AXA profit drops 18% in 2020 but 'resilient' in face of pandemic

French insurer AXA saw its profits slip a little in 2020 due to the impact of COVID-19 claims and lower new business activity but its chief executive Thomas Buberl said the group was "resilient" due to its strategic choices and business mix.

AXA posted a net profit of €3.16 billion in 2020, a decline of 18 percent from €3.86 billion in 2019.

Its total revenues for the year were down just 1 percent to €97 billion, reflecting strong growth in the first and the fourth quarter of 2020.

The insurer posted 1 percent growth in its property and casualty segment, 6 percent in health, and 4 percent growth in its asset management segment.

Meanwhile, AXA saw lower revenues in personal lines (-1 percent) primarily due to lower new business activity during the lockdown periods across most geographies.

Revenues in its life & savings also declined by 6 percent mostly from lower sales in France and in Europe, largely impacted by COVID-19.

The overall impact on 2020 underlying earnings for the group from pandemic-related P&C claims and solidarity measures was €1.5 billion, post-tax and net of reinsurance.

In property and casualty lines the all year combined ratio was up 3.2 points to 99.5 percent, largely reflecting the impact from COVID-19 claims (+3.1 points) and higher natural catastrophe charges (+0.2 point) at AXA XL.

In its health business, the combined ratio increased by 0.5 point to 94.5 percent.

Thomas Buberl, chief executive officer of AXA, said: “AXA’s revenues were resilient in 2020, down just 1 percent compared to the previous year, reflecting the relevance of our strategic choices and business mix. Our preferred segments, P&C Commercial lines, Health and Protection, continued to perform well, growing by 3 percent in 2020 and accelerating in the fourth quarter (+5 percent).”

“We are confident in our earnings outlook and have set a 2020 starting base of Euro 6.3 billion underlying earnings for our 2021 - 2023 strategic plan targets,” he added.

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