In the first three months of the current year the UNIQA Group Austria showed a clear increase in gross premiums written in recurring premium business of 9.5 % to 749.7 million Euro.  The continued targeted reduction of single premium life assurance business and certain special products could be more than compensated for by the universally positive development in the recurring premium business.   The amount of consolidated premiums written was increased by 5.9 % to € 822.5 million Euro. The portion of premium volume written in UNIQA Group Austria’s international companies in the 1^st quarter of 2003 amounted to 10.3 % or 84.7 million Euro.

Loss expenses and benefits paidincreased in the 1^st quarter of 2003 by 3.7% to 598.6 million Euro, which is low in proportion to premium development.

The positive development of business revenue in recurring premium continued in the life assurance line. The volume of recurring premium written climbed by 8.5 % to 191.9 million Euro. Single premium business and special products continued to be clearly withdrawn in favour of promoting current business; the result was a reduction of 20.6% to   72.8 million Euro. All in all this lead to a 1.5 % decrease in the premiums from life assurance, down to 264.7 million Euro. The share of risk premium of the FinanceLife Lebensversicherung AG taken into account in the quarterly report is 5.4 million Euro. The savings portion of the premiums not included in the consolidated premium revenue of the unit-linked life assurance in accordance with international accounting principles amounted to 17.6 million Euro in the 1st quarter. The development of benefits including changes in the actuarial provision was, with a decrease of 1.1 % to   273.0 million Euro, within the range of the normal business trend.

Property and casualty insurance premiumsincreased by 12.9% to 374.9 million Euro. The growth was due in particular to the increase in premiums in the motor vehicle lines (+11.3%) and the other property insurance lines (+15.7%).  Loss expenses in property and casualty insurance increased in the 1^st quarter of 2003 by 14.4 % to 165.9 million Euro because property reinsurance business was taken over for the first time from the Polish market. Adjusted for this special effect loss expenses rose by 12.1 %. 

Health insurancecontributed to the positive overall result of the UNIQA Group Austria with premium growth of 4.1 % to 183.2 million Euro.Insurance benefits including changes in the actuarial provision increased in the health insurance line by 2.2 % to 159.7 million Euro.

The total investments of the UNIQA Group Austria increased by 5.3% or 596.0 Euro million in the first three months of the financial year, to € 11.9 billion. The (net) current investment income is, at 121.4 million Euro, 3.6 % below the level of the previous year. The continuing negative development of the capital markets in the first quarter is burdening the extraordinary financial results of the UNIQA Group Austria. The drops in stock value have largely been recovered by the positive development of the stock markets in the current second quarter. 

The development of acquisition costs is influenced by special effects as a result of taking over the property reinsurance business of the Polish market and including FinanceLife in the scope of consolidation for the first time. The total costs of the UNIQA Group are developing satisfactorily as a result of the cost reduction programme already introduced in 2001. While acquisition costs, adjusted to account for the above mentioned special effects, increased in proportion to the course of business by 8.1 % to 119.1 million Euro, the other operating expenses could be kept at the same level at 48.6 million Euro. 

Outlook
UNIQA’s goal for the current financial year 2003 is to persistently pursue the increased earnings programme introduced in 2001.   In doing so, efforts will again be concentrated on the further improvement of the actuarial results through qualitative growth and the continued reorganization of bad risks as well as the further reduction of costs in the domestic companies.

Although there has been a noticeable recovery of the capital markets at the beginning of the second quarter, because of the uncertainties concerning the further development of the economic environment, however, it is not presently possible to make a reliable prognosis for the development of the capital markets during rest of the year. 

Share in Mannheimer Versicherung
Concerning the Mannheimer Versicherungsgruppe – of which UNIQA with an almost 13 % share is one of the largest shareholders – at the moment there are intensive efforts going on, in cooperation with leading auditing companies and in agreement with the Group shareholders and the German financial controlling authorities to find a workable solution to settle Mannheimer Lebensversicherung’s hidden encumbrances that were trigger by the collapse in the German stock market.   The goal is to enable the continuation of the Mannheimer Group’s successful activity, as it is basically excellently positioned on the property insurance market, by settling the hidden encumbrances of the life assurance company. 

The entire quarterly report can be downloaded from http://www.uniqagroup.com in both German and English.