Munich Re set to exceed profit forecasts
The world’s biggest reinsurer, Munich Re, is set to “to exceed the profit guidance of €3 billion for 2014 slightly” as it benefitted from low catastrophe losses.
The reinsurer made a profit of €738 million in the third quarter of 2014, an increase of 17.1 percent compared with €630 million in the third quarter of 2013. For the first nine months of 2014, its profits hit €2.4 billion, an increase of 14.2 percent compared with €2.1 billion in the same period of the prior year.
Munich Re’s reinsurance business made an operating profit of €598 million, a deterioration of 29.2 percent, compared with €845 million in the third quarter of 2013. Its gross premiums written in the third quarter decreased by 2.3 percent year on year to €6.7 billion, compared with €6.9 billion in the third quarter of 2013. In reinsurance property and casualty, its combined ratio improved to 91.3 percent in the quarter, compared with 94.3 percent in the prior year quarter.
In the forthcoming renewal round at 1 January 2015, slightly more than half of Munich Re’s non-life reinsurance business will be up for renewal.
Torsten Jeworrek, Munich Re’s reinsurance chief executive officer, said: “We will continue to resist pricing pressures and withdraw from business if necessary. In this environment, we can deploy our know-how and capacity better in offering our clients new and intelligent coverage concepts for their differing requirements. Due to the unchanged economic dynamics in Asia in particular, we see good opportunities for profitable growth overall.”
Jörg Schneider, chief financial officer at Munich Re, said: “Munich Re’s group performance was pleasing, despite the difficult environment.
“There will always be uncertainties – for example, the winter storm season just starting in Europe now. To date, however, losses from hurricanes in the USA and the Caribbean have been rather low. Overall, we consequently now expect to be able to achieve a profit of just over €3 billion.”
