Fr., Aug. 4th 2023
The reinsurer Swiss Re increased its profit significantly in the first half of the year. The group benefited from further price increases while costs from natural catastrophes were contained.
Swiss Re boss Christian Mumenthaler sees the group on course to achieve the targeted profit of over 3 billion US dollars for 2023, as he said on a conference call on Friday. Halfway through, almost half of the promise had already been kept with a plus of 1.45 billion.
Swiss Re’s result increased significantly compared to the disappointing previous year (H1: 157 mn). At that time, turbulence on the financial markets, provisions for the Ukraine war or burdens in the wake of the corona pandemic had weighed on the bill.
Less disaster damage
The operational business is back on track. In property and liability reinsurance (P&C Re) in particular, it was possible to reduce the combined ratio by 3.8 percentage points to 94.7 percent. The clearer this value is below 100 percent, the more lucrative the business is.
The bill was spared major natural disasters in the second quarter, CFO John Dacey justified the good performance. In the first half of the year, the costs of natural disasters finally totaled 634 million dollars after almost one billion in the previous year. The main burden was attributed to the earthquakes in Syria and Turkey.
But that doesn’t mean there have been few natural disasters, Dacey stressed. Rather, Swiss Re was recently reluctant to deal with secondary or secondary peril catastrophes such as hail, fire or floods. The forest fires in Canada and the floods in Italy hardly had any impact on the 2023 half-year results.
In the P&C Re business, Swiss Re tripled profits to $904 million. And in life reinsurance, too, the surplus rose sharply to 393 million. Payments for the corona pandemic were omitted here. Corporate Solutions contributed another 323 million to the group profit.
Favorable price environment
Swiss Re has been benefiting from rising reinsurance prices for a good five years now . The trend reversal was triggered by severe hurricane disasters in the USA and the looming inflation. In the current year, the group has managed to increase tariffs by an average of 18 percent like hardly ever before.
Net premiums grew 4.4 percent to $22.1 billion in the first half of the year and Dacey said the pricing environment should remain supportive for future growth. The Group focuses on major risks such as storms and earthquakes.
Dacey sees growth opportunities in the area of windstorm risks outside of Florida, for example in the north-east of the USA, or in Italy to cover earthquake and flood risks. But there is also potential in countries like Thailand. There, after the severe flooding of recent years, for example in industrial areas, the demand for risk coverage is increasing.
Keystone/SDA ©
German 
English 
French 
Spanish 
Arabic