Fitch: European reinsurers confirm resilience to catastrophes

European reinsurers' 2017 results support Fitch Ratings' view of the sector's resilience to catastrophe losses, the agency said in its recent "European Reinsurers Resilient to Catastrophe Losses" report.

With capital typically above companies' target levels, Fitch doesn't expect material premium rate rises this year, despite some increases in the January and April renewals.

The sector's resilience reflects the benefit of business diversification, as profits from life and health business, and solid investment returns tended to more than offset underwriting losses on property and casualty business from last year's large catastrophe claims. The four main European reinsurers - HANNOVER Re, MUNICH Re, SCOR and Swiss Re - all posted profits in 2017, despite significant catastrophe losses, and reported end-2017 capital at or above their stated optimal ranges.

SCOR maintained its share buy-back plan, while MUNICH Re and Swiss Re announced increases to theirs of up to EUR 1 billion and CHF 1 billion, respectively, and HANNOVER Re maintained its special dividend payments. All four said they would still have capital available to invest in growth opportunities or for further returns to shareholders. The continued abundance of capital in the sector, helped by capital influx from insurance-linked security investors, makes significant rate rises unlikely. Rates have been broadly stable this year, with rises limited and well short of offsetting the declines of the past four years.

Large conglomerates continue to show interest in the reinsurance sector in Europe and globally. Japanese telecoms company SoftBank is in talks with Swiss Re over acquiring a stake of up to 10% and there could be more deals involving Bermudan reinsurers, following recently announced deals between AIG and Validus, and AXA and XL Group.

Fitch's outlook for the global reinsurance sector remains negative, reflecting continued pressure on earnings from competitive pricing, alternative capital and low investment yields. Combined ratios, normalized for an average level of reserve releases and catastrophe losses, have steadily deteriorated.

The report "European Reinsurers Resilient to Catastrophe Losses" is available at www.fitchratings.com.

Follow XPRIMM Publications on LinkedIn, for more data on the insurance and financial industry.

Share |

Related articles

Five CEE re/insurers have an "A" rating from A.M. Best

Among the re/insurance companies rated by A.M.Best there are 23 entities domiciled in the CEE, SEE and CIS regions. Out of this total, 5 companies have an "a" Issuer Credit Rating (ICR) and an "A" Financial Strength Rating (FSR)

2018-12-06

A.M. Best announces ESMA registration for new Amsterdam office

A.M. Best has announced that it has been registered as a credit rating agency (CRA) by the European Securities and Markets Authority (ESMA) to provide ratings through its new subsidiary, A.M. Best (EU) Rating Services B.V., based in Amsterdam, the Netherlands.

2018-12-06

The CEE real estate market - increasing demand for title insurance

"Fifteen years after its introduction, title insurance continues to play a growing role in the CEE real estate market," Jean-Bernard WURM, Co-Founder & Managing Director of Secure Legal Title, London said talking to Property Forum about the trends in the CEE region's real estate sector.

2018-11-29

VIG's underwritings up by 2.9% in Q3; year end targets confirmed

Vienna Insurance Group (VIG) continued its stable upward trend in 3Q 2018, achieving a further improvement in key figures. Given the positive development, VIG disclosed for the year end a GWP EUR 9.5 billion target and a result before taxed expected figure of EUR 450 - 470 million.

2018-11-28

ON THE MOVE

MetLife named its EMEA head as CEO of Japan unit

MetLife announced that Eric CLURFAIN, currently Executive Vice President and Head of EMEA, has been named Chairman, President and CEO of MetLife Japan - the company's second largest market globally and its largest retail life insurance business, effective Feb. 1, 2019, following approvals.

06.12.2018

American International Group appoints new CFO

American International Group announced that it has appointed Mark LYONS to the role of Executive Vice President & Chief Financial Officer (CFO). He succeeds Sid SANKARAN, who will remain at AIG in an advisory capacity through the year-end reporting process for fiscal year 2018.

06.12.2018

Wolfgang STOCKMEYER appointed as VIG's BTA Baltic new Board Chairman

Wolfgang STOCKMEYER (49) has been appointed, on 30 November 2018, Chairman of the VIG's subsidiary BTA Baltic Management Board, as part of a series of changes in the composition of its Management Board operated by the main player of Austrian Group in the Baltic region.

05.12.2018

TOP EVENT

Reducing the risks in agriculture by using insurance means, discussed in Skopje

On November 1st, an Agricultural insurance conference took place in Skopje, Macedonia, organized by the Insurance Supervision Agency in cooperation with the Ministry of Agriculture, Forestry and Water Economy. Drawing attention to the necessity of reducing the risks in agriculture by using insurance was the event's main purpose.

06.11.2018

IIF 2018 - Insurance in a DIGITAL WORLD

Emmanuel DJENGUE, Innovation Director, Europe - RGAX, Spain is the Keynote Speaker at IIF 2018 - Insurance in a DIGITAL WORLD Conference in Bucharest, on November 27.

05.11.2018

See all