Unipol Assicurazioni S.p.A. (UNI) Earnings Call Transcript & Summary

Good morning. Good morning, everyone. Thank you so much for being here today. Welcome to Unipol Tower. This beautiful, beautiful building. Well, forgive me, I'm a bit excited, not so much because of this architecture that I know very little about. But I'm excited because we're very much standing in the headquarters of Unipol. Unipol is projected into the future, and that is indeed what we're going to tackle today. We're going to be talking through the plan, of course. But before we dive into it, Chair, Carlo Cimbri, many greetings from all of us. Thank you so much, Chair, for attending, which, of course, I was expecting. But thank you so much for your precious contribution and support you've always provided in drafting this plan. The plan is deeply rooted in all of the efforts we made over the years, particularly during the preparation of the last plan of the prior plan through '24. And indeed, we've opened a number of avenues ever since. So now time has come for us to consolidate all of these avenues. And the goal, of course, is to consolidate our leadership position within our reference market, that is insurance throughout this country, throughout the country, throughout Italy. Of course, the objective is to become stronger taking advantage of and leveraging all of the investments that we will be making over the next 3 years in human capital as well as in technology capital. And first and foremost, I'd love to spend a few words on technology as many investments will be made into new technologies, innovative technologies. And again, the objective is very much to seize as fast as we can all of the opportunities and capture the needs from our customers and clients. So once again, we are ready to take advantage of the insurance market. And once again, the objective we have is to further improve versus our performances. We have excellent performances. So once again, this is going to be quite difficult to do. But anyway, we'll improve the remuneration profile of our shareholders. So well, this is a major challenging plan that we are about to start up. So we're getting ready to go through this. And it comes after 3 years where we have created plenty of industrial value and even financial value. Now this comes, as you can see here, from the performances of our shares. In the past 3 years, our shares went up quickly, especially throughout 2024. So it was the #1 share in FTSE MIB here in Milan. But anyway, as I said before, there's plenty of untapped unexpressed value for these shares. So once again, this is a very first important point. And this means we've been able to distribute a part of the value that we have created, thanks to higher dividends that we have paid out, I mean, much more than the plan. So 35% more than we had in the budget. Now all of this was made possible, thanks to 2 special factors. Factor number one is the improvement of the technical industrial profitability of our business, which is, of course, insurance. And the second pillar, as you can see here, is the strong improvement of the contribution of the investment, financial management, so boosting the profitability of our group. So once again, the context has been characterized by uncertainties and high volatility. We started the plan with the Ukraine-Russia war plus the high inflation rates. Then we have had major natural catastrophes, especially in 2023. So despite all of this, we've been able to hit the target in terms of high profitability levels. As for the banking strategy, it also worked very well. Major results have been obtained. This confirms that the model of -- I mean, the management model that we have here. So the fact that we've taken advantage of bancassurance versus a more traditional model created important results, not just in terms of premiums and profitability of our Insurance business, but also in terms of performance of the banking shares. So great results in terms of our investments, in terms of mark-to-market, but also in terms of dividends that we've been able to cash in and then pay out. So once again, despite all of this, we still think there's plenty of untapped unexpressed value in our shares. And we think that this value can be obtained, thanks to the acceleration of this kind of journey. So we want to increase profits and dividends. We will be talking about this today. So I will take care of the strategic context. Then the floor will go to Enrico San Pietro. Enrico will be talking about the industrial action part of our business. Now let me share with you just one quick word on the previous BP, business plan, from '22 to '24. So as I said before, let me walk you through this quite quickly because these are numbers that you know very well. So as for the reported accounting profit, this is much higher than the plan. In terms of insurance group. Once again, we have exceeded our targets. In terms of insurance group, this is really important. I keep repeating this over and over because it's really, really fundamental. So this is the economic measure, if you will, that describes the contribution to profitability depending or coming from the Insurance business on the one side, together contribution of financial profitability coming from investments on bank and strategic stakes. If you put these 2 ingredients together, you have quite a specific idea of the so-called cash remittance, which is the possibility that an insurance company has to create cash so that you can really distribute this to our shareholders. And so once again, EUR 1.3 billion, this is what we have distributed. And you can see here the comparison. This is what Unipol Group has paid plus UnipolSai to third-party investors plus solidity profile, which is now 212%, which is a very, very high part of the range. So very good results. They have had some repercussions on the evolution of the shares. Now on the left, this is our recent history, if you will. But we also have to take into account the current reality. So there's been a kind of an important re-rating of the shares. But we are still undervalued, if you will, as compared to our peers. I mean, companies we have to compare ourselves with. Now I cannot, well, reveal the names of our peers. But let's say, one is Italian, the other one is in Germany, another one in France and another one in Switzerland. So it's up to you to guess. Now there's a major gap that still has to be bridged. And we would like to do this in the next 3 years or so, thanks to some specific actions. And the market context, as usual, is once again very, very uncertain. So all the plans include some assumptions, but during the 3 years, unexpected events always happen. For example, what we have to do is to face or take up challenges. And again, this means we have to stick to our targets. I mean we want to reach our targets. Now you know the geopolitical context that you are familiar with. So I'm not going to repeat this. And I'm sure that this will generate a moderate modest, if you will, growth context, well, as far as the Italian economy is concerned. We think our economy will be able to grow just by 1% or a little bit less than 1%. We do not think that inflation may be a critical situation for the time being. The tariff policies from the U.S. go hand-in-hand with the weakening of the U.S. dollar and the strengthening of the euro and the European Central Bank, traditionally, they keep monitoring the inflation. So once again, they will keep this aggregate, under control. So inflation in Italy will be under 2%, just like the rest of Europe. Just like the evolution of rates. I mean, in the past 3 years from '22 to '24 rates were very high, especially at the very beginning of the 3-year long time window. But then they dropped, thanks to an expensive monetary policy or if you will, a less restrictive monetary policy from the European Central Bank. So today, rates are flat between 2.3% and 2.4% on the 5-year long swap curve, and around 3% on the Italy 5 years. Now we've used the 5 years average because this is very similar to the average duration of our assets. So we have 4% on 10 years. But anyway, this is the context that we are working in. So there are no assumptions concerning the evolution of the stock exchanges, credit spreads and the spreads concerning govies because these assumptions are almost always wrong. So once again, what we usually project is the as is, so today's situation. Now as for the insurance market, well, we think that this market is quite healthy and sound in terms of growth and development. So the premium level will go up in all our business lines. I'm now talking about the non-life business. I will also be talking about the Life business, of course. Now the MVs of the Motor business and the increase of the premiums, well, this is basically due to a repricing context, I mean, from the market operators as compared to the average cost, which is once again going up. And so once again, profitability is due to go up as well. In the NMVs or Non-motor Vehicle business, prices are going up because demand is also going up. I'm talking about nat cat component. Of course, I'm talking about catastrophes. But we also think that the climate change in general will entail an increase of sensitivity and awareness of Italian operators to buy coverages or hedge. So the same happens with welfare. Population is aging. NHS is going through some difficulties. So more and more Italians will need insurance protection systems. Profitability is flat because it starts from quite good levels. I mean the combined ratio is well under 100%. As for the Motor business, combined ratio is exceeding 100%, okay? So you have to take into account the starting point when you want to measure the profitability on the business in general. As for the Life business, so interest rates are flat. So once again, the evolution of unit-linked investment policies, well, this level should be flat and the same will happen to profitability. In terms of distribution of the life policies, banks will play the lion's share in terms of market share. In the Non-Motor business, we have 2 key topics to share. The first one concerns agents. You know that agents have the biggest non-life, biggest market share in Italy, banks will be protagonist. They will give a contribution to the business growth. So this is an aspect that characterized the previous plan, and I'm sure that this will also characterize our company in the next 3 years. The digital channel will keep having a significant and meaningful role in terms of the Motor business. In general, so on the Non-Motor business, it won't have a significant role. while bancassurance will definitely be a key driver in terms of distributing our products. This is due to the fact that this channel is very active in the welfare business. So this is a general scenario, which is a sort of a benchmark for us. As you can see, in this competitive scenario, we have 4 macro trends. We think they have to be further developed in the next 3 years or so. In general, this will happen in the future of our business. So once again, our population is aging. So Italy has a major issue in terms of population aging. Life expectancy here is one of the highest in the world. So we live longer, but maybe we live a little bit less well than other countries. So there's plenty of demand for new health care services. Once again, NHS, the national health care system in Italy is finding it difficult, I mean, to keep offering the same top level services we were used to. So this is an opportunity for us because the private welfare business is now having a growing role. It's kind of small in Italy versus the general health care expenditure. So this will have a bigger and bigger role in the future. We also have to consider climate change. Now again, it goes without saying that this is a major opportunity. We can see the consequences, unfortunately, of climate change. This is what happened in the past 3 years. And as I said before, especially in 2023. Now this leads to an increase of demand for protection services in terms of companies, organizations and private citizens. So once again, we have to consider this as a market opportunity. As a consequence, we have the opportunity to offer the right services, the right products in order to meet customer needs. We also have 2 major points I'd like to draw your attention on. Point number one is technology and AI. Well, especially the generative AI. You know that this point doesn't just concern technology. I mean, it's a new way. It's a new way of designing and conceiving our business. So we have the duty to leverage AI because it definitely is an opportunity on all the different areas of the value chain of our business. Enrico in a few minutes will be talking about this, just like the customer behavior topic, which is very important, especially concerning the youngest generations. Millennials and Gen Z have an expenditure capacity, which is kind of small and low, but they will be our future customers. Now they need right now quick reaction, quick answers, custom-made services, tailor-made products just to meet their needs. So once again, we have the duty to, well, meet all of their specific needs. So let me share with you bullet number 3, which is our strategy framework. Now this is the most complex slide, sorry for this. So don't worry, the next slides will be much easier. Now I just wanted to put in just one single slide, all of our distinctive assets that also describe our identity profile, which is what we are, the way we look like, and how we can be different. So there's a tangible aspect, which is the operating model, which is the welfare model. This is the largest network having special agreements with our health care services providers. And inside the UniSalute, we have all of the capabilities and skills we have in terms of health care and welfare in general. So I'm sure this is a distinctive aspect. Just like the motor model that we started implementing decades ago. It is so sophisticated. We know how to manage our tariffs. We have to consider the way we pay damages. And of course, we use ITC or telematics. This means we have plenty of data sets available. And this means we can do all what I said before. So the management of tariffs and the claim payment. So once again, as for the insurance, now Unipol is the top-of-mind brand, and this is a great value, just like reputation. We are leaders in reputation. We've been leaders for many years. So this is a fantastic, well, differentiator versus many other companies. Then we have data or data sets issue. So we have more than 4 million black boxes installed in the cars of our customers. This means we produce so much data. And this means we can do plenty of things, obviously in terms of GAI, so generative artificial intelligence, something that some of our competitors cannot do in Italy or even in the rest of Europe. Now on the right-hand side of this slide, what you can see is a couple of blocks. So there's a block whose name is distribution, which means basically agencies or the agencies network. This is very important for us. It identifies us not just because this is Italy's biggest network, but they are extremely specialized, top skilled. And of course, we have plenty of projects in the next 3 years or so to keep moving on. Just like the banking network, once again, we have BPER and BPSO, Banca Popolare Di Sondrio and Banca Popolare dell'Emilia Romagna. We have created a completely different model versus the traditional bancassurance banking system. In that case, the logic is very commercial, for example, I may sign an agreement with a bank, the bank is paid fees and commissions. The insurance company gets the technical margin. And at the end of the agreement, usually, we fight because of the value of the stakes. Well, our system is so different. We have an industrial logic. Of course, we need shares and stakes. But what we believe in is the industrial value of these agreements. So these are 2 integrated networks, so they don't compete against each other. They do plenty of things together. They exchange customers. For example, customers from the insurance business, they may need banking services and vice versa. We are a major organization, 16 million customers. I mean, the CB or customer base allows us to carry out commercial industrial actions are really, really very important. So thanks to this, we can offer our customers insurance products, but also many other products, for example, services having to do with mobility ecosystem, welfare and property. So this is what we mean by beyond insurance. So in the previous plan, sorry, we made so many investments, I mean, to take over plenty of assets that they were included into the 3 major ecosystems we are competing in. So for the next 3 years, we will keep investing on those assets because we want to make them stronger. We want to integrate them, and we want to create a new concept. I mean, products and services will be highly targeted in order to meet our customers' needs. So this is our basic framework, if you will. And we have developed some verticals. Now as you can see here, this industrial plan is aiming at improving industrial profitability level, the so-called technical profitability level. Of course, I'm talking about both business lines, life and long-life. We would like to improve our commercial effectiveness. We want to do this, thanks to a specific integrated model. So this will give us more -- well, it will give more energy and even more strength to all of our agents. There will be plenty of investments in our agents because the agency network has to become stronger. Now to do this, we have to keep investing in technologies and people. Now not only the people who are protesting just outside right here in the main court, but we have 40,000 agents and employees. Let me share with you 4 key bullets very quickly. Enrico will give you more information about this. Stronger industrial profitability. What do we mean by this? Well, first and foremost, we would like to invest in those businesses, just like insurance, for example, where you have high expectations in terms of profitability per unit of risk. So we would like to where we will have, let's say, less risks and more money. It may sound banal or trivial, but it is not. I mean, in terms of underwriting, we need to take into account all of this complicated situation, kind of difficult to do, but this is something we started doing in the previous business plan. So this goes through other ingredients, for example, building products that are natively oriented towards those targets. I mean we want to improve the dynamic portfolio management. By this, I mean that we have a sort of a rerouting of our business towards, I mean, lower risks and high-performance areas. Of course, we have to refresh and renew insurance policies, which are very close to maturity. We also have to pay attention to fast-growing businesses, especially when it comes to health and welfare. I mean, we are experiencing double-digit growth rates. This should slow down a little bit. But anyway, average growth should be around 8% in the Welfare business. And we also have to pay attention to the profitability level that welfare brings about right now, but also in the near future. So we do expect the offering model to be faster and better integrated. And this means that we'll be developing an innovative platform, which is strongly based on data. which also allows our distribution network to be more effective from a commercial standpoint, from a sales standpoint. And Enrico will further deep dive into this very topic. So when it comes to the innovation to this project, it's a very remarkable one as it is one of the most important projects that the company has taken care of over the last few years. Also hand-in-hand with the health aspect. So the bottom line is that we want to develop an omnichannel and multi-modular approach, which allow our customers to access both from a physical standpoint, so people can literally walk to branches or they may access digitally. The idea is also to better integrate beyond insurance world so that we may provide an integrated unique offering, which is in the way, also mirroring our strategy all in all because we've always been strongly focused on insurance, first and foremost. And the idea to broaden up to the beyond insurance product was, let's say, was about having a better interaction, a more expanded interaction with our customers, stronger and better than what a traditional insurance company would deliver. The next 3 years, we will surely be investing in our distribution network, I would say, agency network mainly. And you see what I'm saying in the slide here. I'm saying omnichannel distribution, agency network centric. What does that mean? Well, it means that we are undergoing an omnichannel distribution model, which means that customers may access Unipol through digital platforms as well, but also those who will be coming through the digital, they can then being supported by our agents through a bespoke offering, which basically means that we'll just make it possible for our customers to reach out to us in a more integrated manner. I don't personally believe that digital can be the one way our customers will reach out, but likely digital is going to increase. And perhaps in the next few years, it will become the most important channel. But what really stays is that people are still being strongly supported by our people, whilst they're seeking for the best insurance coverage. Then unfortunately, a digital platform alone cannot really take care of because there's still a big need for support and consultancy and so on. And that can only be provided by our agent in person. We're also going to be focusing on bank insurance. You will soon be seeing what are the goals where actually some have been already conveyed through the press release. We do have indeed ambitious objectives, Enrico will also tell you the way we want to get there. Last but not least, of course, tech and people skills. We constantly invest into people, into the evolution and upgrading of people skills with specific reference to innovative skills in terms of data management and so on. Of course, we want -- we will make it possible for our digital platforms to evolve as well so that we may reach out to the objectives we have. And meanwhile, we will also adopt and implement AI-based algorithms in a faster way. We are still a traditional company. We are deeply grounded into the territory. But of course, we need to evolve our business model. And no doubt that we will seize all of the opportunities that AI technologies are offering. We will gradually approach AI. We will be starting with the scale up, of course, by, let's say, working on use cases from time to time so that we may find the best solutions according to our needs. I will now leave the floor to Enrico, and he will carry on, and he will very much deep dive into the heart of the plan. Thank you.

Good morning. Good morning, everyone. Thank you, Matteo. Thank you. Thank you to my colleagues in person, those who are watching remotely. All of you, you've made this possible. You made, of course, the results of the prior plan possible, and you've also deeply contributed to the strategic plan over the next 3 years. I will try to further dig down and I will be focusing a bit more on the first top 3 topics, so to speak. Well, let's take a look first at what is the strategy that really proved to be effective, to be working, successful, which is the one that, of course, we still want to carry on with. Meanwhile, we're going to improve it. And we will try to be faster because big global changes, which are current, really make it mandatory for us to understand what's going on and react accordingly. The goal, of course, is even to exceed ourselves and to be even better than what we've done so far. So let's take a look at the very first one. So industrial profitability. Matteo said something about this already. So on this graph, you may see all of our lines of business according to their average profitability as well as the average volatility over the last decade. On the top left-hand side, you may appreciate, for instance, the line of business of non-life and little volatility and huge profitability. More here below, we see the agricultural risks. So profitability is negative, super high volatility. Now -- so what do we do based on this graph? Basically, we do want to define and implement more accurate strategies and being able to implement them according to what this graph is showing. So high profitability, low volatility, of course, a strong growth strategy, vice versa for those lines with high volatility and low profitability, we'll be strongly focusing on recovering margins and with a very accurate management of exposures and also derisking. So what do we expect in the end? Well, it's a better mix in our portfolio, which is more profitable and less volatile. How do we want to get there? What are the levers that we want to make use of? So let's see what we did. So this is what we do with product engineering. I will tell you what we mean by this. And then speed, I mean, the fact that managing the portfolio a little bit more quickly than we've done so far and if necessary, with careful management of acquisitions and derisking. So bullet number 1, I'm talking about the Motor business. Now in the motor business, I have to say that our key tools and if you will, leverage as well, we are able to get better results versus our competitors. So we just have to continue, so to say, and we will continue with sophistication and improvement of underwriting and pricing tools. Of course, this will happen in all the companies of the group. We will then continue with a key feature that we have, which is the combined offer, so telematics plus insurance. We will also have to improve claims settlement processes. And the market is telling us that we are quicker in terms of settle claims. And once again, this is the right condition that we have in the plan. I mean, we can really improve. We have to industrialize our processes, which is what we have done for mass claims, but we can improve on the big or large amount claims, but also on the lesions. We will be talking about something new, which is the so-called UNIQA offer, which is about to be started. We don't have to forget the possibility to manage the so-called aggregated demand. I mean, the large fleets, for example, carmakers, long-term rental companies because once again, this is a long-term process. So we have to transfer, I mean, the fact of owning individual cars to aggregators. And of course, we need to have specific skills to do this and to manage this in a profitable way. So what are our targets? Well, you can see them here. The growth of the average premium income, which is 4.2%, so EUR 4.9 billion and the combined ratio, COR improves because end of '24, we had 100%. We would like to reach 95% in 2027. Now 100% in '24 as we said in our quarterly meetings, it depends on the Milan Court tariff tables. And we have worked a lot on pricing or tariffs. And again, I'm sure we will be able to further improve the COR. Let me talk about the non-motor vehicle damages. In terms of property, we have had some turbulent results. Now again, it goes without saying that this is the business where we need to work at best. So we need to improve profitability. So you can see here the results and the consequence of our efforts. You can see here the pricing and underwriting areas. We will have a more sophisticated model. And this means that we have the possibility to change the system. So we just will take opportunities. Of course, we will be useful for our country. Once again, companies necessarily have to be hedged or insured against natural catastrophes. So of course, from the industrial point of view, we will be able to take advantage of this opportunity. We will do this by being quicker and quicker, faster and faster. In the Non-motor Vehicle business, this is fundamental. We need to adjust conditions and pricing on the portfolio where when the underlying risk makes this necessary. Once again, what we also have to do is to further improve claim settlement process. Our processes, well, work very well, let's say, in ordinary normal situations, but especially after the devastating 2023, natural catastrophes where you have tens of thousands of claims in a few days. Well, the process has to react promptly. We have to adjust to every single situation being faster in helping customers and also being more effective in settling claims. We will be talking about this in a few minutes. Anyway, we will continue this growth and the average growth will be 4.7% yearly increase. We will then stabilize combined ratio. It was very good. I mean it was 88.3% in 2024. We will keep it below 90%, 9-0. Don't forget, back in 2024, nat cat incidents was relatively positive. So this is one of the possible explanations. I mean, we've been very cautious, very prudent in calculating the next plan. So let me take you a little bit into the depth of the product engineering. Now product engineering is a key element. And once again, we have to be better than our competitors in terms of pricing exactly. This is the key to be more competitive on the best risks and less competitive on the worst risks. This determines a better industrial result versus our competitors. How can you do this? You need to understand the risk better and better. We have to become more and more accurate in doing this. You have a concrete real-world example concerning the CaSA policy. So once again, there's -- of course, we know risks very well. But of course, we've further improved them. As it usually happens, improvements are a consequence of having data using new fresh data. So this is what we have done. We have used generative AI, and we used it to analyze thousands and thousands of expertises. So this is something we could have done by hand, but it would have been impossible. So we have derived detailed information on the frequency of those cases. And once again, we have plenty of details, for example, what's the price of a flooded apartment, for example, a tree that falls generating damages or, for example, a photovoltaic panel being damaged by hail. So we use the Italian cadastral data sets. We also have risks maps. So all of this means we now have new variables into our pricing structure. For example, the presence or the absence of a basement or underground rooms. So once again, we've been able to use satellite pictures. Now of course, we cannot ask customers, I mean, to take aerial pictures of their homes. Guarantees are very specific. So we need to cover every single specific risk, for example, PV or photovoltaic systems or even trees into the garden that we are insuring. So once again, we're going deeper and deeper because we want to perfectly assess every single risk. So this is what we are doing on the so-called new production. I mean, new policies. But what we need is to work on the portfolio. And I have to say that the portfolio in the non-motor damages, we have a tacit renewal. So if you need to change the price and the conditions, I have to cancel the policy to the customer. And this is something really, really critical in customer relationship management. Of course, we have to adjust the conditions of our portfolio. Starting back in 2017, in the new policies, we have a new provision. We can adjust the price, of course, the customer can accept or reject the new proposal. And I have to say that we use this system for around 50% of the portfolio. We want to be faster. So we're doing something so innovative for the market. So in the next 3 years or so, we will move out of the tacit renewal. For example, our policies on the basic systems won't be depending on this type of renewal. We will have better, more transparent relationships with customers so that we can adjust pricing and conditions if required. Now this is something that we have already done. I mean, the fact that managing exposure and working -- the 2023 events have been very, let's say, important for us. We understood that we have to work with our agents. So this was absolutely a fantastic effort. We have to reduce concentrated risks, including 2 main risks maybe in a small geographical area. So this is what we managed to do with some pruning and repricing activities. So in terms of nat cat guarantees, we have increased the premiums. Look at this, these are in general atmospheric events, plus 33% premium level. This is what we got in '24, minus 14% of annual probabilistic expected loss level. So this is the reduction of risk concentration. So this brought us to a new condition, which is much more solid, sturdier. So if an event happens, we won't be receiving this kind of shock, okay? The shock will be lighter, if you will. So we will be able to keep seizing growth opportunities. But at the same time, we will be much stronger in terms of results expected. We have spoken about a number of topics already. But when it comes to settlement, there are a number of things that we can improve. We do now -- we're actually able to send our customers our real-time alerts to let them know that most likely an event is going to happen. This way, we help customers to either limit or even avoid a damage. And of course, even when that happens, we're still able to understand how bad, how severe it is going to be like and what are the actions that we will have to undertake to be as effective as possible and of course, as fast as possible. So being able to settle a number of claims, attracting experts from all over the country. And of course, during the settlement phase, all of the information is duly provided because we can do that through AI. And so we can settle claims better, and we can be even more accurate in pricing and underwriting the following time. So there's a lot here, and this is really important, something that I really wanted to get across. So Life and Health. Well, Life and Health, of course, over the years, are increasingly important. They are becoming more important. They do grow. And -- but of course, there's still room for improvement when it comes to industrial profitability. We still want to improve here. When it comes to improve profitability, of course, that has to happen through actions and activities such as becoming excellent in settlement, in claims settlement because we do manage millions of claims in a year. And also, we want to be able to leverage bancassurance, which provides the better margin and improves our overall result better. Something that we've improved over the years is the offering in the health, and we've added some service components that I will be deep dive further into. When it comes to life, of course, we always strive to improve our margins, and this means that we need to diversify our offering. So protection, prevention, investment. And we are also leaders in the pension funds, and that can help us as well. And the efforts here, they really mean to become stronger, more consolidated in the growth, but also in the value generation. You can see the target on the right-hand side when it comes to the new business value of life, EUR 1 billion cumulative over the next 3 years versus EUR 750 million we've generated in the prior 3-year plan in terms of health, well, the CAGR is growing 7.7%, 1.1% in terms of income for 2027 and group health insurance service result growing by EUR 300 million cumulative up to EUR 450 million. We've been through the first portion in terms of how to improve our profitability. Let's now move to a faster integrated offering model. Here, again, I think there's something very interesting that I can talk through. Well, when I say offering model is insurance, but also beyond insurance. And the 2 are becoming more and more integrated with one another. Of course, if we focus on the key items, we can take a look at the initiatives for the next few months. First of all, we'll be launching UNIQA, and I'm going to talk through this in a moment, the omnichannel. And then UniSalute, this, again, it follows the same logic. So omnichannel retail offering. And this is all going to be enriched with a number of services, which, of course, are tied to health. And for instance, it will include virtual care, telemedicine, remote medicine support, but also we'll be growing our integration with the Santagostino health care centers. And in terms of the mobility, well, of course, we have been leveraging telematics over the last few years. Now the toll associated service has been increased, and it will become even richer over the next 3 years. UnipolRental, big investment and efforts are still needed to make this investment profitable by improving the offering as well as the operating model. Let me start from UNIQA. UNIQA is the platform for the retail offering. And this platform will become available for our agencies starting from April 7, literally in a few days. And this is going to be truly revolutionary. It is a single contract, which will allow to ensure all family household risks. So motor, home and family, personal, when I say home and family, I'm also including pets, for instance. And whilst we have the opportunity, of course, to interact with the customers in a brand-new way. And it will be omnichannel, a native solution, omnichannel. It means that this is something that customers will be able to purchase by themselves. They can do their maths and by themselves and then potentially talk to the agencies to finalize or even broaden up the offering. We do believe that 2025 numbers will be already interesting ones, significant numbers. In UNIQA, we do expect a lot from UNIQA in terms of development and results. Let me spend some words on UniSalute, the digital offering. This is already existing on the digital channels. It is a modular offering, including all of the retail offers. Over the next few months, we'll be completing this omnichannel model so that the agencies will be able to smoothly interact with customers through platforms. This platform will also be made available to our banking partners. And of course, there will not just be the insurance piece, but also we will be able to enrich with new services from our entire ecosystem. Talking through mobility, UnipolMove. UnipolMove is something important that has started through electronic toll collection, over 2 million devices. It's been developed by Unipol Tech. We've greatly invested on UnipolTech, 2 lines of business today, telematics, of course, our history, as you know, and also today, the electronic toll. Over the next few months, will be even improve this offering, and this is called the Unipol Smart Move. It is a single device inside which you may actually rely on the electronic toll functionalities as well as the telematics. This is a further step that will allow us to improve cross-selling. Those customers who have purchased UnipolMove will be able to actually rely on the same device to benefit from telematics and the other way around, depending on what they purchased first. So again, we do expect a further step onwards in the development. Of course, talking through development, this is something that will be made available to our agency network, of course. Our agency network is central to our strategy and to our omnichannel strategy. As Matteo said, customers will be able to do most of it by themselves. But of course, then they will be assigned to an agency, to an agent who will further implement and improve the relationship and the kind of partnership, if you will. Over the last few years, we've developed the omnichannel logic in a number of items, travels, pets, home and so on and several millions of policies were actually being developed. Through UNIQA, this strategy will surely be making a leap forward. This is also a challenge, of course, for our agency network because new tools and opportunities require new skills. And also expect a brand-new generation of agents who are able to seize those opportunities which are being -- let's say, which are being created, which are being established within this very new context. Agents will also leverage another kind of improvement because we will be replacing our CRM obsolete system with Salesforce. Salesforce is now worldwide leader in CRM supporting sales, and it will help us finalize even more effectively all of the opportunities that we will be generating through the digital channels. We do have many different ideas. We do a number of things. And of course, agents, our agents will have to deal with a broaden up offering a strategy, not only in the insurance, but also in beyond insurance. Something else we've done, and we further want to develop with our agents is the ability to use, to make use of precious time of agents on what can generate value on those sales initiatives that will deliver the best revenues per worked hour, both for the company as well as for the agency at the same time. In this broadened range of offering, it is very much important to be specialized. So we've developed some networks of specialists with thousands of consultants who can make themselves available. And again, we want to develop the so-called financial family specialist, which means those services for those customers who want to increase and improve the effectiveness on their life insurance. So huge attention, which is paid also to bancassurance. Bancassurance has grown. The -- of course, the market share in the non-life is not significant. It is significant in the life line of business. And when it comes to the non-life development, well, we do believe that both the strategic commitment from our partners as well as the expertise and the know-how that we may offer may deliver great satisfactions. UniSalute, but also many other services are becoming more available also to our banking partners. And this is relevant for what I'm showing here as well as the life. The evolution of a capital-light offering may allow us to really move forward with ambitious goals. You see the goal is that we want to grow by 24% per year, moving to EUR 1 billion income in 2027. It doesn't just mean growth. It means growing in a high profitability line of business whilst reporting low volatility so that we can become even more robust and solid. In terms of the life premium income. Again, you see we need to grow and potentially have a EUR 3.4 billion income in 2027. I have tried to show you what is underlying our targets, but I will now leave the floor back to Matteo Laterza. He will tell us about the last of our 4 key drivers.

Well, thank you. Thank you, Enrico. Indeed, we do come to our four key drivers. I will be tackling technology, Enrico spend a few words on technology as well. But I will go back to that, and I will also talk through the human capital. Human capital means skills, meritocracy and generation exchange. When I say skills, well, when I say people skills, where we want to enrich the skill set for our people from a technology viewpoint, something that it is also AI-based in terms of data management. And when I say meritocracy, well, it means that we want to develop multidimensional performance-based systems, which allow our colleagues to really benchmark themselves with the objectives and reach out and even exceed them so that they can grow professionally in their career because -- and of course, there's also a generation exchange topic. This is something that we have worked on for a while now. The objective is to accelerate the generation exchange. And of course, we want to repeat that year-after-year, so to speed up this process even more. All of the above for us to be able to take advantage of our technology investment in the most effective manner. And again, I'm talking to tech platforms. Everything that Enrico said can only be fulfilled. If we have new systems, new technologies. And so that we can really interpret the new needs from our customers and be able to respond swiftly and accurately. And then, of course, the AI solutions. On AI, I will be spending some words in specific through a slide in a moment. So the investments we'll be making is equal to EUR 0.5 billion over the next 3 years, so quite a big investment. And in terms of new hires, we do expect to have 400 new hires with some very specific. And these people will be added on top of those specialists who are already working with us. These specialists are not only those who work in later, but also I'm talking about some -- a number of specialists who are very much own a unique skill set, which we want to become as widespread as possible throughout the company. The reason I said before because we still want to leverage people on the territory. And therefore, our people must have, must own the skill set to be able to cope with the needs and expectations of our customers. Well, when it comes to AI, AI is not just a technology. It will be very superficial to call it as such and it is a new way of doing business, literally. And for us, say, and for everybody to really fulfill in fall extensively, you really need to invest in a number of topics so that you may really make use of this technology the best way possible. We do -- we may rely on important resources, such as the people I spoke about a moment ago. So all of our young specialists taking care by data management as well as IT devices. And we do have data, lots of data. And this is not enough to actually apply AI-based algorithms, because it is important that this data to be organized and structured the right way so that we can use it. So there's an awful lot of work behind the organization and use of data, which we capture from black boxes and from our customers underwriting because we actually want to be able to make use of that all along the value chain. I have to say that we have started with a gradual process. So we do develop use cases from time to time with the objective on the one side to make sure that the investments we've made are transforming into returns -- are turning into returns, but also we want to be able to potentially change our operating model so that this project can really become deeply grounded and rooted in our company. And this is something we're doing throughout. We started from claims with some layer of verticals, and then we worked on sales. We developed chatbot in UniSalute and UnipolSai. And then the coding automation, which is something that our IT people are now working on to speed up the coding. And of course, all of this will further accelerate over the next 3 years so that we may become more efficient from an operational standpoint and more effective from a sales viewpoint. Okay. So let's now move to the financial component. And of course, this is AI. It goes on AI as well. But let's say that the most important component here is very much human capital. So being able to assess the opportunities that financial markets can deliver -- can present. We do experience a lot of uncertainty nowadays from a geopolitical viewpoint. But also, along with that, there are many opportunities out there. There have been -- there has been something happening in the euro zone. German rate has increased because of the EUR 1,000 billion plan that Germany has recently launched. And this is for us an opportunity because it generates value to all of the Govies, which was not accessible up until a while ago. So it is slightly below 3% nowadays. And considering what is happening now, we may literally diversify our portfolio throughout Europe, and that allows us to improve our yield but also to minimize capital absorption, which comes from financial risks. So a more diversified portfolio will lead to less volatility in your assets. And meanwhile, it allows us to develop the AOPA curve that allows us to be aligned between assets and liabilities and reduce the volatility of our solvency ratio accordingly. So let's say that when it comes to the financial aspects, there are -- these 2 aspects. So risk yield profile and, of course, the objective to further reduce the capital absorption. We will still carry on in investing in alternative assets which is a kind of a residual component in our portfolio. We're talking about EUR 4 billion approx over the EUR 60 billion of the overall investment. But yet, it brings a very remarkable profitability, which is something that, of course, we want to tackle and further improve. We will reduce debt. And this will come out as a result -- a runoff result of our senior bond portfolio from Unipol, because we don't really need to do -- to go for senior. So those 2.5 million actually, one came to maturity a week ago. So that EUR 1.5 billion will be totally reimbursed to [ ' 27 and '30 ]. The objectives those here that are sitting on the slides. So it's not that we do expect positive or negative outcome from stock exchanges. And therefore, we don't expect capital gains or capital losses over the years. But simply, we just want to invest on coupons. When I say coupons is both coupons and dividends. Average production is 3.8%. It was 4.2% back in 2024, which was heavily impacted by rates that were higher. Well, it goes without saying that the objective of finance is to seize market opportunities and should market outperform then it goes without saying that we will not just stop that in terms of reaching out to the goal that is displayed on the slide. So in terms of life, you can see an increase of the back book of the portfolio, so the comprehensive yield. And this is due to the fact that new investments are carried out within 3.5%, also 4% on the Life business. And well, what happened in the past. I mean, rates have been negative for 15 years. So yields will go up. A big big chunk of this yield, let's say, improvements will translate into a better profitability of the Life business. It is a little bit less important in terms of size versus the non-life. But of course, it gives, if you will, stability to the volatility of the profits in the next years or so. Before share with you results, I mean, some numbers, let me share with you briefly a couple of keywords on sustainability. Yesterday, Unipol's Board of directors approved the business plan, but also the sustainability plan. For the next 3 years, we decided to have 2 separate plans, even if, let's say, they are very, let's say, similar to each other in terms of executing actions. Now the plan is based on the 4 main drivers: driver number one, concerning climate change. So the support help that our group wants to offer in order to reduce the consequences of climate change. You know about the hydrological risks of Italy. Of course, there's a long discussion on the mandatory Nat Cat policies. So this debate is very important in our country together with all the actions that Enrico has just summarized in his presentation on the settlement model of Nat Cat's. Of course, we would like to speed the assessment of the damage and prioritize the payment or the settlement, if you will -- the company has been very vulnerable. So building products and services, which are natively oriented to favoring the resiliency from companies and organizations to climate change. Once again, risk management and many other topics that may be useful to prevent damages. We will allocate more than EUR 600 million SCR to natural catastrophes. And this is a big number. So this will be made available to our customers who would like to get insured with us, especially after the obligation that will be in force. I guess, if I'm not mistaken, starting March 31. So in a few days, this will become mandatory. There's also a second area, concerning health or welfare. So the protection of Italian citizens against aging. And this is what Enrico told you about the very modular [ Salute birthday offer ] which is what he talked about earlier. We also have the need to strike a balance between prevention on the one side and protection on the other side. Now this is built into UniSalute's product concept. So we need to make an effort in order to favor development in the banking channel together with the agency channel. So once again, we will sell more welfare policies. The target is to have more than 16 million services, which is what we would like to do in the next 3 years. In terms of Santagostino medical centers, I mean, the centers we own, the service level will be more than 75. Second point, I'm talking about the environmental transition. So this is the big big world of telematics and the use of the [ green box ]. So I'm really talking about green box no longer a black box. So the reason is -- but would like to favor, let's say, less pollution. So we will decrease pollution from our customers. We can do this, thanks to a better use of their cars. So based on the mileage, we will calculate the renewal pricing. So we will encourage people to use their car for less time. And then in terms of rental services. So we can also have contracts and agreements with preowned cars. So we won't use new material, new cars so no new pollution. We will also have the transition to Net Zero. This is one of our latest programs persists to encourage positive green behaviors to favor our climate transition. Last but not least, we have people. When I say people, I mean skills and technologies. Now the key target we have here is to comply with Scope 1 and Scope 2, so minus 63% within 2030, minus 50%, this is Scope 3. So indirect investments within 2030, and we would like to reach 40% of high social and environmental content products. We closed the 2024. We reached the target, so we exceeded 31%. But there's still a long way to go. As for the last point, this driver concerns, if you will, investments in technologies, artificial intelligence, training and education for our partners and employees on new technologies, there will be plenty of investments. I mean you can see here, 170,000 training hours, this is important, but what is even more important is the quality of training that we will deliver all of our employees. So this is it, the driver #5, okay, well there's nothing new here. I mean I'm sure you are familiar with those numbers because this is what you can read in our community case. So in the press release. You can see here the -- well, average growth of premiums, which is 4.9%. You can see here how much we grow in motor -- motor and health. You can see here the combined ratio reduction by minus 1.6%. This is a very important number. Let me tell you more about this. Numbers are important, of course, they are significant, but we have to pay attention to the quality of our results. We will reach all of those targets, which are really, really ambitious and we can do this in fact to our strong improvement of the industrial component. So we will cut down on the combined ratio. But of course, even the Life business will bring about a growing contribution to the group profitability and a smaller contribution from the so-called financial management versus, I mean, the results that we had in the last 3 years. So the quality profile of profits is now better then the profits generated by financial management, financial management is highly volatile. So it may not happen again. You can see here the 2025, 2027 consolidated net profit, EUR 3.8 billion. And you can see here, EUR 3.4 billion, this is the group net profit. So these are our 2 key targets. We can also include some yearly average of earnings per share. So 13% EPS, CAGR 2027. This is the shares and 10% as for the DPS, so the dividend per share, very ambitious targets, I know. But for the first time ever, we also unfiled the capital generation profile, which is what you can see in this slide now. Our company has the possibility to create the organic capital generated by, I mean, the industrial business that we manage, which is a very important point. Once again, EUR 2.7 billion between '21 and '24. This is what we've done. We will reach EUR 3.6 billion in the next 3 years. This is, of course, the target we have for 2027. Enrico talked about business development. We will need EUR 400 million capital absorption. So we are left with EUR 3.2 billion net organic capital on which we can pay dividends, EUR 2.2 billion. So once again, we have organic excess capital generation by EUR 1 billion. So once again, this is our perspective. And in the future, we will experience an improvement of the wealth profile of the group and considering unchanged financial parameters. Please don't forget, we are now in a situation where the spread in Italy is 110 equity markets in Europe are very close to their maximum levels. So the situation is very good from the financial point of view. It hasn't always been like this. So that EUR 1 billion is a sort of an additional prudential buffer so that we can take up future challenges. And we also have the possibility to consider new opportunities in the future because we can count on a sturdy robust capital structure. So this is what we need to really understand this kind of, well, a capital situation. Now to wrap up my presentation, let me share with you some closing remarks. Now in the last plan, but also all the previous plans, I mean, we have had a very strong track record. So also in the previous plan we've been able to hit very important targets. You can see, by the way, the performance of our shares, which is an excellent one. Once again, we think there's plenty of unexpressed, untapped value. And we would like to bridge the gap, thanks to all the actions Enrico talked about. First and foremost, all the business, we will have -- so we would like to improve the technical profitability level on the Life and Non-life business lines. So risk-based approach. We will, let's say, manage the business in a faster way. There will be huge investments on operating models. And the key target for us is to become an omnichannel company. And when you go omnichannel, it means that we have to prioritize our distribution network. We'll also keep investing on our bancassurance business line and the main target there will be to further develop our productivity level in the bancassurance channel. As for the, I mean, operational model, if you will, there will be new technologies plus the help of artificial intelligence. Of course, they will turn into a very important driver to help us hit Unipol's targets. Now all of this means that we will generate an acceleration in terms of profits and dividends growth, which is what we want. And hopefully, we will be able to bridge the gap that's still characterizing us versus our peers. Okay. So you can see here the third bullet, which I have already commented, including the fourth bullet. Okay. presentation is over. We can now start our Q&A session.

Good morning, ladies and gentlemen, we are now ready to start the Q&A. And we will get questions from financial analysts and institutional investors. Just one second, please. So once again, there will be questions from this room together with questions from those not being here in the room Q&A answer unipol.it. This is the e-mail address. You need to send the question. Please introduce yourself first name, family name and the company you represent Matteo and Enrico please join me here on stage.

[indiscernible] from ABS Consulting. You've done something exceptional. So you've been very determined, very resolute. So we are absolutely thrilled. So you've shared with us an incredible plan, which is really, really very interesting. And we're very confident. So we are sure you will keep doing what you have been doing so far with plenty of determination. But of course, we cannot forget one point. We are now sailing in deep waters, and we are in Italy. Now Italy has some criticalities which are very deep, very strong. So it's really difficult for me to sleep at night for example, I have a short list of criticalities because I see a very stormy ocean demographics. I mean we lose 300,000 Italians a year. So considering this context, we fear there may be an even stronger demographic problem. We have low salaries. For many people, this is very close to survival level. We have a huge public debt. Our GDP growth is mild. Our industrial structure has a low technology penetration rate and the list may continue. So if we had to identify Unipol, I may say you are just like a Salmon. I mean, you're swimming upstream. You know what Salmon's do? So we now navigating of saying it is very difficult ocean. And -- let me wrap up by telling you something so simple. So we have an incredible determination. We are so resolute. We have incredible skills. So you've been able to deliver exceptional results So can we go international? Can we step out of the country? Can we look for another river hence another C, which is a little bit easier than the one we are sailing in right now. Thank you.

Thank you so much for your points. I know about countries problems very well. Well, we play our role. We are an insurance company, aren't we? So we just -- will offer our own contribution to try and solve some of the criticalities that you have listed. Hence, among those demographics is a key issue, which is the first point you touched upon and the need to have the right healthcare services. We need to find sort of perfect combinations between public and private systems so that the entire system can benefit from some savings. I'm not just talking about the private interest of our own company. I'm not talking about remuneration, concerning what we do. I mean what we believe in is a beautiful combination between our public and private efforts. Of course, I'm talking about healthcare services and welfare services. This system has to be very well structured, very well organized. So once again, this kind of combo will turn into huge advantages for the entire so-called country system because the public system now is no longer able to be as universal as it was in the past. Another key area is represented by the hydrogeological risk level in our country. So we are definitely underinsured from this point of view. I mean we are familiar with this, and the situation has been going on for decades. Now you know that if you are able to increase the level of the penetration of insurance systems, well, this means that the country is sort of ready to react to the consequences of a natural catastrophe, for example, GDP going down after the event together with the possibility of enjoying our recovery after the event. So we've been shown that a high insurance company has, I mean, a bigger reaction capability or strength. Once again, we need to bridge the under-insurance gap in our country. And this is one of the key interests of our country. We have to make sure we can do this. Once again, we have to help the country do this. Now in terms of Nat Cat policies, I know this topic is a huge step forward for the country. But we still have a long way to go to bridge the gap that we have as compared to many other countries. You mentioned many other topics. For example, our contribution may be done in terms of reducing public debt. Of course, so we won't be able to cover all the other topics you mentioned. You also mentioned the word internationalization. We are an Italian company, we just have some stakes in Serbia. We've always, I mean, concentrated in our core business in Italy. And I have to say that in our plan, as you must have seen, we will keep doing this. So with all -- we keep saying that we need to keep an eye on opportunities coming from foreign countries. Maybe you remember, we had a specific organization. Maybe you remember, we had a holding company there. We had an operating company. This was structured just because we wanted to be very flexible. So that one day, we may have -- you may have had taken advantage of other possibilities. We cannot do much in Italy. I mean, we are market leaders. So of course, again, it goes without saying that we are maybe interested in, well, at least exploring what is happening out of the country. So we have to have the opportunity to do this. And this is something that has never happened before, but never say never.

Gian Luca Ferrari, Mediobanca, 3 questions. One on dividends. Matteo, we've always been very clear in saying that 100% of cash flow is capped to the dividend policy. My question is -- if for whatever reason, there was a ban on dividends banks. May we confirm that insurance cash flow may offset the EUR 2 billion of dividend. So there's capacity to cover dividends. Even in the event, there is no cash flow coming from the 2 banks. Second question, on capital generation, EUR 3.6 billion out of 5 SCR corresponds to approximately 20 points. That is even lower than the 4 Ps, you announced presentation, so my question is, where is the gap versus peers which are close to 30 points in capital generation. I believe that the life is still very much exposed to branch one? And are you happy with this positioning? Or do you expect a more profound penetration of life? Last question in -- on a national catastrophe. Enrico explained that the targets will also include normalization of the Nat Cat events. Can you tell us how much you budgeted both for motor and non-motor in the targets you have communicated?

Well, on dividends, well, if you have EUR 100 cash flow, of course, you cannot pay more than EUR 100 in dividends. Your question is, what if the bank stopped paying dividends? Are you still able to pay out dividends? We -- we're talking about a very unique and extreme edgy case scenario. But let's say that I -- when I make my estimate, I do commit to our shareholders, and I do commit to our shareholders in terms of what we can manage independently. So insurance, Life, non-life and beyond insurance. Now you're mentioning a very edgy case scenario in relation to which we're ultimately able to and fulfill our commitment. Of course, banks are important. They do participate. They play a role in building the results of the insurance group but we do not depend exclusively upon the decision on dividends from banks. For us, to then to commit or not commit to our shareholders. So you obviously mentioning a very edgy case scenario, which I do hope are not going to happen. If there's a ban on the bank, and I would probably expect the same ban happening on insurance because usually, what they do on banks, they usually, they do it again one month later on insurance. So -- but that is my feedback in terms of your first question. So we do very much rely on the insurance base. Gap versus competitors in terms of a capital -- organic capital generation? Well, our life model is strongly oriented on to the traditional components where the peers you've seen in those other countries, they do have a much greater component in Life where, of course, with a different profitability. But now the bottom line is not so much. You build the product, but it is more about how you distribute. If your distribution network is made out of agents, you cannot base your sales strategy on distribution of unit linked stand-alone because you can expect an agent to sell something that the agent does not have the skill to do. It is like asking a financial advisory to sell policies. They try to make it, but no success or poor success. Whereas on the bank insurance, this is definitely something that we may work and that we're working on, as I speak, on beta results are very reassuring in terms of placing branch 3 policies. But our gap versus peers very much depend upon the perception that the market has, of these, very peers versus our ability from my perspective at least, our ability, which is definitely undervalued by the market in terms of how we can generate value and capital. I will leave Enrico to actually answer your third question.

I would -- I'd start by saying that the impact of Nat Cat is based on our risk management internal model. This is quite important. It is not a common sense, expert report, but it is something that is completely consistent in terms of what we do when we calculate SGR as well as what we, let's say, what we then come up with policies and so on. So this very much comes from what I have -- what we have spoken through in our presentation. And of course, the assumptions are still very cautious as it is our tradition, especially considering the closing of 2024. The order of magnitude is perhaps another EUR 100 million on top of what we had in the prior plan.

My name is Elena Perini from Intesa Sanpaolo. I would love to focus on the improvement of combined ratio for motor line of business. As I understand there's 5 points of improvement. And I would love to understand what are the assumptions in terms of pricing, volume and also on the claims settlement. So what kind of improvement do you actually expect to deliver based also on all the actions that you have shared and how the new UNICA table will actually impact on this expectations and these assumptions? And then potentially a follow-up with respect to the answer you just shared on the Nat Cat?

Well, it has became mandatory to include the Nat Cat. And I would assume that you're taking that into account when allocating an additional EUR 100 million, right? Is my assumption accurate? Okay. Your first question, combined ratio for motor line of business. First of all, let me say that IRFS number from consolidated combined ratio 2024 includes a runoff component, which was particularly low. Much lower with respect to the one from prior years and lower as well than the one that we expect in a kind of a normal situation, so to speak. With that said, in 2024, of course, we have -- we're very much abided by the tables provided by the court in Milan. And that has led an increase in terms of average cost of claims. And clearly, that includes and absorbs the effect of what I've just mentioned, and it also allows us allows us to work for us to adjust prices. So that combined ratio can become a positive. Looking back, you probably remember the big impact of inflation in '22 and 23, we've been among the first very much taken action on pricing and the average premium in 2023 has increased by 10% which is quite a significant number. Then of course, the tables from the court of Milan were being delivered, and we've still reported increase by 4% in 2024. So what we expect over the next 3 years is totally consistent with the inflation tied expectations. So that Matteo spoke about. So we'll be just catching up with inflation on the average cost as well as the dynamicity of the average premium, considering a constant volume within the portfolio. Nat Cat, well, of course, we made -- we made all of our assessment. And of course, the plan also includes the impact of claims they might actually come from a Nat Cat development for enterprises, which is not starting from zero. So a medium-sized and large enterprises, of course, they do have an insurance policy for flooding an earthquake. So even more so that is included in our numbers. Okay. There's now a question from remote. Alessia Magni from Barclays.

Now the question is on solvency. In the past, we've always had a specific target range of solvency now, this has not included the plan. So do we maintain the old range? And if not, why haven't you defined a new range? Question #2, on the dividends. What are the upsides that you expect of the total dividend after the merger between BPER and Banca di Sondrio. The third question is on combined ratio. What about the budget for the Nat Cat that you considered in the plan, Enrico has already answered on capital generation. There was an update of the question. Let me check. So on top of dividends that we will pay. So what are you going to use this capital for? So in the case of M&A, is the group interested in the life or normal life business? And is this going to be in Italy or abroad? And if abroad, where?

Okay. Thank you so much. Now question #1, solvency. We don't have any target for a very simple reason. There was a disclosure on capital generation. So it goes without saying that we start, I mean, from the foundation we have today, which is 212%. So of course, we would like to build and create new capital over the years. Of course, this is based on a key condition. Financial parameters would stay unchanged. I mean we don't expect big changes in terms of the financial arena, I mean, a increase -- decrease in solvency. Now this being said, and this is what we have already stated in the past. In the past, we had the comfort range between 150% and 180%. Today, we are exceeding 200%. And well, anyway, we keep thinking then being over 200% gives us comfort, so this is our point of view. Again, this being said, we don't have triggers. I mean we don't have levels below which we make specific automatic decisions, but we will never do this. Of course, we have a steady monitoring of our solvency level and this is what we update every time there's high volatility on the market. The reason why we haven't delivered any range is that there's been a leap forward in terms of disclosure on capital generation. And I'm sure this is much more useful for you so that you can really, really understand how much capital we are capable of generate. As for banks, no specific assessments and no synergies, we do have some stand-alone ideas for BPER, but also Banca Popolare Sondrio. So no such assumptions, no boosting of dividends of following any potential operation that is still due to start. So once again, no new plan assessment. . Now I think I've answered the question #3. So let me take question number four. EUR1 billion capital allocation maybe used to consider solvency, so we can set of this solvency by generating organic capital or we may also take into account other opportunities that this is what you referred to in your question. We don't have any specific [ arbitration ]. I mean we cannot say Italy, no, Italy or Life or non-life. I mean we have to consider every single opportunity. So we analyze every single opportunity. And then it could be a yes or it could be no. Now of course, if we have enough capital available, of course, we can do this. We can also use it many other ways. I mean, maybe at the end of the plan. If we have a plant of capital at the end of the plan, you may also consider to distribute. I mean, this is something that we will decide throughout the 3 years. Back to the in-room questions.

[indiscernible] from Banca Akros, I have 2 questions. Capital access, just to complement the previous question. What about the asset management? So this is kind of trendy today. Do you think you may want to invest in asset management? Question number two, It's on the industry, digital channel, you've talked about -- if I have understood correctly, you talked about developing the car business to be developed also in terms of digital systems. Any ideas?

Well, you say this is trendy, let me repeat the sentence from one of our colleagues. We are just like Salmon. I mean we like swimming upstream. So asset management, I know it's an interesting business. You may do this provided that you have the right distribution network. You have to have the right distribution of [indiscernible] the right agencies of financial consultants, sorry, which we don't have today or a banking distribution network that's ready to distribute financial products. We have a network made of agents. So if you -- I mean investing in asset management, well, it doesn't have any industrial meaning. But maybe the only exception is that asset managers have to have their own distribution network that we may leverage. So this is an opportunity that actually we haven't considered because, I mean, we haven't filed any such opportunity on the market. This is something completely different versus our typical business, which is insurance. And as of today, we keep focusing on this business. But once again, what we need is a distribution network. So we have to look for -- for example, I mean, purchasing businesses for which we don't have any distribution network. Now as for the -- well, motor business and digital offer, now the digital offer in Italy started 30 years ago. But market shares are not very big. Anyway, it's a very competitive situation that we have. And so this gives us growth opportunities, especially because of rates or tariffs are going up. So Linear is our direct company. So they have really understood the Unipol philosophy, which is the one we have implemented this morning. I mean we have a major focus on underwriting right pricing, and we've been great because once again, we've been able to grow in terms of size plus generating profitability because in this market, but this is really difficult. So in the next plan, this activity just continues. We will keep growing, of course, we will also keep improving our industrial results. Now on top of this, purely digital business. I mean, big big news that we have shown you this morning is the omnichannel system. So as of today, just like many other traditional companies. So on the website, you can get an offer. And -- so you have to go to the agency, have an offer and then sign the policy. So this is already, if you are generated via the large volume of business. But the big, big leap forward is the fact that the process will be a continuous run with no discontinuation. For example, maybe you have a customer, he or she is very happy of that offer and the customer can purchase it right away. So if you want to move from the digital channel to the agency channel, well, this kind of service will be strengthened by the new CRM and the new technologies. So again, I'm sure some of the growth that we talked about this morning will come exactly from this business. Andrea Lisi, please good ahead.

Andrea Lisi from Equita. Question number one. I'd like to know more about the consolidated profits in 2024, consolidated profits was EUR 1.12 billion, highly impacted by the depreciations, revaluations and positive elements like big capital gains and realizations together with the group's financial results. So considering the average level of profits, once again, EUR 1.27 billion. What about the evolution of these profits? What about the curve? So will there be a big jump in '25 versus '24 then going flat or a progressive growth? Same question on DPS. You already told us something about this. But anyway, what are the main potential drivers that you have implemented when defined in the plan, and the third question is what about the beyond the insurance program. There was some loss there and what will happen to this program at the end of the plan.

Question number one. You have to imagine 3 big steps. So in terms of a linear progression with 3 steps from '24 to '27 in terms of profits, but also in terms of dividends. So in a nutshell, this is my answer. In terms of being prudent or cautious well, yes, but in terms of underwriting. I mean, as Enrico said before, we need to pay attention to Nat Cat's. And they are bigger than 2024 because '24 was quite good kind here as Enrico said before, from the Nat Cat point of view. There's another assumption, as I said during my presentation is on investments. We foresee projection of coupon flows. So this kind of component is a residual minor. So it is not major in terms of building profits. In 2024, as you said, the capital gains have been quite high, so exceeding EUR 200 million. Now of course, you cannot think that there's a one-off extraordinary financial results that we had in 2024 following very positive financial markets may happen again in the next 3 years. But again, as I said before, finance, if you will, in the past 15 years has shown that it has always hit the targets and in some cases, exceeding the targets. It all depends on the financial context around it. If the context around you is difficult, for example, 2022. Maybe you remember what happened. I mean, all the markets dropped fixed credit, shares, equity. So it was difficult, I mean, to be positive in 2022. But we managed to do this in 2022, of course, much less than 2024. And then other, let's say, potential actions. Well, you use this word, but I'd like to use the word assumptions, but I don't see anything else. Third question on the Beyond Insurance program. Well, let me talk about the most important items. Unipol Rental foresees profits from 2025. So a little growth all the way to 2027. As for Santagostino clinics, well, the situation is the same. So they are flat, I mean so to breakeven, so just a minor profits in 2025. There will be growth all the way to 2027 and Unipol Tech. So they work in telematics. So this is basically the black box plus Unipol Move in the plan, as you have seen, they will merge. So the telematics in this case, a beautiful profits and Unipol Move is not active because, of course, we are now investing in the commercial development. But starting from 2026. So next year, Unipol Tech as a whole, will produce profits. If I'm not mistaken, Unipol move stand-alone will go breakeven in 2027. So we don't expect to have drags from this program. Now of course, in terms of size, you cannot compare this with the insurance business. But of course, we won't see what happened in 2024 either.

Alberto Villa, Intermonte. I do have a few questions as well. Back to dividends. Have you spoken in the Board of Directors about a potential interim dividend or using excess capital, EUR 1 billion, if that is the amount. Then would that be possible to consider a buyback plan which is something that the group has never really done in the past and which is something that your competitors are increasingly introducing banks namely? Second question is around the dynamic of staffing costs and considering the -- considering this plan, I understand you have new hires in your forecast and what is the amount that you expect to allocate considering your targets? My third question is on UNA Hotels, we rather than the newspapers, but we've also added from the call -- from the conference call that there is a hypothesis of transfer. So I'd love to know what is the price that is potentially going to be paid, whether or not this is going to be fulfilled. And would that perhaps then deliver an excess capital that hasn't been catered for in the plan yet?

Well, thank you. So question one, our bylaws actually do you consider an interim dividend. We have never really discussed in the Board. But yes, it is an option. It is a possibility that we might consider. Buyback, well, we have studied the buyback several times. And to be honest the idea of using capital to purchase stock as opposed of using capital for entrepreneurial activities, developing core business, namely or maybe considering acquisitions of assets. Well, that is an hypothesis that yes, we've considered and studied, but never took into serious account. So we are happy to pay through cash flow. And we believe that, that is the best way to actually pay our shareholders. In terms of staffing costs, the average projection is 1.5% fully aligned with inflation. As I said during the presentation, we've made several investments to reach the gap, let's say, for people to retire, maybe bridging this gap, which is something that we're happy to invest into over the next 3 years. We have, of course, allocated amounts to cope with this scenario. The payback of this 4.5 year initiatives might actually be seen later on, well, the benefits they might actually been understood later on. The moment we do stop accruing cost for that specific fund. UNA Hotel. You're talking about prices? Well, no, there is no price that has been shown. I mean the press is not informed about price. In our plan, we haven't considered -- we've been very cautious. We haven't included hotels because we're right in the stage where we are considering all of the options, either to keep it, to provide -- to generate more value or to do different things. So in our plan, there is -- you will not see any residual income in the UNA pays to hotels, but there's a financial -- there's a financial amount that does not consider either capital gains or losses, because we've been very cautious on that. So should we not consider to sell the hotels, which is possible because to date, we are in that phase, but no commitment, and we have a really committed to anybody in doing anything. Well, we would just simply include the hotel -- the business of the hotels in the plan? Or should we consider to transcend sell you will see the accounting consequences in our plan, but no economic consequences because that had been taken away from the plan already. I haven't said it but there might be follow-up questions and nobody is asking questions from a remote connection?

Alberto. A couple of follow-up questions. Can you give us a general understanding in terms of the 3-year release ratio that you expect in the Life CSM. And the second is around UNICA, the new product. Do you have any specific targets in terms of volume? I'd love to understand whether it is more a product or agency to benefit agency or maybe banc insurance? So what profitability expectations you have when you sell when you sell this -- when you sell coverages through this product?

First of all, the most important thing on CSM release is that within the plan, we do expect to be much greater in terms of new business versus what is being released. Now the order of magnitude in terms of the release versus the CSM stock, well, it can be a bit lower than 10% roughly. Volume target for UNIQA? Well, first, let me say that UNIQA, yes, indeed, is for our agency network as well as for our digital channels in an integrated fashion, not for banc insurance. Once we complete roll out all the relevant adjustment and so on, UNIQA product will replace the full range of Unipol retail. So new motor policies in 2026 will all come out of this new product. So just to give you a general overview. In terms of the benefits that we expect, which is actually quite an interesting component on retail and motor. Well, that is tied to this omnichannel opportunity. So those customers who make their quote on the Internet for many different reasons, they forget, they will not go to the agency. So that lead does not turn into a policy. So we want to leverage the conversion rate, of course. And as all of our agents will take -- seize all the opportunities, the aim is also to benefit from cross-selling, broadening up the existing coverage that they sign up for. Yes I'm also taking advantage of the follow-up. I am asking for confirmation. You said that you're considering accruals for the incentive plan for retirement. So the EUR 3.8 billion cumulative include that effect, ROI will be higher, right? Correct. Correct. There's another question. Holding does not exist anymore. Well, the parent company. Well, cash flow is 3%. So out of EUR 60 billion after we pay the bond. So the cash flow is 3%. And we are also having 50 million of share that can be transformed in a blink of an eye. And therefore, there's no issue in terms of liquidity. And then because we are paying out EUR 600 million of dividends in May, and so, of course, we do have quite a consistent cash flow. And that is quite normal for an insurance company, though. The question was not spoken to microphone, unfortunately. So end of plan, we have shown a 0.8% liquidity EUR 60 billion. We're talking about EUR 500 million, EUR 600 million. But again, we don't actually use that logic. We don't actually use that matrix. We work on stock that can be converted right away, which to us is cash is liquidity. Are there any more questions? No, no more questions. Okay. Well, Matteo, would you like to say a few words for closing?

Well, thank you so much for attending and wish you all the best for the future. Yes, lunch is ready. Thank you. [The whole transcript was spoken by interpreters present on the live call.]