New Directions

The Long Road Abroad

Deutsche Rück had to find an answer to the sharp decline in premium income in its core business with the public insurers. Which strategy should the company pursue in future? Should it continue along its previous path as the in-house insurer of the public insurers? Should it cooperate with a reinsurer from the private market, or even merge with one? Or should it expand abroad after all?

At the time, the decision was completely open. Among the shareholders, some still had major reservations about international expansion, following their experiences with the London business.

Great Potential

The subsidiary DR Swiss, founded in 2000, quickly demonstrated the potential inherent in international business. From the outset, it exceeded expectations.

And the shareholders also benefited directly from the Swiss subsidiary, as it became an extremely attractive reserve cushion: profits from the volatile natural catastrophe business could be accumulated in Switzerland and released again when needed – for example, in the event of major natural catastrophe losses.

Common Goal

Over many years, Jürgen Rehmann, Chairman of the Executive Board of Deutsche Rück from 1996 to 2008, campaigned among the shareholders for the expansion of the international business – in close cooperation with the company’s Chairman of the Supervisory Board, Friedrich Schubring-Giese.

Friedrich Schubring-Giese

Jürgen Rehmann

The Chairman of the Executive Board of Versicherungskammer Bayern was equally convinced: International expansion was the right strategy for securing Deutsche Rück’s future as an independent company. In this way, new sources of growth could be developed, and the business, which had previously been heavily concentrated on Germany, could be diversified.

“We must change Deutsche Rück, because the world of the public insurers in Germany is changing,” was the guiding principle behind the new strategy.

A Successful Tandem

The continuity in leadership at the top of Deutsche Rück paid off: Over many years, Rehmann and Schubring-Giese jointly drove the changes forward. In the end, they succeeded in convincing the shareholders and initiating a cautious paradigm shift in the company’s strategic realignment.

The strong figures posted by DR Swiss spoke for themselves: Within its first three years, it succeeded in generating premium volume of CHF 300 million.

Premium volume of DR Swiss from 2001 (28.9 million) to 2003 (314.7 million)

Gross premiums written of DR Swiss in CHF million

DR Swiss proved to be a success story – and Deutsche Rück’s international expansion contributed to strong growth in the years that followed.

International Expansion: Step by Step into the Wide World