Profit target
The aim of the Talanx Group is to generate a consistent, above-average value-added on the invested capital. We strive to rank among the most profitable five of the 20 largest European insurance groups, measured by the sustained return on equity calculated under IFRS. Our Group's minimum target in relation to profit: a return on equity that is 750 basis points above the average risk-free market interest rate over the past five years for ten-year German government bonds.
The Group's operational companies are steered using value-based ratios derived from this minimum target; their profit targets are determined individually for each company. A minimum requirement for all companies is that they must generate the cost of capital derived from value-based management. On the Group level, we ensure that the aggregate of individual company profit targets is at least equivalent to the defined target return on equity.
Talanx AG's approach to profits is geared to the continual reinforcement of the Group's capital base. This makes us more independent of developments on insurance and reinsurance markets and enables us to generate a sustained attractive yield. The dividend policy of the individual Group companies is structured by Talanx AG in such a way that the capital efficiency of the Group companies is optimized and the liquidity and capital requirements of the Group are covered.
> Capital management
