Hannover Re, the fourth-largest reinsurer in the world, has seen its group net income improving in the 2018 financial year to roughly EUR 1.05 billion, up from EUR 958.6 million the year before based on preliminary key figures.
The reinsurer's gross premium was in the order of EUR 19 billion (EUR 17.8 billion), equivalent to an increase of some 11% adjusted for exchange rate effects. Of this total result, roughly 83 per cent was attributable to Hannover Re's property and casualty reinsurance business and 17 per cent to life and health reinsurance.
The return on investments from assets under own management amounted to 3.2 per cent for the past financial year. The audited annual financial statement will be published on 7 March 2019.
Of the total premium volume booked in the previous year in traditional property and casualty reinsurance amounting to EUR 8,391 million, treaties with a volume of altogether EUR 5,551 million were up for renewal as at 1 January 2019.
Ulrich Wallin, Chief Executive Officer of Hannover Re, noted. "Thanks to our good market positioning we were thus able to generate pleasing growth in the renewed portfolio at adequate conditions. In the face of another burden of heavy losses, demand from both existing and new clients was solid "
"In view of the favourable outcome of our main renewal season, we take an optimistic view of movements in prices and conditions in the current year and see good prospects for profitable growth in our property and casualty reinsurance portfolio," Wallin commented. "We have put in place a solid foundation for achieving the targets for the 2019 financial year."
Against a backdrop of modestly improved conditions from an overall perspective, Hannover Re increased its premium volume in traditional property and casualty reinsurance by 15.4 per cent on a currency-adjusted basis to EUR 6.4 billion (EUR 5.6 billion) in the 1 January 2019 treaty renewals.
In 2018, as in the previous year, reinsurers incurred considerable large losses. Reinsurance programmes or regions that had been spared losses saw pricing pressures increase again slightly in the recent renewals compared to the situation in 2018. Programmes that suffered additional losses, on the other hand, recorded rate increases that once more reached double-digit percentages in some instances.
On the whole, prices as at 1 January 2019 were commensurate with the risk or slightly improved. Hannover Re maintains its emphasis on a selective underwriting policy under which minimum margin requirements take precedence over premium growth.
Overall, the premium volume in worldwide treaty reinsurance grew by 28.8% in the renewals at the beginning of 2019.
In the Asia-Pacific region Hannover Re was able to significantly expand its market position with selected clients and booked impressive growth in premium income. China, in particular, remains the focus of the company's operations in Asia.
The strongest portfolio growth in the renewals was recorded here. In Australia and New Zealand the anticipated rate improvements materialised on the back of increased demand for natural catastrophe covers.