GEORGE V MAGAZINE / MUNICH RE
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Today, Munich Re released its full Q4 results, showing a total technical result of $3.3 billion, up from $1.9 billion in Q1 2023, and an operating result of nearly $3.2 billion, compared to $1.9 billion in the previous year.
The reinsurance segment’s contribution to the net result increased to $2 billion from $1.127 billion in Q1 2023, with insurance revenue from contracts rising from $9.8 billion to $10.5 billion. The total technical result grew by 79% to $2.3 billion, while the operating result also rose by 77% to $2.6 billion.
In reinsurance, the P&C arm reported a net result of $1.4 billion in Q1 2024, up from $815 million in Q1 2023, with insurance revenue from contracts at €6.831 billion. The P&C reinsurance combined ratio improved to 75.3% from 86.5%, and the normalised combined ratio was 79.5%.
Major losses exceeding $32 million each amounted to $697 million for Munich Re, lower than last year’s $1.11 billion, including gains and losses from run-off of major losses from previous years.
In a statement issued by the global reinsurance giant, it said: “The company selectively exploited the ongoing favourable market conditions to expand attractive business, with growth opportunities being realised particularly in India, Latin America and Europe. These involved both strengthening existing client relationships and establishing new ones.”
Major loss expenditure corresponded to 9.9% of net insurance revenue, below the average of 14%. Man-made major losses increased to $448 million from $177 million, with the largest individual loss being the collapse of the Francis Scott Key Bridge in Baltimore. Major losses from natural catastrophes dropped to $248 million from $933 million.
In the life and health reinsurance segment, the technical result increased to $628 million from $343 million in Q1 2023. The segment’s net result rose to $592 million from $312 million, while insurance revenue from contracts increased to $3,245 billion from $2,932 billion.
Munich Re also reported a positive experience during the April 1st reinsurance renewals, growing the volume of business written by 6.1% to $2.8 billion. The company capitalised on favourable market conditions to expand business opportunities, particularly in India, Latin America, and Europe.
Price development was stable at 1.4, with primary insurance prices increasing in many markets, benefiting Munich Re in proportional reinsurance contracts. The high price level of Munich Re’s portfolio remained almost unchanged, with a decrease of just – 0.7%, but rates rose by 0.6% when adjusted for portfolio diversification effects.
Munich Re’s primary insurance business, ERGO, recorded a strong net result of $270 million, up from $234 million last year. Insurance revenue from contracts increased to $5,583 billion from $5,408 billion, driven by the International segment.
The investment result for Q1 2024 rose to $2,320 billion from $1,729 billion, with regular income from investments increasing to $1,938 billion from $1,717 billion. The investment result represented a return of 3.8% on the average market value of the portfolio, exceeding the firm’s forecast of above 2.8% for the full year.
Looking ahead, Munich Re anticipates continued strong business opportunities and aims to achieve a net result of $5,364 billion for the 2024 financial year.
Christoph Jurecka, CFO, commented, “Munich Re kicked off the new financial year with great momentum. Our Q1 net result this year is nearly 70% higher than in 2023. Every line of business played a role in this impressive performance. In addition, we got a boost from the treaty renewals at 1 April, where we tapped into attractive growth opportunities against a backdrop of continuing high rates. We still expect to generate a profit of $5 billion in 2024. In fact, it has become more likely that we will surpass that target.”
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