Low major losses boost Munich Re Q1 results

Munich Re has benefitted from  low major losses in the first quarter of 2018, lifting its net profit to €827 million from €557 million in the first quarter of 2017.

Munich Re now expects a combined ratio of 97 percent in property/casualty reinsurance for the full year while the profit guidance remains unchanged at €2.1–2.5 billion.

“The first quarter was mainly influenced by low major losses in property-casualty reinsurance,” said chief financial officer Jörg Schneider. “We also achieved a good quarterly result in life and health reinsurance and at ERGO. We can be very satisfied with the start to the year.”

Property/casualty reinsurance contributed €591 million to the consolidated result for the first quarter compared to €340 million in the first quarter of 2017. Premium volume rose to €5.32 billion from €4.56 billion over the period, benefiting from organic growth. The combined ratio improved to 88.6 percent from 97.1 percent of net earned premium.

The expenditure from major losses of over €10 million each fell to €62 million in the first quarter of 2018 from €403 million a year ago. At 1.4 percent of net earned premium, major losses were significantly below Munich Re’s major-loss projection of 12 percent. In the first quarter of the year, major-loss expenditure from natural catastrophes was overcompensated by reserve releases for prior-year major losses, resulting in a positive balance of €49 million compared to a negative €156 million.

Munich Re released reserves (adjusted for commissions) in the amount of around €180 million in the first quarter, corresponding to 4.1 percentage points of the combined ratio.

Overall, gross premiums written increased by 1.6 percent to €13.13 billion in the first quarter of 2018 from €12.93 billion a year ago. If exchange rates had remained the same, premium volume would have risen by 7.8 percent year on year.

Make sure you are GDPR compliant and  confirm your email address to keep getting our daily emails

More of today's news

Buffett warns on cyber insurance risks

Hannover Re grows 18% in Q1

Chubb, Lockton fined $8.3m for NRA-branded insurance

Sompo advances European expansion with Luxembourg unit

Hiscox grows 24% in Q1 as reinsurance, ILS expand

Munich Re grows 8% at April renewals

HDI unveils management board changes as Eicken departs

Aon reinsurance business grows 6% organically in Q1

Don't miss our insurtech email newsletter - sign up today