Reinsurance: Munich Re raises profit forecast

The reinsurer benefits from lower major loss burdens. After nine months, the DAX group achieved a profit of 5.7 billion euros. It should continue to rise.

Munich Re: Between July and September, a profit of around 1.7 billion euros accrued. Photo: dpa

Munich. Munich Re expects business to be more profitable than before for the year as a whole, both in the property/casualty segment and in special reinsurance. In property/casualty reinsurance, the board now expects a combined ratio of below 80 percent for the year as a whole instead of around 80 percent previously, the world's second largest reinsurer announced on Thursday.

In the third quarter it was 80 percent. In special insurance, a combined ratio of less than 90 percent is expected instead of the current level of around 90 percent. In the past quarter it was 83.9 percent. Figures below 100 percent indicate operational profits.

The group had already increased its annual forecast in October based on preliminary quarterly figures. The reinsurer expects a net result of 6.6 billion euros, 300 million more than before. The major loss burden was unexpectedly low in the summer.

Between July and September, a profit of around 1.7 billion euros accrued, as Munich Re has now confirmed. This is less than in the same period last year, but more than analysts had previously expected. After nine months there was a profit of 5.7 billion.

“The increase in our profit target to 6.6 billion euros reflects the very positive operational development of all business segments,” explained CFO Andrew Buchanan when presenting the final figures. “In the third quarter, we benefited from a low burden of major losses and expanded business, particularly in the less volatile segments such as life/health reinsurance.”