Hannover Re ups books 12.6% at renewal on 4.8% risk-adjusted rate gain
Global reinsurer Hannover Re took a 4.8% risk-adjusted rate gain from a set of mid-year renewals showing discipline and continued capacity shortages from some US property cat.
Hannover Re combined the rate gain with a 4.8% increase in volume to ultimately sign off on a €3.62 billion set of renewal books, up 12.6% year on year.
Renewals “brought further improvements in risk-adjusted prices and conditions,” management said of ingredients for what it considers “substantial” growth in the mid-year treaty books.
Hannover Re had faced €3.22 billion in renewal books going into the season, then added €100 million on the net of new and cancelled business before taking the €306 million boost from the combined punch of rate and volume.
Results leave the group on track to meet its goal for a 5% or greater increase in reinsurance revenues across the group for 2023. The P&C combined ratio target of 91-92% remains in place.
“The increasing losses from natural disasters and other severe events as well as persistently high inflation in some regions are driving stronger demand for reinsurance protection,” CEO Jean-Jacques Henchoz said.
Mid-year renewals showed discipline across most geographies and signs of optimism in the key US property market.
US property rates are retaining recent gains with “capacity shortages in some areas remaining,” management said. Primary rates are following suit with “meaningful” gains in most lines.
In Australia, Hannover Re witnessed “continued discipline” with rate increases and improved terms & conditions across primary and reinsurance markets. Loss-affected nat cat programmes took “substantial” rate increases.
Hannover Re is counting on improved margin from its Asian book after having trimmed its share in some lesser-performing treaties on a market Hannover Re can only call “mostly disciplined”.
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