SCOR deepens loss in Q2 to €159m; nat cat leads major rise in claims

Global reinsurance giant  SCOR suffered a consecutive quarter of net losses and a deepening P&C underwriting loss, blaming heavy nat cat, ongoing COVID-19, inflation and more for what management admits is a “stark demonstration” of runaway risks.

“The recent past has been a stark demonstration that uncertainties and instabilities of all kinds are multiplying,”  SCOR chairman Denis Kessler (pictured) said.

Losses proved extreme, with a heavy nat cat dose. All in all, nat cat was said to have contributed 10.5 percentage points (pps) to the H1 combined ratio of 107.7 percent, well above the 8 percent budget and the 9.4 percent suffered in H1 2021.

SCOR claimed a €158 million hit to the Q2 technical result from Brazilian draught, then added in South African floods and an upward tweak to its estimate on Q1 Australian floods.

P&C attritional losses also succumbed to a “sharp increase,” pushing that loss ratio up 9.5 pps year on year to 90.9 percent for the first half.

For the second quarter alone, the net combined ratio shot up to an eye-opening 111.5 percent from 103.7 percent reported in Q1.

COVID-19's ongoing disruption added €59 million in Q2 claims.

The war in Ukraine did nothing to sully the Q2 tally and, for now,  SCOR is sticking to the €85 million reserve that helped destroy the P&L in Q1.

On the top line, gross written premium of €4.97 billion in the second quarter was up 15.2 percent year on year, led by 31 percent growth in P&C.

By the bottom line, Q2 market troubles, an exceptional tax charge and valuations on options on the firm's own shares had all stacked up to deepen the Q2 losses. Mark the Q2 net loss at €159 million.

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