Gross administrative expenses -236.32 -238.73 Result from ceded reinsurance -93.25 -65.20 Other income/expenses (net) -1.98 -9.27 Result from ordinary activities 123.34 174.72

The claim ratio was 65% (total after reinsurance, not incl. claims processing expenses).

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Expenses for claims and insurance benefits rose 3.9% in 2011 to EUR 708.77 million. Gross administrative expenses were EUR 238.73 million in 2011 (+1.0%).

The result from ordinary activities for the property/casualty area was EUR 174.72 million for the whole of 2011, repre-senting an increase of 41.7% over the previous year.

Life insurance Wiener Städtische recorded a decrease in life insurance premiums to EUR 872.93 million, representing a drop of 17.5% compared to 2010. This was primarily due to in-creased volatility in the single-premium product area.

Due to changes in the tax framework for life insurance, there was a massive fall in new single-premium business in 2011. The change that came into effect (raising the minimum lock-in period to 15 year) as part of the amendments to the 2011 Austrian Budget Accompanying Act (Budgetbegleitge-setz) imposes an 11% insurance tax on policies with terms shorter than 15 years. Direct premiums written in the life insurance segment fell by 17.6% compared to the previous year, with premiums from single-premium policies falling even further by 43% to EUR 233.07 million. Life insurance policies with regular premiums decreased by 1.5% to EUR 636.50 million because of an increase in policy expirations.

Key figures – life insurance

in EUR million 2010 2011 Gross premiums written 1,058.52 872.93 Financial result 278.44 227.03 Gross expenses for claims and insurance benefits1 -1,307.88 -763.74 Result from unrealised gains and losses from unit- and index-linked life insurance 174.83 -143.14 Gross administrative expenses -147.34 -142.50 Result from ceded reinsurance -1.72 -1.71 Other income/expenses (net) -14.22 -18.37 Result from ordinary activities 40.63 30.50

1 incl. the change in the mathematical reserve

Gross expenses for claims and insurance benefits were EUR 763.74 million in 2011 (incl. change in the mathematical reserve). Gross administrative expenses were EUR 142.50 million in 2011 (-3.3%). This change was caused by the drop in single-premium business and price decreases in unit- and index-linked life insurance.

The result from ordinary activities was EUR 30.50 million for the life insurance business in 2011, representing a drop of 24.9% compared to 2010.

Health insurance EUR 335.44 million in premiums were written in the health insurance segment during the financial year just ended, corresponding to an increase of 2.3% over 2010.

Wiener Städtische also brought new products to market in 2011 that were primarily intended to make it easier for young people to purchase private health insurance. Wiener Städ-tische also added new supplementary nursing care policies to its product range.

Expenses for claims and insurance benefits (incl. the change in the mathematical reserve) were EUR 275.92 million in 2011. Gross administrative expenses were EUR 40.27 mil-lion in 2011.

The result from ordinary activities reached EUR 30.29 mil-lion in the health insurance segment in 2011.

Key figures – health insurance

in EUR million 2010 2011 Gross premiums written 327.76 335.44 Financial result 19.53 31.33 Gross expenses for claims and insurance benefits1 -263.04 -275.92 Gross administrative expenses -39.74 -40.27 Result from ceded reinsurance -9.11 -8.01 Other income/expenses (net) -11.81 -12.28 Result from ordinary activities 23.59 30.29

1 incl. the change in the mathematical reserve



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Employees The number of Wiener Städtische employees fell by 35 com-pared to the previous year. At the end of 2011, Wiener Städ-tische had a total of 3,462 employees, including 1,778 sales employees and 1,543 administrative employees. There were 141 trainees at the end of 2011.

Number of employees

2010 2011 Office employees 1,546 1,543 Field sales representatives (incl. trainees) 1,951 1,919

TOTAL 3,497 3,462 Employee interests Wiener Städtische's business performance is highly depend-ent on the use of qualified, satisfied employees. Professional, motivated employees therefore represent a valuable re-source for Wiener Städtische.

Training, advanced training and equal treatment in the work-place are key elements of the Company's business philoso-phy. The Company places great importance on training and offers many development and career opportunities. The Company's own human resources development company, Horizont GmbH, is one of the ways the Company ensures continuous training of its employees. Targeted support is also provided for trainee development. Wiener Städtische will continue its efforts in this area in 2012 by offering 100 young people outstanding career opportunities.

Wiener Städtische is one of the most family and women-friendly companies in Austria. The company day-care centre is one example of how employees are actively supported in creating a balance between career and family. Wiener Städ-tische also provides a variety of fringe benefits to make con-ditions attractive for its women employees.

Events occurring after the balance sheet date No other events of special significance that would have changed the presentation of the net assets, financial position and results of operations occurred after the balance sheet date.

RISK REPORT 2011

The risk management system consists of all the guidelines, processes and reporting procedures used to continuously identify, measure, monitor, manage and report on relevant risks on an individual and aggregated basis while taking account of interdependencies. One of the main functions of the Company-wide corporate risk management department is to establish, maintain and manage the risk management system.

The new Solvency II framework directive (2009/138/EG), which also amends insurance company risk management, is to be implemented at the national level in the EU by 2013, although delays of a year are very likely. Like the Basel II model for the banking sector, Solvency II is composed of three pillars. The first pillar deals with the quantitative re-quirements of capital adequacy, while the second pillar deals with the qualitative requirements for company management, the risk management system and internal controls. The second pillar also covers supervisory principles and methods. The third pillar deals with the new provisions for market discipline, transparency and disclosure requirements.

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Due to the many complex requirements of the new Solvency II framework directive, implementation has already begun on Level 2 and drafts for Level 3, when available, based on the framework directive and provisional implementing measures. As a rule, there is no single valid method for implementing these future statutory principle-based requirements. Insur-ance companies have been asked to analyse the statutory requirements and provide a justification for their method of implementation.

These issues therefore require intensive efforts in advance in order to implement the current abstract and theoretical risk management requirements of Solvency II in practice. Wiener Städtische performed a voluntary test run for the calculation of risk-based equity capital in 2011 in order to document and improve the calculation procedures. Current plans are to use a partial internal model to calculate the risk capital needed for the property/casualty class. The model is under development and must receive supervisory approval under Solvency II. The actuarial department is performing ongoing tests of the potential internal model for property/casualty insurance whose theoretical foundations are being devel-oped by the Group. The Company-wide risk management department and the actuarial department are developing a concept for application of the internal mode in consultation with all relevant areas, such as operational departments, the Group and the FMA. In addition, Wiener Städtische is an active participant in the Group-wide project that is making preparations for Solvency II.

The rating agency Standard & Poor’s continuously rates the VIG Group and, therefore, Wiener Städtische, which is the most important component of the Group. The Group has an A+ rating with stable outlook.

All important risk measures are in the good to excellent range.

THE INDIVIDUAL RISK CATEGORIES

Underwriting risks Underwriting risks are risks that the calculated premiums and reserves will be insufficient to provide the benefits that are promised to policyholders in advance, but unknown.

Credit risk This risk quantifies the potential loss due to a deterioration of the situation of a counterparty against which claims exist.

Market risk Market risk is the risk of changes in the value of investments due to unforeseen fluctuations in interest rate curves, share prices and exchange rates, and the risk of changes in the market value of real estate and participations.

Strategic risks Strategic risks can arise due to changes in the economic environment, case law, or the regulatory environment.

Operational risks These may result from deficiencies or errors in business processes, controls or projects caused by technology, em-ployees, organisation or external factors.

Liquidity risk Liquidity risk depends on how good the fit is between in-vestment holdings and insurance obligations.

Concentration risk Concentration risk is a single direct or indirect position, or a group of related positions, that have the potential to signifi-cantly endanger the insurance company, core businesses or key performance measures. Concentration risk is caused by an individual position, a collection of positions with common holders, guarantors or managers, or by sector concentrations.

RISK STRATEGY

The Managing Board is responsible for risk management, and the internal control system developed from it, and de-fines the risk strategy, risk policy, targets and measurement bases.

The objective of risk management is not complete avoidance of risk, but instead a conscious acceptance of desired risks or the implementation of measures to monitor and, if neces-sary, reduce existing risks based on economic factors. These considerations are based on the assumption that higher returns can be achieved by accepting higher risk.

The risk-return ratio is therefore a key measure that should be optimised.

RISK ORGANISATION

In addition to the operational risk managers, an independent corporate risk management department has been estab-



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lished in the Managing Board Secretariat, directly under the Managing Board.

The risk committee is headed by the Company-wide corpo-rate risk management department; it is part of the risk man-agement system and provides detailed reports for the Com-pany-wide risk report. The risk committee is an information platform used to identify relevant risks; it proposes risk man-agement measures to the Managing Board.

OUTLOOK 2012

2012 will also be dominated by the Eurozone crisis. The international rating agencies Standard & Poor’s and Fitch consider default by Greece to be very likely. The rating agen-cies began downgrading the credit ratings of most European countries in 2012. Austria was also affected, receiving a downgrade to AA+. The countries of Europe must now pro-pose a solution for stabilising the EU financial system, and support and implement such a solution.

The insurance industry expects the new solvency legislation to have unpleasant side effects, i.e. that it will be expensive and increase capital costs. Wiener Städtische will continue to improve its Solvency II compliance in 2012 and optimise and document its risk processes. Another test run of the risk-based equity capital calculation and an Own Risk and Sol-vency Assessment (ORSA) are planned for the second half of the year.

Internal control system

The internal control system (ICS) is continuously revised and documented. Operational and financial statement-related risk classes are ranked according to risk magnitude, com-bined with their controls in a risk and control matrix, and reported to the Managing Board and Supervisory Board. This allows control processes to be efficiently optimised. This risk and control matrix is monitored continuously and registered, thereby enabling optimal risk hedging.

OUTLOOK

ECONOMIC GROWTH FOR AUSTRIA IN 2012 The Austrian economy grew strongly in 2011. The latest forecast by the Austrian Central Bank (Österreichische Nationalbank – OeNB) predicts real GDP growth of 3.3% in 2011. Do to a significant deterioration in foreign trade and a major loss of confidence, growth will likely only be 0.7% in 2012.

Assuming that the international economy recovers and the loss of confidence resulting from the sovereign debt crisis eases, growth is expected to increase to 1.6% in 2013. The economic outlook is therefore considerably poorer compared to the OeNB forecast of June 2011. The forecasts for 2012 and 2013 were reduced by 1.6 and 0.9 percentage points, respectively.

Austria continues to be one of the countries with the lowest unemployment rates in the Eurozone. The unemployment rate was 4.2% in 2011 based on the Eurostat definition. As growth prospects deteriorated, however, it rose from 4.1% in the second quarter of 2011 to 4.6% at the end of 2011, followed by a small reduction. The unemployment rate is expected to remain at 4.5% in 2012 and 2013.

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THE AUSTRIAN INSURANCE MARKET IN 2012

The insurance market will be dealing with the financial and banking crisis and the resulting real economic problems for some time to come. The outlook for the Austrian insurance industry is, however, optimistic.

According to the February 2012 forecasts by the Austrian Association of Insurance Companies (VVO), the Austrian insurance market as a whole will grow by 1.3% in 2012. The decrease in premiums in 2011, provisionally estimated at 7.5%, is due to above-average growth in single-premium life insurance in 2010 and the change of the minimum lock-in period to 15 years.

According to initial conservative forecasts, a small reduction of 0.5% is expected for life insurance premiums in 2012. However, due to the demographic change which is increas-ing the number of older people in the population, demand is expected to rise in the area of retirement provisions. Life insurance is the ideal instrument for making provisions to protect one's standard of living in old age.

Premium growth is expected to remain strong in the health insurance area, with an increase of 3.2% expected in 2012. The growing propensity to invest in private health insurance in order to protect the standard of medical care in old age will have a positive effect on premium income.

Property/casualty premiums are forecast to grow by 2.5% in 2012. Premiums for motor vehicle liability insurance are expected to grow again slightly by 0.3% in 2012.

WIENER STÄDTISCHE IN 2012

Times of economic stress cause a particularly large increase in customer demands for security. This applies both to pres-ervation of assets and safeguarding the standard of living that has been achieved.

Our focus in 2012 will be to inspire our customers and gain their confidence by further intensifying customer contact and personal advice, thereby clearly orienting all our activi-ties around the customer. This also applies to the acquisition of new customers in the market, who we plan to win over with custom-tailored products and services.

Wiener Städtische worked intensively on product improve-ments in 2011, and great efforts will also be made to be just as innovative in 2012. Product-specific optimisations will be used to smooth the road to our customers.

In addition to intensifying efforts to build customer relation-ships, attention has also turned to the business opportunities offered by advisory services in the retirement provision and property insurance business. In light of the trend toward increasingly better informed consumers, Wiener Städtische's top priority is to communicate transparently and credibly to customers that their retirement provisions are in good hands and taken seriously by Wiener Städtische, today and in the future.



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Proposed appropriation of profits

WIENER STÄDTISCHE Versicherung AG Vienna Insurance Group ended financial year 2011 with net retained profits of EUR 186,390,649.21.

We propose that the 2011 net retained profits be appropriated as follows:

A dividend of EUR 140,000,000.00 should be paid from the net retained profits, and the remaining balance of EUR 46,390,649.21 carried forward.

The Managing Board

Robert Lasshofer

Christine Dornaus

Judit Havasi

Ralph Müller

Erich Leiß

Vienna, 9 March 2012

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WieNer STäDTiSche Versicherung Ag Vienna insurance group

Separate financial statements prepared in accordance with the Austrian corporate code (UgB) and the Austrian insurance Supervision Act (VAg)

ANNUAL FiNANciAL STATeMeNTS

66 Balance sheet 72 Income statement

NOTeS 2011

79 General disclosures on accounting policies 79 Accounting policies 86 Notes to the balance sheet 89 Notes to the income statement 93 Profit participation 101 Significant equity investments 102 Other disclosures

AUDiTOr’S rePOrT

DecLArATiON BY The MANAgiNg BOArD

SUPerViSOrY BOArD rePOrT

ANNUAL FiNANciAL STATeMeNTS 2011

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Separate financial statements prepared in accordance with the Austrian corporate code (UgB) and the Austrian insurance Supervision Act (VAg) 31/12/2011

Reporting period 1/1/2011 – 31/12/2011Balance sheet comparison date 31/12/2010Income statement comparison date 1/1/2010 – 31/12/2010Currency euR

WieNer STäDTiSche Versicherung Ag Vienna insurance group

HIGHlIGHtS & MAnAGeMent | CoMpAnY & StRAteGY | MAnAGeMent RepoRt 2011 | ANNUAL FiNANciAL STATeMeNTS 2011

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BALANCE SHEET FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2011 Assets Property/casualty In EUR

A. Intangible assets I. Expenses for acquisition of an insurance portfolio 700,000.00 II. Other intangible assets 15,099,291.04

TOTAL INTANGIBLE ASSETS 15,799,291.04 B. Investments

I. Land and buildings 35,786,842.44 II. Investments in affiliated companies and participations

1. Shares in affiliated companies 536,270,367.69 2. Bonds and other securities of affiliated companies and loans to affiliated companies 562,961,393.59 3. Participations 28,124,969.65

thereof reorganisation surplus 0.00 4. Bonds and other securities of and loans to companies in which an ownership interest is held 1,937,147.91 1,129,293,878.84

III. Other investments 1. Shares and other non-fixed-income securities 188,498,402.45 2. Bonds and other fixed- income securities 277,273,337.44 3. Shares in joint investments 0.00 4. Mortgage receivables 21,004,946.72 5. Policy prepayments 0.00 6. Other loans 33,818,139.10 7. Bank balances 21,886,261.44 542,481,087.15

IV. Deposits on assumed reinsurance business 504,453.18

TOTAL INVESTMENTS 1,708,066,261.61 C. Investments of unit- and index-linked life insurance 0.00 D. Receivables

I. Receivables from direct insurance business 1. from policyholders 70,822,657.48 2. from insurance intermediaries 60,041,513.10 3. from insurance companies 15,188,135.78 146,052,306.36

II. Receivables from reinsurance business 77,481,582.47 III. Other receivables 141,729,321.34

TOTAL RECEIVABLES 365,263,210.17 E. Pro rata interest 15,165,188.59 F. Other assets

I. Tangible assets (not incl. land and buildings) and inventories 18,357,568.48 II. Current bank balances and cash on hand 23,768,865.82 III. Futher other assets 87,318,806.06

TOTAL OTHER ASSETS 129,445,240.36 G. Prepaid expenses

I. Deferred taxes 41,143,926.33 II. Other prepaid expenses 19,207,191.01

TOTAL PREPAID EXPENSES 60,351,117.34 H. Offsetting items between departments 125,756,400.58 Total assets 2,419,846,709.69



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Health Life Total business in 2011 2010 In EUR '000

0.00 0.00 700,000.00 2,100 0.00 62,035.42 15,161,326.46 14,972

0.00 62,035.42 15,861,326.46 17,072 87,310,865.70 146,681,710.39 269,779,418.53 273,844 11,523,077.80 1,017,587,903.30 1,565,381,348.79 1,484,257 58,038,973.19 303,709,810.80 924,710,177.58 821,440 9,518,113.96 234,948,770.55 272,591,854.16 276,068 0.00 8,957,022.00 8,957,022.00 8,957 16,747,611.29 95,827,776.24 18,031,667.36 1,574,278,152.01 36,716,426.56 2,799,399,807.09 37,306 118,732,148.74 2,354,494,254.52 2,661,724,805.71 2,836,199 528,773,538.87 2,872,756,299.55 3,678,803,175.86 3,770,160 0.00 32,107,191.79 32,107,191.79 40,787 37,655,563.49 293,639,722.11 352,300,232.32 371,803 0.00 16,981,069.88 16,981,069.88 18,026 4,801,924.17 204,869,238.68 243,489,301.95 221,998 14,194,992.40 704,158,167.67 13,008,362.19 5,787,856,138.72 49,089,616.03 7,034,495,393.54 116,409

0.00 2,872,414.95 3,376,868.13 18,306 887,296,809.61 7,511,688,416.07 10,107,051,487.29 10,286,603 0.00 2,215,940,978.19 2,215,940,978.19 2,223,989

3,569,213.70 25,941,831.59 100,333,702.77 111,795 0.00 418,400.52 60,459,913.62 70,620 1,341,623.22 4,910,836.92 1,247,456.98 27,607,689.09 17,777,215.98 178,570,832.37 33,745 5,243.10 221,749.22 77,708,574.79 76,192 1,518,148.74 12,450,192.73 155,697,662.81 149,930

6,434,228.76 40,279,631.04 411,977,069.97 442,282

12,570,941.37 88,426,542.68 116,162,672.64 117,628 0.00 362,529.05 18,720,097.53 19,648 29,715,630.45 21,426,863.56 74,911,359.83 85,047 4,127,500.00 16,186,896.02 107,633,202.08 110,298

33,843,130.45 37,976,288.63 201,264,659.44 214,993 2,582,828.22 9,915,596.24 53,642,350.79 74,193 0.00 5,137,529.11 24,344,720.12 50,740

2,582,828.22 15,053,125.35 77,987,070.91 124,933 248,189,800.17 –373,946,200.75 0.00 0

1,190,917,738.58 9,535,480,816.63 13,146,245,264.90 13,427,500

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BALANCE SHEET FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2011 Liabilities and shareholders' equity Property/casualty In EUR

A. Shareholders' equity I. Share capital

1. Par value 10,000,000.00 II. Capital reserves

1. Committed reserves 157,617,585.61 III. Retained earnings

1. Mondatory reserves 1,000,000.00 2. Free reserves 14,000,000.00 15,000,000.00

IV. Risk reserve as per § 73a VAG, taxed portion 15,301,745.25 V. Net retained profits 144,883,050.54

thereof brought forward 23,835,976.92 Thereof partial payment in accordance with § 54a AktG 0.00

TOTAL SHAREHOLDERS' EQUITY 342,802,381.40 B. Tax-exempt reserves

I. Risk reserve as per § 73a VAG 19,406,564.75 II. Valuation reserve for impairment losses 326,215.30

TOTAL RESERVES 19,732,780.05 C. Subordinated liabilities

II. Supplementary capital bond 70,000,000.00

TOTAL SUBORDINATED LIABILITIES 70,000,000.00 D. Underwriting provisions - retained

I. Unearned premiums 1. Gross 109,563,524.86 2. Reinsurers' share –14,121,764.56 95,441,760.30

II. Mathmatical reserve 1. Gross 0.00 2. Reinsurers' share 0.00 0.00

III. Provision for outstanding claims 1. Gross 1,078,454,358.52 2. Reinsurers' share –348,071,810.14 730,382,548.38

IV. Provision for profit-unrelated premium refunds 1. Gross 23,065,501.79 2. Reinsurers' share –2,870,671.15 20,194,830.64

V. Provision for profit-related premium refunds and policyholder profit participation 1. Gross 196,912.47 2. Reinsurers' share 0.00 196,912.47

VI. Equalisation provision 141,715,554.00 VII. Other underwriting provisions

1. Gross 13,014,301.26 2. Reinsurers' share –1,489,821.03 11,524,480.23

TOTAL TECHNICAL PROVISIONS 999,456,086.02 E. Underwriting provisions of unit- and index-linked life insurance 0.00 Amount carried forward 1,431,991,247.47



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0.00 0.00 10,000,000.00 10,000 28,724,845.15 316,539,424.61 502,881,855.37 502,882 0.00 0.00 1,000,000.00 1,000 10,000,000.00 10,000,000.00 36,000,000.00 36,000,000.00 60,000,000.00 61,000,000.00 0 3,325,210.71 27,226,449.51 45,853,405.47 45,853 22,760,535.74 18,747,062.93 186,390,649.21 200,246 9,811,961.26 12,497,764.03 46,145,702.21 –84 0.00 0.00 0.00 –80,000

64,810,591.60 398,512,937.05 806,125,910.05 759,981 9,208,223.29 14,825,539.49 43,440,327.53 43,440 11,018,497.07 42,435,033.20 53,779,745.57 78,287

20,226,720.36 57,260,572.69 97,220,073.10 121,727 10,000,000.00 195,000,000.00 275,000,000.00 275,000

10,000,000.00 195,000,000.00 275,000,000.00 275,000 2,137,982.10 34,506,318.42 146,207,825.38 143,319 –213,798.21 1,924,183.89 –28,065.85 34,478,252.57 –14,363,628.62 131,844,196.76 –13,757 901,939,854.00 6,070,829,054.32 6,972,768,908.32 7,188,991 –91,631,644.50 810,308,209.50 –11,158,224.84 6,059,670,829.48 –102,789,869.34 6,869,979,038.98 –99,785 44,711,861.00 45,988,030.36 1,169,154,249.88 1,118,470 –4,470,405.12 40,241,455.88 –51,000.00 45,937,030.36 –352,593,215.26 816,561,034.62 –295,057 15,050,000.00 0.00 38,115,501.79 38,988 –1,505,000.00 13,545,000.00 0.00 0.00 –4,375,671.15 33,739,830.64 –5,770 0.00 48,533,800.00 48,730,712.47 51,858 0.00 0.00 0.00 48,533,800.00 0.00 48,730,712.47 0 0.00 0.00 141,715,554.00 154,223 523,563.65 1,064,536.87 14,602,401.78 14,903 0.00 523,563.65 0.00 1,064,536.87 –1,489,821.03 13,112,580.75 –1,482

866,542,412.92 6,189,684,449.28 8,055,682,948.22 8,294,901

0.00 2,164,866,606.61 2,164,866,606.61 2,141,430 961,579,724.88 9,005,324,565.63 11,398,895,537.98 11,593,039

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Liabilities and shareholders' equity Property/casualty In EUR

Amount carried forward 1,431,991,247.47 F. Non-underwriting provisions

I. Provision for post-employment benefits 5,981,152.00 II. Provision for pensions 37,331,155.00 III. Tax provisions 29,258,575.00 IV. Other provisions 72,706,816.62

TOTAL OTHER PROVISIONS 145,277,698.62 G. Deposits from ceded reinsurance business 82,092,138.08 H. Other liabilities

I. Liabilities from direct insurance business 1. from policiyholders 84,710,313.63 2. from insurance intermediaries 16,088,194.73 3. from insurance companies 5,072,339.44 105,870,847.80

II. Liabilities from reinsurance business 18,702,198.27 III. Liabilities from bonds (not including supplementary capital) 0.00 IV. Liabilities to financial institutions 103,072.00 V. Other liabilities 634,111,354.75

TOTAL LIABILITIES 758,787,472.82 I. Prepaid expensese 1,698,152.70 Total assets 2,419,846,709.69



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961,579,724.88 9,005,324,565.63 11,398,895,537.98 11,593,039 2,376,389.00 6,357,791.92 14,715,332.92 14,912 14,832,148.00 37,402,808.00 89,566,111.00 89,654 0.00 230,900.00 29,489,475.00 29,489 1,694,777.00 7,664,046.72 82,065,640.34 81,814

18,903,314.00 51,655,546.64 215,836,559.26 215,869

93,448,381.68 11,186,290.69 186,726,810.45 138,402

3,106,533.43 22,745,180.42 110,562,027.48 193,744 0.00 5,305,316.11 21,393,510.84 21,852 254,949.26 3,361,482.69 0.00 28,050,496.53 5,327,288.70 137,282,827.02 7,261 7,999,194.33 1,539,569.23 28,240,961.83 32,270 0.00 150,000,000.00 150,000,000.00 150,000 0.00 4,665,206.77 4,768,278.77 38,510 105,545,501.77 200,787,902.87 940,444,759.39 945,165

116,906,178.79 385,043,175.40 1,260,736,827.01 1,388,802

80,139.23 82,271,238.27 84,049,530.20 91,388 1,190,917,738.58 9,535,480,816.63 13,146,245,264.90 13,427,500

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INCOME STATEMENT FOR THE FINANCIAL YEAR FROM 1 JANUARY TO 31 DECEMBER 2011 Property/casualty insurance 2011 2010

In EUR In EUR '000

Underwriting account 1. Net earned premiums

Premiums written Gross 1,066,178,221.01 1,046,516 Ceded reinsurance premiums –443,857,598.94 622,320,622.07 –387,300

Change due to unearned premiums Gross –4,054,434.68 7,191 Reinsurers' share 5,391,201.65 1,336,766.97 –7,617

TOTAL PREMIUMS 623,657,389.04 658,790 2. Investment income from technical business 34,589.11 53 3. Other underwriting income 5,743,290.02 6,335 4. Expenses for claims and insurance benefits

Payments for claims and insurance benefits Gross 659,793,816.21 698,493 Reinsurers' share –219,087,625.90 440,706,190.31 –226,266

Changes in provision for outstanding claims and insurance benefits Gross 48,982,183.38 –16,436 Reinsurers' share –62,401,957.15 –13,419,773.77 –3,607

TOTAL CLAIMS AND INSURANCE BENEFITS –427,286,416.54 –452,184 5. Increase in underwriting provisions

Other underwriting provisions Gross 949,200.00 982 Reinsurers' share 0.00 949,200.00 –27

TOTAL INCREASE IN UNDERWRITING PROVISIONS –949,200.00 –955 6. Expenses for profit-unrelated premium refunds

Gross 7,735,403.71 13,166 Reinsurers' share –505,107.72 7,230,295.99 –4,458

TOTAL EXPENSES FOR PROFIT-UNRELATED PREMIUM REFUNDS –7,230,295.99 –8,708 7. Administrative expenses

Acquisition expenses 191,644,052.46 191,487 Other administrative expenses 47,093,031.84 44,834 Reinsurance commissions and profit commissions from reinsurance cessions –87,951,861.57 –62,356

TOTAL OPERATING EXPENSES –150,785,222.73 –173,965 8. Other underwriting expenses –11,704,355.91 –7,078 9. Change in the equalisation provision 12,507,185.00 10,410 Underwriting result (Amount carried forward) 43,986,962.00 32,698



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Property/casualty insurance 2011 2010

In EUR In EUR '000

Underwriting result (amount carried forward) 43,986,962.00 32,698

Non-underwriting account 1. Investment and interest income

Income from participations 44,791,162.54 26,893 Income from land and buildings 3,522,527.89 2,518 Income from other investments 76,704,260.49 61,886 Income from appreciations 264,174.68 0 Gains from disposal of investments 47,026,480.58 43,775 Other investment and interest income 2,476,254.35 3,880

TOTAL INVESTMENT INCOME 174,784,860.53 138,952 2. Expenses for investments and interest expenses

Expenses for asset management 2,056,614.36 2,536 Depreciation of investments 2,994,107.07 2,879 Interest expenses 39,083,399.13 39,893 Losses from disposal of investments 46.39 30 Other investment expenses 140,404.57 3,189

TOTAL INVESTMENT EXPENSES –44,274,571.52 –48,527 3. Investment income transferred to the underwriting account –34,589.11 –53 4. Other non-underwriting income 315,912.20 568 5. Other non-underwriting expenses –61,289.73 –298

Result from ordinary activities; property/casualty insurance 174,717,284.37 123,340

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INCOME STATEMENT FOR THE FINANCIAL YEAR FROM 1 JANUARY TO 31 DECEMBER 2011 Health insurance 2011 2010

In EUR In EUR '000


Premiums written Gross 335,444,511.17 327,763 Ceded reinsurance premiums –40,902,634.98 294,541,876.19 –40,693

Change due to unearned premiums Gross 201,926.84 –310 Reinsurers' share 3,140.83 205,067.67 15

TOTAL PREMIUMS 294,746,943.86 286,775 2. Investment income from technical business 31,334,363.09 19,530 3. Other underwriting income 3,321.94 7 4. Expenses for claims and insurance benefits

Payments for claims and insurance benefits Gross 214,126,922.28 212,094 Reinsurers' share –21,807,152.97 192,319,769.31 –20,846

Changes in provision for outstanding claims and insurance benefits Gross 379,255.00 –561 Reinsurers' share –60,805.52 318,449.48 58

TOTAL CLAIMS AND INSURANCE BENEFITS –192,638,218.79 –190,745 5. Increase in underwriting provisions

Mathematical reserve Gross 61,413,703.00 51,509 Reinsurers' share –6,217,072.40 55,196,630.60 –5,293

TOTAL INCREASE IN UNDERWRITING PROVISIONS –55,196,630.60 –46,216 6. Expenses for profit-unrelated premium refunds

Gross 12,402,279.29 11,472 Reinsurers' share –1,238,141.81 11,164,137.48 –1,127

TOTAL EXPENSES FOR PROFIT-UNRELATED PREMIUM REFUNDS –11,164,137.48 –10,345 7. Administrative expenses

Acquisition expenses 26,474,511.05 26,051 Other administrative expenses 13,793,809.98 13,689 Reinsurance commissions and profit shares From reinsurance cessions –4,562,588.13 –4,402

TOTAL OPERATING EXPENSES –35,705,732.90 –35,338 8. Other underwriting expenses –1,107,645.53 –82 Underwriting result (Amount carried forward) 30,272,263.59 23,586



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Health insurance 2011 2010 In EUR In EUR '000


Non-underwriting account: 1. Investment and interest income

Income from participations 29,080.00 293 Income from land and buildings 2,173,393.62 2,327 Income from other investments 37,740,920.79 33,675 Gains from disposal of investments 3,824,194.16 3,716 Other investment and interest income 3,131,271.61 1,296


Expenses for asset management 4,029,377.26 4,897 Depreciation of investments 2,814,330.16 8,588 Interest expenses 7,708,503.55 7,589 Losses from disposal of investments 0.00 0 Other investment expenses 1,012,286.12 703

TOTAL INVESTMENT EXPENSES –15,564,497.09 –21,777 3. Investment income transferred to the underwriting account –31,334,363.09 –19,530 4. Other non-underwriting income 21,366.73 0

Result from ordinary activities; health insurance 30,293,630.32 23,586

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INCOME STATEMENT FOR THE FINANCIAL YEAR FROM 1 JANUARY TO 31 DECEMBER 2011 Life insurance 2011 2010

In EUR In EUR '000


Premiums written Gross 872,928,368.13 1,058,516 Ceded reinsurance premiums –3,381,992.54 869,546,375.59 –3,313

Change due to unearned premiums Gross 2,232,338.10 1,169 Reinsurers' share –19,652.54 2,212,685.56 –1

TOTAL PREMIUMS 871,759,061.15 1,056,371 2. Investment income from technical business 227,025,688.24 278,442 3. Unrealised gains on investments shown under balance sheet asset item C 51,338,871.86 186,808 4. Other underwriting income 563,808.41 558 5. Expenses for claims and insurance benefits

Payments for claims and insurance benefits Gross 1,023,787,323.25 738,969 Reinsurers' share –3,981,436.21 1,019,805,887.04 –1,236

Changes in provision for outstanding claims and insurance benefits Gross 1,528,457.29 4,086 Reinsurers' share 90,000.00 1,618,457.29 40

TOTAL CLAIMS AND INSURANCE BENEFITS –1,021,424,344.33 –741,859 6. Increase in underwriting provisions

Mathematical reserve Gross 0.00 564,824 Reinsurers' share 0.00 0.00 –417

TOTAL INCREASE IN UNDERWRITING PROVISIONS 0.00 –564,407 7. Increase in underwriting provisions

Mathematical reserve Gross –261,579,318.80 0 Reinsurers' share 2,320,139.33 –259,259,179.47 0

TOTAL REDUCTION UNDERWRITING PROVISIONS 259,259,179.47 0 8. Expenses for profit-unrelated premium refunds

and policyholder profit participation Gross 18,350,276.57 15,700 Reinsurers' share 0.00 18,350,276.57 0

TOTAL PROFIT PARTICIPATION –18,350,276.57 –15,700 9. Administrative expenses

Acquisition expenses 110,038,196.94 112,083 Other administrative expenses 32,459,066.67 35,259 Reinsurance commissions and profit commissions from reinsurance cessions –527,714.89 –533

TOTAL OPERATING EXPENSES –141,969,548.72 –146,809 10. Unrealised losses on investments shown under balance sheet asset item C –194,480,849.63 –11,979 11. Other underwriting expenses –3,280,952.40 –802 Underwriting result (Amount carried forward) 30,440,637.48 40,623



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Life insurance 2011 2010 In EUR In EUR '000



Income from participations 18,398,110.45 10,764 Income from land and buildings 8,145,927.01 9,260 Income from other investments 257,013,599.19 289,381 Income from appreciations 428,686.78 29,005 Gains from disposal of investments 27,153,477.51 14,521 Other investment and interest income 34,938,352.66 27,166


Expenses for asset management 15,672,589.30 18,532 Depreciation of investments 60,081,364.01 67,908 Interest expenses 27,349,810.68 9,915 Losses from disposal of investments 7,435,678.20 1,852 Other investment expenses 8,513,023.17 3,448

TOTAL INVESTMENT EXPENSES –119,052,465.36 –101,655 3. Investment income transferred to the underwriting account –227,025,688.24 –278,442 4. Other non-underwriting income 57,814.22 8

Result from ordinary activities; life insurance 30,498,451.70 40,631

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INCOME STATEMENT FOR THE FINANCIAL YEAR FROM 1 JANUARY TO 31 DECEMBER 2011 Property/Casualty + Health + Life = Total Business 2011 2010

In EUR In EUR '000

Underwriting result, property/casualty 43,986,962.00 32,698 Underwriting result, health 30,272,263.59 23,586 Underwriting result, life 30,440,637.48 40,623

TOTAL UNDERWRITING RESULT 104,699,863.07 96,907


Income from participations 63,218,352.99 37,951 Income from land and buildings 13,841,848.52 14,105 Income from other investments 371,458,780.47 384,942 Income from appreciations 692,861.46 29,005 Gains from disposal of investments 78,004,152.25 62,011 Other investment and interest income 40,545,878.62 32,342


Expenses for asset management 21,758,580.92 25,965 Depreciation of investments 65,889,801.24 79,375 Interest expenses 74,141,713.36 57,397 Losses from disposal of investments 7,435,724.59 1,882 Other investment expenses 9,665,713.86 7,340

TOTAL INVESTMENT EXPENSES –178,891,533.97 –171,959

3. Investment income transferred to the underwriting account –258,394,640.44 –298,025

4. Other non-underwriting income 395,093.15 576

5. Other non-underwriting expenses –61,289.73 –298

6. Result from ordinary activities 235,509,366.39 187,557

7. Taxes on income –59,771,332.01 –51,954

8. Profit for the period 175,738,034.38 135,603 9. Release of reserves

Release of valuation reserve for impairment losses 24,506,912.62 30,727

TOTAL RELEASE OF RESERVES 24,506,912.62 145,727 10. Transfer to reserves

Transfer to risk reserve as per § 73a VAG 0.00 1,000 Transfer to free reserves 60,000,000.00 0

TOTAL TRANSFER TO RESERVES –60,000,000.00 –1,000 11. Profit for the year 140,244,947.00 280,330 12. Partial payment in accordance with § 54a AktG 0.00 –80,000 13. Retained profits brought forward 46,145,702.21 –84

Net retained profits 186,390,649.21 200,246



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NOTES TO THE ANNUAL FINANCIAL STATEMENTS OF 2011

I. GENERAL DISCLOSURES ON ACCOUNTING POLICIES

The accounting provisions of the Austrian Commercial Code (UGB) and special provisions of the Austrian Insurance Su-pervision Act (VAG) as amended were applied when prepar-ing the annual financial statements as of 31 December 2011.

The annual financial statements were prepared in accor-dance with Austrian generally accepted accounting princi-ples and the general standard of presenting a fair and true view of the net assets, financial position and results of opera-tions.

The precautionary principle was satisfied in that only profits that had been realised as at the balance sheet date were reported and all identifiable risks and impending losses were recorded in the balance sheet, with the exception of the less strict valuation of bonds and other fixed-income securities as provided for in § 81h(1) VAG and use of the valuation relief options provided for in § 81h(2) VAG for units of institutional funds. Figures are generally shown in thousands of euros (EUR ‘000). Figures from the previous year are indicated as such or shown in brackets.

II. ACCOUNTING POLICIES

Land is valued at cost, buildings at cost less depreciation and any write-downs. As a rule, repair costs for residential buildings are spread over ten years.

Investments for unit- and index-linked life insurance are valued using the current cost principle. Unit-linked life insur-ance investments are made in the following funds:

A2A DEFENSIV T ABER GLOBAL II EURO GOVERNMENT BOND A2 T ABERDEEN GL EMERG MKT SM I2 USD ABERDEEN GLOBAL EMERGING MARKETS EQUITY A2 T ABERDEEN GLOBAL WORLD RESOURCES S2 T ACATIS AKTIEN GLOBAL FONDS T ACTIVEST TOTAL RETURN D ALL ASIA MITEIGENTUMSANTEILE GEM § 20 INFG T ALL EUROPE THESAURIERUNGS ANTEILE ALL JAPAN T MITEIGENTUMSANTEILE ALL TRENDS T ALL WORLD T MITEIGENTUMSANTEILE ALLIANZ PIMCO EUROPAZINS A ALLIANZ PIMCO INTERNATIONAL RENTENFONDS ALLIANZ RCM BIOTECHNOLOGIE A ALLIANZ RCM VERMOEGENSBILDUNG DEUTSCHLAND A AMUNDI FUND EQUITY LATIN AMERICA AU C T USD ARERO DER WELTFONDS T AUSTRIA STOCK T AXA WF FRAMLINGTON SWITZERLAND A CAP T CHF AXA WORLD EURO 5 7 CAP BANTLEON OPPORTUNITIES L PT BARING EASTERN EUROPE FUND BARING EUROPE SELECT INC GBP BARING GERMAN GROWTH TRUST T GBP BARING GLB EMG MKTS FD USD INC BARING HONG KONG CHINA FD A BAWAG PSK GLOBAL BOND FOND BAWAG PSK MUENDEL RENT KRZ A BAWAG PSK MUENDEL RENT KRZ T BELLEVUE LUX BB MEDTECH BEUR BERENBERG EMER MKT EQY SEL R BGF EMERGING EUROPE FUND A2 BGF EUROPEAN FUND A2 BGF GBL HI YIELD BD HED A2 BGF NEW ENERGY FUND USD A2 BL BOND DOLLAR T BL BOND EURO T BLACKROCK GLOBAL FUND JAPAN S&M CAP OPPORTU-NITIES A2 USD BLACKROCK GLOBAL FUNDS WORLD GOLD FUND BLACKROCK GLOBAL FUNDS EMERGING MARKETS FUND A2 USD BLACKROCK GLOBAL FUNDS EURO BOND FUND A2 EUR BLACKROCK GLOBAL FUNDS EUROPEAN OPPORTUNITY FUND A BLACKROCK GLOBAL FUNDS GLOBAL ALLOCATION FUND HEDGED A2 EUR

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BLACKROCK GLOBAL FUNDS LATIN AMERICAN FUND T USD BLACKROCK GLOBAL FUNDS NEW ENERGY FUND T BLACKROCK GLOBAL FUNDS US FLEXIBLE EQUITY FUND A2 USD BLACKROCK GLOBAL FUNDS WORLD ENERGY FUND T USD BLACKROCK GLOBAL FUNDS WORLD GOLD FUND BLACKROCK GLOBAL FUNDS WORLD MINING FUND A2 EUR BLUEBAY HIGH YIELD BOND B BNPP L1 BOND WORLD EMERGING LOCAL C USD BNPP L1 EQUITY USA GROWTH C T BNPP L1 EQ EU ENRGY CD BNPP L1 EQUITY EUROPE CC BW RENTA INTERNATIONAL UNIVERSAL FONDS CAPITAL INVEST GOLD STOCK A CAPITAL INVEST SWISS STCK A CARMIGNAC INVESTISSEMENT CARMIGNAC PATRIM.A 3D CB GELDMARKT DEUTSCHLAND I A CI GLOBAL MIX 50 COMGEST GROWTH INDIA USD COMINVEST FONDAK P COMINVEST FONDIS A COMSTAGE ETF DOW JONES EURO STOXX 50 TR CPB ZZ 2 FUND CPB ZZ1 FUND C-QUADRAT ACTIVE BALANCED T C-QUADRAT ACTIVE GLOBAL EQUITY T C-QUADRAT ARTS BEST MOMENTUM T C-QUADRAT ARTS TOTAL RETURN BALANCED T C-QUADRAT ARTS TOTAL RETURN GLOBAL - AMI C-QUADRAT ARTS TOTAL RETURN SPECIAL T C-QUADRAT BEST FONDS BASIC T CREDIT SUISSE BF LUX CHF B T CREDIT SUISSE BF LUX SHORT TERM CHF B T CREDIT SUISSE EF (LUX) USA VALUE B CRYSTAL ROOF RUBIN T CRYSTAL ROOF SAFIR T CRYSTAL ROOF SMARAGD T CS EF LUX GLB VALUE R CHF CS EUROREAL A DBXT DBLCI DBX TRACKERS DJ EU STX 50 1D DEEP BONUS 30 ZERT.EUROSTOXX 50 DEGI EUROPA DEKARENT INTERNATIONAL CF DEXIA BOND EURO INFLATION LINKED C T

DEXIA EQUITIES B EUROPEAN PROPERTY C T DEXIA QUANT EQUITIES EUROPE C T DEXIA QUANT EQUITIES USA C T DEXIA SUSTAINABLE MEDIUM C CAP T DIT GLOBAL MARKETS BOND UNITS DJE ABSOLUT P DJE INTERCASH P DJE RENTEN GLOBAL P DKLT EM BD UNITS CF DISTRIBUTION DWS AKKUMULA T DWS AKTIEN STRAT DEUTSCHLAND DWS BIOTECH TYP 0 DWS DEUTSCHLAND DWS ENERGY TYP O DWS FLEX PENS 2014 T DWS FLEXPENSION 2015 T DWS FLEXPENSION 2016 T DWS FLEXPENSION 2017 T DWS FLEXPENSION 2018 T DWS FLEXPENSION 2019 T DWS FLEXPENSION 2020 T DWS FLEXPENSION 2021 T DWS FLEXPENSION 2022 T DWS FLEXPENSION 2023 T DWS FLEXPENSION II 2019 T DWS FLEXPENSION II 2020 T DWS FLEXPENSION II 2021 T DWS FLEXPENSION II 2023 T DWS FLEXPENSION II 2024 T DWS FLEXPENSION II 2025 T DWS FLEXPENSION II 2026 T DWS HEALTH CARE TYP O DWS INTER RENTA DWS INVEST CHINESE EQUITY LC EUR DWS INVEST EUROPEAN EQUITIES T DWS INVEST GLOBAL AGRIBUSINESS LC DWS INVEST TOP 50 ASIA LC DWS INVEST TOP 50 ASIA T DWS OSTEUROPA FCP UNITS CAPITALISATION T DWS SHIFT 2015 EUR T DWS SHIFT 2016 EUR T DWS SHIFT 2017 EUR T DWS TELEMEDIA TYP O DWS TOP 50 ASIEN T DWS TOP 50 WELT DWS TOP DIVIDENDE ANTEILE DWS VERMOEGENSBILDUNGSFOND I A E+S ERFOLGS INVEST T ECOFIN INDEX AKTIEN GLOBAL T



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ESPA BEST OF AMERICA T ESPA BEST OF EUROPE T ESPA BEST OF HEALTHCARE T ESPA BEST OF WORLD T ESPA BOND DANUBIA T ESPA BOND DOLLAR A ESPA BOND DOLLAR CORP T ESPA BOND EMERGING MARKETS ESPA CASH EURO MIDTERM A ESPA CASH EURO PLUS T ESPA PORTFOLIO BALANCED 50 T ESPA PORTFOLIO BALANCED 30 T ESPA PORTFOLIO BOND T ESPA SELECT BOND T ESPA STOCK ASIA INFRASTRUCTURE T ESPA STOCK ISTANBUL T ESPA STOCK NEW CONSUMER T ESPA STOCK PHARMA T ESPA STOCK VIENNA A ETF DACHFONDS P ETHNA AKTIV E T ETHNA AKTIV E UNITS ETHNA GLOBAL DEFENSIV A FAIR INVEST BALANCED T FI ALPHA RENTEN GLOBAL FIDELITY EURO BOND FUND A FIDELITY EUROPEAN FUND T EUR FIDELITY EUROPEAN GROWTH FUND A FIDELITY FDS SOUTH E ASIA A FIDELITY FDS SOUTH E ASIA A USD FIDELITY FNDS GL CONS IND A FIDELITY FNDS GL TECH FD A FIDELITY FNDS GLO FIN SVC A FIDELITY FNDS GL HEALTH C A EUR FIDELITY FNDS STERLING BD A GBP FIDELITY FUND CHINA FC A USD FIDELITY FUNDD II AUD CURRENCY FUND FIDELITY FUNDS INTERNATIONAL USD FUND FIDELITY FUNDS LATIN AMERICA FUND USD FIDELITY FUNDS MALAYSIA FUND A USD FIDELITY FUNDS PACIFIC FUND USD FIDELITY FUNDS WORLD FUND FIDELITY GLOBAL PROPERTY FUND A EUR FIDELITY JAPAN FUND A JPY FIDELITY JAPAN SMALLER COMPANIES FUND A JPY FIDELITY MODERATE FPS EUR FUND FIDELITY PS GLOBAL GROWTH FUND A USD FIDELITY PS GROWTH FUND A FIDELITY SOUTH EAST ASIA T USD

FORTIS L FUND EQ ENRGY WD CC FRANK TE IN FR GL SMC G AACC FRANKLIN INDIA FUND T EUR FRANKLIN TEMPLETON BRIC FUND GARTMORE CONTINENTAL EUROPEAN SHS A1 GLOBAL ADVANTAGE EMERGING MARKETS HIGH VALUE T GLOBAL HEALTH CARE GOLDEN ROOF BRANCHEN T GOLDEN ROOF WELT R T GOLDMAN SACHS EUROP COR E BA GUTMANN VORSORGEFONDS A HENDERSON GLOBAL TECHNOLOGY A2 USD HSBC GIF CHINESE EQUITY AD USD HSBC GLOBAL INDIAN EQUITY USD INDUSTRIA A EUR INVESCO ASIA INFRASTRUCT A USD INVESCO EMERGING MARKETS BOND A INVESCO GLB HEALTH CARE A USD INVESCO GLOBAL TECHNOLOGY A USD INVESCO JAPANESE EQUITY A INVESCO JAPANESE SMALL/MID CAP EQUITY A INVESCO JAPANESE VL EQUITY T JPY INVESCO PACIFIC EQUITY A USD INVESCO PAN EUR STRUC EQTY A INVESCO PAN EUROPEAN EQUTIY T INVESCO PAN EUROPEAN SMALL CAP EQUITY T INVESCO UMWELT UND NACHHALTI ISHARES ATX DE ISHARES DAX DE ISHARES DJ EURO STOXX 50 DE ISHARES DJ EURO STOXX SD 30 ISHARES EB.REXX JUMBO PFANDBRIEFE ISHARES EUROSTOXX SEL DVD 30 ISHARES MSCI EMERGING MARKET ISHARES MSCI WORLD ISHARES MSCI WORLD ACC ISHARES S+P LISTED PRIVATE EQUITY USD JB EUROPE GRWTH STOCK B EUR JB GBP STERLING CASH FUND B JP MORGAN FLEMING EUROPE SMALL CAP FUND JPM AMERICA EQUITY A USD JPM EMERGING MARKETS DEBT A DIS EUR HGD JPM EMERGING MARKETS EQUITY A USD JPM GLOBAL TOTAL RETURN T EUR JPM INDIA FUND A USD JPM LATIN AMERICA A USD JPM MORGAN US SMALL CAP GROWTH A DIS USD JPM PACIFIC EQUITY A DIST USD JPM US TECHNOLOGY A USD

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JPMORGAN EUROPE STRATEGIC VALUE A JPMORGAN F EAST EURO E A JULIUS BAER MULTISTOCK BLACK SEA FUND A KBC ECO FUND WATER C KBC EQUITY FD FOOD & BEVERAGES C KBC RENTA NOKRENTA B CAP NOK KBC RENTA NZD RENTA CAP KEPLER ETHIK AKTIENFONDS A LLOYDS TSB MF NEW ZEALAND NZD LO FUNDS WORLD GOLD EXPERTISE USD P LO FUNDS WORLD GLD EUR PA LYXOR ETF DJ BUYWRITE PARTS DE CAPITALISATION/DI LYXOR ETF EURO 5 7Y LYXOR ETF EURO MTS LYXOR ETF EUROMTS CBA LYXOR ETF WORLD WATER LYXOR EURO MTS 3 5Y M&G 1 GLOBAL BASIC ACCUMALTED SHARES CLASS A M&G ASIAN FUND A ACC M&G GLBL GROWTH EUR A ACC MAGNA TURKEY FUND A MARKET ACCESS JIM ROGERS INT COMMODITY INDEX MLIIF WORLD MINING SHARES A2 CAPITALISATION USD MMT GLOBAL SELECTION B A MORGAN STANLEY EMERGING MARKETS DEBT T USD MORGAN STANLEY EMERGING MARKETS EQUITY T USD MULTI INVEST OP NORDASIA FUND T OEKOWORLD OEKOVISION CLASSIC OP FOOD ANTEILE A PEH STRATEGIE FLEXIBEL PIA AMERICA STOCK FONDS T USD PIA DOLLAR BOND FONDS T PIA DOLLAR SHORT TERM BOND A PIA EURO BOND A PIA EURO CORPORATE BOND T PIA MASTER FONDS DYNAMISCH A ANTEILE PIA MASTER FONDS DYNAMISCH T PIA MASTER FONDS PROGRESSIV T PIA MASTER FONDS TRADITIONELL T PIA MÜNDEL BOND A MITEIGENTUMSANTEILE PIA SELECT EUROPE STOCK A MITEIGENTUMSANTEILE PIA SELECT EUROPE STOCK T PIA TRADERENT T PICTET FUNDS FCP BIOTECH ANT. P PICTET ASIAN LOCAL CURRENCY PDY GBP PICTET FUNDS (LUX) SICAV SECURITY PICTET FUNDS (LUX) SICAV WATER PICTET GLOBAL EMERG DEBT P USD

PICTET WATER I PICTET WATER PDY PICTET EMERGING DEBT HP PIONEER AUSTRIA CORP TR IN A PIONEER CENTRAL EUROPE BD A PIONEER EM. M. PIONEER EURO AGGREGATE BOND PIONEER EURO BOND MEDIUM PIONEER FDS GLBL ECOLG A AC PIONEER FDS GLOBAL SEL A A PIONEER FUNDS CORE EU EQ A PIONEER FUNDS US DOL S T A USD PIONEER FUNDS EURO AG BO A=A PIONEER EM EUR & MED A EUR PSM GROWTH UI PSM VALUE STRATEGY UI QUALITY USA EQUITY FUND B USD RAIFFEISEN EURO RENT T RAIFFEISEN OESTERREICH AK A RAIFFEISEN EURASIEN AKTIEN A RAIFFEISEN OSTEUROP AKTIEN A REAL INVEST AUSTRIA A RINGTURM PIF DYNAMISCH VT RINGTURM PIF TRADITIONELL VT ROBECO INT. ASSET MANAGM. BV RT ABSOLUTE RETURN BOND FUND T RT ACTIVE GLOBAL TREND T RT EURO CASH PLUS T RT OESTERREICH AKTIENFONDS T RT OSTEUROPA AKTIENFONDS T RT VIF VERSICHERUNG INTERNATIONAL T RT VORSORGE § 14 RENTENFONDS A RT VORSORGE RENTENFONDS T RT ZUKUNFTVORSORGE AKTIENFONDS T SCHOELLERB GLOBAL PENSION FONDS SCHOELLERBANK TOP BAL M T SCHOELLERBANK AKTIENFONDS A SCHOELLERBANK AKTIENFONDS T SCHOELLERBANK AKTIENFONDS WÄHR.T SCHOELLERBANK AKTIENFONDS WÄHRUNGSGESICHERT SCHOELLERBANK ANLEIHEFONDS A SCHOELLERBANK ANLEIHEFONDS T SCHOELLERBANK ANLEIHENFNDS 14 A SCHOELLERBANK ANLEIHENFONNDS 14 T SCHOELLERBANK EURO ALTERNATIV SCHOELLERBANK EURO ALTERNATIV T SCHOELLERBANK GLOB RESORCS A SCHOELLERBANK GLOB RESORCS T SCHOELLERBANK GLOBAL DYNAMIK T



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SCHOELLERBANK KURZINVEST A SCHOELLERBANK KURZINVEST T SCHOELLERBANK KURZINVST T SCHOELLERBANK LIQUID A SCHOELLERBANK LIQUID T SCHOELLERBANK NETTO RENT SCHOELLERBANK NETTORENT T SCHOELLERBANK PIF T SCHOELLERBANK REALZINS PLUS A SCHOELLERBANK REALZINS PLUS T SCHOELLERBANK USD KURZINVEST T SCHOELLERBANK USD KURZINVEST ANTEILE A SCHOELLERBANK USD KURZINVST A SCHOELLERBANK USD RENTENFONDS A SCHOELLERBANK USD RENTENFONDS A EUR SCHOELLERBANK USD RENTENFONDS T SCHOELLERBANK VORSORGEFONDS SCHOELLERBANK VORSORGEFONDS T MITEIGENTUMS-ANTEILE SCHOELLERBANK ZINSSTRUKTUR PLUS MITEIGEN-TUMSF.GEM. SCHÖLLERB.ZINSSTRUK.PLUS SCHÖLLERBANK (LEMBERGER) USD RENTENFONDS T SCHÖLLERBANK GLOBAL PENSION SCHRODER INT EME ASIA A USD ACC SCHRODER INT HONG KONG EQ AAC HKD SCHRODER INTL EMG EUROPE A D SEMPER BOND EURO A SEMPERPROPERTY EUROPE T SEMPERSHARE AUSTRIA T SMART INVEST HELIOS AR B SPAENGLER BOND CORPORATE A SPAENGLERR BOND CORPORATE RT SPECIAL PLUS T STARCAPITAL UNIVERSAL BONDVALUE UI SUCCESS ABSOLUTE T SUCCESS RELATIVE T SUPERIOR 3 ETHIK A TEMPLETON ASIA GROWTH FUND T EUR TEMPLETON EMERGING MARKETS BAL. FUND T TEMPLETON EMERGING MARKETS FUNDS A YDIS TEMPLETON GLOBAL TOTAL RETURN T EUR TEMPLETON GROWTH FUND EURO TERRASSISI RENTEN I AMI A THREADNEEDLE EM MK B USD RGA THREADNEEDLE EUROPEAN SELECT FUND THREADNEEDLE US EQUITIES TOP VARIO MIX T TRADECOM FONDSTRADER T

TRADITIONAL FUND TR GLOBAL BD GBP DG UBS (LUX) STRATEGY FUND FCP BALANCED T UBS LUX BOND FUND GBP P ACC UBS LUX BOND FUND USD P ACC T UBS LUX BOND FUND CHF P ACC T CHF UBS LUX MD TRM BND EUR P ACC UNIASIA T UNIDEUTSCHLAND UNIDYNAMICFONDS EUROPA A UNIFONDS UNIGLOBAL UNIJAPAN UNTERNEHMENSANLEIHENFONDS 2014 GEM §20 INVFG A UNTERNEHMENSANLEIHENFONDS 2014 GEM §20 INVFG T VONTOBEL EMERGING MARKETS EQUITY B T USD VONTOBEL USD BOND T VONTOBEL EURO BOND A VONTOBEL SWISS MONEY B CHF VPI WORLD INVEST TM VPI WORLD SELECT TM WALSER PORTFOLIO GERMAN SCT WIENER PRIVATBANK PREMIUM AUSGEWOGEN T WIENER PRIVATBANK PREMIUM DYNAMISCH T WSTV ESPA DYNAMISCH WSTV ESPA PROGRESSIV WSTV ESPA TRADITIONELL WSTV ESPA GARANTIE II WSTV ESPA GARANTIE MITEIGENTUMSFONDS In accordance with § 20A I Shares and other non-fixed-income securities (with the exception of units of RT2 and RT3 institutional funds), and shares in affiliated companies are valued according to the strict lower-of-cost-or-market principle (strenges Niederst-wertprinzip). Starting in 2008, bonds and other fixed-income securities have been valued using the less strict lower-of-cost-or-market principle (gemildertes Niederstwertprinzip) provided for in § 81h(1) VAG. Valuation using the less strict lower-of-cost-or-market principle resulted in write-downs of EUR 110,237,000 (EUR 59,833,000) not being performed. Bonds issued by the Republic of Greece were written down to market value at the end of 2011. In accordance with Man-agement Board resolutions, holdings of RT2 and RT3 institu-tional funds were reported as fixed assets and the valuation relief options provided for in § 81h(2) VAG were not used until 30 September 2011.

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PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft provided confirmation that the statutory requirements for using the valuation relief options were satisfied and the existing amount of net hidden re-serves was double the size of the write-downs not performed.

Use of the less strict valuation principle resulted in EUR 94,258,000 (EUR 0) in write-downs not being performed for units of institutional funds.

The Company makes its investments in fixed-income securi-ties, real estate, participations, shares, and structured in-vestment products, taking into account the overall risk posi-tion of the Company and the investment strategy provided for this purpose. The risk inherent in the categories specified and market risks were taken into account when determining exposure volumes and limits.

The investment strategy is laid down in the form of invest-ment guidelines that are continuously monitored for compli-ance by the corporate risk controlling and internal audit departments. The corporate risk controlling department reports regularly to the tactical and strategic investment committee. The internal audit department reports regularly to the Managing Board.

As a rule, investments are generally low-risk. The strategic investment committee decides on possible high-risk invest-ments based on the inherent risk of each individual invest-ment after performing a full analysis of all related risks and liquidity at risk, and considering all assets currently in the portfolio and the effects of the individual investments on the overall risk position.

All known financial risks are assessed regularly and specific limits or reserves are used to limit exposure. Security price risk is reviewed periodically using value-at-risk and stress tests. Default risk is measured using both internal and exter-nal rating systems.

An important goal of investment and liquidity planning is to guarantee that the return on investment remains continu-ously above the minimum rate of return for the life insurance class and that adequate amounts of liquid, value-protected financial investments are maintained for all classes. Liquidity planning therefore takes into account the trend in insurance benefits and the majority of investment income is generally reinvested.

The Company reported assets whose interest payments were not guaranteed and whose principal repayment might be defaulted in whole or in part in the balance sheet asset item “shares and other non-fixed-income securities” with a carry-ing amount of EUR 29,973,000 (EUR 32,345,000) and a fair value of EUR 29,973,000 (EUR 33,996,000) as at 31 De-cember 2011.

Austrian banks have the option to tender previously sub-scribed bank bonds with a value of EUR 15,000,000 in 2013. It is currently not expected that these options will be exer-cised.

As a rule, mortgage receivables and other loans, including those to affiliated companies and companies in which a participation is held, are valued at the nominal value of the outstanding receivables. Discounts deducted from loan principal are spread over the term of the loan and shown under deferred income on the liabilities side of the balance sheet.

Valuation allowances of adequate size are formed for doubt-ful receivables and deducted from their nominal values. Tangible assets (not including land and buildings) are valued at cost less depreciation. Low-cost assets are written off in full in the year of acquisition.

Unearned premiums for property/casualty insurance were generally calculated by prorating over time after applying a cost deduction of EUR 17,708,000 (EUR 16,859,000). Un-earned premiums for life insurance are formed according to the amounts prescribed in the business plan. No cost deduc-tion is applied. Unearned premiums for health insurance are calculated by prorating over time without applying a cost deduction.

The mathematical reserve is calculated using the formulas and calculation bases contained in the business plans ap-proved by or submitted to the supervisory authority.

The provision for outstanding claims for direct prop-erty/casualty and life insurance business is calculated for claims reported by the balance sheet date by individually valuing unsettled claims and adding lump-sum safety mar-gins for large unexpected losses. Lump-sum provisions based on past experience are formed for claims incurred but not reported.



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In health insurance, provisions for outstanding claims are calculated by applying lump-sum percentages to payments made for claims during the financial year. The percentage rates were unchanged compared to the previous year.

In indirect business, provisions for outstanding claims are primarily based on reports from ceding companies as of the 31 December 2011 balance sheet date. The reported amounts were increased where this was considered neces-sary in light of past experience.

The equalisation provision is calculated in accordance with the directive of the Austrian Federal Finance Minister, BGBl (Federal Gazette) No. 545/1991 in the version contained in BGBl II No. 66/1997. Use was made of the release provision in § 13.

The provision for profit-related premium refunds and poli-cyholder profit participation includes the amounts ear-marked for policyholder premium refunds based on the business plans and articles of association for which no dis-position had been made as of the balance sheet date.

The provisions for severance pay, pensions, and anniver-sary bonuses are based on the pension insurance calcula-tion principles of the Actuarial Association of Austria (AVÖ), AVÖ 2008-P (Employees), using a discount rate of 4% p.a. Company pension plan obligations are measured using the actuarial entry age normal method (Teilwertverfahren). The retirement age used to calculate the provisions for anniver-sary bonuses and severance pay is the statutory minimum retirement age as stipulated in the Austrian General Social Security Act (ASVG) (2004 reform), subject to a maximum age of 62 years for the provision for anniversary bonuses. The retirement age used to calculate the provision for pensions is based on each individual agreement. The following percent-ages were used for employee turnover based on age: <31 7.5%, 31-35 3.5%, 36-40 2.5%, 41-50 1.5%, 51-55 0.5% and 56-65 0%. (<31 7.5%, 31-35 3.5%, 36-40 2.5%, 41-50 1.5%, 51-55 0.5% and 56-65 0%) The severance entitlement used to calculate the provision for severance obligations is based on each individual agreement or on the collective agreement. The following percentages were used for em-ployee turnover based on age: <30 7.5%, 30-34 3.5%, 35-39 2.5%, 40-50 1.5%, 50-59 1.0% and 60-65 0.5% (<30 7.5%, 30-34 3.5%, 35-39 2.5%, 40-50 1.5%, 50-59 1.0% and 60-65 0.5%) The interest expenses for personnel provisions of EUR 4,550,000 (EUR 4,921,000) are reported under in-vestment and interest expenses. A portion of the direct pen-

sion obligations, in the amount of EUR 25,368,000 (EUR 25,689,000), is administered as an occupational group insurance plan under an insurance policy concluded in ac-cordance with § 18f to 18j VAG. Provisions are formed for another portion (actuarial pension amount of EUR 9,603 thousand (EUR 9,804 thousand)). As permitted under the Austrian Federal Ministry of Finance decree of 3 August 2001, an amount of EUR 295,000 (EUR 273,000) was trans-ferred to an outside insurance company to outsource sever-ance pay obligations. The severance pay provision required under Austrian corporate law for 2011 was EUR 71,715,000 (EUR 70,216,000). The amount earmarked for satisfying the outsourced severance pay obligations that was held by the outside insurance company was EUR 63,590,000 (EUR 60,682,000). The difference of EUR 14,461,000 (EUR 14,721,000) between the size of the severance pay provi-sions to be formed under Austrian corporate law and the deposit held by the outside insurance company is reported in the provisions for severance pay in the balance sheet.

Amounts denominated in foreign currencies are translated to euros using the appropriate mean rate of exchange.

A portion of the underwriting items for assumed reinsurance business and the associated retrocessions for prop-erty/casualty and life insurance is deferred for one year be-fore being shown in the annual financial statements.

The following disclosures are provided for off-balance sheet contingent liabilities: Letters of comfort and liability under-takings totalling EUR 40,582,000 (EUR 38,904,000) have been issued in connection with a real estate purchase and borrowing. Liability undertakings totalling EUR 278,000 (EUR 72,000) have been issued in connection with loan repayments and bank guarantees.

A total of EUR 29,149,000 (EUR 29,149,000) relates to letters of comfort with affiliated companies.

III. NOTES TO THE BALANCE SHEET

The value of developed and unimproved properties was EUR 74,135,000 (EUR 73,788,000) as of 31 December 2011.

The carrying amount of owner occupied property was EUR 53,272,000 (EUR 53,444,000).

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Other loans not secured by insurance contracts were com-posed of the following: loans to the Republic of Austria in the amount of EUR 28,408,000 (EUR 31,813,000), loan receiv-ables from other public bodies in the amount of EUR 26,653,000 (EUR 30,885,000) and loan receivables from other borrowers in the amount of EUR with 188,428,000 (EUR 159,300,000).

The fair values of the investments are: Items under § 81c Abs. 2 VAG

Market value 31/12/11

Market value 31/12/10

In EUR '000

Land and buildings 410,899 373,548 Shares in affiliated companies 1,814,938 1,743,071 Bonds and other securities of and loans to affiliated companies 925,151 821,908 Participations 290,470 350,939 Bonds and other securities of and loans to other companies in which an ownership interest exists 36,716 37,306 Shares and other non-fixed-interest securities 2,631,971 3,066,979 Bonds an other fixed-income securities 3,762,691 3,897,843 Shares in joint investments 32,107 40,787 Mortgage receivables 352,300 371,803 Policy prepayments 16,981 18,026 Other loans 243,489 221,998 Bank balances 49,090 116,409 Deposit receivables 3,377 18,306

10,570,180 11,078,923

Hidden reserves totalled EUR 463,129,000 (EUR 792,320,000) as of 31 December 2011. The fair value of the shares in affiliated companies and shares in companies in which a participation is held is equal to the stock exchange value or other available market value (up-to-date internal measurement calculations). If no stock exchange value or other market value is available, the purchase price is used as the fair value, if necessary reduced by any write-downs or a proportionate share of the publicly reported equity capital, whichever is greater. For shares and other securities, stock exchange values or carrying amounts (purchase price, re-duced by write-downs if necessary) are used as the fair value. The remaining investments were valued at their nominal values, reduced by write-downs where necessary.

The fair values of land and buildings were determined in accordance with the recommendations of the Austrian Asso-ciation of Insurance Companies. All properties are individu-ally valued during a 5-year period.

The fair value of EUR 410,899,000 (EUR 373,548,000) for land and buildings is composed of market value appraisals for the years 2007 to 2011 as follows: 2011: EUR 139,434,000, 2010: EUR 124,275,000 (EUR 124,275,000), 2009: EUR 59,857,000 (EUR 69,547,000), 2008: EUR 44,017,000, (EUR 99,124,000), 2007: EUR 43,316,000, (EUR 80,602,000).

In health insurance, the mathematical reserve is calculated using actuarial principles in accordance with § 18c VAG for all portfolio groups.

For individual insurance, the mathematical reserve is calcu-lated exclusively for each individual policy. This also applies to new business in the group insurance area affected by the 1994 amendment to the Austrian Insurance Contract Act (VersVG). A lump-sum mathematical reserve is formed for the remaining group policies. The mathematical reserve is generally calculated using the prospective method. The calculation of the mathematical reserve takes into account the fact that the mathematical reserve for a policy is forfeited in favour of the community of the insured (Versichertenge-meinschaft) in the event of early policy termination or death of the insured.



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The claims frequencies used for the actuarial calculation of the mathematical provision are primarily derived from analy-ses of the Company's own claims experience. Mortality rates were mainly taken from the Austrian 2000/2002 general mortality tables. Consistent with the premium calculation, the mathematical reserve is generally calculated using a discount rate of 3% p.a.

In life insurance, the mathematical reserve is calculated using principles laid down in business plans and approved by the supervisory authority and using calculation bases sub-mitted to the supervisory authority.

The mathematical reserve is calculated for each individual case, with the prospective method being used almost exclu-sively.

The main probability tables used are the following:

For endowment insurance policies DM 24/26 ÖVM 80/82

ÖVM/ÖVF 90/92 ÖVM/ÖVF 00/02

For annuity insurance policies EROM/EROF AVÖ 1996 R AVÖ 2005 R

For a large portion of the portfolio, the mathematical reserve is calculated using a discount rate of 3% p.a. Starting in 1995, a discount rate of 4% p.a. was used for certain policies, and between 1 July 2000 and 31 December 2003 a discount rate of 3.25% p.a. was used. For policies with coverage be-ginning on or after 1 January 2004 the discount rate is 2.75% p.a., and on or after 23 September 2005 the discount rate is 2.25% for employer group policies. The discount rate is 2.25% for policies concluded on or after 1 January 2006, and 2.0% p.a. on or after 1 April 2011.

The amount shown under other liabilities includes EUR 24,137,000 (EUR 22,953,000) in tax liabilities and EUR 3,186,000 (EUR 3,167,000) in social security liabilities.

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The following balance sheet items are accounted for by affiliated companies and companies in which an ownership interest is held:

Affiliated companies Companies in which an ownership

interest existis In EUR '000 2011 2010 2011 2010

Mortgage receivables 33,513 37,761 5,067 5,064 Deposit receivables 10,247 10,452 0 0 Receivables from direct insurance business 2,681 12,356 1,417 1,358 Receivables from reinsurance business 14,373 23,521 78 114 Other receivables 108,004 105,269 255 195 Deposits retained 173,857 122,532 0 0 Liabilities from direct insurance business 1,253 436 1 50 Liabilities from reinsurance business 10,106 12,132 16 10 Other liabilities 902,631 905,918 2 0

Liabilities arising from the use of off-balance sheet tangible assets were EUR 31,622,000 (EUR 25,097,000) for the following financial year and EUR 166,032,000 (EUR 148,922,000) for the following five years.

The book values of intangible assets, land and buildings, investments in affiliated companies and ownership interests have changed as follows:

Intangible

assets Land and buildings

Shares in affiliated companies

Bonds and other securities of and

loans to affiliated

companies Participations

Bonds and other securities of and

loans to companies in

which an ownership

interest is held In EUR '000

As of 31 December 2010 17,072 273,844 1,484,257 821,440 276,068 37,306 Additions 2,465 3,417 97,435 71,001 101 712 Disposals 7 0 311 9,147 3,227 1,302 Rebooking 0 0 0 11,416 0 0 Appreciation 0 693 0 0 0 0 Capital consumption 3,669 8,175 16,000 0 350 0 Change due to value adjustments 0 0 0 30,000 0 0 As of 31 December 2011 15,861 269,779 1,565,381 924,710 272,592 36,716



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IV. NOTES TO THE INCOME STATEMENT

The premiums written, earned premiums, expenses for insurance claims, operating expenses and reinsurance bal-ance in property/casualty insurance in 2011 are broken down as follows:

Gross Premiums written Net earned premiums

Expenses for claimsand insurance

benefits Administrative

expenses Reinsurance

balance In EUR '000

Direct business Fire and fire business interruption insurance 203,626 200,225 127,230 38,976 –54,664 Liability insurance 114,451 114,270 63,660 32,405 –23 Household insurance 76,803 76,804 37,852 19,973 –2,578 Motor liability insurance 190,036 190,949 129,396 36,081 –1,193 Legal expenses insurance 26,949 26,963 12,698 6,733 320 Marine, aviation, and transport insurance 32,799 31,979 20,827 7,673 –4,885 Other insurances 33,955 33,963 39,906 6,812 10,147 Other motor vehicle insurance 123,926 123,264 96,294 26,764 –3,285 Other non-life insurance 161,986 161,545 112,309 39,352 –13,242 Casuality insurance 96,352 96,770 57,248 22,290 –2,170

1,060,883 1,056,732 697,420 237,059 –71,573 Previous year value 1,037,091 1,044,202 670,877 234,458 –102,703

Indirect business Marine, aviation, and transport insurance 37 37 –74 13 8 Other insurances 5,258 5,355 11,430 1,665 2,540

5,295 5,392 11,356 1,678 2,548 Previous year value 9,425 9,504 11,180 1,863 16

Direct and indirect business 1,066,178 1,062,124 708,776 238,737 –69,025 Previous year value 1,046,516 1,053,706 682,057 236,321 –102,687

The reinsurance balance includes earned reinsurance premiums, effective reinsurance claims and reinsurance commissions.

Premiums written for health insurance in 2011 are broken down as follows:

2011 2010 In EUR '000

Direct business Individual insurance 235,679 230,122 Group insurance 99,657 97,566 Indirect business Group insurance 109 75

335,445 327,763

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Premiums written had the following breakdown for life insurance in 2011:

2011 2010 In EUR '000

Direct business 869,568 1,055,076

Indirect business 3,360 3,440

872,928 1,058,516

Direct premiums for life insurance were composed of the following:

2011 2010 In EUR '000

Individual insurance 794,651 984,289 Group insurance 74,917 70,787

869,568 1,055,076 Single premium policies 233,069 408,703 Policies with regular premium payments 636,499 646,373

869,568 1,055,076 Policies with profit participation 410,519 449,253 Policies without profit participation 2,951 3,260 Unit-linked life insurance policies 412,786 556,730 Index-linked life insurance policies 43,312 45,833

869,568 1,055,076

The branch office in Italy wrote direct premiums of EUR 8,963,000 (EUR 59,653,000) and had an underwriting result of EUR 198,000 (EUR 4,798,000). The exception rule of § 81o(6) VAG was used.

The reinsurance balance for life insurance was negative in 2011, with a value of EUR 1,499,000 (EUR 1,717,000). The result from indirect business was EUR 212,000 (EUR 540,000). The reinsurance balance for health insurance was negative in 2011, with a value of EUR 8,010,000 (EUR 9,109,000). The result from indirect business was EUR 75,000 (EUR 64,000). A portion of the net earned premiums of EUR 5,392,000 (EUR 9,504,000) from indirect property/casualty insurance business had been deferred one year before being recognized in the income statement. Of the EUR 3,364,000 (EUR 3,443,000) in net earned premiums from indirect life insurance business, EUR 332,000 (EUR 391,000) was deferred for one year before being shown in the income statement.



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Of the income from participations, income from other investments and income from land and buildings shown in the income statement, affiliated companies accounted for the following amounts:

2011 2010 In EUR '000

Income from participations Property/casualty insurance 42,631 26,061 Life insurance 10,808 4,388

Total 53,439 30,449

Income from other investments Property/casualty insurance 21,454 20,415 Health insurance 1,199 2,112 Life insurance 15,449 14,909

Total 38,102 37,436

Income from land and builing Property/casualty insurance 62 0 Health insurance 17 75 Life insurance 517 532

Total 596 607

All of the investment income in the life insurance and health insurance segments was transferred to the underwriting account, as investment income is a component of the underwriting calculations in both segments. In the property/casualty segment, only deposit interest income for indirect business was transferred to the underwriting account.

The expenses for insurance claims and benefits, administrative expenses, other underwriting expenses and invest-ment expenses include:

2011 2010 In EUR '000

Wages and salaries 119,102 112,932 Expenses for severance benefits and payments to company pension plans 4,038 7,980 Expenses for retirement provisions 15,831 13,428 Expenses for statutory social contributions and income-related contribution and mandatory contributions 40,970 46,788 Other social security expenses 1,476 1,807

Commissions of EUR 180,057,000 (EUR 174,553,000) were incurred for indirect business in 2011.

Losses on disposals of investments were EUR 7,436,000 (EUR 1,882,000) in financial year 2011.

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The valuation reserve shown on the balance sheet as of 31 December 2011 and releases over the fiscal year are broken down by asset item as follows:

As of

31/12/2010 Release As of

31/12/2011 In EUR '000

Land and buildings 51,605 1,263 50,342 Shares in affiliated companies 226 0 226 Shares and other non-fixed-income securities 26,456 23,244 3,212 78,287 24,507 53,780

The formation and release of untaxed reserves resulted in an increase in income tax expenses of EUR 316,000 (EUR 7,682,000) for the financial year.



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V. PROFIT PARTICIPATION

HEALTH INSURANCE

All policies with an adjustment clause whose premiums were not increased by the required actuarial amount when 2011 premium adjustments were performed receive a special profit share on 31 December 2011.

The size of the profit share equals the single-premium amount that is necessary to provide relief to elderly persons covered by health insurance.

Under § 7 of the Financial Market Authority (FMA) regulation on profit participation in the health insurance industry (GBVKVU) of 12 June 2007, this regulation is applicable to policies whose actuarial bases were submitted after 30 June 2007 and whose terms provide for profit participation. The expenses for profit-related premium refunds plus any direct credits must be at least 85% of the assessment basis for the health insurance policies concerned.

The assessment basis within the meaning of § 3(1) GBVKVU is calculated as follows for health insurance policies eligible for profit participation:

In EUR ´000

Earned premiums 6,013 Expenses for insurance claims including changes to underwriting reserves -5,114 Operating expenses -2,320 Other underwriting and non-underwriting income/expenses -20 Investment and interest income and expenses 271 Assessment base as at 31/12/2011 -1,170

As a general rule, the listed income and expense items were calculated directly. Where this was not possible, an alloca-tion was performed as far as possible on the basis of origin in accordance with the provisions of § 3(2) GBVKVU. The option provided for in § 3(3) GBVKVU to apply a prior deduction to the calculation of the assessment basis was used.

Since the assessment basis is negative, the percentage rate specified in § 6(1) GBVKVU was not calculated.

LIFE INSURANCE

Under the FMA regulation of 20 October 2006 on profit participation in the life insurance sector (GBVVU), the ex-penses for profit-related premium refunds and policyholder profit participation plus any direct credits must be at least 85% of the assessment base.

The assessment basis within the meaning of § 3(1) GBVVU is calculated as follows for life insurance policies eligible for profit participation:

In EUR ´000

Earned premiums 405,522 Expenses for insurance claims including changes to underwriting reserves -478,605 Operating expenses -66,324 Other underwriting and non-underwriting income/expenses -3,780 Investment and interest income and expenses 165,366 Assessment base as at 31/12/2011 22,179

As a general rule, the listed income and expense items were calculated directly. Where this was not possible, an alloca-tion was performed as far as possible on the basis of origin in accordance with the provisions of § 3(2) GBVVU.

Expenses for profit participation, including direct credits, were EUR 23,744,000 in 2011 (EUR 21,279,000), repre-senting 107.1% of the assessment basis.

The Managing Board of Wiener Städtische Versicherung AG has adopted a resolution providing the following earnings appropriation as of 31 December 2011 for the insurance policies in the following various profit classes depending on the guaranteed actuarial interest rate:

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Profit Class A 1. In accordance with policy terms and conditions, all insur-ance policies in Profit Class A that belong to Settlement Class 92 receive the following profit shares:

a) An interest profit share equal to 0.25% of the mathe-matical reserve specified in the business plan at the be-ginning of the current insurance year.

b) A total profit share equal to 2.5% of the sum insured upon death for policies that have a proper adjustment letter and no regular premium payments outstanding, and 1% for all other policies.

c) A final profit share upon maturity of the endowment sum in 2012 equal to an interest profit share as per point a) on the total matured capital.

2. In accordance with policy terms and conditions, all insur-ance policies in Profit Class A that belong to Settlement Class 96 (single-premium insurance policies) receive the following profit shares:


b) A final profit share upon maturity of the endowment sum in 2012 equal to an interest profit share as per point a) on the total matured capital.

3. In accordance with policy terms and conditions, all insur-ance policies in Profit Class A, with the exception of policies in Settlement Classes 92 and 96, receive the following profit shares:


b) A total profit share equal to 3.5% of the sum insured upon death for policies that have a proper adjustment letter and no regular premium payments outstanding, and 2% for all other policies.

c) A final profit share upon maturity of the endowment sum in 2012 equal to an interest profit share as per point a) on the total matured capital.

Profit Class B In accordance with policy terms and conditions, all insurance policies in Profit Class B receive profit shares equal to 15% of the annual net premium. Ordinary life insurance policies with a sum insured of at least EUR 726.73 and a policy term of at least 12 years that are included in Profit Class B also receive a final profit share equal to 20% of the sum insured upon maturity of the sum insured in 2012 in the case of survival. The special profit shares approved in 1983 and 1984 are counted toward this final profit share. Profit Class D In accordance with policy terms and conditions, all insurance policies in Profit Class D receive the following profit shares:


b) A total profit share equal to 2% of the sum insured upon death for policies that have a proper adjustment letter and no regular premium payments outstanding, and 1% for all other policies.

c) A final profit share upon maturity of the endowment sum in 2012 equal to a single interest profit share as per point a) on the total matured capital for single-premium policies, and equal to a single interest profit share as per point a) on the total matured capital for policies with regular premiums and a premium payment period of less than 20 years, or equal to double the interest profit share for policies with a premium payment period of 20 years or more.



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Profit Classes F, H, I, J, L, X, Y and S 1. In accordance with policy terms and conditions, all insur-ance policies in Profit Classes F, H, I, J, L, X, Y and S that belong to Settlement Class 2004 receive the following profit shares:

a) An interest profit share equal to 0.50% of the contrac-tual mathematical reserve at the beginning of the cur-rent insurance year.

b) A total or additional profit share equal to 1% of the sum insured upon death, the contractual annuity redemption value or the endowment sum for policies with no regular premium payments outstanding.

c) A final profit share upon maturity of the endowment sum in 2012 equal to the interest profit share as per point a) on the contractual mathematical reserve and, in the case of Profit Class F or S, an additional 3.25% of the profit reserve existing as at the balance sheet date, re-gardless of whether payout is in the form of an annuity or a lump-sum payment.

2. In accordance with policy terms and conditions, all insur-ance policies in Profit Classes F, H, I, J, L, X, Y and S that belong to Settlement Class 2006 receive the following profit shares:


b) A total or additional profit share equal to 1% of the sum insured upon death, the contractual annuity redemption value or the endowment sum for policies with no regular premium payments outstanding.

c) A final profit share on maturity of the endowment sum in 2012 equal to a single interest profit share as per point a) on the contractual mathematical reserve for single-premium policies, and equal to a single interest profit share as per point a) on the contractual mathematical reserve for policies with regular premiums and a pre-mium payment period of less than 15 years, or equal to double the interest profit share as per point a) on the contractual mathematical reserve for policies with a premium payment period of 15 years or more and, in the case of Profit Class F or S, an additional 3.25% of the profit reserve existing as at the balance sheet date. In

the case of annuity contracts, the corresponding final profit share is allocated only if the payout is made in the form of an annuity.

d) Special profit share as additional final profit share upon maturity of the endowment sum for policies with regular premium payments equal to the interest profit share applicable at the time. In the case of annuity contracts, this special profit share is allocated only if the payout is made in the form of an annuity.

3. In accordance with policy terms and conditions, all insur-ance policies in Profit Classes F, H, I, J, L, X, Y and S that belong to Settlement Class 2007 receive the following profit shares:


b) A total or additional profit share for policies with no regular premium payments outstanding, equal to 1% of the sum insured upon death or the contractual annuity redemption value or the endowment sum, plus an ad-ministrative cost bonus equal to 0.15% of the sum in-sured upon death or the contractual redemption value or the endowment sum for each year of the policy term and/or period of deferment, distributed over the last five years of the policy term and/or period of deferment.

c) A final profit share upon maturity of the endowment sum in 2012 equal to a single interest profit share as per point a) on the contractual mathematical reserve for single-premium policies, or equal to double the interest profit share as per point a) on the contractual mathe-matical reserve for policies with regular premium pay-ments plus, in the case of Profit Class F or S, 3.25% of the profit reserve existing as at the balance sheet date. In the case of annuity contracts, the corresponding final profit share is allocated only if the payout is made in the form of an annuity.

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4. In accordance with policy terms and conditions, all insur-ance policies in Profit Class F that belong to Settlement Class 2008 receive the following profit shares:


b) A total or additional profit share for policies with no regular premium payments outstanding, equal to 1% of the sum insured upon death or the contractual annuity redemption value or the endowment sum, plus an ad-ministrative cost bonus equal to 0.15% of the sum in-sured upon death or the contractual annuity redemption value or the endowment sum for each year of the policy term and/or period of deferment, distributed over the last five years of the policy term and/or period of defer-ment.

c) A final profit share upon maturity of the endowment capital in 2012 equal to a single interest profit share as per point item a) on the contractual actuarial reserve, plus 3.25% of the profit reserve existing as at the bal-ance sheet date. In addition to this final profit share, a "goal" bonus of EUR 73.00 for each EUR 50.00 of monthly premiums is credited to policies with Annex TBL, provided the contractual premium is paid as agreed until policy expiration.

5. In accordance with policy terms and conditions, all insur-ance policies in Profit Classes F, H, I, J, L, X, Y and S that belong to Settlement Class 2011G receive the following profit shares: a) An interest profit share equal to 1.25% of the contrac-

tual mathematical reserve at the beginning of the cur-rent insurance year.

b) A total or additional profit share for policies with no

regular premium payments outstanding, equal to 1‰ of the sum insured upon death, plus an administrative cost bonus equal to 0.15% of the sum insured upon death or the annuity present value or the endowment sum for each year of the policy term and/or period of deferment for policies with a term and/or deferment period of 15 years or more, distributed over the last five years of the policy term and/or period of deferment.

c) A final profit share upon maturity of the endowment sum in 2012 equal to a single interest profit share as per point a) on the contractual mathematical reserve for single-premium policies, or equal to double the interest profit share as per point a) on the contractual mathe-matical reserve for policies with regular premium pay-ments plus, in the case of Profit Class F or S, 3.25% of the profit reserve existing as at the balance sheet date.

6. In accordance with policy terms and conditions, all insur-ance policies in Profit Classes F, H, I, J, L, X, Y and S that belong to Settlement Class 2011E or 2011R receive the following profit shares: a) An interest profit share equal to 1.25% of the contrac-


b) A total or additional profit share for policies with no

premium payments outstanding, equal to 0.5% of the contractual annuity redemption value or the endowment sum, plus an administrative cost bonus equal to 0.15% of the contractual annuity redemption value or the en-dowment sum for each year of the policy term and/or period of deferment for policies with a term and/or de-ferment period of 15 years or more, distributed over the last five years of the policy term and/or period of defer-ment.

c) A final profit share upon maturity of the endowment sum

in 2012 equal to a single interest profit share as per point a) on the contractual mathematical reserve for single-premium policies, or equal to double the interest profit share as per point a) on the contractual mathe-matical reserve for policies with regular premium pay-ments plus, in the case of Profit Class F or S, 3.25% of the profit reserve existing as at the balance sheet date, regardless of whether payout is in the form of an annuity or a lump-sum payment.



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7. In accordance with policy terms and conditions, all insur-ance policies in Profit Classes F, H, I, J, L, X, Y and S, with the exception of policies in Settlement Classes 2004, 2006, 2007, 2008, 2011E, 2011G and 2011R, receive the following profit shares: a) An interest profit share equal to 0.00% of the contrac-


b) A total or additional profit share equal to 1‰ of the sum

insured upon death, the contractual annuity redemption value or the endowment sum for policies with no regular premium payments outstanding.


in 2012 equal to the interest profit share as per point a) on the contractual mathematical reserve and, in the case of Profit Class F or S, an additional 3.25% of the profit reserve existing as at the balance sheet date, re-gardless of whether payout is in the form of an annuity or a lump-sum payment.

Profit Class WVN 1. In accordance with policy terms and conditions, all whole life endowment insurance policies in Profit Class WVN that belong to Settlement Class 2004 receive the following profit shares:


b) An additional profit share equal to 25% of the risk pre-mium included in the total premium for the current in-surance year for policies with no regular premium pay-ments outstanding.

2. In accordance with policy terms and conditions, all whole life endowment insurance policies in Profit Class WVN that belong to Settlement Class 2006 receive the following profit shares:


b) An additional profit share equal to 25% of the risk pre-mium included in the total premium for the current in-

surance year for policies with no regular premium pay-ments outstanding.

3. In accordance with policy terms and conditions, all whole life endowment insurance policies in Profit Class WVN that belong to Settlement Class 2011 receive the following profit shares: a) An interest profit share equal to 1.25% of the mathe-

matical reserve specified in the business plan at the be-ginning of the current insurance year.

b) An additional profit share equal to 25% of the risk pre-

mium included in the total premium for the current in-surance year for policies with no regular premium pay-ments outstanding.

4. In accordance with policy terms and conditions, all whole life endowment insurance policies in Profit Class WVN, with the exception of policies in Settlement Classes 2004, 2006 and 2011, receive the following profit shares: a) An interest profit share equal to 0.25% of the mathe-


b) An additional profit share equal to 25% of the risk pre-

mium included in the total premium for the current in-surance year for policies with no regular premium pay-ments outstanding.

Profit Class FLV 1. In accordance with policy terms and conditions, all insur-ance policies in Profit Class FLV that belong to Settlement Class 2008 receive the following profit shares:

0.3% p.a. of the assets of the fund in question will be distrib-uted as profit for policies with no premium payments out-standing.

2. In accordance with policy terms and conditions, all insur-ance policies in Profit Class FLV that belong to Settlement Class 2010 receive the following profit shares:

0.3% p.a. of the assets of the fund in question will be distrib-uted as profit for policies with no premium payments out-standing.

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3. In accordance with policy terms and conditions, all insur-ance policies in Profit Class FLV, with the exception of poli-cies in Settlement Classes 2008 and 2010, receive the fol-lowing profit shares: a) Policies with regular premium payments: A profit share

equal to 3% of the premium set for the insurance year beginning in 2011.

b) Single-premium policies: A profit share equal to 3 ‰ of

the single premium of the master insurance policy at the beginning of the insurance year falling in the year 2011.

4. For premium shares and capital shares invested in the cover fund (Deckungsstock) of the traditional life insurance policy, the approved total interest is distributed equally over all of the days of the calendar year and partial amounts cred-ited continuously to their portion of the cover fund. Total interest of 3.25% p.a. will be credited to the corresponding mathematical reserve in 2012.

Profit Class ZV – Retirement provision For premium shares and capital shares invested in the cover fund (Deckungsstock) of the traditional life insurance policy, the approved total interest is distributed equally over all of the days of the calendar year and partial amounts credited continuously to their portion of the cover fund. Total interest of 3.25% p.a. will be credited to the corresponding mathe-matical reserve in 2012. Profit Class BU with profit participation In accordance with policy terms and conditions, all occupa-tional disability policies in Profit Class BU with profit partici-pation receive profit shares equal to 35% of the insurance premium, accumulated with interest at 3.25% and paid out at the end of the policy term.

Profit Class BU with premium bonus In accordance with policy terms and conditions, all occupa-tional disability insurance policies and supplementary occu-pational disability insurance policies with regular premium payments in Profit Class BU with premium bonus receive a premium bonus equal to 35% of the policy premium or sup-plementary policy premium set for the insurance year begin-ning in 2012.

Profit Class K / DD supplementary policy 1. In accordance with policy terms and conditions, all risk insurance policies with regular premium payments in Profit

Class K that belong to Settlement Class 99 receive a pre-mium bonus equal to 65% of the premium set for the insur-ance year beginning in 2012.

2. In accordance with policy terms and conditions, all risk insurance policies with regular premium payments in Profit Class K that belong to Settlement Class 05 receive the follow-ing premium bonus: a) 65% of the premium set for the insurance year begin-

ning in 2011 for policies 3GP, 3FP, H3P, H3G, K3P and K3G

b) 20% of the premium set for the insurance year begin-

ning in 2012 for all remaining policies. 3. In accordance with policy terms and conditions, all risk insurance policies with regular premium payments and sup-plementary risk insurance policies in Profit Class K, with the exception of policies in Settlement Classes 99 and 05, re-ceive a premium bonus equal to 25% of the premium set for the insurance year beginning in 2012.

4. In accordance with policy terms and conditions, all dread disease supplementary insurance policies with regular pre-mium payments for lump-sum payment and premium waiver in the event of serious illnesses or need for extensive nursing care receive a premium bonus equal to 10% of the supple-mentary policy premium set for the insurance year beginning in 2012.

Profit Class R 1. In accordance with policy terms and conditions, all insur-ance policies in Profit Class R (including policies in Settle-ment Classes 87 and 99), with the exception of policies whose annuity payments have already started, receive the following profit shares: a) An interest profit share equal to 0.25% of the mathe-


b) An additional profit share equal to 1 ‰ of the contrac-

tual annuity redemption value or endowment sum for policies with no regular premium payments outstanding.


in 2012 equal to an interest profit share as per point a) on the total matured capital.



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2. In the case of insurance policies in Settlement Class 2000 whose annuity payments have already started and are in their second year of payments or later, annuities whose pay-ments have already started receive an increase starting as of 1 January 2011 equal to 0.00% of the last annuity payment. The bonus interest rate is 3.25% for bonus annuity agree-ments.




6. For insurance policies that are not in Settlement Classes 2000, 2004, 2006 and 2011 whose annuity payments have already started and are in their second year of payments or later, annuities whose payments have already started receive an increase starting as of 1 January 2012 equal to 0.25% of the last annuity payment. The bonus interest rate is 3.25% for bonus annuity agreements.

Profit Class Z 1. In accordance with policy terms and conditions, all sup-plementary pension insurance policies in Profit Class Z, with the exception of policies whose annuity payments have al-ready started, receive the following profit shares:

a) A profit share equal to 0.25% of the mathematical re-serve specified in the business plan at the beginning of the current insurance year.

b) An additional profit share equal to 1‰ of the contrac-tual annuity redemption value for policies with no regu-lar premium payments outstanding.

c) A final profit share on maturity of the endowment sum in

2012 equal to an interest profit share as per point a) on the total mathematical reserve.

2. In the case of insurance policies in Profit Class Z whose annuity payments have already started and are in their sec-ond year of payments or later, annuities whose payments have already started receive an increase starting as of 1 January 2011 equal to 0.25% of the last annuity payment.

Profit Class FPZ 1. In accordance with policy terms and conditions, all insur-ance policies in Profit Class FPZ in the “Single” policy form receive profit shares equal to 25% of the risk premium at the beginning of the current insurance year, provided the first annuity payment has not yet become payable. These will be transferred to an investment fund for the acquisition of fund units.

2. Insurance policies in Profit Class FPZ are subject to the provisions of Profit Class Z starting as of the time of liquida-tion.

Profit Class BKV 1. In accordance with policy terms and conditions, all insur-ance policies in Profit Class BKV that belong to Settlement Class 2006 with equal distribution receive the following profit shares:

The profit share approved for the entire calendar year and the guaranteed minimum interest are distributed equally over all of the days of the calendar year and partial amounts credited continuously to their portion of the cover fund. Total interest of 4.00% p.a., equal to the sum of the profit share and guaranteed minimum interest, will be credited to the corresponding mathematical reserve in 2012.

2. In accordance with policy terms and conditions, all insur-ance policies in Profit Class BKV that belong to Settlement Class 2011 with equal allocation receive the following profit shares:

The profit share approved for the entire calendar year and the guaranteed minimum interest are distributed equally over all of the days of the calendar year and partial amounts

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credited continuously to their portion of the cover fund. Total interest of 4.00% p.a., equal to the sum of the profit share and guaranteed minimum interest, will be credited to the corresponding mathematical reserve in 2012.

3. In accordance with policy terms and conditions, all insur-ance policies in Profit Class BKV - classic that belong to Settlement Class 2006 with reporting date allocation receive the following profit shares:

An interest profit share equal to 1.75% of the mathematical reserve specified in the business plan at the beginning of the current insurance year.

4. In accordance with policy terms and conditions, all insur-ance policies in Profit Class BKV that belong to Settlement Class 2011 with reporting date allocation receive the follow-ing profit shares: An interest profit share equal to 2.00% of the mathematical reserve specified in the business plan at the beginning of the current insurance year.

5. In the case of insurance policies in Profit Class BKV that belong to Settlement Class 2006 whose annuity payments have already started and are in their second year of pay-ments or later, annuities whose payments have already started receive an increase starting as of 1 January 2012 equal to 1.75% of the last annuity payment. There is no in-crease for bonus annuity agreements. The bonus annuity interest rate is 4%.

6. In the case of insurance policies in Profit Class BKV that belong to Settlement Class 2011 whose annuity payments have already started and are in their second year of pay-ments or later, annuities whose payments have already started receive an increase starting as of 1 January 2012 equal to 2.00% of the last annuity payment. There is no in-crease for bonus annuity agreements. The bonus annuity interest rate is 4%.

The following applies to all profit classes: The Managing Board will decide towards the end of 2012 on the size of the profit allocation for 31 December 2012.



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VI. SIGNIFICANT PARTICIPATIONS

Participations were held in the following companies as of 31 December 2011:

Name, Location

Direct share in %

Net income fort he year in EUR ´000

Equity capital in EUR ´000

Last Annul Financial

Statements I. Direct interests in affiliated companies

Andel Investment Praha s.r.o., Prag 100 901 27,816 2011 ARITHMETICA Versicherungs- und Finanzmathematische Beratungs-Gesellschaft m.b.H., Wien 75 27 403 2011 BML Versicherungsmakler GmbH, Wien 100 36,199 810,060 2011 CENTER Hotelbetriebs GmbH, Wien 55 294 -652 2011 DBR-Liegenschaften GmbH & Co KG, Stuttgart 100 44 11,185 2011 DBR-Liegenschaften Verwaltungs GmbH, Stuttgart 100 0 23 2011 DIRECT-LINE Direktvertriebs-GmbH, Wien 100 1 64 2010 EXPERTA Schadenregulierungs-Gesellschaft m.b.H., Wien 25 371 903 2010 HORIZONT Personal-, Team- und Organisationsentwicklung GmbH, Wien 76 33 177 2010 KÁLVIN TOWER Immobilienentwicklungs- und Investitionsgesellschaft m.b.H., Budapest 100 80 1,771 2011 PFG Holding GmbH, Wien 60 -8,678 126,122 2011 PFG Liegenschaftsbewirtschaftungs GmbH, Wien 50 0,0 45 2010 Projektbau Holding GmbH, Wien 60 -2 21,328 2011 Senioren Residenz gemeinnützige Betriebsgesellschaft mbH, Wien 100 -422 492 2010 Senioren Residenz Veldidenapark Errichtungs- und Verwaltungs GmbH, Innsbruck 67 -438 9,360 2011 Sparkassen Versicherung AG Vienna Insurance Group, Wien 17 84,615 523,229 2011 VICE-Beteiligungs GmbH, Wien 100 -10 52 2010 Wiener Verein Bestattungs- und Versicherungsservice Gesellschaft m.b.H., Wien 100 29 1,498 2011 WPWS Vermögensverwaltung GmbH, Wien 100 11,296 442,638 2011 II. More than 20%,ownership, where a direct ownership interest exists Österreichisches Verkehrsbüro Aktiengesellschaft, Wien 36 10,396 146,641 2010

The exception provided for in § 241 (2) and (3) of the Austrian Corporate Code (Unternehmensgesetzbuch – UGB) was used.

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VII. OTHER INFORMATION

The Company has EUR 10,000,000.00 in share capital that is divided into 100,000 no-par value registered voting shares, with each share participating equally in the share capital.

The Company has subordinated liabilities in the form of supplementary capital bond 2009 in accordance with § 73c(2) VAG with a total nominal value of EUR 100,000,000.00. This bond does not have a fixed term, and pays a variable rate of interest.

On 22 December 2010, the Company issued supplementary capital bond 2010 in accordance with § 73c(2) VAG with a total nominal value of EUR 175,000,000.00. This bond does not have a fixed term, pays a fixed interest rate of 8% p.a., and can be called starting as of 28 December 2029.

The auditor has verified that these supplementary capital bonds satisfy the requirements of § 73b (2)(4) VAG.

The Company also issued bond 2010-2020 with a nominal value of EUR 150,000,000.00 in September 2010. The bond has a term of ten years and pays a fixed interest rate of 3.63% p.a.

THE SUPERVISORY BOARD HAD THE FOLLOWING MEMBERS IN FINANCIAL YEAR 2011:

Chairman: Günter Geyer

Deputy Chairman: Hans-Peter Hagen

Members: Rudolf Ertl Christian Haidinger Werner Muhm Gabriele Payr Martin Simhandl Sonja Zwazl

Employee representatives: Peter Grimm Franz Urban Gerd Wiehart Peter Winkler

THE MANAGING BOARD HAD THE FOLLOWING MEMBERS IN FINANCIAL YEAR 2011:

Chairman: Robert Lasshofer

Members: Christine Dornaus Judit Havasi Peter Höfinger (until 30 June 2011) Ralph Müller (starting 1 April 2011) Erich Leiß

THE FOLLOWING INDIVIDUALS WERE APPOINTED AS TRUSTEES IN FINANCIAL YEAR 2011 IN ACCORDANCE WITH § 22(1) VAG:

Trustee: (cover funds – § 20(2)(1) VAG): Oskar Ulreich

Deputy: Nicole Schweizer

Trustee: (except for cover funds – § 20(2)(1) VAG): Wolfgang Pechriggl

Deputy: Michael Hysek



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The average number of employees (including cleaning staff) was 3,480 (3,528). 1,935 (1,992) of these employees were active in sales resulting in personnel expenses of EUR 85,305,000 (EUR 89,815,000), and 1,545 (1,536) were in operations resulting in personnel expenses of EUR 96,112,000 (EUR 93,119,000).

No loans were outstanding to members of the Managing Board on 31 December 2011 (EUR 0).

Supervisory Board members received no loans in 2011 (EUR 0).

No guarantees were outstanding for members of the Manag-ing Board or Supervisory Board as of 31 December 2011.

In 2011, the total expenses for severance pay and pensions of EUR 19,869,000 (EUR 21,408,000) included severance pay and pension expenses of EUR 9,074,000 (EUR 29,000) for members of the Managing Board and senior manage-ment in accordance with § 80(1) of the Austrian Stock Corporation Act (Aktiengesetz – AktG).

The members of the Managing Board received EUR 2,760,000 (EUR 1,760,000) in remuneration for their ser-vices to the Company during the reporting period. The mem-bers of the Managing Board received EUR 805,000 (EUR 458,000) from affiliated companies during the reporting period. EUR 544,000 (EUR 436,000) of this amount was charged to the Company in the form of an intercompany charge.

The total compensation paid to former members of the Man-aging Board (including surviving dependants) during the reporting period was EUR 3,472,000 (EUR 1,655,000).

The members of the Supervisory Board received EUR 173,000 (EUR 99,000) in remuneration for their services to the Company in 2011.

A summary of auditing fees is provided in the notes to the consolidated financial statements of VIENNA INSURANCE GROUP AG Wiener Versicherung Gruppe, Vienna.

The Company is a group member within the meaning of § 9 of the Austrian Corporate Tax Act (Körperschaftssteuerge-setz – KStG) of WIENER STÄDTISCHE WECHSELSEITIGER VERSICHERUNGSVEREIN – VERMÖGENSVERWALTUNG – Vienna Insurance Group, Vienna. The taxable earnings of group members are attributed to the parent company. The parent company has entered into agreements with each group member governing the allocation of positive and nega-tive tax amounts for the purpose of allocating corporate income tax charges according to their origin. A liability of EUR 5,935,000 (EUR 11,792,000) is owed to the parent company for tax allocations. Use was made of the election to capitalise deferred profit taxes arising due to temporary differences between earnings under corporate law and tax-able earnings. A 25% tax rate was chosen for deferred taxes.

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The Company is a 99.9% subsidiary of VIENNA INSURANCE GROUP AG Wiener Versicherung Gruppe, Vienna, and is therefore part of the group formed by this shareholder and its affiliated companies. The remaining 0.1% of the shares belong to Wiener Städtische Wechselseitiger Versicherungs-verein – Vermögensverwaltung – Vienna Insurance Group, Vienna.

Wiener Städtische Wechselseitiger Versicherungsverein – Vermögensverwaltung – Vienna Insurance Group, Vienna, prepares consolidated financial statements that include

most of the companies. These consolidated financial state-ments have been disclosed and are available for inspection at the business premises of this company located at Schot-tenring 30, 1010 Vienna.

VIENNA INSURANCE GROUP AG Wiener Versicherung Gruppe, Vienna, prepares consolidated financial statements for a small number of companies. These consolidated finan-cial statements have been disclosed and are available for inspection at the business premises of this company located at Schottenring 30, 1010 Vienna.

The Managing Board:

Robert Lasshofer

Christine Dornaus

Judit Havasi

Ralph Müller

Erich Leiß




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AUDITOR'S REPORT

REPORT ON THE ANNUAL FINANCIAL STATEMENTS

We have audited the accompanying annual financial state-ments, including the accounting, of WIENER STÄDTISCHE VERSICHERUNG AG Vienna Insurance Group, Vienna, for the financial year from 1 January to 31 December 2011. These annual financial statements comprise the balance sheet as of 31 December 2011, the income statement for the financial year ended 31 December 2011, and the notes to the finan-cial statements.

Management’s responsibility for the annual financial statements and the accounting The management of the Company is responsible for the ac-counting and for the preparation of annual financial state-ments giving a true and fair view of the Company's net assets, financial position and results of operation in accordance with the requirement of Austrian corporate and insurance super-visory law. This responsibility includes: designing, implement-ing and maintaining an internal control system for the pur-pose of preparing annual financial statements that give a true and fair view of the Company's net assets, financial position and results of operation and are free from material misstate-ments, whether due to fraud or unintentional error; selecting and applying appropriate accounting policies; making esti-mates that are reasonable in the circumstances given.

Auditor’s responsibility and description of type and scope of the statutory audit Our responsibility is to express an opinion on these annual financial statements based on our audit. We conducted our audit in accordance with the statutory requirements applica-ble in Austria and Austrian generally accepted principles for financial statement auditing. Those standards require that we comply with professional guidelines and plan and perform the audit to obtain reasonable assurance that the financial statements are free from material misstatement.

An audit involves performing audit procedures to obtain audit evidence about the amounts and disclosures in the annual financial statements. The choice of audit procedures is within the auditor’s discretion, based on an assessment of the risk of material misstatements, whether due to fraud or uninten-tional error. The auditor takes the internal control system into account when performing this risk assessment, to the extent it is relevant to the preparation of annual financial statements that give a true and fair view of the Company's net assets, financial position and results of operations, in order to deter-mine audit procedures that are suitable under the circum-stances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control system. An audit also includes an assessment of the appropriateness of the accounting policies used and the accounting estimates made by management, and an evaluation of the overall pres-entation of the annual financial statements.

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We believe that we have obtained sufficient and suitable audit evidence to provide a reasonable basis for our audit opinion.

Opinion Our audit did not give rise to any objections. In our opinion, based on the findings of our audit, the annual financial statements comply with the statutory requirements and give a true and fair view of the Company's net assets and financial position as of 31 December 2011 and the Company's results of operations for the financial year from 1 January to 31 De-cember 2011 in accordance with Austrian generally ac-cepted accounting principles.

COMMENTS ON THE MANAGEMENT REPORT

The management report is to be audited based on the statu-tory requirements to determine whether it is consistent with the annual financial statements and whether the other dis-closures in the management report are misleading with re-spect to the situation of the Company. The auditor’s report must also include a statement as to whether the manage-ment report is consistent with the annual financial state-ments.

In our opinion, the management report is consistent with the annual financial statements.


PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und

Steuerberatungsgesellschaft

signed:

Günter Wiltschek Austrian Certified Public Accountant

signed:

Liane Hirner Austrian Certified Public Accountant

Disclosure, publication and reproduction of the annual financial statements together with the auditor’s report within the mean-ing of § 281(2) UGB in a form that is not in accordance with statutory requirements and differing from the version audited by us is not permitted. Reference to our audit may not be made without out prior written permission.



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DECLARATION BY THE MANAGING BOARD

We declare to the best of our knowledge that the annual financial statements of WIENER STÄDTISCHE Versicherung AG Vienna Insurance Group, prepared in accordance with the requirements of Austrian corporate law and the Austrian Insurance Super-vision Act, give a true and fair view of the Company’s net assets, financial position and results of operations, the management report presents the business development, performance and position of the Company so as to give a true and fair view of its net assets, financial position and results of operations, and the management report provides a description of the principal risks and uncertainties to which the Company is exposed.

The Managing Board:

Robert Lasshofer

Christine Dornaus

Judit Havasi

Ralph Müller

Erich Leiß


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SUPERVISORY BOARD REPORT

The Supervisory Board reports that it has taken the opportu-nity to comprehensively review the management of the Com-pany, both acting as a whole and also regularly through its committees, Chairman and Deputy Chairman. Detailed pres-entations and discussions during meetings of the Supervisory Board and its committees served this purpose, as did recur-ring meetings with the members of the Managing Board, who provided detailed explanations and supporting documenta-tion relating to the management and financial position of the Company. The strategy, business development, risk man-agement, internal control system and activities of the internal audit department of the Company were also discussed in these meetings.

The Supervisory Board has formed four committees from among its members. Information on the responsibilities and composition of these committees is available on the Com-pany’s website and in the corporate governance report.

One Annual General Meeting, one extraordinary General Meeting and four Supervisory Board meetings were held in 2011. Three meetings of the Audit Committee were also held. The Committee for Urgent Matters held no meetings in 2011 but was contacted in writing with regard to three matters. The Supervisory Board was informed of any resolutions passed by the committees at the next Supervisory Board meeting. The auditor, PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft (PwC), attended three Audit Committee meetings and one Supervisory Board meet-ing, namely the meeting dealing with the auditing and formal approval of the annual financial statements, as well as the Annual General Meeting. In addition, one meeting of the Committee for Managing Board Matters was also held in 2011.

No agenda items were discussed in the Supervisory Board and committee meetings without the participation of mem-bers of the Managing Board. No member of the Supervisory Board attended fewer than half of the Supervisory Board meetings.

By inspection of appropriate documents, meetings with the Managing Board and discussions with the auditor, the Super-visory Board Audit Committee was able to form a satisfactory view of the accounting process and found no reasons for objection.

The Audit Committee also reviewed the effectiveness of the internal control system, the internal auditing system and the risk management system by requesting descriptions of the processes and organisation of these systems from the Man-aging Board, the auditor and the individuals directly respon-sible for these areas. The Audit Committee reported on these monitoring activities to the Supervisory Board and stated that no deficiencies had been identified.

In order to prepare the Supervisory Board’s proposal for selection of the auditor for the annual financial statements, the Audit Committee requested that PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesell-schaft submit documents concerning its license to audit. A written report was prepared stating that there were no grounds for exclusion or circumstances that could provide cause for concern regarding partiality. In addition, a list of services grouped by category showing the total revenues that PwC received from the Company in the previous financial year was requested and reviewed, and it was verified that PwC was included in a statutory quality assurance system. The Audit Committee reported to the Supervisory Board on the findings gained from these investigations and proposed to the Supervisory Board and subsequently to the General Meeting that PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft be selected as auditor for the annual financial statements.

In addition, the Supervisory Board Audit Committee received the 2011 annual financial statements and management report from the Managing Board, and reviewed and carefully examined them. The Managing Board’s proposal for appro-priation of profits was also debated and discussed during the course of this examination. As a result of this examination and discussion, a unanimous resolution was adopted to rec-ommend to the Supervisory Board that they be accepted without qualification. The committee chairman informed the Supervisory Board of the resolutions adopted by the commit-tee.



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The 2011 annual financial statements and management report, and the Managing Board's proposal for appropriation of profits were then taken up, thoroughly discussed, and examined by the Supervisory Board. In addition, the auditor’s reports prepared by PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft for the 2011 annual financial statements and 2011 manage-ment report were reviewed by the Audit Committee and the Supervisory Board, and debated and discussed in detail with PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft. The final findings of the audit provided no reason for objections. The Supervisory Board declared that it had nothing to add to the auditor's reports.

After a thorough examination, the Supervisory Board there-fore unanimously adopted a resolution to approve the annual financial statements prepared by the Managing Board, to raise no objections to the management report, and to declare its agreement with the Managing Board proposal for appro-priation of profits.

The 2011 annual financial statements have therefore been approved in accordance with § 96(4) of the Austrian Stock Corporation Act.

The Supervisory Board proposes to the General Meeting that it approve the Managing Board proposal for appropriation of profits and formally approve the actions of the Managing Board and Supervisory Board.

Vienna, March 2012

The Supervisory Board

Günter Geyer

(Chairman)

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STATE ADVISORY BOARDS

The advisory boards for the federal states of Austria provided for in the Articles of Association to advise the Managing Board have the following members:

STATE ADVISORY BOARD FOR VIENNA

Martin Bachlechner Peter Bosek Ilse Brandner-Radinger Ismail H. Ergener Michael Hafner René Alfons Haiden Peter Hanke Brigitte Jank Helmut Jonas Hans Judmann Willibald Keusch Michael Landau Michael Ludwig Sigi Menz Walter Nettig Ernst Nonhoff Carl Ludwig Richard Michael Schottenberg Günter Wandl Udo Weinberger Wilhelm Wohatschek

STATE ADVISORY BOARD FOR LOWER AUSTRIA

Christian Aichinger Gertrude Baumgartner Rupert Dworak Burkhard Ellegast Wilhelm Gelb Helmut Guth Berthold Heigl Herwig Hofstätter Karl Jurtschitsch Herbert Kaufmann Herbert Klenk Hans Knoll Otto Korten Werner Magyer Josef Panis Elisabeth Schubrig Matthias Stadler

Dietmar Steinbrenner Karl Th. Trojan Johann Trost jun. Wolfgang Wiedermann Gerhard Zinner

STATE ADVISORY BOARD FOR UPPER AUSTRIA

Othmar Bruckmüller Herbert Brunsteiner Robert Ebner Othmar Friedl Alois Froschauer Peter Glatzmeier Manfred Haimbucher Peter Halatschek Norbert Haudum Heinz Hillinger Manfred Hochhauser Hermann Kepplinger Anette Klinger Richard Kirchweger Markus Limberger Johann Mayr Josef Peischer Ludwig Scharinger Adolf Scheuchenpflug Wolfgang Schneckenreither Ernst Strauss Gerda Weichsler-Hauer

STATE ADVISORY BOARD FOR STYRIA

Wolfgang Bartosch Herbert Beiglböck Gerhard Deutsch Gerhard Fabisch Horst Hilmer Andrea Hirschenberger Karl-Franz Maier Ernst Meixner Wolfgang Messner Paul Nussbaumer Hermann Retter Ulrike Retter Bernhard Rosenberger Wolfram Sacherer Alois Samer Horst Schachner



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Christoph Stark Gerald Stoiser Josef Wallner Manfred Wegscheider

STATE ADVISORY BOARD FOR CARINTHIA AND EAST TYROL

Ingo Appé Helmut Eder Hermann Egger Horst Felsner Günter Goach Reinhard Iro Rudolf Kandussi Franz Kreuzer Johann Lintner Franz Liposchek Helmut Manzenreiter Claudia Mischensky Hans Michael Offner Anton Peternel Herwig Rettenbacher Hans Schönegger Oskar Seidler Arno Sorger Andrea Springer Michael Stattmann

STATE ADVISORY BOARD FOR SALZBURG

Wolfgang Bell Franz Blum August Hirschbichler Hildegund Maier Alois Johann Nindl Regina Ovesny-Straka Ferdinand Saller Günter Schied Harald Seiss Christian Stöckl Josef Treml

STATE ADVISORY BOARD FOR TYROL

Martin Baltes Christian Bernard Manfried Gantner Hannes Gschwentner Markus Jochum Walter Kircher Hansjörg Mölk Hermann Nagiller Jakob Ringler Elmar Schmid Harald Schneider Karl Schranz Raimund Schreier Hans Unterdorfer Elisabeth Zanon

STATE ADVISORY BOARD FOR VORARLBERG

Wilfried Berchtold Werner Böhler Michael Diem Horst Fritz Jürgen Gabrieli Werner Gunz Guntram Jäger Edgar Mayer Peter Mennel Wilhelm Muzyczyn Ewald Netzer Peter Oksakowski Kuno Riedmann Anton Steinberger Walter Thöny

STATE ADVISORY BOARD FOR BURGENLAND

Mario De Martin De Gobbo Hannes Frech Michael Gerbavsits Oswald Hackl Erich Horvath Christian Illedits

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Michael Koch Helmut Löffler Hans Niessl Frank Pfnier Matthias Reiner Ingrid Salamon Nikolaus Sauer Ernst Schmid Johann Schmidt Peter Schmitl Rudolf Simandl Gerhard Steier Georg Stiegelmar Csaba Szekely Robert Tauber Josef Wein

ADVISORY BOARD FOR FUNERAL INSURANCE

The advisory board provided for in the Articles of Association to advise the Managing Board on funeral matters and funeral insurance has the following members: Walter Egger Christian Fertinger Wilhelm Fuchs Peter Kotzbauer Othmar Lechner Hansjörg Lein Peter Marent Ulrich Mayerhofer Franz Nechansky Gerfried Redlich Wolfgang Saiko Peter Schlaffer Eduard Schreiner Mario Wagenhuber Karl Wagner Gregor Zaki



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STATE HEAD OFFICES

STATE HEAD OFFICE FOR VIENNA

1020 Vienna, Obere Donaustrasse 49-53 Phone: +43 (0) 50 350-40000 Fax: +43 (0) 50 350 99-40000 Email: [email protected] Hermann Fried, State Director

STATE HEAD OFFICE FOR LOWER AUSTRIA

3100 St. Pölten, Europaplatz 2 Phone: +43 (0) 50 350-41000 Fax: +43 (0) 50 350 99-41000 Email: [email protected] Helmut Maurer, State Director

STATE HEAD OFFICE FOR UPPER AUSTRIA

4020 Linz, Untere Donaulände 40 Phone: +43 (0) 50 350-42000 Fax: +43 (0) 50 350 99-42000 Email: [email protected] Günther Erhartmaier, State Director

STATE HEAD OFFICE FOR STYRIA

8010 Graz, Brockmanngasse 32 Phone: +43 (0) 50 350-43000 Fax: +43 (0) 50 350 99-43000 Email: [email protected] Gerald Krainer, State Director

STATE HEAD OFFICE FOR CARINTHIA AND EAST TYROL

9020 Klagenfurt, St. Veiter-Ring 13 Phone: +43 (0) 50 350-44000 Fax: +43 (0) 50 350 99-44000 Email: [email protected] Erich Obertautsch, State Director

STATE HEAD OFFICE FOR SALZBURG

5020 Salzburg, Max-Ott-Platz 3 Phone: +43 (0) 50 350-45000 Fax: +43 (0) 50 350 99-45000 Email: [email protected] Hans Vierziger, State Director

STATE HEAD OFFICE FOR TYROL

6020 Innsbruck, Südtiroler Platz 4 Phone: +43 (0) 50 350-46000 Fax: +43 (0) 50 350 99-46000 Email: [email protected] Ida Wander, State Director

STATE HEAD OFFICE FOR VORARLBERG

6800 Feldkirch, Waldfriedgasse 2 Phone: +43 (0) 50 350-47000 Fax: +43 (0) 50 350 99-47000 Email: [email protected] Burkhard Berchtel, State Director

STATE HEAD OFFICE FOR BURGENLAND

7000 Eisenstadt, Kalvarienbergplatz 7 Phone: +43 (0) 50 350-48000 Fax: +43 (0) 50 350 99-48000 Email: [email protected] Gerold Stagl, State Director BRANCH OFFICES

ITALY

Wiener Städtische Versicherung AG Vienna Insurance Group I-00147 Rome Via Cristoforo Colombo 149 Phone: +39 (0) 6 510 70 11 Email: [email protected] Website: www.wieneritalia.com Gernot Isak, Managing Director Paolo Masci, Managing Director

SLOVENIA

Wiener Städtische zavarovalnica podružnica SI-1000 Ljubljana Masarykova 14 Phone: +386 (0) 1 300 17 00 Email: [email protected] Website: www.wienerstaedtische.si Tomo Mrden, Managing Director Thomas Schmidtmeier, Managing Director

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CONTACTS AND ADDRESSES

LIFE/HEALTH ACTUARIAL DEPARTMENT

Josef Hiller Phone: +43 (0) 50 350-21721 Fax: +43 (0) 50 350 99-21721 Email: [email protected]

PROPERTY/CASUALTY ACTUARIAL DEPARTMENT

Michael Schlögl Phone: +43 (0) 50 350-21530 Fax: +43 (0) 50 350 99-21530 Email: [email protected]

ALTERNATIVE DISTRIBUTION

Gerhard Heine Phone: +43 (0) 50 350-22840 Fax: +43 (0) 50 350 99-22840 Email: [email protected]

PARTICIPATION MANAGEMENT AND LOANS

Christine Dornaus Phone: +43 (0) 50 350-21126 Fax: +43 (0) 50 350 99-21126 Email: [email protected]

BUSINESS ORGANISATION

Robert Redl Phone: +43 (0) 50 350-22193 Fax: +43 (0) 50 350 99-22193 Email: [email protected]

CONTROLLING

Szabolcs Nagy Phone: +43 (0) 50 350-21056 Fax: +43 (0) 50 350 99-21056 Email: [email protected]

ENTERPRISE RISK MANAGEMENT

Alexander Schuh Phone: +43 (0) 50 350-21450 Fax: +43 (0) 50 350 99-21450 Email: [email protected]

FINANCE AND ACCOUNTING

Hans Meixner Phone: +43 (0) 50 350-21810 Fax: +43 (0) 50 350 99-21810 Email: [email protected]

CORPORATE AND LARGE CUSTOMER BUSINESS

Underwriting Wolfgang Petschko Phone: +43 (0) 50 350-21406 Fax: +43 (0) 50 350 99-21406 Email: [email protected]

Claims Josef Aigner Phone: +43 (0) 50 350-26112 Fax: +43 (0) 50 350 99-26112 Email: [email protected]

GENERAL SECRETARIAT

Doris Janik Phone: +43 (0) 50 350-21059 Fax: +43 (0) 50 350 99-21059 Email: [email protected]

COMPANY LAW

Helene Kanta Phone: +43 (0) 50 350-21122 Fax: +43 (0) 50 350 99-21122 Email: [email protected]

IT MANAGEMENT AND PROVIDER MANAGEMENT

Klaus Krebs Phone: +43 (0) 50 330-22106 Fax: +43 (0) 50 330 99-22106 Email: [email protected]



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MOTOR VEHICLE INSURANCE (UNDERWRITING)

Michael Schlögl Phone: +43 (0) 50 350-21530 Fax: +43 (0) 50 350 99-21530 Email: [email protected]

HEALTH INSURANCE

Peter Kranz Phone: +43 (0) 50 350-21610 Fax: +43 (0)50 350 99-21610 Email: [email protected]

LIFE AND CASUALTY INSURANCE

Mathias Frisch Phone: +43 (0) 50 350-21600 Fax: +43 (0) 50 350 99-21600 Email: [email protected]

REAL ESTATE AND REAL ESTATE-RELATED PARTICIPATIONS

Anton-Leonhard Werner Phone: +43 (0) 50 350-21050 Fax: +43 (0) 50 350 99-21050 Email: [email protected]

OMBUDSPERSON

Julia Christanell Phone: +43 (0) 50 350-21088 Fax: +43 (0) 50 350 99-21088 Email: [email protected]

HUMAN RESOURCES / HUMAN RESOURCES DEVELOPMENT

Robert Bilek Phone: +43 (0) 50 350-21300 Fax: +43 (0) 50 350 99-21300 Email: [email protected]

COMMUNICATIONS / INTERNAL COMMUNICATIONS

Claudia Riebler Phone: +43 (0) 50 350-21336 Fax: +43 (0) 50 350 99-21336 Email: [email protected]

LEGAL EXPENSES INSURANCE (CLAIMS)

Günther Bauer Phone: +43 (0) 50 350-21587 Fax: +43 (0) 50 350 99-21587 Email: [email protected]

AUDIT

Herbert Allram Phone: +43 (0) 50 350-21070 Fax: +43 (0) 50 350 99-21070 Email: [email protected]

REINSURANCE

Eduard Oberleithner Phone: +43 (0) 50 350-21474 Fax: +43 (0) 50 350 99-21474 Email: [email protected]

NON-LIFE, GENERAL LIABILITY AND LEGAL EXPENSES INSURANCE – PRIVATE AND COMMERCIAL BUSINESS (UNDERWRITING)

Robert Ulbing Phone: +43 (0) 50 350-21421 Fax: +43 (0) 50 350 99-21421 Email: [email protected]

COLLECTIONS SERVICE CENTRE

Andreas Weninger Phone: +43 (0) 50 350-21817 Fax: +43 (0 )50 350 99-21817 Email: [email protected]

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PERSONAL INSURANCE SERVICE CENTRE

Sabine Pfeffer Phone: +43 (0)50 350 21313 Fax: +43 (0)50 350 99-21313 Email: [email protected]

PROPERTY INSURANCE SERVICE CENTRE

Annemarie Ulbing Phone: +43 (0) 50 350-27500 Fax: +43 (0) 50 350 99-27500 Email: [email protected]

SPECIAL CLAIMS

Wolfgang Reisinger Phone: +43 (0) 50 350-21500 Fax: +43 (0) 50 350 99-21500 Email: [email protected]

DISTRIBUTION

Walter Wichtel Phone: +43 (0) 50 35022530 Fax: +43 (0) 50 350 99-22530 Email: [email protected]

ADVERTISING / SPONSORING

Sabine Weiss Phone: +43 (0) 50 350-21194 Fax: +43 (0) 50 350 99-21194 Email: [email protected]

SECURITIES AND FUNDS

Reza Kazemi Tabrizi Phone: +43 (0) 50 100-75473 Fax: +43 (0) 50 100-975473 Email: [email protected]



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BUSINESS OFFICES

Wiener Städtische is available throughout Austria for the cost of a local call 24 hours a day, 7 days a week.

Phone +43 (0) 50 350 (direct line), Fax: +43 (0) 50 350 99 (direct line)

Offices with motor vehicle registration

VIENNA

Headquarters Direct dial 20000 Schottenring 30 1010 Vienna [email protected] State Head Office for Vienna Direct dial 40000 Obere Donaustrasse 49-53 1020 Vienna [email protected] Customer retirement provisions office Direct dial 22380 Zelinkagasse 14 1010 Vienna [email protected] Donaustadt Direct dial 51400 Bernoullistrasse 1 1220 Vienna [email protected] Floridsdorf Direct dial 51300 Am Spitz 10 1210 Vienna [email protected] Landstraße Direct dial 50800 Rochusgasse 3-5 1030 Vienna [email protected]

Liesing Direct dial 51700 Breitenfurter Strasse 393 1230 Vienna [email protected] Ottakring Direct dial 51100 Thaliastrasse 44 1160 Vienna [email protected]

LOWER AUSTRIA

State Head Office Lower Austria Direct dial 41000 Europaplatz 2 3100 St. Pölten [email protected] Amstetten Direct dial 53900 Waidhofner Strasse 31 3300 Amstetten [email protected] Aspang Direct dial 53400 Mönichkirchner Strasse 3 2870 Aspang [email protected] Baden Direct dial 53000 Bahngasse 9 2500 Baden [email protected]

Bruck/Leitha Direct dial 52900 Fischamender Strasse 54 2460 Bruck/Leitha [email protected] Gänserndorf Direct dial 52500 Bahnstrasse 15 2230 Gänserndorf [email protected] Gföhl Direct dial 64300 Hauptplatz 1 3542 Gföhl [email protected] Gmünd Direct dial 54900 Stadtplatz 17 3950 Gmünd [email protected] Groß Enzersdorf Direct dial 52600 Bischof Berthold-Platz 4 2301 Groß Enzersdorf [email protected] Herzogenburg Direct dial 53600 St. Pöltner Strasse 11 3130 Herzogenburg [email protected]

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Hollabrunn Direct dial 51900 Bahnstrasse 12 2020 Hollabrunn [email protected] Horn Direct dial 54600 Schützenplatz 2 3580 Horn [email protected] Klosterneuburg Direct dial 54200 Am Renninger 2 3400 Klosterneuburg [email protected] Korneuburg Direct dial 52100 Wiener Ring 16 2100 Korneuburg [email protected] Krems Direct dial 54500 Ringstrasse 11 3500 Krems [email protected] Laa/Thaya Direct dial 52300 Stadtplatz 38 2136 Laa/Thaya [email protected] Lilienfeld Direct dial 53700 Babenbergerstrasse 36 3180 Lilienfeld [email protected] Melk Direct dial 54100 Hauptstrasse 9 3390 Melk [email protected]

Mistelbach Direct dial 52200 Ernstbrunnerstrasse 8 2130 Mistelbach [email protected] Mödling Direct dial 52800 Klostergasse 14 2340 Mödling [email protected] Neulengbach Direct dial 53500 Hauptplatz 27 3040 Neulengbach [email protected] Neunkirchen Direct dial 53100 Schwarzottstrasse 2a 2620 Neunkirchen [email protected] Poysdorf Direct dial 52400 Brunngasse 4 2170 Poysdorf [email protected] Retz Direct dial 52000 Hauptplatz 21 2070 Retz [email protected] Scheibbs Direct dial 53800 Rathausplatz 11 3270 Scheibbs [email protected] Schwechat Direct dial 52700 Wiener Strasse 9 2320 Schwechat [email protected]

Stockerau Direct dial 51800 Hauptstrasse 4 2000 Stockerau [email protected] Ternitz Direct dial 53200 Hans Czettel-Platz 1 2630 Ternitz [email protected] Tulln Direct dial 54400 Königstetter Strasse 60 3430 Tulln [email protected] Waidhofen/Thaya Direct dial 54700 Bahnhofstrasse 8 3830 Waidhofen/Thaya [email protected] Waidhofen/Ybbs Direct dial 54000 Riedmüllerstrasse 3a/1 3340 Waidhofen/Ybbs [email protected] Wolkersdorf Direct dial 65100 Wiener Strasse 1 2120 Wolkersdorf [email protected] Wr. Neustadt Direct dial 53300 Ferdinand Porsche-Ring 2 2700 Wr. Neustadt [email protected] Zistersdorf Direct dial 65500 Schlossgasse 2 2225 Zistersdorf [email protected]



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Zwettl Direct dial 54800 Neuer Markt 13 3910 Zwettl [email protected]

UPPER AUSTRIA

Head Office for Upper Austria Direct dial 42000 Untere Donaulände 40 4020 Linz [email protected] Bad Ischl Direct dial 56900 Karl Wiesinger-Strasse 2 4820 Bad Ischl [email protected] Bad Leonfelden Direct dial 65200 Böhmerstrasse 7 4190 Bad Leonfelden [email protected] Braunau/lnn Direct dial 57300 Ringstrasse 47 5280 Braunau/lnn [email protected] Eferding Direct dial 55500 Bahnhofstrasse 19 4070 Eferding [email protected] Freistadt Direct dial 55700 Zemannstrasse 25 4240 Freistadt [email protected] Gmunden Direct dial 56800 Schiffslände 1 4810 Gmunden

[email protected] Direct dial 56600 Roßmarkt 30 4710 Grieskirchen [email protected] Kirchdorf/Krems Direct dial 56200 Linzer Strasse 2 4560 Kirchdorf/Krems [email protected] Kremsmünster Direct dial 56100 Rathausplatz 9 4550 Kremsmünster [email protected] Leonding Direct dial 55400 Michaelsbergstrasse 5 4060 Leonding [email protected] Linz, Kleinmünchen Direct dial 55100 Zeppelinstrasse 4 4032 Linz, Kleinmünchen [email protected] Linz, Urfahr Direct dial 55200 Freistädter Strasse 16 4040 Linz, Urfahr [email protected] Mondsee Direct dial 61100 Herzog-Odilostrasse 14 5310 Mondsee [email protected] Perg Direct dial 55800 Dr. Schober-Strasse 25 4320 Perg [email protected]

Ried/lnnkreis Direct dial 57200 Thurnerstrasse 16 4910 Ried/lnnkreis [email protected] Rohrbach Direct dial 55600 Pfarrgasse 4 4150 Rohrbach [email protected] Schärding Direct dial 56700 Linzer Strasse 29 4780 Schärding [email protected] Scharnstein Direct dial 56400 Hauptstrasse 22 4644 Scharnstein [email protected] Schörfling Direct dial 57100 Hauptstrasse 7b/Top 3 4861 Schörfling [email protected] Steyr Direct dial 55900 Leopold-Werndl-Strasse 10a 4400 Steyr [email protected] Traun Direct dial 55300 Kremstalerstrasse 20 4050 Traun [email protected] Vöcklabruck Direct dial 57000 Linzerstrasse 61 4840 Vöcklabruck [email protected]

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Wels Direct dial 56300 Bauernstrasse 9 4600 Wels [email protected] Windischgarsten Direct dial 65700 Gleinkerseestrasse 1 4580 Windischgarsten [email protected]

STYRIA

State Head Office for Styria Direct dial 43000 Brockmanngasse 32 8010 Graz [email protected] Bad Aussee Direct dial 59900 Kirchengasse 31 8990 Bad Aussee [email protected] Bad Radkersburg Direct dial 58500 Emmenstrasse 21-27 8490 Bad Radkersburg [email protected] Bruck/Mur Direct dial 58800 Mittergasse 4 8600 Bruck/Mur [email protected] Deutschlandsberg Direct dial 58600 Frauentalerstrasse 44 8530 Deutschlandsberg [email protected] Feldbach Direct dial 58200 Bismarckstrasse 16 8330 Feldbach [email protected]

Fürstenfeld Direct dial 58100 Realschulstrasse 2a 8280 Fürstenfeld [email protected] Gleisdorf Direct dial 57900 Businesspark 4 8200 Gleisdorf [email protected] Gratkorn Direct dial 57700 Grazer Strasse 50 8101 Gratkorn [email protected] Graz, Andritz Direct dial 65400 Andritzer Reichstrasse 26 8045 Graz [email protected] Graz, Elisabethstrasse Direct dial 66200 Elisabethstrasse 59 8010 Graz [email protected] Graz, Seiersberg Direct dial 057600 Kärnterstrasse 525-527 8054 Seiersberg [email protected] Gröbming Direct dial 59800 Poststrasse 336 8962 Gröbming [email protected] Hartberg Direct dial 58000 Ressavarstrasse 12-14 8230 Hartberg [email protected]

Judenburg Direct dial 59400 Jägersteig 2 8750 Judenburg [email protected] Kapfenberg Direct dial 58900 Mariazellerstrasse 1 8605 Kapfenberg [email protected] Knittelfeld Direct dial 59300 Hauptplatz 15 8720 Knittelfeld [email protected] Leibnitz Direct dial 58400 Bahnhofstrasse 9 8430 Leibnitz [email protected] Leoben Direct dial 59200 Franz Josef-Strasse 1 8700 Leoben [email protected] Liezen Direct dial 59700 Werkstrasse 30 8940 Liezen [email protected] Murau Direct dial 59600 Anna-Neumann-Strasse 9 8850 Murau [email protected] Mürzzuschlag Direct dial 59100 Kirchengasse 10 8680 Mürzzuschlag [email protected]



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Voitsberg Direct dial 58700 Hauptplatz 1 8570 Voitsberg [email protected] Weiz Direct dial 57800 Marburgerstrasse 47 8160 Weiz [email protected]

CARINTHIA

State Head Office for Carinthia Direct dial 44000 St. Veiter-Ring 13 9010 Klagenfurt [email protected] Feldkirchen Direct dial 60500 Dr.-Arthur-Lemisch-Strasse 1 9560 Feldkirchen [email protected] Ferlach Direct dial 60100 Hauptplatz 5 9170 Ferlach [email protected] Hermagor Direct dial 60600 Hauptstrasse 33 9620 Hermagor [email protected] Spittal/Drau Direct dial 60700 Bahnhofstrasse 2 9800 Spittal/Drau [email protected] St. Veit/Glan Direct dial 60200 Platz am Graben 3 9300 St. Veit/Glan [email protected]

Villach Direct dial 60400 Moritschstrasse 5 9500 Villach [email protected] Völkermarkt Direct dial 60000 Klagenfurter Strasse 12 9100 Völkermarkt [email protected] Wolfsberg Direct dial 60300 Wiener Strasse 5 9400 Wolfsberg [email protected]

EAST TYROL

Lienz Direct dial 60800 Andreas-Hofer-Strasse 1a 9900 Lienz [email protected]

SALZBURG

State Head Office for Salzburg Direct dial 45000 Max-Ott-Platz 3 5020 Salzburg [email protected] Abtenau Direct dial 61300 Au 87 5441 Abtenau [email protected] Bad Gastein Direct dial 61700 Bahnhofsplatz 7 5640 Bad Gastein [email protected]

Bischofshofen Direct dial 61400 Franz-Mohshammer-Platz 14 5500 Bischofshofen [email protected] Hallein Direct dial 61200 Bürgermeisterstrasse 13 5400 Hallein [email protected] Mattighofen (Upper Austria) Direct dial 61000 Stadtplatz 18 5230 Mattighofen [email protected] Saalfelden Direct dial 61900 Bahnhofstrasse 12/Top4 5760 Saalfelden [email protected] Salzburg, Lasserstrasse Direct dial 60900 Lasserstrasse 32 5020 Salzburg [email protected] Seekirchen Direct dial 65300 Bahnhofstrasse 5 5201 Seekirchen [email protected] St. Johann/Pongau Direct dial 61600 Hans Kappacherstrasse 1 5600 St. Johann/Pongau [email protected] Tamsweg Direct dial 61500 Kirchengasse 13 5580 Tamsweg [email protected]

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Zell am See Direct dial 61800 Brucker Bundesstrasse 67 5700 Zell am See [email protected]

TYROL

State Head Office for Tyrol Direct dial 46000 Dr. Carl Pfeiffenbergerstrasse 14 6020 Innsbruck [email protected] Imst Direct dial 62700 Pfarrgasse 32 6460 Imst [email protected] Kufstein Direct dial 62300 Arkadenplatz 6 6330 Kufstein [email protected] Landeck Direct dial 62800 Malser Strasse 19 6500 Landeck [email protected] Reutte Direct dial 62900 Mühlerstrasse 19 6600 Reutte [email protected] Schwaz Direct dial 62100 Swarovskistrasse 25a 6130 Schwaz [email protected] Telfs Direct dial 62600 Anton Auer Str. 5 6410 Telfs [email protected]

Wörgl Direct dial 62200 Steinbacherstrasse 1 6300 Wörgl wö[email protected]

VORARLBERG

State Head Office for Vorarlberg Direct dial 47000 Waldfriedgasse 2 6800 Feldkirch [email protected] Bludenz Direct dial 63000 Färberstrasse 10 6700 Bludenz [email protected] Bregenz Direct dial 63400 Rheinstrasse 42 6900 Bregenz [email protected] Dornbirn Direct dial 63200 Schwefel 91 6850 Dornbirn [email protected]

BURGENLAND

State Head Office for Burgenland

Direct dial 48000 Kalvarienbergplatz 7 7000 Eisenstadt [email protected] Güssing Direct dial 63900 Hauptplatz 10 7540 Güssing [email protected]

Jennersdorf Direct dial 64000 Eisenstädter Strasse 1 8380 Jennersdorf [email protected] Mattersburg Direct dial 63600 Schubertstrasse 42 7210 Mattersburg [email protected] Neusiedl/See Direct dial 63500 Altenburgerstrasse 20/Top 1 7100 Neusiedl/See [email protected] Oberpullendorf Direct dial 63700 Hauptstrasse 22 7350 Oberpullendorf [email protected] Oberwart Direct dial 63800 Waldmüllergasse 6 7400 Oberwart [email protected]



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GLOSSARY

Ceded reinsurance premiums Share of the premiums to which the reinsurer is entitled in return for reinsuring certain risks.

Net earned premiums The portion of premiums written that is allocated to the cur-rent financial year.

Administrative expenses Commissions, personnel expenses, cost of materials and other expenses for distribution and administration of insur-ance policies.

Expenses for claims and insurance benefits Paid insurance benefits plus the change in provisions for losses that have already occurred, but are not yet processed, plus the costs for claim settlement, loss investigation (e.g. Fees for expert witnesses, legal fees) and loss prevention.

Gross/net In insurance terminology, “gross/net” means before or after reinsurance has been deducted (“net” is also used to mean “for own account”). In connection with income from partici-pations, the term “net” is used when related expenses have been deducted from income (e.g., depreciation, amortisation, write-downs and disposal losses). This means that (net) income from participations is the profit or loss on these shares.

Combined ratio Ratio for assessing development of the property and casualty insurance business. All actuarial expenses after deducting reinsurers' shares, except for the change in the equalisation provision, as a percentage of net earned premiums after deducting reinsurers' shares (=sum of net expense ratio and net claim ratio). Does not include any financial income.

Mathematical reserve A reserve calculated according to mathematical principles for future insurance benefits in the life and health insurance segments. In the health insurance segment, this is also re-ferred to as an ageing reserve.

Direct business Business acquired in-house, including coinsurance shares assumed, less surrendered coinsurance shares.

Result from ordinary activities Result from ordinary activities Sum of the the underwriting result, financial result and other non-actuarial income and expenses before tax expense.

Equity Consists of share capital and reserves.

Single-premium policy Policy where the policyholder is obligated to make a single lump-sum premium payment at the beginning of the term of the policy that covers the entire term of the policy.

Financial result Investment and interest income less expenses. This includes, for example, income from securities, loans, real estate, par-ticipations, and bank interest, and expenses incurred in the financial area, such as scheduled depreciation on owned real estate, write-downs of securities to stock exchange prices, bank fees, etc.

Financial Market Authority (FMA) See insurance supervisory authority.

Fund-linked life insurance In this special form of life insurance, the amount of the bene-fit payment depends on the performance of a portfolio of assets in a fund. The policyholder bears the investment risk and therefore has the opportunity to directly participate in above-average performance of the fund, but must also take into account the risk of losses.

GBVVU Financial Market Authority (FMA) regulation of 20 October 2006 on profit participation in the life insurance industry (Gewinnbeteiligungs-Verordnung).

Profit participation See Premium refund (profit-related).

Retained earnings Retained earnings are profits earned by the Company that are not distributed as dividends or carried forward to the following year.

Indirect business Assumed reinsurance business (inwards reinsurance).

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Index-linked life insurance Life insurance where income depends upon the performance of an underlying stock index.

Investments Assets such as securities, loans, real estate and participa-tions that are primarily used to cover obligations arising from the insurance business.

Consolidation The parent company combines its annual financial state-ments and those of its subsidiaries when preparing its con-solidated financial statements. During this process, equity holdings, interim results, receivables and payables, and income and expenses within the Group are eliminated.

Group of consolidated companies Consists of the parent company and all subsidiaries included in the consolidated financial statements.

Consolidated financial statements Annual financial statements prepared by the parent com-pany that present the net assets, financial position and re-sults of operations of the group. Also see Consolidation.

Expense ratio Ratio of administrative expenses to net earned premiums.

Market value The value of a balance sheet item that can be realised by selling it in the market to a third party.

Non-life Non-life insurance includes the property & casualty and health insurance segments.

Non-motor vehicle classes Non-motor vehicle classes are property & casualty classes that are not motor vehicle related.

Premium Agreed fee paid in exchange for assumption of risk by an insurance company.

Premium refund (profit-related) The policyholder’s profit participation in the profit of the insurance class in question (mandatory for traditional life insurance)

Premium refund (profit-unrelated) Contractual refund of premiums to the policyholder.

Unearned premiums The portion of premium income that represents fees paid for the policy term following the balance sheet date, i.e. premi-ums that have not yet been earned as of the balance sheet date. Unearned premiums are reported in the balance sheet under underwriting provisions.

Annuity tables Annuity tables are the most important calculation tool used in life and health insurance. The annuity tables used by in-surers are based on the mortality tables derived from the population census. These are revised every ten years to take into account changing conditions, such as medical advances and improved living conditions.

Risks/risk Insured individuals, objects, hazards or interests

Reinsurance Insurance coverage for insurance companies, whereby one insurance company uses another insurance company, the reinsurer, to insure a portion of its risk.

Reinsurance company A company that will assume risks from a primary insurer or another reinsurer (retrocession) for an agreed premium.

Loss reserve Provision for outstanding claims (claims incurred but not yet settled or only partially settled).

Claim ratio Ratio of expenses for claims and insurance benefits to net earned premiums.

Equalisation provision The equalisation provision is an underwriting provision used to smooth out fluctuations in future claims. It is built up in years with below-average claims and used in years with above-average claims.

Secondary market yield The secondary market yield is the average return on all fixed-interest securities in circulation with an agreed term of more than four years. The secondary market yield therefore re-flects level of capital market interest rates.



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Solvency Solvency is the capital available to an insurance company (free and unencumbered assets). It is governed by § 53c(1) VAG.

Incurred but not reported (IBNR) Claims incurred in the current financial year but not reported until following years.

Hidden reserve A hidden reserve is created when the actual value (market value) of a balance sheet asset is higher than its carrying amount, e.g. if the price of a security rises, but the security is not written up in the balance sheet.

UGB Austrian Corporate Code (Unternehmensgesetzbuch)

VAG The Austrian Insurance Supervision Act (Versicherungsauf-sichtsgesetz) includes provisions governing the organisation and supervision of insurance companies.

Affiliated company A parent company and its subsidiaries are considered to be affiliated companies if the parent company is able to exert control over the business policies of the subsidiary. Examples of this are where the parent company directly or indirectly holds more than half of all voting rights, a controlling agree-ment exists, or it is possible to appoint the majority of the members of the managing board or other executive bodies of the subsidiary (§ 244 UGB).

Premiums written Policyholder premiums stipulated in the insurance policies, not including taxes, levies and fees.

Insurance supervisory authority The Austrian insurance supervisory authority is the Financial Market Authority (FMA), an independent government agency that supervises the operations of all insurance companies, banks, and employee retirement and pension funds in Aus-tria.

Underwriting provisions These consist of the provision for outstanding claims (mathematical reserve), unearned premiums, provisions for profit-related and profit-unrelated premium refunds, the equalisation provision, and other underwriting provisions.

Insurance benefits See Expenses for claims and insurance benefits

VersVG The Austrian Insurance Contract Act (Versicherungsver-tragsgesetz), which governs general insurance contract law.

Volatility Fluctuations in security prices, exchange rates, and interest rates.

VVO The Austrian Insurance Association (Versicherungsverband Österreich) is an umbrella association for Austrian insurance companies in the Austrian Federal Economic Chamber (Wirtschaftskammer Österreich).

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ADDRESS

WIENER STÄDTISCHE Versicherung AG Vienna Insurance Group Schottenring 30 1010 Vienna Phone: +43 (0) 50 350 350 [email protected] www.wienerstaedtische.at General Secretariat WIENER STÄDTISCHE Versicherung AG Vienna Insurance Group Contact person: Doris Janik NOTICE

This annual report includes forward-looking statements based on current assumptions and estimates that were made by the management of WIENER STÄDTISCHE Versi-cherung AG Vienna Insurance Group to the best of its knowl-edge. Statements using the words “expectation”, “target” or similar formulations indicate such forward-looking state-ments. Forecasts related to the future development of the Company are estimates made on the basis of information available as of the date this annual report went to press. Actual results may differ from the forecasts if the assump-tions underlying the forecast prove to be wrong or if unex-pectedly high risks occur.

Rounding differences may occur when rounded amounts or percentages are added.

The annual report was prepared with great care to ensure that all information was complete and accurate. The possibil-ity of rounding, type-setting or printing errors can, however, not be ruled out completely.

Editorial deadline: 29 February 2012

GENERAL INFORMATION

Editor and media owner WIENER STÄDTISCHE Versicherung AG Vienna Insurance Group Company register: 333376i Data Processing Register No (DVR): 4001506 Production & Design be.public Werbung Finanzkommunikation GmbH Produced in-house using FIRE.sys Michael Konrad GmbH Corporate Media Solutions Photos Ian Ehm Young & Rubicam Christian Hofer / Fernwärme Wiener Städtische Printing Gutenberg GmbH, Wiener Neustadt Environmentally responsible paper: Forest Stewardship Council (FSC), from sustainably man-aged forests was used.

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