Global reinsurance giant Munich Re said that compared with the previous year, prices of the renewals in January were stable but that the market was expected to improve during the next round in April, which focuses on Japan.
Approximately half of Munich Re’s property-casualty reinsurance business was up for renewal at 1/1, representing a premium volume of €9.4 billion.
Of this, 8% was not renewed, set against new/additional business with a volume of approximately €1.4 billion. The volume of business written at 1/1 therefore increased to around €10 billion.
The reinsurer saw fourth quarter profits fall 56% year-on-year to €238 million following the impact of the California wildfires in November and volatile financial markets towards the end of year.The company’s net profit of €2.2 billion for the year was, however, in line with its target of €2.1 billion to €2.5 billion.
Gross premiums written (GPW) by the whole group in 2018 were €49 billion, slightly down from €49.1 billion in 2017. The company attributed the decline in premium income to the expiry or restructuring of large-volume capital-relief treaties. But it said this drop was “largely compensated for by partly robust growth in property-casualty reinsurance.”
GPW for the reinsurance part of the business were also down slightly year on year to €31.2 billion in 2018 from €31.5 billion.
Christoph Jurecka, CFO, Munich RE, said “We are very satisfied with the overall result for 2018. We increased our profit and achieved our result target – despite the volatile capital markets and high losses from natural catastrophes in the fourth quarter. The year was especially positive for life and health reinsurance and for ERGO, both of which surpassed their profit guidance for the year. Munich Re shares remain a reliable, high-return investment, which is again reflected in the significant increase in the dividend.”