“Think globally – act locally” – Vienna Insurance Group also follows this guideline when making investment decisions. In the area of infrastructure investments, this means supporting local infrastructure projects that bring sustainable improvements in local living conditions. An example is its ongoing involvement in providing affordable living space in Austria. At the end of 2016, Vienna Insurance Group had around EUR 3.7 billion in investments in non-profit societies that build and renovate homes with affordable rents. This gives a broad section of the population access to low-cost and – due to the unlimited term of most of the rental agreements – long-term housing. In addition to increasing the stability of the housing market, this also promotes social solidarity, which is an important contribution given the increase in rents, particularly in metropolitan areas. The extensive use of renovation in social housing also reduces heating energy use and therefore makes an environmental contribution. The focus on multi-story buildings also increases density, thereby reducing space use.
A central factor in Vienna Insurance Group’s investment philosophy is its ongoing investment in government bonds. These investments in local government bonds form an important part of the securities investments made by VIG insurance companies in CEE region. These ongoing investments by Vienna Insurance Group provide long-term capital to help meet the funding needs of CEE countries.
A responsible investment strategy is particularly important for life insurance, given the long-term obligations that are created. Ensuring that these obligations can be fully satisfied in the future is a top priority when investments are made. The life insurance companies in the Group are required to use appropriate control measures to ensure that this is the case. Internal analyses of maturity matching are performed regularly in the Group using current market parameters (yield curve).