Munich Re grows P&C reinsurance book 6.1% at 4.1; mid-year still ripe

Munich Re managed 6.1% premium growth at the April treaty renewal deadline with average risk-adjusted pricing within a fractional 0.7% of the prior year mark.

“We got a boost from the treaty renewals at 1 April, where we tapped into attractive growth opportunities against a backdrop of continuing high rates,” CFO Christoph Jurecka said of the renewal results.  

Growth opportunities were said to have been taken particularly in India, Latin America and Europe and included a mix of new business along with increased participations with select existing clients. “At the same time, Munich Re willingly discontinued business that was no longer appealing,” management said. CFO Christoph Jurecka told analysts that the Japanese nat cat book had “slightly decreased.”  

Trends proved sufficient to hope for continued opportunity at the June and July mid-year renewals.

“Despite market pressure increasing slightly, Munich Re expects the environment to remain positive in the upcoming July renewal round,” management said.

The roughly stable overall price reading included select price gains to keep pace with most upwards moves in loss trend, management claimed. Price development “for the most part more than compensated for the higher loss estimates in some areas” including those driven by inflation, management said.

Adjusted for portfolio diversification effects, rates rose by 0.6%, management claimed.  

Proportional treaty further gained on pricing power exercised in primary insurance “in many markets,” management added.

Word on the April renewals follows word that Q1 P&C reinsurance revenue had increased by 5.1% year on year, part and parcel with a major increase in margins to the tune of 11 combined ratio points as the group avoided large-loss for the quarter, with the exception of the Baltimore Bridge collapse.  

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