Strong results create solid foundation for independent future

Customer needs is first priority

• It is a.s.r.’s ambition to be the most customer-friendly insurance company in the Netherlands. We continuously tailor our products and services to this ambition by developing innovations and implementing improvements.

• In the Non-life segment, the Vernieuwde Voordeelpakket package of policies, which was introduced last year, is as popular as ever. Sales of this package were up by 55% from the first half of 2014.

• In June, De Amersfoortse introduced a new flexible occupational disability policy. This policy allows business owners to change their insurance coverage, including insured sum, policy excess, contract term, benefit payment threshold, age limit and indexation of benefits, at any given time.

• The successful ‘The Other Tour’ campaign undertaken by a.s.r. pensions was a demonstration of the fact that people over the age of 60 can be really fit. It offered some of them the opportunity to ride a Tour de France stage.

• a.s.r. was awarded the Customer-Oriented Insurance Quality Mark for another year.

• Ditzo was again named the most customer-friendly insurance company in the Netherlands. This is the third time that Ditzo has won the Customer Centric DNA Award. The award is presented to businesses that customers rate as giving their best interests the highest priority.

Net result at € 397 million (H1 2014: € 171 million); operating result at € 280 million (up 27%)

• Net profit rose from € 171 million to € 397 million thanks to an increase in operating result, higher investment income due to realized capital gains and incidental income items.

• This is the first accounting period in which operating result (before tax), an indicator of the underlying financial performance, is reported. This result was up from € 221 million in the first half of 2014 to € 280 million in the reporting period. Operating return on equity improved from 13.0% to 15.8%.

• Operating expenses stood at € 273 million (H1 2014: € 264 million). The rise is primarily attributable to an increase in operations after the acquisition of Van Kampen Groep and costs incurred for other strategic acquisitions.

• The combined ratio for the Non-life segment came to 92.5% (H1 2014: 93.7%), thanks, in particular, to a strong operational performance.

Premium income increased to € 2,476 million; slight drop in Non-life segment and increase in Life segment

• In the Non-life segment, premium income saw a limited 3% decline to € 1,375 million (2014: € 1,415 million). The occupational disability and health insurance businesses experienced a fall in premium income, while premium income was up in the P&C business.

• In the Life segment, premium income rose to € 1,171 million (2014: € 916 million), mainly due to a large pension contract buy-out (€ 370 million).

DNB Solvency I ratio at 297% (year-end 2014: 285%); Solvency II (SCR) ratio at approximately 185% (year-end 2014: approximately 175%)

• The DNB Solvency I ratio continued to rise to 297% at 30 June 2015. Excluding the UFR effect, the DNB Solvency I ratio stood at 224%.

• Based on the standard formula, the Solvency II ratio came to approximately 185% at 30 June 2015 (year-end 2014: approximately 175%).

Jos Baeten, CEO of a.s.r.: ‘In the first half of 2015, a.s.r. has managed to shore up its already solid foundation for the future. More and more consumers and businesses are opting to buy our products and services through the intermediary channel. Our interim results confirm this. We managed to bring about further improvements in our performance by being highly disciplined on cost control, pricing and underwriting, and focusing on execution. As the economy recovered, we were also successful at improving our operating result while our investment policy seemed successful. Our strong balance sheet and capital position are reflected in an increase in the DNB Solvency I ratio to 297%. Based on the Solvency II standard model, the solvency ratio rose to approximately 185%. a.s.r. also announced a number of strategic acquisitions in the reporting period, which were completed in July and August. All these factors combined allow us to shape our own future.

a.s.r. keeps track of developments in society and is committed to making an active contribution. We are a dynamic organization and we will continue to build momentum, also in 2015, the year in which we celebrate our 295th anniversary. We invest in adapting to changing market conditions so that we can continue to serve our customers better. To optimize our contact options and customer service, we have created Customer Contact Centres, where customer feedback (NPS) is reflected in improvements. All our efforts are driven by what we do best, which is providing insurance cover. In the recently published AFM dashboard for treating customers fairly, a.s.r. scored a 3.4 out of 5 for customer satisfaction.

The new flexible occupational disability policy for self-employed persons is an example of our ability to offer innovative products that meet changing customer needs.

At the end of the reporting period, a.s.r. pensions organized a special campaign that offered a group of over-60s the opportunity to ride a stage of the Tour de France. This initiative went by the name ‘The Other Tour’. By organizing The Other Tour, a.s.r. wanted to show the world that you do not have to be young to be fit and able-bodied.

Profit from ordinary activities was up. Our risk management prompted us to scale back our equity exposure because of higher share prices. This was necessary for us to remain within the set risk parameters. The result was that our investment income rose. It was mainly thanks to these two developments that net profit amounted to € 397 million for the first half of 2015 against € 171 million for the same period last year.

The improvements were also due to our continuous efforts to work more efficiently and outsourcing specific services, mainly in the Pensions and Individual Life businesses. a.s.r. has teamed up with Infosys, a specialist in handling and improving knowledge-intensive processes. Infosys, which has worked with our Individual Life business for some time, has taken over the back office of the a.s.r.-label pension products since the beginning of this year.

a.s.r. acquired Van Kampen Groep (VKG), located in Hoorn, as of 1 January 2015. VKG keeps records for more than 3,000 financial advisers in the Netherlands and works in partnership with over 150 financial institutions. Through this acquisition, a.s.r. is investing in a business that plays a key role in a changing distribution landscape.

In the Non-Life segment, the combined ratio is sustainably robust. At 92.5%, this ratio again remained well below 100% in the reporting period. We are seeing increasing interest in our Vernieuwd Voordeelpakket package of policies compared to last year, partly because we added home owner insurance for Airbnb, solar panel insurance and coverage for charging stations for electrical and hybrid cars.

Entirely in line with our strategy, we bolstered our position in the pensions and funeral insurance business (Life segment) by acquiring De Eendragt and Axent. These two acquisitions were completed in July and August 2015 respectively. The two companies are complementary as far as their risk profile is concerned; together, they will add € 3.5 billion to capital invested.

The pensions market remains challenging because of the persistently low level of interest rates. a.s.r. has made a deliberate choice to focus on sound and sustainable pricing. In the pensions market, a.s.r. offers defined contribution (DC) and defined benefit (DB) products, as well as an Institution for Occupational Retirement Provision (IORP). In addition, a.s.r. is preparing for the creation of a General Pension Fund (Dutch acronym: APF), including the expansion of our asset management with fiduciary asset management for third parties. More and more businesses are attracted to our Werknemers Pensioen (Employee Pension) product. The number of businesses that have taken out such a policy has increased from approximately 700 to 1,300 over the past six months. The customer base of the Brand New Day IORP, in which a.s.r. has teamed up with Brand New Day, rose to just over 1,400 employers (year-end 2014: 1,000 employers).

a.s.r. takes responsibility for helping holders of non-accruing unit-linked policies to make the right choices. To do so, we are making every effort to contact this group of customers. Although we have been in contact with the vast majority of these customers, some of them are proving difficult to reach. At 30 June, 88.3% of non-accruing policyholders had changed their policies or made a reasoned choice to leave their policies as they are. Of our mortgage-related unit-linked policyholders, 83% have been mobilized. Both these figures are higher than the targets set by the Netherlands Authority for the Financial Markets (AFM). a.s.r. will continue the drive to mobilize customers who have not responded to date.

Early in the year, a.s.r. vastgoed vermogensbeheer, the real estate investment management business, placed a fifth closing of the ASR Dutch Prime Retail Fund worth € 250 million with an external investor. As a result, the Fund’s total externally placed assets rose to € 785 million (approximately 60% of its total assets of € 1.3 billion). In addition, the ASR Dutch Core Residential Fund started at the beginning of the year. It has now placed € 80 million (of its total assets of € 0.8 billion) with external investors.

The Executive Board has decided to put the real estate development business up for sale. This business line is now ready to be sold. As a result, this business wasified as ‘held for sale’ as at 30 June 2015. It will not be included in the key figures as of this date. We will continue to honour our current commitments.

The strong financial performance we are presenting today is the result of the hard work of our employees who are committed to treating our customers fairly every day. Dedication, professionalism and flexibility are essential features of our people and a.s.r. invests in the development of everyone who represents the organization in whatever capacity.

In the second half of this year, we will learn more about the future of a.s.r. Our shareholder NLFI is scheduled to present its advisory opinion to the Dutch Minister of Finance. The privatization process will start after the minister has decided on this matter and informed the Parliament. Today’s financial results demonstrate that a.s.r. is well on its way towards an independent future.’

Notes

• Operating result represents profit before tax adjusted for (i) investment income of an incidental nature (including realized capital gains, impairment losses and realized and unrealized changes in value) and (ii) incidental items not relating to ordinary activities as a result of accounting changes, consulting fees for acquisitions, restructuring expenses, start-up costs, privatization expenses and shareholder-related expenses

• Operating expenses associated with ordinary activities are operating expenses included in operating result.

• a.s.r. has implemented a change in accounting policies. Investment property and property own use have been carried at fair value with effect from 1 January 2015. Policy acquisition costs are recognized directly through profit or loss. To allow comparison with the financial results for 2014, the figures for 2014 have been restated to reflect the change in accounting policies. For more detailed notes, see the 2015 interim report .