06 Chap. 1 MANAGEMENT TO OUR SHAREHOLDERS Your company, the AMB Generali Group, has not only reached its ambitious targets in the closed business year, but it has by far exceeded most of them. Already in the middle of the year we had raised our original earnings target from 380 m to 400 m for 2007. We even exceeded that target slightly and increased our Group net profit to 417 m, up 21 percent from 346 m in the previous year. Thanks to the prosperous diversity of our distribution channels, the total premiums of insurance business increased by 2.7 percent to 13,768 m. For the fourth consecutive year we have thus achieved a stronger growth than the market. This success is supported by all insurance segments. In life insurance we continue to benefit from our top position in the Riester and basic pension business. The new business of our life insurers again witnessed a better development than the market. The growth of total premiums was also noticeably stronger than in the market and we were able to expand our market share again. Our health insurers are acting in a market which continues to be dominated by the parameters of the healthcare reform. Although access to private health insurance has become more difficult for customers, we nevertheless succeeded in achieving growth above the market level also in this sub-segment. In property and casualty insurance we continued our strategy of concentrating on prof- itable customer segments. We again surpassed our target of growing in line with the market and gained market share in this segment, too. At the same time we were able to keep our combined ratio below our target of 97 percent, despite the repercussions of the storm "Kyrill" and the ensuing claims expenditure for the Group. In this field we benefit from our underwriting policy oriented on profitability and from the initiated measures to improve our claims and cost position. You as our shareholders will benefit from the positive development of your company. The Board of Management and the Supervisory Board propose to the General Meeting to increase the dividend from 2.30 to 2.90 per unit share, which equals a 26 percent rise. In the future we are set to further expand the success we have achieved by means of targeted measures. One of the focus areas of our strategic enhancement is the merger of our two multi-channel insurers, Generali Versicherungen in Munich and Volksfürsorge Versicherungen in Hamburg. The target of this merger is to reduce complexity within our Group, shape structures more efficiently and cut costs. We thus aim to sustainably increase profitability and distribution strength and are set to reinforce and expand our position as one of the leading providers in the German primary insurance market with regard to the quality of our services and products as well as in terms of profitability. Dear Madam, Dear Sir,