Welcome to the Topdanmark's half year report for 2023. For the first part of this call, all participants are in listen only mode. Afterwards, there will be a question and answer session. To ask a question, please press five Star on your telephone keypad. This call is being recorded. I now hand the call over to CEO Peter Hermann. Please begin. Thank you, operator. Good afternoon, everybody, and good morning to the U.S.A. Thank you for joining us in this conference call. My name is Peter Hermann, and I'm the Group CEO of Topdanmark, and with me is our Group CFO, Lars Kufall Beck, and Head of Investor Relations, Robin Hjelgaard Løfgren. We're hosting this conference call because earlier today, we published our interim report for the first half of 2023. Naturally, the news value of today's release is lower than usual, as we pre-announced the results and updated profit forecast on Monday. Nevertheless, I would like to start with a few opening remarks before handing over to Lars to comment on the results in more detail. Before going into the financial figures, let me briefly comment on the progress with our acquisition of Oona Health. Last week, we received the formal approval of the acquisition from the Danish FSA. We are very happy, of course, to have yet another piece of the puzzle laid, and we are now only waiting the approval from the Danish competition authorities before we can finalize the acquisition. The approval process is progressing according to plan, and we continue to expect closing of the transaction in the second half of 2023. As mentioned on previous occasions, we are very much looking forward to welcoming more than 200 new colleagues to Topdanmark, and also to become a leading player within health products and services. Can I have Slide 2, please? Turning to the financial performance in Q2, this was a challenging quarter. Net profit amounted to DKK 260 million, with an insurance service result of DKK 450 million, and a combined ratio of 82.3. The quarter was marked by higher claims frequencies across a few product categories. We thus saw our underlying claims ratio deteriorate by 2.4 percentage point. Lars will go through the dynamics in more detail in a minute, but let me take the opportunity to put the Q2 result into perspective. Our customer promise is that we are here to help, and that we have done in a busy quarter, where we saw higher frequencies, more fires, and cloudburst, rain, and drought. Financially, we deliver a combined ratio in Q2 that is among the best in the market, as has been the case for many quarters now. Just to be very clear, page one of our equity story states that our DNA is a focus on profitable growth in that order, and that means that we favor profitability over growth, both in the past, present, and future. This also means that we will continue to adjust our pricing in accordance with risk premia, and that goes for potential higher frequencies as well as a hardening reinsurance market. On the investment side, we posted a loss of DKK 82 million, forced mainly by the wage indexation of workers' compensation provisions. Insurance revenue grew by 1.4% in the quarter. This was low, as expected, but we are still seeing continued growth across all business areas, partly driven by our pricing initiatives, but also by up and cross-selling to new and existing customers. However, our continued work with pricing initiatives has also caused a higher churn rate, as expected. An important topic over the recent quarters has been the very high inflation. We are pleased to see further evidence that inflation has already peaked, as the Danish consumer price index continued to drop to now 2.5% here in June. As you know, the consumer price index is not a good proxy for inflation in an insurance company, as we buy significantly different goods than those included in the index. On those goods, we also see signs of falling inflation, that delivery time from suppliers is normalizing, and demand for new construction and private consumption is decreasing. This all leads to a drop in material prices in general, although at energy heavy metal materials, which we do not use to any large degree, still experience innovative price. The next phase of the inflation cycle that we also have to tackle is about real wage inflation, real wage growth. In the short term, we are in a good position to handle inflation through procurement and underwriting, et cetera, and we have already imposed inflation-based price increase across a number of products. We remain committed to our target of maintaining profitability by pricing at least in line with inflation over time. Lars, will you take us through the Q2 results in more detail, please? Yes, I will, and thank you, Peter. If we take a closer look at our Q2 results, the profit after tax amounted to DKK 260 million, as Peter mentioned. The result is affected by two main items that I would like to address: higher claims frequencies across a few products, and a negative net investment result due to a loss on the matching portfolio. In terms of the technical results, we delivered a combined ratio of 82.3 or 84.5, excluding run-off, and a growth of 1.4% in the quarter. The quarter was characterized by a high level of large-scale claims and higher claims frequencies, with more fire-related claims in house, fire and drought-related claims in agriculture, and a higher claims frequency in motor, including a few large commercial motor claims. If we strip out all the usual moving parts, the underlying claims ratio rose by 2.4 percentage points in the quarter. Motor accounted for approximately half of this deterioration on group level, as the number of motor claims increased by more than 5 percentage points compared with Q2 2022. The other half of the deterioration primarily relates to the stochastic claims within house and agriculture, as I just mentioned. The investment result was a loss of DKK 82 million in Q2, impacted by a loss on the matching portfolio, driven by two different things. On the duration part, the main negative was a spread widening on Danish mortgage bonds throughout the quarter. This overshadowed the positive effects from running yields and a lower spread between Danish and Euro interest rates. Within workers' compensation, wage indexation of provisions contributed negatively to the net investment result. As this was the main reason for our profit warning on Monday, let me try to further clarify the method by which we incorporate future wage inflation in our reserving. For the short term, we adapt a simple average of the wage inflation forecast from the Danish Central Bank and the Danish Economic Councils. These projections are updated twice a year. For the longer term, we adapt the Danish CPI market curve, plus a real wage constant based on historical average. We choose to add a real wage constant, as we see a long-term tendency that collective agreements in Denmark ensure real wage growth. Adding a constant on top of the market-based inflation curve, thus means that our reserving is quite prudent. In Q2, the short-term wage projections from the Danish Central Bank and the Danish Economic Councils increased, reflecting finalized collective agreements in the Danish labor market. The higher projections resulted in an upward adjustment in the front end of the wage curve. It's important to be aware that there's normally a time lag between changes in inflation and wage expectations. Overall, we do believe we have an appropriate hedge in place. Just to add, as Peter also alluded to, in May, the Danish monthly inflation numbers experienced the largest decrease in the last 40 years, which affected the short end of the inflation curve, causing negative valuation adjustments on inflation swaps in Q2. On the investment side, we continued the reduction of our CLO exposure, now standing at around DKK 100 million. We aim to reduce the CLO exposure further over the coming quarters. In addition to balance the portfolio against adverse shocks, we reduced the allocation to equities and added to fixed income securities for the second quarter running. Just let me quickly comment on solvency. Our solvency cover increased to 378% in Q2, mainly due to earnings in the quarter and a lower solvency capital requirement, following further CLO sell-off and the shift in investment portfolio from equity to fixed income. Our solvency cover remains elevated as we continue to hold excess capital for the acquisition of Oona Health, which, as Peter mentioned, is still expected to close in the second half of 2023. Can we have Slide 3, please? Just allow me to briefly comment on the renewal of our catastrophe reinsurance program on July first, 2023. It is evident that the reinsurance market has toughened significantly, and consequently, we decided to increase our retention from DKK 100 million to DKK 150 million on the catastrophe program. In addition, pricing increased substantially. However, in the market, we have heard intelligence of risk-adjusted price increases of anywhere between 20% and 50%, and I can confirm that our risk-adjusted price increase is definitely in the lower end of the market experience. As a consequence of the higher retention, we have also updated our assumptions for normalized weather-related claims per annum from DKK 285 to DKK 350 million. That is an increase of DKK 30 million in a normal year. As the program is renewed on July 1st, the increase only affects the second half of 2023, and that is by DKK 15 million. Let me also make it clear that we intend to pass the negative impact from the hardening reinsurance market onto our customers through price increases. Slide 4, please. Turning to the profit forecast model for 2023, which high level was provided to the market on Monday. We have narrowed the assumed combined ratio for 2023 from between 82 and a half% to 85 and a half%, to now between 83 and a half% and 85 and a half%, excluding run-off in the second half of the year. On the negative side, we incorporate the experienced higher large-scale claims and higher claims frequencies in Q2, as mentioned, as well as an ongoing impact of higher motor frequencies into the second half of the year. In addition, the net impact of hardening reinsurance markets on the renewal of our catastrophe reinsurance program was a little higher than anticipated. Partly offsetting this, on the positive side, we incorporate run-off and the lower than forecasted weather-related claims in Q2. The assumed premium growth is lowered from between 2% to 3.5% to now above 2%, based on the developments in the first half of 2023 and the prevailing competitive dynamics in the Danish market. In terms of the net investment result for 2023, that is lowered by approximately DKK 175 million, which incorporates the full year impact of the change in wage expectations on the workers' compensation provisions. As is evident from this indicates a further and no negative impact to be seen in Q3. In conclusion, the Post-tax's profit forecast model for 2023 is now between DKK 1.05 billion and DKK 1.2 billion, and that, as usually, excludes run-off in the second half of 2023. Could you turn to slide, please? Slide 5, please. Sorry, over to you, Peter, again. Opening remarks, and we are now ready to answer your questions, so please keep your questions to one or two at a time. If you have more questions, feel free to enter the queue again for a second round. Operator, may we have the first question, please? Yes. Well, if you do wish to ask a question, please press five Star on your telephone keypad. To withdraw your question, you may do so by pressing fie Star again. There will be a brief pause for the questions are being registered. The first question will be from the line of Asbjørn Mørk from Danske Bank. Please go ahead. You will now be unmuted. Yes, good afternoon, and thanks for taking my questions. I'll limit myself to two questions. First, if I could get a little bit more flavor on sort of the underlying claims trends, the 240 basis points, and I guess especially the 120 basis points relating to motor insurance. If you look at the Slide 6, it looks like prices are more or less flat year-over-year, a little bit up, but not much. I remember you did some price adjustments in the beginning of 2022. Is that basically what we're seeing now, that you have lowered prices or you sort of miscalculated the insurance risk here? Should we expect you to sort of reprice it quite significantly upwards? What exactly is it that has sort of gone wrong in the motor frequency versus your expectations? Also, I guess linking to your online claims ratio, which also deteriorated in Q1. If I just, if I don't adjust for IFRS, and look at the trends in Q3 and Q4 2022, those are also quite a significant year-over-year deterioration to your underlying claim situation. A little bit more flavor here would be helpful. Thanks. Maybe we can just start by saying that I think it's two different things, at least for this year. In the beginning of the year, we still saw, you would say, at least comparing with 2022, there was still COVID-19 effect in the books on 2022, where actually the country closed down. That we also mentioned from Q1, actually on top of that, we also saw a lot of snow in March, which actually also made the frequency go up. That was not happening in 2022. That's one thing. You can say, what about the pricing? It's true that, as also mentioned on these calls, that everyone knows how much their motor insurance costs, meaning that we have also looked into when we have, you can say, full customers, where to do the price increases. Should it be on motor, on house, content insurance, so on, so on. That's, of course, also a tactical point of view. That's the reason why you can say we haven't, you can say, put forward all of the price increases on motor alone, product by product, but looking at it more from a courtesy customer point of view. Then maybe you can say that one thing that could maybe be one of the explanations to hit this, which we are behind having a higher, you see frequency in Q2. If you look at last year, Q2, at that stage, we had the very, very high gas prices, electricity, gasoline, and so on, that made people maybe drive less. I think it's prudent that when we see, you can say frequency going up by more than 5% on motor on a quarter here, and also, yes, we have some explanation from Q1, then it's just instead of us saying that this will not probably just go away, then we have put into some, you can say, deterioration on the frequency also for the next half year, more from a pool point of view. It's actually quite difficult to compare now, because what to compare it with? There's a lot of numbers here affected by the COVID-19, and then we see a quarter very high, could be some about the gasoline and so on. It's prudent, I don't think it's to do with pricing, because we have actually put prices forward. If you can also see that it's going up again a little. I think it's important to say that the competitive situation also have made us a little more aware of not to put forward just on motor alone. I think just to underpin, it's super important to note that the challenge we see here in Q2, and which we have also taken with us for the rest of the year in terms of motor, in our forecast, is related to frequency only. When we look at our average claim size development, inflation in motor is very much under control. If I may just follow up on that, because we've seen some of your peers, reporting the same on frequency in motor, and it seems, it sounds on you as if this is sort of a teaser product. This is a product where you do not want to reprice too much up. Is this 120 basis point headwind, is that basically what we should expect going forward? You need to make up that lost revenue on other product lines, or should we see some sort of material repricing on the motor side from your side? Well, that depends on what you put into materials, but clearly, we're not gonna just lean back and say: Motor prices are what they are, and other products have to subsidize this. We will, of course, during the autumn, first of all, be looking into whether this is indeed a trend that we have assumed for the forecast. Secondly, we will also look into the details about how and where is that potential pricing measures needs to be taken. Is there also an electric vehicle element here or is it just the gas prices? Electrical vehicles are part of our motor portfolio, however, it represents what I would call still a very, very small or even insignificant part of total portfolio. That is not what's driving it. Okay, fair enough. Final question, my side on inflation. Actually, we've made quite a lot of analysis and of electrical vehicles this year to get a good and thorough understanding of the risk picture. At least when we look at it, you're right that in the early days of electrical vehicles, it was to compare with muscle cars, I would say. Very fast and people used the power of the car, so to speak. When we look at it now, it's a completely different risk pattern that we're looking into for electrical vehicles. Actually, when we compare at least electrical vehicles with a certain age, the risk premium for an electrical vehicle compared to a diesel or gas or hybrid is actually not that different. All right. Thanks for that. Just a final question on my side. On inflation, Peter, you mentioned that you're seeing inflation coming down on materials, then we're seeing wage inflation coming up. You spent quite a lot of time last year saying that your claims pattern was more like three quarters wage inflation and wages, and one quarter materials. Just wondering, these changes that we're looking into, could you sort of quantify and help us a bit on what that means on actual nominal claims inflation on your side now versus expectations, if these trends continue? We have, you can say, we have already been say in our inflation, we also put in, of course, price increases to, you can say, stick to the profitability, looking both material and wages coming up. It's true that, if wages keeps coming up, then as you're saying, actually, for some of the business lines, it's more wage and materials driving the price. Of course, you can say then we also have to look at that on prices, but we have already, you can say, in terms of our own claims inflation, then we have actually also considered the wage drift upwards when we did the first inflation-based price increases. Now you can say, if wages keep coming up, then of course, we need to go out and see if we should do more price increases on that. Indexation. Sorry, just one more thing. You can say wage inflation, at least that goes into the index that we are doing every year. You can say material inflation will not always go in there, but you can say most of the product lines is actually indexed by based on the wage. It will come in, you can say, automatically, but of course, we also need to look in if there's product line where we do need to do something more. Okay, you don't see the composition changes of wages going up. That doesn't mean that your total nominal claims inflation headline will increase necessarily? You can say, of course, we will make an inflation go up if we use more wages than materials. Just to say that the index on the product is based on the wages, so you also get the premium, you can say, automatically coming in there. All right. Thanks a lot. Thank you. Thank you, Asbjørn. The next question will be from the line of Jakob Brink from Nordea. Please go ahead. Your line now will be unmuted. Thanks a lot, and good afternoon. Lars, if I could just come back to the topic on the inflation swap and the adjustments you did Monday. Just so I fully understand, so you said after the first period where you used the central bank forecast, you would use some kind of market inflation. Is that correct? Is there any specific index we should look at? Yeah. If you turn to Slide 14, now, I get the bit, which is a new slide. We've actually tried to indicate exactly what it is that we do. What we do, as I said, is for the first, for the first years, we use the estimates from the Danish Central Bank and the Economic Councils. After that, we use the Danish API market curve from the market. What we do there is that in addition to just taking the CPI expectations, we do add a constant factor on top of that from our point of view, represents the fact that in Denmark, we have for a number of years had real growth, and that we feel proved it, that we believe is proven to add on the CPI curve as well, to make sure that we don't get a tail that bites us, once real wage growth occurs. Okay. 1%, actually. The moment, this constant factor, at this point in time, is 1% flat that we are adding on to the CPI curve. That will remain flat. Even let's say, CPI goes up or down with whatever, you'll keep one? Yeah, we will keep the constant factor, at least for now. The CPI, the constant factor is the same for all the years and all the, and all the axis of the, of the CPI curve. Okay. We can change this, you can say, this wage constant here. We base that on a historical average. At the moment, it's 1%. If, for example, we see going forward that wage will actually grow, will be more than 1% on top of the, you can say, inflation, then, of course, we'll use that. For now, it's one. Just remind me, so how much of this is new? What did you do last year, for example? What inflation did you use then? You like the answers? This is exactly the same method that we have applied all year long. Okay. Isn't it fair to, I know we didn't talk about it last year because it was all baked into your technical profit, your inflation swap, I presume, would have gone up in value quite a lot last year, while maybe? Actually not last year, because remember that, well, you know that the valuation of the inflation swap is not based on actual inflation, but on inflation expectations. Inflation expectations already increased in 2021. The majority of the positive impact actually came in 2021. Three into four in 2021, and actually also something in the start of 2022, but most in 2021. It's a long hedge, you can call it. I guess these inflations or this inflation swap support you had then in, let's say, latter half of 2021 and beginning of 2022, I guess they hit your technical profit and we didn't adjust for it. Isn't that also part of the headwind we're seeing now? I guess you must have had a fairly significant support to your underlying combined ratio last year from the inflation swap. It is important to note that it does not impact us that much. The impact is clearly on the already established provisions for annuities and capitalizations. It impacts the already existing provisions on the balance sheet, and hence you would see it in the run-off results, which is where it ends up. That's the main part, because I think 55% of our, you can say, abilities or provisions, that is actually workers' compensation. That's the main part. That's, you can say, more going run-off. It's true also that you can say, looking at the years on workers' compensation also be hit a little, but every new claim will be a little more expensive, but that is the minor part in the total picture. Basically, the... I'm just thinking now. Basically, we should expect if the no, now it's, now it's in a different line. Okay, fair enough. I think I get it now. If I may just, Peter, on our usual discussion, you mentioned again that you've in the beginning, you wanted to stress that, of course, you do only profitable growth. Could you then tell me what is profitable growth in your view? Yeah, that's a good question. I think actually, if you look at the, you can say, from a trend, you would say at least we have been working for a long time, actually improving our profitability, I would say, and also show to that on the meeting you had with some of your investors the last time. If you look at the trend, we've actually been running a better and better business. You can say combined trend that's going downwards. At the moment, we have to offer to you and the market that, yeah, we don't have the highest growth, but we think it's important that we still grow the prices also when we're talking about frequencies, as Lars mentioned, but also we insure prices. That, of course, can affect both the return and we will do that in order to protect profitability. It's I think it's I know what you're pointing to. I think that one quarter where we have, you can say, a lot of stochastic, very institutional, anything else, buyers and so on, I wouldn't use that to conclude that now it's going the other way around. I'm not that. I'm still confident about that we are doing the right things. Of course, sometimes thing happens with a time lag. We need to have some time to put in the right, you can say, prices and the right way to do it. I still think that we are still going towards having better profitability over time, and then growth will come up, whether that's low or high, let's see. Depends on the level as well. Okay. Good to hear. Thank you. Okay. Thank you, Jakob. The next question will be from the line of Yudis Chiguri from Alzheimer's Research. Please go ahead. Your line now be unmuted. Good afternoon, everyone. I'll ask two questions to start with, if I may, please. The first one, if I can go back on your comments on motor. It sounds like you're saying you're kind of in a wait and see mode about the increase in frequency, and then depending on, you know, whether you see a trend, then you will adjust prices. The reason you're doing that is because of the competitive situation. Is that, did I hear correctly? Yeah, you can say that, we are looking as, just to repeat a level, we have seen higher frequency, yes. We have, prudently, we think, put in some more frequency in the second half year than we expected, due to the fact that we have now seen higher frequencies in some quarters. We don't know whether due to the fact that it's quite difficult to compare with what actually, what is the reason. Maybe it is the reason that there were high gasoline and electricity prices last year. That, of course, could be a positive, if it doesn't keep on going. Of course, if frequency keeps up, then, of course, we also look into the pricing. What I mentioned is just that motor is, of course, also a product that you can change prices on. We have just said until now, we have been a little more reluctant in using that. Still, if you look at the page 6 on our letter presentation, we have actually from 2020 going forward, also raised prices on motor. I'm just saying that it's a little more tricky and competitive situation, but we will do that if that's necessary to protect the profitability. No, no, I get the point, you've increased prices in the past. The point is whether they were high enough, right? I mean, I get there's a hesitation to increase prices further, like get ahead of the curve, because, you know, you, I guess you think you might lose volumes. Is that a fair, a fair description? It's maybe fair, to say that, but yeah. I think it's important that we will do it, we have done it. You can say it's being in, ahead of inflation here. No, we have not chosen to be ahead of inflation on most of we have been ahead of inflations on the other lines. All right, okay. Then the second question, I'd like to go back to on the inflation swap accounting. Obviously, look, in last quarter, you basically, you know, you revised up your wage inflation assumption, you took a reserve charge, at the same time, you lost money on the inflation swap. When you say there is a substantial lag before, you know, these two things come in line, so you're kind of saying that: well, in the next review of the Danish Central Bank and the Council, you would expect that they bring down their wage inflation, because that's the only way, you know, then, you know, you reverse this impact, right? I would be surprised if for the next release that come from the Central Bank and the Economic Council, that they actually take down wage expectations in the short end of the curve. Uh-huh. we are finding those estimates in the, in the short end of the curve. Right. When we look at the hedge over a time period, what we've done internally, is to look at the period from 2021, which was where inflation expectations started to rise. Looking until the end of the year, where we now have the increased wage inflation expectations from the Central Bank and Economic Council. When we look at this in the aggregate over the period, including the updated full year forecast, which I alluded to, that there's also a negative impact in Q3 in that from the increased wage inflation. When we look at the forecast throughout the year on all known factors, we actually have a very, very good hedge in place. Right. We see the basis what gives us the impact, not only in terms of positive or negative signs, but actually also magnitude. It does give us the hits that we're looking for, but there is a time lag of between 18-24 months. In that, having said that, I think it's also, of course, important to remember that what we've seen over the last 2 years is unprecedented, at least for many, many years. I know I'm not that old, but at least in my time, it's unprecedented, so it's been some very, very volatile inflation expectations that we have seen. That filters through, and hence, the impact and the effect of the time lag is more visible now than what it would be in a normal environment. Right. No, no, I appreciate that. I fully appreciate that. I'm just wondering then, in that case, if, for example, if you could provide, let's say, on the reserve side, the sensitivity of your reserving to, let's say, changes to short-term inflation, if that's possible, in the future? Similarly, maybe, provide us, you know, like some indication of how we can best measure these movements. You know, I appreciate what you said, that, you know, you've got a good hedge, but obviously they can have quite a material impact in the quarter. Yeah, thank you so much. I should actually have probably have said that in the, in the instructor notes, that what we are planning to include in our Q3 investor presentation, is a new slide that both gives you the reference to where the updated wage inflation expectations are actually published, and also give you a sensitivity analysis as to what wage inflation increases or decreases, what impact that will have on our workers' compensation provisions. We will for Q3 investor, if not sooner, we will have a slide giving you that exactly so you can do your pre-closing analysis and consensus estimates yourself. Okay, great. Thank you. Thank you very much for your time. Thank you. Just maybe one more comment, just about the motor, just to tell you that we still have a satisfying combined ratio on motor, just to make that clear. Thank you, Yudish. The next question will be from the line of Jan Erik Gjerland from ABG. Please go ahead, Gjerland, now you're unmuted. Thank you for taking my questions as well. I just had the follow-up on the weather and drought, which seems to be sort of a little bit more far-fetched now. How important has that been to your second quarter weather-related stuff? How do you think about that for the second half of this year? How much is built into your sort of expectation now, last Monday, when it comes to the drought, into the equation there? Secondly, my second question is for Oona. Could you just shed the solvency or adjusted the solvency ratio for Oona? Have you had any update on Oona's expectations for 2023? How was the Q1 or the first half results for Oona? Could you shed some light to that? Thank you. I think if I take the last one first, what I meant was that the solvency cover we have of the 378% end of Q2, is elevated compared to where we would normally be, and that is because we still hold equity to pay for the Oona acquisition. Hence, that's why it's updated. In terms of Oona performance, no, we do not have anything to disclose on that. Just in terms of drought, I'm mentioning that we are saying that, you can say now, Lars also described that it was a deterioration in the underlying, half of it was from motor. The rest, you can say, is actually from frequencies. ... due to fire, fires in private houses, but also fires in agriculture business. Actually, we have a okay level of fires in commercial, and then we also have the drought. You can say that as we are the only company, insurance company in Denmark, having the crop insurance, of course, when you have a drought, that can also give you some claims. You can say that is maybe around DKK 10 million in the quarter or something for these kind of claims. Of course, there could be a potential going forward. Also, if you look at drought coming into the second half of the year. On the other hand, it's raining in Denmark at the moment, so who knows what's going to happen? Just to make a little, just to give you a heads up here, if we take all of our exposure to crop insurance, then it's a little over DKK 50 million, you can say, in total estimated max PNL, estimated maximum loss. It's not the biggest exposure at the moment. Of course, that could have an effect going into the second half of the year, depending on how much the rain will take away the drought and so on. Okay, thanks a lot. Thank you, Jan. The next question will be from Vinit Malhotra from Mediobanca. Please go ahead, Vinit, you're unmuted. Yes, good afternoon. Thank you for the opportunity. My two questions, please. One is the motor inflation or frequency, or the commentary, which you said, should remain high into second half. I think you mentioned somewhere in another answer that it was a prudent assumption. I'm just curious if it was a prudency or just, or you have some reasons why, this trend should continue in second half? Second question is just on the wage inflation topic. In my sense, my sense was that the wage inflation, the wage negotiations went on for quite some time last year, and then after much debate, we found out the numbers already, maybe February, March. Isn't this another way to think that, okay, we've known for a few weeks or months what the Danish wage inflation agreements are, or wage increase agreements are? How should we explain to investors that, okay, if we knew the Danish wage inflation agreement, why is Topdanmark making a change now into Q in this way? Thank you. If we take the last question first. Labor union agreements was negotiations were finalized, at least in the month of April. As we stated also in the slide on wage indexation in the presentation, there is some processing time before the Danish Central Bank and the Danish Economic Councils comes out with their updated forecast. That is what we used. You are perfectly right saying, well, okay, that came out then in May, which is actually when it came out. Shouldn't you have known this in May? There we just have to say, yes, we did know already in May what's the wage indexation would be like, and we could have calculated the effect. It's important to note that, of course, we look at the overall PNL of it, hence the warning that came out on Monday when we looked at everything in combination, and also hence the lessons learned as I said to Julius just before. We will put out a slide that shows you the sensitivity on the provisioning side to daily wage inflation changes, so that you have an opportunity to actually do this yourself, and also so that we also have a little better foresight or sight into this. Yes, you're right, this is an IFRS 17 first time adoption level, and an area where we will improve. Thank you. In terms of motor, what I said was that when we look at average claim size development, inflation seems to be under control. It's not that we don't have the inflation on motor, because of course we have that, but that is very much under control. When we look at this, the challenges we have in Q2 on motor is entirely related to frequency. Then as any actuary or statistician would say, having one data point, which is what we have now, is not enough to decide whether it's a trend or not. What we have, for prudency, done is to assume that this is actually a trend, so that we have a worse claims frequency on motor in the second half of the year, compared to what we had anticipated when we did our last forecast. That is what is baked in or built into our, to our updated full year profit forecast. There is a potential upside if it turns out to be a little better than... If it's only one quarter, yes, then the increased impact from that we have put into the forecast is potentially an upside. Again, as we also said, that only explains half of the underlying. The rest of the underlying development in the quarter is from stochastics claims. I think it's important for everyone to remind ourselves that it's an insurance business that we're running, and you will see stochastic elements to our claims experience on a quarter by quarter basis. Of course. Okay. Thank you, sir. Thank you. Thank you, Vinit. The next question will be from the line of Martin Gregers Birk from SEB. Please go ahead, your line now will be unmuted. Thank you so much. First question on net investment income. We have seen the dividend go out. We have seen we still see some excess capital towards the Oona transaction, we also see run-off are going up. What is a an annualized run rate of your net investment income going forward once the Oona transaction has closed? That would be my first question. Then second question on reinsurance. You mentioned the reinsurance price is up, but so is your net retention. If we had assumed that you would have kept the DKK 100 million net retention, how much would that have impacted your reinsurance price? If we take, as usual, take the last one first. We don't disclose that. Naturally, in the process, we evaluate all scenarios, and we also had pricing indications for the first DKK 50 million of coverage. decided that that was not worthwhile in terms of risk and reward. Then you can look at how we have updated our annualized modeled weather or cost to weather and make your own calculation as to what does that then imply for prices. Clearly, I think it is a DKK 100 million layer in today's market would be exchanging money and nothing else. Okay. In terms of the annualized investment results, post Oona, assume you will get that when you look at our profit forecast for 2024. But until then, I would, in your Excel sheet, I would probably put in something around DKK 100 million or so. Yeah. Okay. Thank you so much. Thank you, Martin. The next question will be from the line of Faizan Lakhani. Please go ahead. Your line will now be unmuted. Hi, this is Faizan from HSBC. Thanks for taking my questions. I just wanted to sort of come back a little bit to the frequency and sort of more of a helicopter view. I guess I'm a little bit confused in terms of saying you're talking about being at very, very low combined ratios and then talking about issues in motor frequency. Is there a view that actually you're now at the right level of profitability, and you're willing to take the headwinds in motor going forward in order to maintain competitiveness? Will you look to actively price it and come back down to sort of the combined ratios to adjust for that? I guess the same sort of sentiment on the reinsurance change as well. Will you be looking to reprice to factor in the DKK 30 million they're doing DKK 30 million headwind next year to the reinsurance as well. If you just help me understand that would be great. In terms of going forward and the outlook beyond 2023 on premium, you still seem to be going through a lot of rates. Do you have any intention to really grow volume significantly from here, or should we expect, you know, 2%-3% growth rates going forward? Thank you. If we take the easiest one, I think, which is the reinsurance part, and thank you for the question, Faizan. As we also write out explicitly in the report, we intend to pass the negative impact from the hardening reinsurance market onto our customers through price increases, so that is the plan. I think in motor, what we said, we have definitely not said that we're not gonna work with prices in motor. What we have said is that we've now had one quarter, one observation, and before we judge whether that's a trend or not, we have to get a little bit more data. In parallel with that, of course, we are looking into the pricing structure and risk premiums of our motor insurance. I think that's as close as we can get it. Going, if you look at the growth, no, we're not guiding for 2024 yet. Just to say that we have said overall that we, again, the profitable growth, that we will align our growth, you can say, with market. We think that we should have growth in accordance, in line with the market, sometime better growth to the GDP or something, growth in society or something. That's. Yeah, it depends on a lot of the things, because there could be other things. We were a little in front of the curve. In one place, had a little more churn and so on. If there could be some competitive situation where we could either increase prices more and keep the same growth, or we could maybe, let's say, take some more market share if we were in a good situation. We cannot give you a full answer on 2024 yet. We will do that when we reach the last part of the year here. Going forward, I think that overall it's around, it's around the GDP or something, the market growth then. Okay, thank you very much. Thank you, Faizan. As a reminder, please press five Star to ask a question. The next question will be a follow-up from the line of Jakob Brink from Nordea. Please go ahead. Your line now be unmuted. Thank you. Just a few follow-up, please. On your growth rate, we obviously know in Denmark that there is not that high of a price sensitivity for especially for retail clients. Many of your competitors are significantly cheaper, and they do not take markets here. What do you think the actual problem is? Is it lack of partnerships? Is it, I mean, any indication, please? We can at least see that, when we have working prices for some while now, we can see that, we have had a higher share, which is okay when you look at the overall profitability. This is, of course, always a question of volume times a combined ratio. What is the most efficient? Is it have a high growth with a poor combined, you can say absolute number, or is it got the best combined in the world and not that much growth? For us, it's, you can say it's a matter of getting the best, what you call efficient ramp, so to speak. What, where's the best place to be here? I don't think there's a straight answer to that. That will depend on the competition situation as well. We will still work towards, you can say, improving our profitability in absolute numbers. I'm just wondering, so, I mean, if you look at some of your customer-owned competitors, they're cheaper, at least on the headline, they're significantly cheaper than you and some of your larger competitors. Everyone are raising prices. Even some of the mutuals have cut their customer bonuses this year for the first time in a very long time. Still, you're not very growing, or growing very much. It just seems like maybe it's not just a pricing thing, that it's something else. I think it's, I think it's fair comment that, at the moment, what we are, say, spending a lot of time and money, say, in developing for the future in our courses. We are not, you can say, at the moment, we've not produced a lot of new products to the market for a while. We have, of course, introduced the new cyber insurance and so on, but we haven't put all our effort into putting new products to the market, for example. It's like a new product, change of job insurance. You can say that is something that we think is more important that actually to be even more efficient and develop for the future, instead of just coming up with new products that we think it could have a little more growth on in the short run. That's, at least one explanation for what or how we are prioritizing. Okay. Makes sense. We know that Peter also allude to. We have seen an improvement in here, and also seen a lower outflow in terms of number of business this year compared to the previous years, as we've also said that we would. Of course, also here, there is a time lag from the trend turns, the actual growth in your earned premium. That still hurts us from an earned premium point of view. Actually, on the price increases, you've said it quite a few times that you're ahead of the curve. If we look at page six in your own slides and the trend in average premiums, I agree that it was a very rapid increase in 2021. As far as I recall from then, it was. The whole explanation back then was that you had gotten behind the curve, and inflation didn't really pick up until mid 2021. This was more of a repair of something that basically, that you didn't have the right pricing on the housing product due to pipes and whatever. If 9%-10% of this increase was related to basically catching up to where you should be, you have only around 5% or so left for two years, which is not enough to cover inflation, I guess. Isn't the problem more that you had gotten behind and then you sort of panicked and raised prices too much in one go, rather than it's you being ahead of the curve? No, the price increases that we take that back then was actually not related to prices, to inflation, that was related to a number of other challenges that we had in the housing product back in 2020, where we had a number of activities to improve profitability within house. Price was only one, but actually the smaller element to that profit return to a profit improvement program that was run. That also included, as we talked about before, the procurement initiative and also very much a significant improvement in quality doing on site assessment, et cetera, et cetera, before risk was actually underway. That was only one part of the profitability improvement project that we were running. I don't buy the way you did your calculation work. I'll also say that from a, again, not just a quarter, you can say the trend of the combined ratio. I think in the Danish market, we have been in front of the curve because we can see that we and you can say at least we are in a market that also have competitors with different ratio. You can say we're not saying them front, now, we are some more than in line with inflation now protected. I don't know if my, you're breaking up a bit, so maybe you didn't hear me, because that was exactly last what I said before, that the price increases you did in 2021 was not related to inflation, but to all kinds of other problems. If you take 9% out of this red or purple line, then there's only 5% or so left, which doesn't seem like a lot to cover inflation. That's what I say, you can't say, you can't do nine minus five, because the nine was only one element out of the profitability improvement, projects that we did on houses. Actually, the smaller part of it, if you look at the total improvement that we saw in our, in our housing portfolio. Okay, now I may, I'll maybe give you a call later, but, I'm not sure I understand. Just a final one on the swap. What was the negative impact specifically of the inflation swap in Q2? I think it's minus DKK 6 million. It is in the report. Yes. Oh, that's fine. I can find it. DKK 6 million. Okay. Thanks a lot. Minus DKK 6 million in the quarter. Yes, Jakob. Thank you, Jacob. As there are no further questions at this moment, I'll head back to the speakers for any closing remarks. Yeah, thank you. Thank you for taking the time to attend our conference with all the good questions here. As you know, you're always welcome to reach out to Robin if you have any further questions. We wish you all a pleasant rest of the day and hopefully a good summer. See you. Bye.