Good morning from Hannover. This is the Talanx results call for the first six months of 2024, and I'm here together with Jan Wicke, our CFO, who will take you through the results and answer all the questions you may have in relation to those. For the first time, we are doing this in a video format, as we thought it would be nicer if we could see each other while talking through numbers. Obviously, the choice to display your image or not is entirely up to you. For the Q&A session, we also have the chat features activated, and as usual, you can use the hand raise feature. For those on the phones, you press star, eight to raise hands, and we will somehow manage to walk through the Q&A.
After this experiment with the virtual session, we will collect feedback and see as to whether we continue or how to adapt, or as to whether we switch back to the traditional phone call format. That, we will see. Should we encounter technical issues during the session, we'll somehow manage. I'm pretty confident, as we are all used to go via virtual formats these days. As usual, all the documents, including but not limited to our financial data supplement, is displayed on our website in the IR section of the homepage, and for later, you will also find a replay of this video. And with this, I hand over to you, Jan. The floor is yours.
Thank you, Bernd, and good morning, everybody, and thank you for joining us here in our half-year numbers call. I'm very pleased that I can present you those numbers. And to start with, at Talanx, we are really pleased to see our growth momentum continuing. Our revenues are up 13%, and most importantly, the bottom line is growing even stronger than the top line, that is 32%. And all this crystallized in a return on equity of around 20%, which demonstrates the strength and profitability of our diversified business model. Let's go into more detail. We have reached EUR 23.6 billion revenue after six months. The growth rate has picked up in the second quarter, but it was heavily influenced by M&A.
The first time consolidation of the Liberty business in LATAM is enhancing our growth in both the top and the bottom line. The organic growth without M&A for the group would have stand at, eight percent, which is still a very good number if you compare that to our peers. Looking at the bottom line, and this is where the CFO looks to, achieving EUR 1 billion group net income already after six months is quite an achievement, and it's a milestone for our group. The main driver of this is the insurance service results, so the technical performance. The combined ratio is down by 2.5 percentage points, and, after six months, which is a real good number. The return on equity, as I already mentioned, is up to 20.3% and was also influenced by slightly higher investment income.
Our group consists of two parts. One is Reinsurance, and the other part is the primary. If you look at both parts of the group, you first have to acknowledge both parts are growing. In Reinsurance, growth has picked up. It's 5% for Reinsurance as a whole, with much more growth in the P&C Reinsurance, whereas Life and Health was stable. In Primary Insurance, the growth was even stronger, with 24% during the course of the year. If we were to exclude the M&A in Latin America, it would have been 11% for the primary group, the growth rate. All in all, for the group, 13% growth. If you look at the bottom line, the development is even more pronounced.
Hanover, we just published fantastic half-year results, with the net income up 21%, very strong numbers, and primary did even better. We have an increase of the net income of 39% during the course of the first six months, and this both adds up to us in the group, and we are lucky shareholders of both of primary and reinsurance, with a 32% increase of the net income. And this strong development of primary during the course of the last years, from- you can see it here on the chart, from 2018- 2024, where we have increased the share of the group profit of Primary Insurance to 48%, brings us closer to the 50/50 split, which we have set as an informal target, for primary versus reinsurance. However, please keep in mind, this is not a dogma.
We would not hold back Hannover Re from growing strongly just to achieve this. Or in other words, we like anything in between 40%-60% as a share for the Primary Insurance , and this is due to the fact that this is a sweet spot of diversification, which is good for capital efficiency, within the group. Looking at the first half of 2024, we have to have a look at the large loss development, given that we are ensuring bigger risks compared to many of our peers. And what you can see here is that we have booked, as usual, our budget, given that the reported large losses have been below the budget.
The biggest large losses, which we've seen in the second quarter, in particular, were flood events, like the floods in southern part of Germany, with more than EUR 170 million, like the flood in Brazil, which is another core market for Talanx with more than EUR 100 million, or like a man-made issue, the riots in New Caledonia with EUR 82 million, but and also the floods in Dubai, who had another EUR 80 million, which is not here marked on the chart. So we have seen in the second quarter, an increase with regard to large losses, which is worth to be mentioned.
In the Primary Insurance, we will have a buffer for the quarters to come of EUR 84 million, whereas in Reinsurance, we have to mention that within the large loss budget, which was booked, there is also something in for the Baltimore Bridge, which was not, there are a lot of questions still not clear, so we cannot give you a concrete number of Baltimore, but we are very confident that the large loss budget will cover Baltimore as well, and that there will be even in addition a small buffer for the quarters to come. With regard to the quarters to come, we have already seen two hurricanes in the third quarter, Beryl and Debby.
And the hurricane season is predicted to be quite severe, and we should keep that in our minds when we come to the guidance of the group, because we have decided, like all other insurance groups, too, not to adjust our guidance for the full year. But I want to bring across that at Talanx, we are very, very confident that we can deliver a net income clearly above EUR 1.7 billion for the year as a whole, that we will deliver a return on equity of above 15%, and given the favorable growth, which we have seen in the first half year, which will come down a little bit, as this M&A effect is phasing out slightly during the course of the year, will be very strong, for the full year.
So we will reassess our guidance after the third quarter when we have some more knowledge, and then discuss that with you with the Q3 numbers. If we go a little bit more into detail into the segments, I would like to start with Industrial Lines. Industrial Lines is able to present a fantastic result for the first half of the year. The net income is up by 48%, and this is driven by the further improvement of the technical performance. Combined ratio is down to 91.1%, sorry, which is a strong number, keeping in mind that they continue to do their books very conservatively. Insurance revenue are up 14%, and this also drives my optimism for the future of Industrial Lines.
In our HDI Global business, we have by far the best cost ratio of the industry. This gives us the opportunity to grow faster than our peers in a hard market, and this is good for the bottom line. Here you can see the first signs of it, and this translates into a return on equity of slightly below 16%, 15.7%, for the first half year. If you go then to Retail International, Retail International remains the growth engine of Primary Insurance . Even without the acquisition, it is growing at a solid double-digit growth rate of 19% currency adjusted, and if we include M&A, it's 49%. Yeah. It's not only the growth. Please look also for the technical performance, which we can deliver here.
So we have a 92 combined ratio here, which helps us to increase the profit by 59% to EUR 224 million net income contribution to the group for the first half of 2024. And this adds up also to a return on equity to 14.7% for the first half year. And there we have decided to adjust the segment forecast a little bit. We have been too conservative here, stating, initially, a return on equity only slightly above 8.5%. We will increase that to more than 10% for the full year, and we are very confident that we can deliver on that one. And let me add something more. What drives my confidence with regard to this segment? We are here in the right markets.
Being so strong in Latin America, where the demography is significantly different than from other parts of the world, this will provide us with very good growth opportunities, not only for the current year, but also for the years to come. Let's go to Retail Germany. In Retail Germany, return on equity is above 10%. The return on equity of 12%, what you see here in this graph, includes also the asset management contribution earned from the assets sitting in this division. But even without this contribution, the return on equity is above 10%. Yes, we are facing some headwinds in Retail Germany. The combined ratio is up to 99.7%, and the main drivers are the floods in Southern Germany and the motor business.
But our management is taking action to improve the performance, and what gives me confidence, the mindset is clearly on profitability. That might go at cost of growth. But if you look at the growth potentials in other parts of the group, I'm not concerned at all. Talanx will remain a strongly growing company also for the future. And with regard to reinsurance, I do not have to say so many words. Just look at the return on equity, 22.8% return on equity for Hannover Re, a very strong number, and we are happy shareholders of Hannover Re. So, then I have a few insights for you from the CFO desk.
As usual, I start with the capital position, so the overall Solvency II ratio after the second quarter stands at 218%, which is one percentage point up compared to the previous quarter, and this is despite the fact that we paid dividend. So very strong number, which also shows that the capital generation, which is shown on the next chart, is pretty strong. What you can see here on the left side of the chart, is the net asset value. We have increased our equity from EUR 10.5 billion to EUR 11 billion, and this despite the fact of paying EUR 600 million dividend, and this adds then up to a value creation of close to EUR 1.2 billion from a shareholder's point of view.
If we enhance the shareholder's point of view, not only looking at what is already reflected in the equity development, what is to be expected in the future, we can add the CSM after minority interests, and we can also add the risk adjustment after minority interests. And if we do so, we end up at EUR 19 billion shareholders' total value, which then translates into EUR 73.6 per share if you divide it through the number of shares. What does that number mean? It's not a going concern value. It's an assumption that we would stop business next day and just would be winding up the profits, which we have acquired so far. And just be assured, we do not want to stop doing business.
We want to grow our franchise and add additional future value to the numbers here. So this really drives my confidence, and this is my favorite chart. As I'm here together with Bernd, I also have to show you Bernd's favorite, favorite slide, which is this one, where you can see the development of the market cap of Talanx divided into the two parts of Hannover Re and Primary Insurance. You see that, starting from 2022, we have seen a nice increase, a slight dip in the last weeks. Maybe this might change. But if we go to the valuation a little bit deeper, then we will easily find out, if you look at the PEs of Talanx, it's well within the range of the peers .
You can add up the PEs of Hannover Re and Primary Insurance, and if you see the very good Hannover Re PE, which is due to the fact that Hannover Re is able to constantly deliver a return on equity better than its peers and more stable results and better growth. Then you see the valuation of Primary Insurance, which is below a 4 PE. This is something where we look at and ask ourselves also some questions about the valuation. On the next page, you see our second source of income, which is next to our technical performance, the investment income, and sorry, we are pretty boring here, so we stick to our conservative asset allocation. As you can see, what is here worth mentioning, two things. Excuse me, please. Two things.
First of all, we have a shrinking proportion of euro investments in our portfolio. This doesn't come as a surprise, as we are growing internationally. Second, we have reduced our already small equity share in the first half of the year further by 26%, but which is a normal portfolio management action. So if you look then at the reinvestment yields, there we see a nice development, that we are able to achieve 4.7% reinvestment yield, which is also driven that, the current, that we include a lot of dollars and so on in, into our reinvestment. And in the dollar areas, there are higher interest rates than in the eurozone.
You can also see that the spread on the left side of the chart, that the spread which we earn on our investment portfolio, which is reflected in the net insurance, finance, and investment result, we were able to increase that by 50 basis points during the course of the year. Finally, I want to draw your attention to one chart, where my team very often recommends that not to put it in, but I insist on doing this. That is the fair value and P&L assets, which can provide quite some volatility to the bottom line, and we haven't seen so much volatility during the course of six months. We have seen some depreciation, not surprisingly, in the area of real estate, EUR 48 million, but the rest was more than.
So with the rest, we were more than able to compensate for it. So all in all, we had a very positive development here, or a slightly positive development here. It's. I do not want to overestimate that, but I want to draw your attention also to the right side of the chart, that there is, in case of a capital markets meltdown, quite some potential that the bottom line could be affected, which you can see on the right side, but we haven't seen anything so far. So having said that, coming to the group outlook. So to summarize a little bit before taking your questions, we are very happy about the strong growth in the first quarter. Primary group is doing exceptionally well.
This is why we are very confident that we can deliver a return on equity of above 15% for the full year, that the group net income will be clearly above EUR 1.7 billion for the full year, and that we first of all, will also pay the dividends which we have announced. Second, I would like to see most of you in person at our Capital Markets Day on December 11th, which will take place in Munich. We will provide you with our new financial midterm targets, as come, or to be more precise, what we expect as return on equity, what our net income ambitions are, and how we want to continue with our dividend policy. We hope to welcome you. Having said that, I'm now ready to take your question.
Okay, so now as we enter the Q&A phase, the next phase of the experiment starts. When you want to raise a question, please activate your hand raise feature in the MS Teams. If you are dialed in by phone only, you press star five if you want to notify us as to a question you have, and then I try to moderate and switch between the questions. So, the floor is now on you. You can fire your questions at us, and I start with Ismail. Ismael Dabo from Morgan Stanley. Ismail, please unmute your mic and go ahead with your questions.
Good morning, and congrats on a good set of results. I have two really quick questions. One is, the Industrial Lines performance keeps coming in exceptionally well, even with large losses in the 2Q. I'm just wondering if you could talk a little bit more about the trends in the line, rate versus trend, that maybe the amount of business, and also if there was any resiliency built in the reserves, for the quarter or for the first half, in general? And the second question is, maybe not related to you, but maybe related to you. S&P gave Hannover a positive credit rating and, you know, removed some, some of the constraints on the capital ratings, which I think some people are expecting a higher set of dividends to come from Hannover Re.
I'm just wondering, what does that mean for Talanx and any potential future capital return for you guys?
So let's start with the first question with regard to Industrial Lines and the market trends, to give you some color here. So we are growing both the rates, and we are acquiring new business, and the increase in the rates is still covering inflation increases completely. So we are very happy with the development of the profitability, and we can grow our business compared to our peers, so good, given that we have by far the lowest cost ratio. And this makes us pretty competitive in the market. With regard to the resiliency, we have an already high resiliency level, and we added to the resiliency during the course of the first half year in order to compensate also, that the buffer in relative terms remains stable, even though the business is growing by 14%. Yeah, and we did.
Maybe we do not have exact, an exact assessment after the first half year. We maybe could have done, or have done, not could have done, slightly more than that. So, you can assume that, we have displayed rather conservative numbers here for Industrial Lines. So this is the first question. With regard to the second, I think, with regard what the rating agencies are doing, there are always reviews in progress. And with regard to the dividend policy, which might be affected by rating requirements, we will come out with our dividend policies on December 11th into our Capital Markets Day. Does it answer your question, Ismael?
Yeah, that's the thing, at least for the interim, it's probably something I have to wait for until the end of the year, which I completely understand.
Yeah.
That's perfect. Thank you.
Okay, so then, we continue with Michael. Michael Huttner from Berenberg. Michael, please unmute your phone and go ahead with your questions.
Thank you very much. Yeah, a good set of results, but I must say I was disappointed. I was hoping you'd raise your net income guidance, and I know you put asterisks or whatever, but it's not the same as actually raising it. I just wondered what held you back? 'Cause it's clearly not an absence of buffers, it's clearly not an absence of strong trends. There must be something in your mind as CFO, where you thought, "Mm, this is not." So I just wondered what that might be, that little kind of difficult, that little gray cloud is in your mind, you know, which stopped you raising. And then the other two questions are much more mechanical.
You mentioned the net income and the expense ratio advantage in Industrial Lines . I just wondered if you can give us the figures as you see them, you relative to peers. You also mentioned that you were clearly not favoring margin rather than volume in Retail Germany, and I just wondered if you can actually give us some numbers and some precise indications. I think you canceled some brokers, you raised pricing, and you left your guidance of 98% combined ratio for the year unchanged. Thank you.
Okay, first, to the overall question with regard to the, to the guidance. Together with my team, I looked at the volatility of Q3 results and second half results. And if you look, just take the nine years 2017, 2018, and so on. Then we have even seen losses in the third quarter due to a very strong hurricane season. You may recall the Irma hurricane season, and it's always the case, and it's not only us who are reluctant to reassess the guidance, in the midst or after the hurricane season has started.
Next to that, there are some predictions that we will see by the predictions of the authorities in the U.S. There's an 85% probability they see a more severe hurricane season this year, and this makes me a little bit reluctant to adjust too early. But nevertheless, all the rest, what you said, Michael, is pretty true. We are pretty true. We are a very resilient group. Yeah. And so we will reassess our guidance after the third quarter. So, this is the first one. Second, was.
German retail
German retail. To be very concrete here, so what we are doing is we have to adapt prices to a heavy claims inflation, which we see in particular in the motor business. We are not alone, the whole market does it. And we are bringing more or less a message to the customer, which is derived from the behavior of the garages, of the automobile industry. Because we have seen increases in the hourly wages for mechanics in the body shops for cars to EUR 300-EUR 400 an hour. And this has to be translated into higher insurance costs or higher premiums for insurance, and this is what needs to be done in the German market.
So, going forward, what makes me confident that our segment will deliver more return on equity above 10% for the full year is pretty simple. We put profit first towards growth, and this is what a CFO normally likes. First have a profitable business before you grow it. Does that answer your question, Michael?
I think you mentioned you. Maybe you could be a bit more specific on the price increases and also the cancellation of some contracts with some brokers?
Yes. We have cancellation with some brokers where the overall broker relationship proved not to be profitable, and together attempts to make it profitable were not successful. So we are still talking to the people, but if we cannot achieve prices which are adequate, then we have to cancel it. And so was with broker pools who get a nice margin also on the pool level next to the margin on the broker level. Yeah? So you have a double charge with regard to commissions here. And second, we have a very differentiated price increases in the market, so it really depends on the risk. It really does not. It's very difficult to give you an overall number here.
But what I've seen is, but it's not reflecting HDI, it's reflecting the market as a whole, is that there was inflation index where motor insurance was part in, and they reported an increase of 29%. Yeah, on a whole market level.
Wow, okay. That looks fantastic. Okay, thank you.
Thanks, Michael. Next we go with Phil, Phil Ross from BNP Paribas. Phil, go ahead.
Hi. Good morning, guys. Thanks for the presentation. I just have one question, it's a broader one on nat cat exposures across the group. I guess it follows on a little bit about Michael's guidance question, but it seems to me that the market sort of understands the Hannover Re, the reinsurance footprint, as opposed to the, in terms of nat cat exposure. But just thinking about the primary business, particularly industrial, you've done some work over the years to correct the footprint. Maybe 7 or 8 years ago, you were overexposed, etc . So if you could just talk about how you see the footprint in Industrial Lines , from some Q3 nat cats, and maybe, I guess also in, international, you'll have some exposure, maybe in Mexico, Latin America.
I appreciate it's a lot smaller, but just to give us a bit more of a flavor of what you might be exposed to in 3Q in the wind season. Thank you.
So, with regard to the wind season in Q3, I'm not talking about the earthquake risks, then yes, we are surely exposed to Mexico. Last year we had a hurricane in December in Mexico, which was in our large loss list, but next to that, the hurricane being affected by tropical cyclones, we have also seen this in Brazil, in the northern part of Brazil, during the course of the last two years. So these are the two areas where we've seen so far, nat cat exposure to tropical cyclones at Retail International.
The most exposure within the primary group is in Industrial Lines , and we are insuring industrial plants in the United States, in Florida and Texas, and so on, and also in Puerto Rico, where there's a lot of pharmaceutical industry. And so we are a little bit more exposed in Industrial Lines , but as you said correctly, we have adjusted our nat cat exposure, and we did two things. First, we included that in the pricing, and we took smaller tickets. Second, and this is in particular true for the specialty business, we have a little bit downsized the nat cat exposure in the course of 2022.
the beginning of 2023 already in the portfolios, as we were not satisfied with the price increases which we wanted to see there. So if you compare that to 2017, we are on a relative base, less exposed, given our growth, which we have seen. If you look at the growth of industrial lines, in absolute terms, we are more exposed. I hope this gives you some color. So but, we are confident, and given the resiliency of Industrial Lines , which is extremely strong, we are very confident.
That's helpful. Thank you.
All right, so then we go to Bhavin. Bhavin Kumar from HSBC. Please go ahead, Bhavin.
Hey, good morning, and good morning, Bernd. Thank you for taking my questions. So I have a few on my side. The first one would be on retail international. And if you could remind us, what is the resiliency situation of the retail international line, particularly following the integration of Liberty Mutual? So has the resiliency situation been taken into consideration in the sense that it's already been under review, or should we expect some more review to be done maybe at the later half of this year? So any color on that would be really helpful. And then the second one would be on the ROE guidance for retail international. It's obviously increased from 8.5% to over 10%, but it's obviously, obviously very strong already at the first half of 2024.
But should we expect some more equity top-up for this segment, which would probably dilute the ROE for the second half for this segment? And the third and final one would be on your fair value, fair value through profit and loss, statement. So obviously, we have seen a positive impact in the first half of 2024, and can you remind us what is the inherent assumption that you have baked in, in your guidance for full year 2024 to net income? Thank you.
Yeah. So let's start with Latin America. To be very, yeah. First of all, I want to state on December eleventh, Wilm Langenbach, who is responsible within the board for Retail International, will give a deep dive on the integration work which is done, and everything there is currently on track. But we have to knock on wood, yeah, because it's a difficult task, and the people are really working in Latin America to achieve this already very good results. Second, with regard to resiliency and the overall impression, we have bought some very good entities in Latin America. We are very pleased with the technical performance of the entity. We are pleased with the quality of the management which we could add to our group, so we are very happy with the overall development. Third, with regard to integration costs.
It's normal when you start integrating companies, at the beginning, you have slightly higher costs before you then benefit from the synergies to take place. We already have seen within our numbers, quite a significant part of integration costs already during the course of the first half year, which is another positive. So all in all, we are really up so far. Everything is on track. The development by far exceeds our initial expectation, but it's also driven by a very cyclical market. Yeah, and I just want you to keep that in mind, that in Latin America, you used to have shorter cycles, and we have currently a very hard cycle in South America. And maybe we are a little bit conservative with increasing it to above 10%.
Yes, I have to admit that, but on the other side, the volatility of the cycles is down. Then you asked something about the fair value through PNL, what we've mentioned, what we have included in our guidance. So we have included in our guidance further depreciation on the real estate. Roughly, it's the same amount which was displayed on the chart. So keep that also in mind, but we expect this to happen, yeah? That we will have further depreciation on the real estate, and we haven't added anything else to the guidance on top of this, so but this is already included.
Perfect. Thank you.
Okay, then there's a follow-up question from Michael, Michael Huttner. Michael, please go ahead.
Thank you very much. So, two questions. One is, the. Well, actually only one. It was the cost advantage in, in Industrial Lines. And I know you said you'll do a deep dive on, on the Retail International on the eleventh of December, but is there any figure you can give us, any at all, on, on the, acquisitions and any, any kind of feel for where the profit lies or the ROE or combined ratio? Anything would be hugely appreciated.
Yeah.
Thank you.
So, with regard to Retail International, first of all, within the growth numbers you've seen, on a group level, without the LatAm acquisitions, the growth would have been just 8%, not 13%. On a segment level, it's 19% instead of 49% currency adjusted, and with regard to the bottom line, as it's roughly EUR 40 million what we've seen in the first quarter, and it's already including a significant part of integration costs, yeah, but not all of the integration costs. This is also clear. The colleagues who are working on it in Latin America, in particular in Chile, Colombia, and Ecuador, they've just started their work after the approval of the regulator end of the first quarter.
So there's more to come, and therefore it really makes sense to make a reassessment in December, where do we stand, to see the full picture here.
Helpful.
Okay, then and then wait, wait, wait, on the Industrial Lines?
On Industrial, could you repeat it once again? Sorry, Michael, I wasn't.
That's okay. No, no, no, it's okay. It's the cost advantage. You mentioned many times you have a cost advantage versus peers, and I just wondered if you can remind us of the figures.
So the cost ratio in Industrial Lines is still below. It's 17%, and most of the peers stand more around 24%, so it's quite huge, so more than five percentage points difference here. And this is in the DNA of the group. We really try to avoid matrix structures. We try to avoid that we have too much staff in the headquarters. We want to have the people more in underwriting and sales.
Thank you so much.
All right. Thanks, Michael. Then final question comes from Nick, Nick Johnson from Deutsche Bank. Nick, please unmute your mic and go ahead.
Hi, good morning. Thanks very much. Just coming back to Latin America, and it's a follow-up question really on reserves there. Just wondering if you can say how confident you are that the reserve prudence in LatAm is as strong as the German business? Could you possibly just talk a bit about the reserve process for LatAm and the rest of international, particularly around inflation assumptions? Thanks.
That's a good one. So given that we put the integration First of all, I should explain a little bit the resiliency concept, and then I will explain what we do in specifics for the LatAm region. So first of all, the resiliency process is as follows: Once in a year, we have an additional assessment of our reserves, of 95% of the reserves as a group by Towers Watson, and we compare the numbers Towers Watson tells us for best estimate with what we have booked. And as you could see, we published it in May. We have EUR 3.7 billion additional reserves booked if we compare this to Towers Watson. So our best estimate view is much more conservative than what Towers Watson told us.
With regard to Latin America, the CFO of Retail International and I, we have decided to include the Retail International Liberty business in the next review of Towers Watson. So we haven't done this external review of Towers Watson with the newly acquired Liberty entities. But what we have done so far is that our own actuaries have had a closer look to it, and we are very comfortable with the level of reserving we've seen, but we haven't had a final assessment of Towers Watson. So in next May, when we publish our resiliency review, once again, we will have some more insights. My overall expectation is that we won't see a bigger difference to what we have in our own entities in Latin America.
Finally, what is the difference between Latin America and the business, which we have in Europe, for instance? In Latin America, we have more short-tail business. Yeah. Given that there's more short-tail business, the overall level of resiliency is slightly smaller, as this business is winding up pretty fast. Does this answer your question?
Yeah, that's very helpful. Thank you. Any comments around inflation assumptions, or is that, that just baked into the comments.
No.
You made about being comfortable?
No, no. Yes, oh, good, good, good question. So what we do in our own actuaries, so we have, first of all, in the loss triangles, we have implicit inflation, which is derived from the past year. And on top of it, we have an extra assessment in the group, whether we need to add, with regard to the projected inflation, additional inflation buffers. And this is also done in the newly acquired companies, and this also is reflected here in the numbers. But this is a normal procedure, because inflation really matters to us, and if I look at the group as a whole, I just seen the report of the actuarial function. We have more than 430 different inflation indices, for valuation purposes and pricing purposes, which came as a surprise by the number for me, as well.
So it's really very differentiated, for line by line and country by country, currency by currency.
That's very helpful. Thanks, and well done on a very good Q2. Thanks.
Okay, thanks, Nick. And, that was the final question. Final call, is there anything, anyone? Okey-doke. So then, this was our first virtual results call. We liked it that we could see you. Hopefully you liked it, too. We'll get in touch with you to collect some feedback, in order to improve for the future. Thanks for spending time with us. Thanks for listening, and, with that, concluding remarks to Jan.
Yeah. Thank you, Bernd. Thank you for joining us here. You've seen our half-year numbers. We are very pleased about the numbers we could present to you. We are very confident with regard to the future of Talanx, given that we are growing pretty fast in very profitable markets, and, we are really looking forward to our future. Thank you for joining again.
See you. Bye.