AXA slashes reinsurance premiums 21% in H1 in move to cut cat by 40%

French-domiciled insurance giant  AXA cut premiums by 21% in its reinsurance division as it pushes its way out of natural catastrophe, the key driver holding group premium growth to a mere 1% in the first half.

“Revenues were down by 21% as a reflection of the strategy to reduce our exposure to nat cat in reinsurance,” CFO Alban de Mailly Nesle told reporters early Wednesday (August 3).

“We are reducing this exposure by 40% this year and the drop in premiums at  AXA XL Re is a reflection of this.”

The decline in premium came despite an 8% pricing increase for the  AXA XL Re unit.   AXA XL Re cut premium in both cat-exposed and non-exposed property by 37%, despite pricing gains at 14% and 8% respectively.  AXA made up for a portion of the decline with notable increases in casualty and professional reinsurance.

AXA continues to struggle with reinsurance margins. The combined ratio for the reinsurance operations rose 0.7 percentage points (pps) to top the 100 mark at 100.6% for the first half, albeit only 0.2 pps of that gain came from the loss ratio.

AXA offset with a 4% increase in primary commercial and a 3% increase in primary retail insurance to secure 1% group top line growth. Management called out 8.4% growth in primary commercial at its global unit  AXA XL where pricing was said to be up 9% on average. European personal insurance outside of France was said to be up 5.9%.

Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.