Mapfre updates profit targets citing 'complex environment'

​Spanish re/insurer Mapfre has revised its profit and growth targets for the 2019–2021 period citing "complex environment" and warned of the impact of COVID-19 on insurance activity.

CEO Antonio Huertas stated that the updated public objectives are a result of the current economic, political and social environment, changes in business models in all sectors particularly in the insurance industry, and the volatility of global economies.

Overall, the group expects its revenues to reach between €28 and €30 billion by the end of 2021, and its return on equity (ROE) to average between 8 to 9 percent over the three-year period ending in 2021.

The group has also updated its target average combined ratio for the three-year period to 96 and 97 percent.

"We have moderated our profitability and growth expectations and will continue to make prudent underwriting decisions in this complex environment," said Huertas at the company's Annual General Meeting. "We plan to deliver solid technical margins, as our target combined ratio shows."

He also indicated that the strategic plan, which focuses on profitable growth, is accompanied by a major cultural, sales, operational and technological transformation. "We are advancing firmly along this path of transformation, preparing the company for greater challenges, without losing focus on prudent business management."

Additionally, Huertas warned of the currently unmeasurable effects of COVID-19 and the impact it may have on economic growth and insurance activity.

In 2020, Mapfre aims to drive growth in the digital business, which last year brought in revenues of €1.33 billion.

In the coming years, the company wants to commit to diversification, and much of the group's growth will need to come from Life Protection insurance, with this business rising by over 9 percent in 2019. It said that the growth of the life and pension lines is a clear strategic priority for Mapfre.