Helvetia result 2023 impacted by high catastrophe losses
Published: Thursday, Apr 11th 2024, 13:52
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Helvetia Insurance Group generated a lower profit in 2023 than in the previous year. However, the previous year's result was still positively influenced by the profit from the sale of a company. The 2023 result was also impacted by high claims from natural disasters and other major losses in the second half of the year.
Profit fell by 37% to CHF 301.3 million compared to the revised figures for the previous year, as Helvetia announced on Thursday. In addition to the absence of the special gain from 2022 from the sale of the Spanish life insurer Sa Nostra Vida, the write-down of CHF 27 million on the mortgage broker Moneypark announced in the fall also contributed to the decline in profit.
The business volume developed positively with an increase of 5.4% to CHF 11.31 billion. Adjusted for exchange rate effects, growth even amounted to 7.2 per cent. In addition to Switzerland, Helvetia also operates in Germany, Italy, Austria and Spain.
Investors are now to benefit from a higher distribution: Not least with reference to the continued strong capitalization of the insurance group, the dividend per share will be increased by 40 centimes to CHF 6.30.
Loss-making third quarter
In non-life insurance, Helvetia achieved currency-adjusted growth of just under 11%. Helvetia grew faster than the market, particularly in Switzerland, Spain and Austria, emphasized CEO Fabian Rupprecht at the annual media conference. However, the "Specialty Markets" segment "stood out" with growth of 21%. This segment offers insurance cover in areas such as transportation, aviation and art.
However, extraordinarily high costs from natural disasters and major claims weighed on the business. In the third quarter of 2023 alone, these costs amounted to around CHF 215 million, around one and a half times as much as in the whole of 2022, according to Helvetia. The combined ratio - i.e. the ratio of claims payments and costs to premiums earned - deteriorated accordingly to 97.4% after 94.3% in the previous year.
Restrained life business
In contrast, the life insurance business developed modestly (premiums +1.7 %). In the group life business, Helvetia continued to feel the effects of the decline in full insurance solutions for occupational pensions towards semi-autonomous solutions. The contractual service margin (CSM) reported in accordance with the new accounting rules rose slightly year-on-year to CHF 4.03 billion (previous year: CHF 3.94 billion).
Helvetia reported further growth in fee income: For example, income from the operation of hospitals and nursing homes of the Spanish company Caser increased again. The integration of the mortgage broker Moneypark, which was fully acquired in 2022, into Helvetia's sales structure was given a positive initial assessment: the feedback from Moneypark employees on the new structures has also been positive, assured CFO Annelis Lüscher Hämmerli.
Strategy review in December
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