Summary
- ASR Nederland grew its operating profit by 47% to €1,428 million in 2024, driven by strong performance across all segments and the successful integration of Aegon Nederland.
- The Solvency II ratio increased to a robust 198%, supported by €1.2 billion in organic capital creation and the sale of Knab, creating ample room for dividend growth and share buybacks.
- ASR is well-positioned to benefit from the Dutch pension reform, recording €2.77 billion in DC contributions and €581 million in annuities, reinforcing its leadership in pension solutions.
- A combined ratio of 91.9% in non-life insurance outperforms peers, highlighting ASR’s underwriting discipline and operational efficiency compared to NN Group, Allianz, and AXA.
- With a ~6% dividend yield and a forward P/E of around 10x, ASR offers an attractive mix of growth, capital returns, and value for long-term investors.
Introduction
Early 2025, CEO Jos Baeten of ASR Nederland and some 2,500 (former) Aegon colleagues said a festive farewell to Aegon’s former head office in The Hague. That meeting marked the successful integration of Aegon Nederland into ASR – an acquisition that made ASR considerably larger in one fell swoop and immediately contributed to strong results. Not only is the integration well on track, ASR also recently rewarded its shareholders with an 8% higher dividend for 2024.
These developments form the core of the investment thesis: ASR has increased its scale, is booking record results and is distributing more capital, which raises the question of whether the stock is now an attractive buy. ASR’s share price initially reacted cautiously to the Aegon deal news in 2022 (due to share issuance and integration risk) but recovered strongly in 2023-2024 as integration benefits became visible and higher interest rates supported the sector. The stock closed 2024 around €55, with a P/E ratio of 10x and a dividend yield of around 6%, still reasonably priced relative to its peers. In this article, we analyze whether ASR Nederland is an attractive buy based on market developments, performance and valuation, and conclude with a substantiated investment rating.
Pension Act, Interest Rate Advantage And Scale Give ASR An Edge
ASR operates in a financial sector that is undergoing major changes. One of the most important structural trends is the Dutch pension reform. With the new Future Pensions Act, the Netherlands is transforming from guaranteed benefits to a premium system. This creates opportunities for insurers: employers and pension funds are looking for partners for buy-outs of existing pension schemes, and participants are paying premiums into new individual pension pots. ASR is excellently positioned for this.
ASR Nederland has a strong presence in collective pensions and a growing platform for defined contribution (DC) products. In 2024, ASR recorded €2.77 billion in DC premium contributions and €581 million in annuity contributions, while the assets under management in DC pensions grew to €26.7 billion. I expect that, thanks to this acquisition and its combination of expertise and scale, ASR will be one of the winners of the new system and will capture a large share of the new pension premiums and pension fund outsourcing.
A second factor is interest rate sensitivity. Insurers such as ASR benefit from higher interest rates because investments yield more and future obligations become less valuable. With a Solvency II ratio of 198% at the end of 2024, ASR is benefiting fully from the increased interest rate. In the second half of 2024, a fall in the market interest rate even resulted in revaluation profits on the investment, which boosted the IFRS result on a one-off basis. Of course, ASR remains sensitive to major interest rate and market movements: an abrupt fall in interest rates or stock market correction could depress the capital ratio and reduce investment returns. However, my view is that ASR is prudently covering its interest rate and market risks and that the current capital buffer is sufficient to absorb normal fluctuations.
Consolidation in the insurance market is a third important theme. Following the recent takeovers, the Netherlands now has only a few dominant insurers (NN Group, ASR and the Achmea cooperative). This consolidation reduces competitive pressure somewhat, but the remaining players have actually become more efficient and capital strong. ASR has significantly increased its scale through the integration of Aegon and has already achieved cost benefits.
For example, the cost ratio in non-life insurance decreased slightly to 8.1% in 2024 thanks to synergies. The combined ratio in non-life (P&C + disability) also improved significantly to 91.9%, better than NN Group’s 93.1% over 2024. This indicates that ASR is currently operating more efficiently or profitably in non-life insurance than its largest domestic competitor. NN Group does have a broader international portfolio (for example, NN is active in Poland and Japan), but ASR’s focus on the Dutch market has clearly paid off in the form of sharp underwriting results. ASR’s solvency is also slightly stronger (198% vs 194% at NN). ASR is also performing excellently at European level. Major players such as Allianz and AXA had similar combined ratios in the 91% range in 2024, so ASR is on a par with these giants in terms of profitability. Of course, ASR’s activities lack the broad geographical spread of Allianz or AXA, but the focus on the Netherlands has paid off so far due to rapid synergies and thorough market knowledge.
However, insurers must also meet stricter sustainability requirements and invest in technology. For example, ASR is steadily reducing the CO2 footprint of its investments (–5% in 2024) and is increasing the share of impact investments in the portfolio, in line with major industry peers. In addition, the sector is investing in AI to handle claims faster and assess risks more accurately. ASR is doing this by digitizing; effective application of AI can help keep costs low and stay ahead of competitors.
ASR Posts Record Profit And Strengthens Capital Position After Merger
The 2024 annual figures of ASR Nederland provide a clear indication of the financial strength of the merged company. Operating profit increased by 47% to €1,428 million. All segments contributed: Non-life saw its profit increase to €469 million with a combined ratio of only 91.9%, Life almost doubled to €1,076 million, and the fee business also grew strongly. The operating return on equity increased to 13.1%, well above the target (>12%) and confirms the structural profitability.
Furthermore, the capital position is excellent. The Solvency II ratio increased to 198%, partly due to strong organic capital creation of €1,193 million (+36% Yoy) and the sale of banking subsidiary Knab. With such a buffer, ASR has room to return capital – a share buyback of €125 million is ongoing – and the increased dividend is amply covered by the free cash flow. Some positives in 2024 (such as mild weather and high reinvestment gains) were incidental. However, most of the improvement appears to be structural. The intended cost synergies of €215 million by 2026 be fully realized in the coming years, and additional premium income from new pension contracts and buyouts is expected to continue to grow. After completion of the integration (expected in 2025-2026) I expect ASR to continue healthy growth, albeit at a slightly more moderate pace after 2024. Analysts predict a slight normalization of profit in 2025 (after the exceptional 2024), followed by renewed growth in 2026.
Dividends and Valuation
ASR Nederland is increasingly profiling itself as an attractive dividend stock. The dividend has been increased to €3.12 per share for 2024. At the current price of around €56, this means a dividend yield of approximately 5.5%, which is higher than the market average and competitive with peers. For comparison: NN Group paid out a total dividend of €3.44 for 2024, good for a yield of approximately 6%. International players such as Allianz and AXA offer around 4 to 5% dividend yield. ASR is therefore at the top end, which may be because the company pays out a large part of its profit. The dividend payout ratio is around 60-65%, which is reasonable for an insurer, especially given ASR’s strong capital position. In addition, ASR has a conditional policy: no dividend will be paid if group solvency falls below 140%. With almost 200% solvency, there is ample room. The dividend policy focuses on stable growth, the payout per share has been increased in recent years (from €2.42 in 2021 to €2.89 in 2023 and now €3.12). Investors can therefore count on an attractive dividend in addition to the price return.
Not only the dividend, but also the current valuation of ASR is attractive. Below we compare some key figures of ASR with sector peers:
The table shows that ASR is valued comparable to other European insurers (all around 10x earnings). However, compared to NN Group, ASR is trading at a substantial premium to book value. ASR trades at 1.3x book value, while NN is trading at around 0.7x. This is partly because NN’s book value is relatively high due to accounting effects, while ASR has a higher ROE of 13% than NN (10%). Investors are therefore paying a premium for ASR’s more efficient use of capital and growth perspective. Compared to Allianz and AXA (P/B 1.0-1.2x), ASR is slightly more expensive, but not excessively so.
In my view, these differences are justified. NN struggles with a more complex legacy and lower growth, Allianz/AXA have scale but a moderate growth rate; ASR, on the other hand, combines healthy growth with a high dividend.
The current consensus price target is around €58, which is close to the current price. Analysts do not expect a huge price jump in the short term. However, almost all analysts are positive: of the 16 analysts, none have a sell recommendation, the vast majority advise “Buy”. For example, Deutsche Bank raised the price target for ASR from €55 to €61 in May 2025 and confirmed its buy recommendation. This underlines the confidence that ASR’s integration benefits and capital policy will unlock further value. In short, ASR is no longer a dirt-cheap hidden gem, but still attractively priced given the quality of its earnings and shareholder returns.
Key Risks
- Integration risk: The completion of the Aegon integration (life and pension activities, running until mid-2026) entails risks: if the last €215 million in synergy is delayed or disappointing, this will slow down the intended profit growth.
- Market and interest rate risk: Shocks on financial markets (sharply falling share prices, unexpected interest rate jumps) can temporarily put pressure on results and solvency and thus cause price volatility.
- Competition: New (digital) players or a cutthroat competition can put pressure on premiums and erode margins. ASR must continue to invest in innovation and customer focus to maintain its strong position.
- Regulatory changes: Stricter capital requirements or unfavorable new rules (e.g. around pensions or products) can negatively impact the sector and ASR’s profitability.
However, I consider these risks to be manageable. ASR has proven to be a conservative insurer that proactively responds to changing circumstances. With an experienced management team, support from a stable major shareholder (Aegon will remain on board for the time being) and substantial financial buffers, ASR is well equipped to absorb any setbacks. On balance, the positive potential for further value creation outweighs the risks mentioned. For investors who are looking for both income (dividend) and growth, ASR Nederland offers an excellent investment opportunity in my opinion.
Conclusion
ASR Nederland has quickly become a top player with impressive results thanks to the Aegon integration. The company is benefiting from favourable market developments (pension reform, higher interest rates) and is performing better operationally than its main competitors. The 2024 figures show that the synergies are real, supported by robust solvency and high cash flows. Investors are also benefiting from a generous dividend, while the valuation of the share is certainly reasonable.
Based on this analysis, I currently consider the ASR Nederland share to be a Strong Buy. The combination of a high dividend yield, solid growth prospects and a healthy balance sheet make ASR attractive for the long term investor. This means that ASR offers a unique mix of value and growth within the European insurance sector, and the current price seems an attractive entry point now that the integration synergies have not yet been fully discounted in the price.