AXA income up 75%; P&C and protection combined ratios slightly improved

AXA has reported a 75 percent increase in net income for 2019. Total revenues increased in all business lines, with improvements to the P&C, protection and health combined ratios. Scott Gunter has been appointed CEO of AXA XL, which saw a 10 percent increase in total revenues for 2019.

AXA’s net income for 2019 was €3.9 billion ($4.2 billion), up from €2.1 billion in 2018, mainly driven by the non-repeat of the goodwill impairment of Equitable Holdings in 2018 (€3.0 billion) as well as higher underlying earnings, partly offset by the negative impacts from the announced disposal of AXA Bank Belgium, the deconsolidation of Equitable Holdings and the change in the fair value of derivatives.

The property & casualty all-year combined ratio was 96.4 percent, improving by 0.6 points, mainly due to an improved claims experience and more favourable prior-year reserve developments.

The protection combined ratio improved by 0.7 points to 93.2 percent, reflecting the positive impact of the Group Life transformation in Switzerland, partly offset by lower prior-year reserve developments.

Health combined ratio was up by 0.1 point to 94.1 percent, as a less favourable claims experience was partly offset by an improvement in expense ratio.

Underlying earnings increased by 2 percent to €6.5 billion, reflecting continued positive operational performances from France, International, Asia and Europe, mainly driven by improved technical profitability in P&C and volume growth in Health. The increased contribution from AXA XL was offset by the lower contribution from Equitable Holdings. Holding costs were higher mainly due to temporary higher financial charges.

The AXA XL all-year combined ratio was 101.5 percent. Further steps have been taken to reduce earnings volatility at AXA XL in 2020, notably via reduced exposure to property catastrophe business, line-sizing in casualty, as well as additional reinsurance covers.

“AXA recorded another strong operational performance in 2019,” said Thomas Buberl, chief executive officer of AXA. “The group achieved a significant milestone in 2019 in its strategy to shift its profile away from financial markets and towards technical risk, by fully exiting the US Life & Savings market and integrating the XL Group, and at the same time reducing its debt gearing ratio.

“At AXA XL, impacted again by adverse claims experience in 2019, we are recording strong price increases and taking further steps to reduce volatility. I am also very happy to welcome Scott Gunter to the AXA Group to drive the next phase of development of AXA XL.

“AXA’s active leadership role in fighting climate change also continued, as a global investor, a global insurer, and as a coalition builder. In 2019, AXA doubled its green investments target, launched transition bonds as a new asset class, further strengthened its coal underwriting policy, established AXA Climate and joined the Net Zero Asset Owner Alliance. I would like to thank all our colleagues and partners who have been working together to deliver these results and transformative achievements, as well as our clients for their continued trust.”