Munich Re expands P&C by 21% in Q3
Munich Re has taken advantage of organic growth potential in the property/casualty (P&C) reinsurance segment and expanded its portfolio significantly during the third quarter of 2018.
Premium volume saw a “significant and gratifying increase” to €5.76 billion in the third quarter of 2018, an increase of 21.5 percent compared to the €4.74 billion registered in the same period a year ago as the reinsurer benefitted from organic growth, the company said in a statement.
The combined ratio for the third quarter was 100.7 percent of net earned premiums in the third quarter compared to 160.9 percent a year ago. Overall expenditure for major losses of over €10 million each amounted to €599 million in the third quarter driven by typhoon Jebi and hurricane Florence. This compares to large losses of €3.17 billion in the same period of 2017 when hurricanes Harvey, Irma and Maria (HIM) alone caused a loss of €1.47 billion.
P&C reinsurance contributed €151 million to the total reinsurance profit of €309 million in the third quarter of 2018. In the third quarter of the previous year the P&C reinsurance posted a loss of €1.53 billion.
Overall, the group posted a net profit of €483 million for the third quarter of 2018 after a net loss of €1.44 billion in the same period a year ago.
“This good Q3 result puts us on track to achieve our profit target for 2018, despite a series of major natural catastrophes still continuing in the fourth quarter,” said Jörg Schneider, chief financial officer.
“The benefits of first-class primary insurance and reinsurance cover become apparent in times of climate change and growing economic risks,” Schneider added.
The overall reinsurance business grew gross premiums written by 6.2 percent year on year in the third quarter to €8.57 billion. A decline in premium volume in life and health reinsurance was more than compensated for by significant premium growth in property-casualty reinsurance. Premium income in life & health reinsurance declined to €2.81 billion from €3.32 billion due to terminations and the restructuring of large-volume treaties, the company explained. Nevertheless, the life & health reinsurance business saw a year-on-year increase in profit to €159 million from €59 million over the period.
Munich Re’s primary insurance business produced a net profit of €173 million in the third quarter of 2018 compared to €29 million a year ago.
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