RGA profit falls in Q2 as COVID-19 claims reach $300m

Reinsurance Group of America (RGA) believes its second quarter 2020 results were in line with or better than expectations due to relatively 'modest' COVID-19 claims in all regions except the US.

The company reported second quarter net profit of $158 million, down from $202 million it made in the prior-year quarter.

The consolidated net premiums totaled $2.8 billion, an increase of 1 percent over last year’s second quarter, with adverse net foreign currency effects of $45 million.

RGA estimated its COVID-19 claims, including IBNR, to be $300 million on a global basis.

Anna Manning, president and chief executive officer, said: “We did experience a material level of excess mortality claims in the U.S. that we believe to be COVID-19 related; however, COVID-19 claims from the rest of the world were relatively modest. While our operating results were negatively impacted by the various effects of COVID-19, most of our segments reported results that were in line with or better than expectations. Our morbidity experience in all key markets was favorable and our Global Financial Solutions results were very strong. We were pleased with the resilience of our business in this challenging environment.

Manning added: “During the quarter we took measured and proactive action to raise additional capital to further strengthen our balance sheet, and we ended the quarter with excess capital of approximately $1.4 billion. With our strong balance sheet and diversified global platform, we believe that our global business is well positioned to successfully manage through this period of uncertainty.”