美国保险业：AIFA会议财险与寿险要点

1、GlobalResearch7 March2019U.S. InsuranceAmericasP&CandLifeInsuranceTakeawaysfromAIFA2019 andDinnerswithATH&UNMAmericasLife Dinners w/ ATH & UNM; Meetings w/ AFL, BHF, FG, LNC, MET, PRU, VOYA Wehosteddinnersw/ATH&UNM.RegardingATH,weviewconsensus2019EPSas too low and our meeting fortified this view. Ot

2、her takeaways: 1) ATH will govern organicsales(doesnotmeanYoYdecline)in2019inanefforttobuildexcesscapital into a potential cycle turn; 2) ATH expects to take share in more complicated PRT deals with higher % of deferred lives and would allocate 20-30% of the B/S to PRT over time; 3) statutory earnin

3、gs plus capital used for net organic growth should generate $1b of excess equity capital in 19 (ex. inorganic opportunities). Regarding UNM, conversations were less dominated by LTC w/ more focus on corebusinesses. Key takeaways: 1) With $1b of annual statutory earnings, no change to the expected pa

4、yout ratios, which should be in line with historical levels; 2) mgmt. would look at &A ptuite, t ds nt ee ay oles” r ceig es n te iss mix;3)therearenocurrentpotentialLTCrisktransfersolutionsbeingpursued.Wealso includetakeawaysfrommeetingswithAFL,BHF,FG,LNC,MET,PRU&VOYA.P&C CL pricing feels stable in

5、 19, but pockets of loss cost pressure emerging Auto continues to drive pricing, offsetting by the continuation of competitive pricing in workers comp. Overall, our sense is that pricing will face downward pressure in 20 barringacatalyst.E&Swastheexception,withevidenceofbetterpricingandterms.In rein

6、surance,limitedmid-yearrenewalsdownside,butenthusiasmdiminished.Onloss trend,autopressureisduetoinexperienceddriversandtargetedlitigation.Increasing socialinflationwasaconsensustheme,butismanifestingindifferentwaysandlinesby carrier.WebelieveLTtickedupcomparedto17/18,butiswithinoverallexpectations.P

7、ersonal lines pricing is decelerating as 18 profitability drives competitionEvery company we spoke to pointed to a decelerating pricing environment and most areattemptingtogrowshare.Losstrendfrequencycontinuestobefavorable,butmost carriersareseeinghigherPDcostsduetechinnewcars.TheCanadianmarketisfur

8、ther aheadinaddressingseverity(bothBIandPD)andthemarketisfirming,benefitingIFC.In P&C, we hosted dinner with AXS; remain positive on HIG, AIGHIGisontrackwithNavigatorsacquisitionandwebelieveCRguidanceisconservative. AIGreaffirmed1Q19profitabilityandexpectssequentialimprovementthroughout19.InsuranceE

9、quitiesBrian MeredithInsuranceEquities HYPERLINK mailto:brian.meredith +1-212-7132492JohnNadel HYPERLINK mailto:john.nadel +1-212-7134299WesleyCarmichael,CFA HYPERLINK mailto:wesley.carmichael +1-212-7139903Seth AssociateAnalyst HYPERLINK mailto:seth.rosenberg +1-212-7132527Michael AssociateAnalyst

10、HYPERLINK mailto:michael.a.ward +1-212-7133518 HYPERLINK /investmentresearch /investmentresearchThis report has been prepared by UBS Securities LLC. ANALYST CERTIFICATION AND REQUIRED DISCLOSURES BEGIN ON PAGE 22. UBS does and seeks to do business with companies covered in its research reports. As a

11、 result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.ContentsTOC o 1-1 h z u HYPERLINK l _TOC_250019 AflacIncorporated (AFL)

12、3 HYPERLINK l _TOC_250018 American InternationalGroup (AIG)4 HYPERLINK l _TOC_250017 Allstate Corporation (ALL)4 HYPERLINK l _TOC_250016 Arch Capital GroupLtd.(ACGL)5 HYPERLINK l _TOC_250015 Athene Holding Ltd. (ATH)5 HYPERLINK l _TOC_250014 AxisCapital (AXS)7 HYPERLINK l _TOC_250013 Brighthouse Fin

13、ancial,Inc.(BHF)7 HYPERLINK l _TOC_250012 EverestRe (RE)9 HYPERLINK l _TOC_250011 FGLHoldings(FG)9 HYPERLINK l _TOC_250010 The Hartford (HIG)10 HYPERLINK l _TOC_250009 James River GroupHoldings(JRVR)10 HYPERLINK l _TOC_250008 Lincoln NationalCorporation(LNC)10 HYPERLINK l _TOC_250007 MetLife, Inc. (

14、MET)11 HYPERLINK l _TOC_250006 RenaissanceRe HoldingsLtd.(RNR)12 HYPERLINK l _TOC_250005 Prudential Financial,Inc.(PRU)12 HYPERLINK l _TOC_250004 Travelers Companies,Inc.(TRV)13 HYPERLINK l _TOC_250003 Unum Group(UNM)14 HYPERLINK l _TOC_250002 Voya Financial,Inc.(VOYA)15 HYPERLINK l _TOC_250001 Pane

15、l: State of LifeInsuranceIndustry17 HYPERLINK l _TOC_250000 Panels:StateofP&CIndustry;Reinsurance;Alt.Capital;PersonalLines19Brian Meredith HYPERLINK mailto:brian.meredith +1-212-7132492JohnNadel HYPERLINK mailto:john.nadel +1-212-7134299WesleyCarmichael,CFA HYPERLINK mailto:wesley.carmichael +1-212

16、-7139903Seth AssociateAnalyst HYPERLINK mailto:seth.rosenberg +1-212-7132527Michael AssociateAnalyst HYPERLINK mailto:michael.a.ward +1-212-7133518Aflac Incorporated (AFL)Fred Crawford EVP and CFO Eric Kirsch EVP and Global CIOMax Broden SVP, Treasurer and Head of Corporate DevelopmentIn the March 2

17、019 update presentation, mgmt. changed guidance around segment net investment income (NII). Previous guidance given with the 2019 outlook call included declining NII in Aflac U.S. driven primarily by the RBC drawdownandmodestlyincreasingNIIinAflacJapanbasedontheU.S.portfolio build, partially offset

18、by callable and maturing private securities. The new presentation calls for both Aflac U.S. and Japan NII to decline modestly offset by CorporateandOtherNII.Inthesegments,modestlydecliningNIIisdrivenbyrising USD hedging costs, the recent $3.4b de-risking actions, and the U.S. RBC drawdown. Mgmt. now

19、 forecasts NII of 262b in Japan (unchanged) and $700m in the U.S. (down from previous $717m). The modest YoY decline in both segmentsshouldbeoffsetbyhigherinvestedassetsinCorporate(movementofA- rated corporates from U.S. to Corporate segment) as well as the enterprise hedging program where the benef

20、it will flow through Corporate NII. The enterprise hedging program is effectively an offsetting hedge position relative to hedgingcostsintheAflacJapansegment.Theenterprisehedgingpositionended 2018 at $2.5b of notional and contributed $18m pre-tax to 4Q18. Mgmt. expects the enterprise hedge notional

21、to average $3b in 2019, and NII running throughtheCorporatesegmentshouldbenefitasnotionalmoveshigher.Overall, we view the update as more of an issue of geography rather than any update to consolidated NII guidance.JapanPoststrustisestablished,andthecompanyislikelytobeginacquiringAFL sharesintheopenm

22、arket.Postissubjecttodailyvolumelimitations(15%ofADV) butcanalsotransactblocktradestobuildthepositiontothe7%ownershipstake over the next 12 months (could be sooner). In terms of partnered product development, AFL and Post continue to be very much in the planning stages of development for opportuniti

23、es. Mgmt. indicated that it may not be able to announce much in the way of specifics until 2020. Excluding block transactions, we ontnue to etmate that the ombnton of Fs hare repurhe program plusPostsopen-marketpurchasesshouldequal12-13%ofADV(assumingboth are completed ratably by year-end 2019).Rega

24、rding the Income Support product in Aflac Japan, the launch of the standalone product seems to have fallen short of mgmt.s original expectations thus far. The product was launched in 2016 and has generated 4b in sales to date. Mgmt. noted that it does not go out of its way to encourage agents to foc

25、us onsalesofthisproductasitmayrisktakingfocusawayfromthecorecancerand medicalproducts.Lastyear,roducedanincomesupportriderthatcanbe attachedto3rd sectormedicalpolicies,anditseemsthisproductissimplerandhas been quicker to build out. Overall, the target demographic for the standalone product and rider

26、 is younger and the company is using the income rider on the medical product as a strategy to grab that youngercohort.Regarding the investment portfolio, mgmt. continues to defensively posture the portfolio and de-risked $1b during the year including yen-denominated private placements. Mgmt. stresse

27、d that it continues to position the portfolio for a credit cycleturnwhichitviewsasalikely2020event(thoughuncertaintyaroundtiming clearly remains). The company continues to focus on growing the alternativesportfolio, but this will take time as it has only deployed $300m with another$700-800m in commi

28、tments to managers. Mgmt. expects to grow alts to 3% of invested assets but expects this could take approximately five years.American International Group (AIG)Mark Lyons CFOLiz Werner VP, Investor RelationsFor1Q19thecompanycontinuestoexpectasub100combinedratiow/AALand will see sequential improvement

29、 throughout the year. Ceded reinsurance will contribute to the improvement, benefiting the loss ratio. The benefit from ceded reinsurance will increase throughout the year as subject premium earns in. Also, more of the improvement in the loss ratio will come from underwriting ratherthan pricinginexc

30、essofoverthenextseveralyears,asthegrosslossratioimproves,AIG willgetbettercedingcommission,whichwillloweracquisitionexpenseratio.AIGhasdecadesoflegacysystemswhichwilltakeayearstofix(oneoftheissues with underwriting and data quality in our view). Investment spend will shift to improving systems rathe

31、r than fixing the old.Corporateandgeneraloperatingexpenseswillcontinuetodeclinein2019andthe GOE ratio will be below 2019s level of 14.5%.In achieving a double digit ROE in three years, AIG sees the ability to grow the numerator faster than the denominator. Also, having the Legacy business with a 2-3

32、% ROE is a headwind, and we expect the company will look to sell the business, which will likely result in a hit to GAAP equity.Allstate Corporation (ALL)John Griek Director, Investor RelationsALLbelievestheautomarketisshiftingtogrowthgivenbetterindustryprofitability in2018andisdoingsoaswellgiventhe

33、companyscurrentunderwritingmargins. ALLisincreasingmarketingandadspendtofuelgrowthandhasalsofocusedon strategicagencyappointmentstobroadendistributionandaccesstonewbusiness. Accelerating new business growth will result in a modest new business/tenure penalty (likely measured in tens of bps), but mgm

34、t. notes that if retention can continue to improve it would provide an offset since the average age of the book could be maintained.Mgmtcontinuestoseefavorablefrequency,butphysicaldamageseverityhasbeen a growing issue as technology in vehicles becomes more prevalent and the cost and complexity to re

35、pair vehicles with sensors increasingly results in total loss claims.ALLalsonotedthattheyareseeingasomewhathigherproportionofthird partysubrogatedclaims,whichcanlimittheirabilitytocontrolclaimcostsandalso impactstiming.Thirdpartysubrogationoccurswhenaclaimantfilewiththeirown policy/carrier,whopaysou

36、tandultimatelyrecoversfromtheatfaultdriverscarrier through subrogation, rather than the claimant filing directly with the at faults policy.ALL targets a low-60%s underlying combined ratio in homeowners. In recent quarters,thecompanyexperiencedhighernon-catastrophewaterlosses.ALLhas beenlumpedinwitha

37、numberofcarriersthathavediscussedhigherhomeowners waterlosses,howeverwenotethatthereappearstobeanimportantdistinctioninthatALLhasseenweather-relatedwaterlosses(i.emorerainfall),whilewebelieve others have generally been referring to non-weather water (i.e. burst pipes/plumbing failures).Mgmt is pleas

38、ed with the growth in Squaretrade and reiterated that the deal economics are based on a rapid growth assumption. ALL likes high growth, solid returnbusinessesthatfitintothetotalprotectionsolutionbroaderbusinessmodel.Allstatebrand,EsuranceandEncompassareArityslargestcustomers,howeverthe telematics co

39、mpany does have other clients, including small/mid cap publicly traded carriers. Arity currently has 1.5 million active connections and collects collects data on 300 trips persecond.ALLsimmediateannuityblockisusingahorizonbasedinvestmentstrategy.The company uses fixed income investments to cash flow

40、 match seven years of liabilities.Thebalanceoftheportfolioisinvestedinalternativeassets,inparticular private equity. In our view, this limits the attractiveness for a potential acquirer sincetheinvestmentassetsaresubstantiallyilliquidorcommitted.Arch Capital Group Ltd. (ACGL)Francois Morin EVP, CFO

41、and Treasurer Don Watson EVP, Financial ServicesACGL would ultimately like to see the Insurance segment return to a 15% ROE from high-single-digit profile today and thinks this is possible as underwriting improves. Mgmt pointed to travel and A&H as two examples of lines it finds attractive. In addit

42、ion, the improving interest rate environment has helped and higher new money yields should contribute about a point near-term.We found ACGL to be among the more pessimistic mgmt teams we spoke to regardingtheoverallmidyearreinsurancerenewalenvironment.ACGLnotedthat lossdevelopmentonJebihasbeensignif

43、icant,yettheyexpecttosee4/1renewals in the 5-10% range versus the 20% or more they believe is needed to make the Japanese market a profitablebusiness.InMI,ACGLlikesthereturnprofileoftherisktransferbusiness,butnotesthatthe 7-10% of volume they get from the GSEs is unlikely to move materially given th

44、e GSEs desire to mitigate counterpartyrisk.ACGLdoesnotthinkofitselfasanMIcompany,butnotesthatMIvaluationsmay be impacted by perceived credit risk that mgmt believes has been significantly reduced since 2008 given PMIERs and little or no sub-prime risk in the market. Industry multiples appear low giv

45、en the modern MI risk profile and high-teens returns in the business.Lastyearsdividendwaslikelya“highwatermark”.Thecompanywoulddomore M&A at the right price, but does not see many high quality entities for sale that make financial sense. Mgmt gave crop as an example of a line they would be intereste

46、d in under the rightcircumstances.Athene Holding Ltd. (ATH)Bill Wheeler President (Dinner and Meeting)Jim Belardi CEO, CIO, Co-Founder (Meeting Only) Noah Gunn VP, Head of IR (Dinner and Meeting)We hosted a dinner with President Bill Wheeler and Head of IR Noah Gunn and also attended a morning meeti

47、ng with CEO Jim Belardi, President Wheeler and Head of IR Gunn. We remain confident that consensus 2019 EPS of $7.43 is too low, assuming reasonable market conditions, (current UBSe $7.70) and our discussion with management fortified this view. While messaging needs to improve, we believe commentary

48、 on the 4Q18 conference call around 2019 earnings power that “exceeds $7” was not an indication that consensus EPS ($7.40 at the time) needed to move lower (and it should be noted thatconsensus hasactuallymovedup3cvs.pre-4Q18results).Rather,webelievethisreflecteda higherdegreeofconservatismaftergran

49、ularguidanceprovidedatthecompanys September 2018 Investor Day resulted in a line item miss with 3Q18 results and negative stock reaction with results. Despite many moving parts, including portfolio/alternativesyield,shiftsinotherliabilitycosts,etc.,thesimplemathisthis: ATH targets operating income a

50、s percentage of average invested assets of1.35- 1.45%.YE18investedassetstotaled$111.0b.Evenifweassumenogrowthand the low end of targeted return (1.35%), we derive 2019 operating income of$1.50b, or Operating EPS of $7.67, or 3.5% above current consensus. Moreover, while the LNC block transaction is

51、likely to put near-term downward pressure on that ROA range, it brings on an additional $8b of account values with $700m of capital deployed that is clearly incremental to the outlook provided last September.On capital, we expect buybacks to continue at a modest pace depending on the prevailing ATH

52、share price. $100m remains on the current authorization (as of YE18), and mgmt. is confident it would be able to receive an additional authorization if stock performance does not improve. Absent large, compelling inorganic opportunities we expect mgmt. to build capital over time. On the 4Q18 call, m

53、gmt. spoke about “governing,” or controlling, sales in 2019. We note that this does not mean that mgmt. is targeting declining YoY sales, but rather than25% sales growth in 2018, we expect organic growth to be somewhat more muted. The rationale behind intentionally controlling sales is related to 1)

54、 raising internalIRRtargets;and2)thedesiretobuildcapitalovertime.Mgmt.stressedits intention to build a level of capital that would allow the company to weather investmentlossesinarecessionaryenvironmentandsimultaneouslycapitalizeon the “fat pitch” opportunities arising during a market dislocation.AT

55、H expects 2019 statutory earnings of $1.1b. Run off from the block should also generate $900m of capital, summing to $2b of gross statutory capital generation in 2019. Mgmt.s organic growth target is expected to consume $1b of capital, leaving roughly $1b of excess capital to generated during 2019.

56、In addition to the current $1b of excess equity capital, ATH should have $2b of excess equity capital by YE19 that it can 1) deploy into share repurchases; 2) deploy into inorganic growth; and/or 3) retain on the balance sheet. We believe deployment into buybacks is likely to continue, but we also b

57、elieve mgmt. is focusedonretainingexcesscapitalonthebalancesheet.CEOBelardiexpressed the companys intention to have sufficient capital flexibility, especially in a recessionary environment, where ATH could experience a higher level of credit losses that would need to be absorbed, but also where ATH

58、would have the opportunity to deploy capital into highly accretiveacquisitions.Pensionrisktransferwasakeytopicofdiscussioninbothourdinnerandmorning meetings. Over time, mgmt. is willing to allocate 20-30% of its balance sheet to pensionrisktransfer(PRT)transactions.Currently,thecompanyhaswritten$6.8

59、b ofPRTbusiness,excludingtheBristolMyers(BMY)dealwhichwillendupadding$2.5b of deposits upon close in Summer 2019. The BMY plan termination PRT deal was both large in size (fourth largest transaction to date) as well as unique relative to deals the industry has seen in the past. This deal included a

60、high percentage of deferred/active lives (75%) where pension benefits had been frozen but the participants have not yet retired. This structure differs from the typical PRT structure (traditionally focus almost exclusively on retired lives).ATH mgmt. noted that the structure of the BMY deal does int