Increased global diversity boosts RGA’s 2018 results: CEO Manning

Reinsurance Group of America (RGA) enjoyed strong growth in 2018 on the back of what its CEO said was its growing diversity from its global operating platform; its net profit fell compared with the year before, but this was because of one-off tax boost in 2017.

The reinsurer made a net profit of $715.8 million in 2018 compared with $1.8 billion in 2017. The prior year reflected the effects of the reduced corporate tax rate from the enactment of US Tax Reform, totalling $1 billion. The company’s adjusted operating income for the full year increased to $789 million compared with $712.7 million a year earlier.

Its net premiums written for 2018 increased to $10.5 billion compared with $9.8 billion a year earlier. Some parts of its business saw stronger growth than others. In traditional lines, its US and Latin American operations saw an increase of 3 percent to reach $5.5 billion; in contrast, its Asia Pacific operations enjoyed growth of 12 percent to reach $2.2 billion.

Anna Manning, CEO of RGA, said: “On balance, this was a solid quarter, as we continued to benefit from earnings diversity that comes with our global operating platform, with strong results in EMEA, Asia and Canada, offsetting moderate weakness in the US Traditional segment and Australia. Premiums were up a healthy 12 percent, and we had another quarter of significant capital deployment.

“The full year featured numerous highlights, including continued strong operating results from our operations in EMEA and Asia, good overall organic growth and a high level of capital deployment.

“Our strong capital position has allowed us to pursue and execute attractive in-force transactions and manage capital effectively through active share repurchases. For the year, we deployed approximately $440 million toward in-force transactions, including approximately $160 million in the fourth quarter. We also repurchased $284 million of common shares in 2018, including $25 million in the fourth quarter. Our Board approved a new authorization of $400 million, replacing the previous authorization. We ended the year with an excess capital position of approximately $1 billion.

“Looking forward, we remain optimistic about the future and our business prospects, and ability to deliver attractive financial returns. RGA is well positioned in its markets, we have a proven strategy and a long track record of successful execution. We anticipate ongoing change in the life insurance industry, and RGA expects to continue to innovate and add to its capabilities in order to help our clients successfully address these industry challenges and opportunities.”