SCOR enjoys solid growth in April renewals
SCOR Global P&C (SGPC), the global property/casualty division of SCOR, has said it enjoyed premium growth of 8.5 percent in the recent April renewals. Some 10 percent of its portfolio was renewed representing around €318 million with the main countries renewing being Japan, India and the US.
The French reinsurer also said that, within this growth, it expects profitability on the business to fall well within its targets.
In Japan, it said it maintained the stability of its P&C Treaty book in an otherwise shrinking reinsurance market, characterised by reduced cession levels and the unification of reinsurance programmes following mergers and acquisitions.
In India, it said it reaped the fruits of a strong presence on this market seizing meaningful opportunities in specialty lines such as agriculture, credit & surety.
It said its expected technical performance measured in terms of gross underwriting ratio deteriorated by just under 2 percentage points compared with April 2013, while return on allocated capital deteriorated by just under 3 percentage points.
It said the expected profitability trend observed in April 2014 is largely driven by the Japanese market, where non-proportional prices in the property-cat segment have returned to their pre-Tohoku (2011) levels. Excluding the price reductions affecting the non-proportional property cat segments, the overall price level is broadly stable.
Looking at the January to April 2014 period versus the same period in 2013, the expected gross underwriting ratio increased by 1 percentage point, while the net underwriting ratio is expected to benefit from savings achieved in the retrocession programme, as announced in January, SCOR said.
The return on allocated capital is nearly stable. The expected profitability of the overall book renewed in April remains well within its targets. Given that profit levels of the April and later renewals tend to be higher than in January, these April renewals contribute to improving the 2014 profitability expectation.
Victor Peignet, CEO of SCOR Global P&C, said: “Thanks to its strong franchise in the Asia-Pacific region, SCOR Global P&C has successfully managed the April 2014 renewals. Through its strong presence in specialty lines and its proximity to key clients, SGPC has proven its ability to materialise sizeable opportunities of profitable diversification.
“The contained overall price reduction, to a level that is still consistent with our profitability assumptions, demonstrates the competitive advantage of having a broad and diversified business platform, based on long standing client relationships. On the back of these strong renewals, we reiterate the ‘Optimal Dynamics’ three-year assumption of a 93 percent-94 percent net combined ratio and annual premium growth assumption of around 8.5% over the period.”
