MUNICH Re informed its Q profits fell by 56% y-o-y to EUR 238 million, impacted by the California wildfires in November and volatile financial markets towards the end of year. The group's FY 2018 net profit of EUR 2.2 billion is in line with its target of EUR 2.1 - 2.5 billion.

The reinsurer mentioned it achieved an operating result of EUR 3.72 billion in 2018 (vs. EUR 1.24 billion a year before), of which EUR 404 million (EUR 864 million) related to the fourth quarter.

Gross premiums written by the Group in 2018 were EUR 49.06 billion, and thus roughly at the same level as in the previous year (EUR 49.11 billion). "A decline in premium income in the life and health reinsurance segment, which was attributable to the expiry or restructuring of large-volume capital-relief treaties, was largely compensated for by partly robust growth in property-casualty reinsurance".

The reinsurance field of business contributed EUR 1.86 billion (EUR 120 million) to the consolidated result in 2018, and the operating result climbed significantly from EUR 73 million to EUR 2.46 billion. Gross premiums written were down slightly to EUR 31.28 billion (vs. EUR 31.56 billion).

Life and health reinsurance contributed EUR 729 million (EUR 596 million) to the consolidated result. The technical result, including the result from business not recognized in the technical result owing to insufficient risk transfer, was EUR 584 million (EUR 428 million).

The result for property-casualty reinsurance rose to EUR 1.13 million (-EUR 476 million). The combined ratio was 99.4% (114.1%) of net earned premium, with 105.1% (103.9%) in the fourth quarter "owing to the especially high major losses from natural catastrophes in that quarter".

In 2018, the ERGO field of business reported a profit of EUR 412 million (EUR 273 million), thus exceeding its original target range of EUR 250-300 million. Gross premiums written increased to EUR 17.77 billion (vs. EUR 17.54 billion). The combined ratio in the property-casualty Germany segment amounted to 96.0% (97.5%) for the year, and 97.9% (100.3%) for the fourth quarter. The combined ratio for the ERGO International segment improved to 94.6% (95.3%) for the full year, mainly on account of positive developments in Poland, and amounted to 94.5% (94.7%) for the fourth quarter.

The company mentioned the reinsurance renewals as at 1 January 2019 once again "took place in a very competitive market environment. Prices for the Munich Re portfolio remained stable overall (+0.0%)". Munich Re said that approximately half of property-casualty reinsurance business was up for renewal as at 1 January 2019, representing a premium volume of EUR 9.4 billion. Of this, 8% was not renewed, set against new/additional business with a volume of approximately EUR 1.4 billion. The volume of business written at 1/1 therefore increased to around EUR 10 billion.