That was despite sizeable natural catastrophe claims, further pandemic-related losses in life and health reinsurance and additional strengthening of provisions for possible losses resulting from the war in Ukraine.
In life and health reinsurance Hannover Re expects further pandemic-related losses, although these will drop sharply over the course of the year.
On the Group level it remains Hannover Re's expectation that net income of EUR 1.4 billion to EUR 1.5 billion will be generated for the 2022 financial year. This assumes that major loss expenditure does not materially exceed the budgeted level of EUR 1.4 billion, the Covid-19 pandemic does not have a significant unexpected impact on the result in life and health reinsurance and no unforeseen developments occur on capital markets.
"While we are all appalled by the suffering that Russia has unleashed in its war on Ukraine, it is not yet possible to put a concrete figure on the economic impact at this point in time," said Jean-Jacques HENCHOZ, Chief Executive Officer of Hannover Re.
"Along with the potential implications of the war in Ukraine, we faced numerous natural catastrophes and further pandemic-related strains in life and health reinsurance in the first three months of the year. Against this backdrop, we again demonstrated the quality of our risk and capital management and stood shoulder-to-shoulder with our clients as a reliable partner."
The gross written premiums booked by Hannover Re increased by 19.5% as of 31 March 2022 to EUR 9.3 billion (EUR 7.8 billion), while net premiums earned rose by 17.9% to EUR 6.7 billion (EUR 5.7 billion).
Operating profit (EBIT) reached EUR 396 million (EUR 404 million) despite the losses incurred in the first quarter. Group net income fell by 13.8% to EUR 264 million (EUR 306 million). Earnings per share stood at EUR 2.19 (EUR 2.54).
In property and casualty reinsurance portfolio, the reinsurer mentioned it "was satisfied overall with the renewal (...) as of 1 January 2022. 62% of the treaties in traditional property and casualty reinsurance were renegotiated on this date. The inflation- and risk-adjusted price increase amounted to 4.1%, with the biggest gains recorded in Europe".
Gross written premiums grew by 26% as of the end of March to EUR 7.1 billion (EUR 5.7 billion) while net premiums earned was up by 24% to EUR 4.8 billion (EUR 3.9 billion).
Expenditures for major losses reached a total of EUR 336 million (EUR 193 million) and thus exceeded the budgeted amount of EUR 284 million for the first quarter. The largest individual losses were the floods in Australia caused by heavy rainfall with net expenditure of EUR 186 million, the windstorm events Ylenia/Zeynep in Europe at a cost of EUR 124 million and the sinking of the cargo ship "Felicity Ace" following a fire with a loss of EUR 14 million.
The reinsurer said it established an additional general provision in the low triple-digit million-euro range in the first quarter for possible losses from the war in Ukraine.
The combined ratio in property and casualty reinsurance increased to 99.5% (96.2%) and thus exceeded the target level of no more than 96%. The underwriting result for property and casualty reinsurance including interest on funds withheld and contract deposits came in well below the previous year's level at EUR 26 million (EUR 147 million). Despite the substantial losses, it was possible to generate an operating profit (EBIT) of EUR 284 million (EUR 312 million). Net income in property and casualty reinsurance amounted to EUR 177 million (EUR 261 million).
In life and health reinsurance Hannover Re continued "to expand its financial solutions business, especially in China. Demand for solutions to protect against longevity risks also showed further growth worldwide. Interest here was still particularly strong in the United Kingdom, but also extended to the United States and Canada. The environment for life and health reinsurance was satisfactory on the whole".
The impact of the pandemic remained the dominant issue, especially in relation to mortality covers. As expected, further pandemic-related losses of EUR 123 million were incurred, although these diminished progressively over the course of the quarter.
Gross written premiums increased by 3.2% to EUR 2.2 billion (EUR 2.1 billion) while net premiums earned rose by 5.4% to EUR 1.9 million (EUR 1.8 billion).
The operating result (EBIT) increased by 23% to EUR 113 million (EUR 92 million). Net income in life and health reinsurance grew by 78% to EUR 101 million (EUR 57 million).