Swiss Re

The overview

Swiss Re is an international reinsurance company, employing around 10,000 people across 55 offices in 20 countries. Its global headquarters are in Zurich and its UK operations are based at 30 St Mary Axe in London, a building better known as ‘the Gherkin’. In 2010, the UK was its second largest market in terms of net premiums earned and fees from policy holders – second only to the United States.

What is reinsurance and what does Swiss Re do?

Reinsurance is essentially insurance for insurance companies: insurers enter into reinsurance agreements with reinsurers to cover their losses in the event of large (or a large number of) insurance claims by policy holders, for example in the wake of natural disasters.

Swiss Re specialises in providing reinsurance products and services within the property and casualty, and life and health, insurance sectors (casualty insurance protects individuals or businesses against losses for injuries done to others or damage of others’ property). However, it also provides insurance-based finance and risk management products and services to businesses and the public sector.

Swiss Re is generally recognised as one of the more stable reinsurers.

Clients

• Insurance companies
• Insurance and reinsurance brokers and agents
• Corporations and businesses
• Governments and NGOs (non-governmental organisations, which are typically charities and aid organisations).

Company divisions

For the purposes of graduate recruitment, Swiss Re categorises its functions as follows:

• Reinsurance client markets: this division works with reinsurance clients, first identifying needs and then suggesting appropriate products or services.
• Corporate solutions: this division provides insurance and/or other solutions to companies and businesses.
• Admin Re: this division takes over and administers existing policies (often ‘closed-book’ policies that are no longer available to new customers) through reinsuring them, or through acquiring (in part or whole) other businesses.
• Asset management: this division invests the income generated by the other divisions.
• Products: this division develops new products and completes underwriting and actuarial operations.
• Risk management: this function assesses the company’s exposure to risk; duties include internal auditing to ensure that the company carries out risk-management processes effectively.
• Finance: management of the group’s finances.
• Operations: general operational functions within the company such as IT, legal and human resources.

Swiss Re’s post-credit crunch strategy

Traditionally, insurance and reinsurance companies have been big players in the markets; investments made by companies in the insurance industry can keep insurance premiums down. However, these companies were heavily exposed to the financial products that generated big losses during the credit crunch. As a result, Swiss Re has recently focused on re-capitalisation (that is, building up its cash reserves).

Chief executive Stefan Lippe won 2011 CEO of the year at the Reactions magazine awards.

It’s now generally recognised as one of the more stable reinsurers; the company is estimated to trade the lowest ‘book value’ of the five largest reinsurers – investing around 63% of its capital reserves.

The company claims that it remains competitive due to its underwriting skills, ability to innovate and capacity to handle large transactions.

Awards

In the past year, the company has been recognised by the following organisations:

• The company won ‘deal of the year’ awards in 2011 from The Banker and Trading Risk magazines for its Kortis longevity trend risk note issue.
• It was ranked as one of the world’s most ethical companies in 2011 by the Ethisphere Institute.
• The company was awarded rehabilitation initiative of the year in 2011 by Post Magazine for helping staff with mental health problems to get back into work.
• Chief executive Stefan Lippe won 2011 CEO of the year at the Reactions magazine awards. The company also won the ILS (insurance-linked securities) adviser of the year award

Salary and benefits

The company states that salaries for those on the graduate scheme are ‘competitive’. This can be hard to gauge in the insurance and financial services sector because the range of graduate jobs available is so wide, but graduate trainees can expect a starting salary of between £20,000 and £26,000, depending on the job and location.

The benefits package

Benefits include:

• 25 days’ annual leave
• Discretionary bonuses
• Subsidised gym membership
• Life assurance
• Pension scheme
• Season ticket loan
• Share options

Culture and values

Swiss Re makes much of its initiatives to be a socially and environmentally ‘responsible’ company – principally in the following ways:

• To help tackle the issue of climate change
• To ‘nurture’ and develop its employees.

Climate change

The company’s 2010 corporate responsibility report states that the company aims to help tackle the problems of climate change by:

• Furthering knowledge of climate change, quantifying the risk and, where appropriate, providing clients with offerings that mitigate the costs of climate change effects.
• Raising awareness of, and influencing attitudes towards, climate change among the business community.
• Ensuring its own activities are environmentally friendly.

Swiss Re has been carbon neutral since October 2003.

It certainly seems to be having at least some success reaching some of these objectives. For example, in November 2011 it sponsored a report by the Economist Intelligence Unit into managing risk into renewables. Swiss Re has also been carbon neutral since October 2003 and by 2013 it aims to reduce its carbon footprint per employee by 2013 against the 2003 measurement.

The focus on climate change is conceivably driven by business needs as well as ethical concerns: an increase in natural disasters caused by, or exacerbated by, climate change will pull on the resources of reinsurance companies. Whatever the motivations, Swiss Re is clearly not an employer for climate change disbelievers!

People development

The company literature emphasises a culture in which promotions are common and that everyone’s perspectives are valued. As well as training opportunities for graduates, progression into senior management is supported by an ‘onboarding’ – or induction – programme. The company also operates an ‘employee assistance programme’ to help with any financial or emotional issues.

Graduates and senior executives at Swiss Re interviewed by TARGETjobs City & Finance have testified to the meritocratic nature of the company. A CEO of life and health moved to Swiss Re after qualifying as an actuary and said that in the ten years he’d been with the company, ‘I’ve had the opportunity to experience a variety of roles and different markets, as well as having a secondment with an investment bank.’ One graduate said: ‘My opinions are respected by more senior staff. I identified a contentious issue and successfully defended my findings to management.’