22 April 2014 News

VIG Re posts stable results despite cat losses

VIG Re, the Czech Republic-based reinsurer, posted stable profits in 2013 despite a drop in its premiums written for the year and a drop in profits due mainly to high losses from various natural catastrophe events in central Europe last year.

The company, which was the first reinsurer to obtain a licence in the Czech Republic, posted premium volume of €412 million, a 12 percent drop on the €470 million in wrote in 2012.

It made a pre-tax profit of €18.4 million, a decline on the €24.2 million it made in 2012. Its combined ratio for 2013 was 97.6 percent compared with 94.8 percent the year before. It made a 14.3 percent return on equity in 2013.

Since its foundation in 2008, VIG Re has built a client base in central and eastern Europe. Its client base comprises some 40 insurance companies belonging to Vienna Insurance Group and over 200 other insurance companies. It has a rating of A+ from Standard & Poor’s, which was reconfirmed with a stable outlook in December last year.

The company’s decline in premiums was in its life and health segment. Its property/casualty business actually grew by 15.6 percent to €325 million.

The reinsurer reported claims for the year of €332 million, well above the 2012 level of €285 million. It said the drivers for the increased loss activity were various natural catastrophe events happening in Central Europe, most notably a severe flood in June 2013, which contributed with €116 million. It said its comprehensive protection programme mean its combined ratio remained below 100 percent, despite of the severe weather-related claims.

“VIG Re was able to demonstrate to its clients that it delivers on its promises, provides effective reinsurance protection and pays out claims swiftly,” said Johannes Martin Hartmann, the chairman of the board of directors at VIG Re.

“VIG Re clients appreciate our partnership approach, combining financial strength and prudent underwriting with a focus on long term business relationship. This enables us to manage the current challenges of the reinsurance cycle in a well-balanced way.”

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