SAVA Re, 2017: positive results in the first year after the merger of the Group's EU-based units

5 April 2018 — Daniela GHETU
At the end of the first year following the merger of the Group's EU-based insurance companies, SAVA Re Group has recorded consolidated GWP of EUR 517.23 million, 5.5% more y-o-y, according to the audited Annual Report 2017 published today.

The Group generated a net profit of EUR 31.1 million, corresponding to a 10.1% return on equity. While the profit of the Group's parent company, Zavarovalnica SAVA was impacted by storm losses, the performance of the reinsurance portfolio (excluding exchange differences) fell short of the 2016 result owing to several large loss events in the international market (such as the storms in the USA and the flooding of a mine in Russia).

Gross premiums written in the reinsurance segment in 2017 were up 3.8% y-o-y, to EUR 98.22 million. Premium growth is driven by the growth in XL business with the highest absolute growth achieved in marine reinsurance business.

Gross non-life insurance premiums grew by 6.4% in 2017, all insurance companies in the Group recording a positive dynamic. In Slovenia GWP rose by 5.7%, mainly due to higher premium volumes in the motor, assistance and property business. Outside Slovenia non-life GWP increased by 9.9% in all non-Slovenian non-life insurance companies, with the Croatian branch of Zavarovalnica SAVA recording the highest growth.

Gross claims paid decreased y-o-y by 6.6%, to EUR 54.16 million because large claims were paid in 2016 for previous underwriting years.

Gross claims paid for Slovenian business in 2017 were higher due to a larger volume of gross claims paid for private motor business and partly for assistance business. The main reason for the excess in claims relative to the previous year was the settlement of claims in 2017 relating to hail events in 2016 (three large loss events). Large claims in 2017 were the result of several weather-related loss events (June, July, August and December) and an increase in the number of motor and assistance insurance policies sold to individuals. In terms of commercial sector motor insurance, the excess of losses from 2016 related mainly to one major and several minor claims in motor vehicle liability insurance and a higher number of insurance policies sold, which means that at the same loss frequency more claims are reported. Higher payments in the property segment were also the result of weather-related loss events in 2016 and 2017. Provisions for a part of these claims were made in 2016 and their settlement therefore did not have a significant impact on the profits.

Gross claims paid for non-Slovenian business rose by 25.9%. Growth was primarily driven by the settlement of large liability claims of the Macedonian non-life insurer, subsidiary which also recorded some large Motor Hull and other damage to property claims after the June storm in Skopje region. An increase in gross claims of the Kosovan non-life insurer was the result of a large claim in fire and natural forces insurance and an increased volume of health insurance written compared to 2016. An increase in gross claims paid by Zavarovalnica SAVA in Croatia was due to the increased frequency of small claims and one large motor liability claim from 2013.

The full version of the SAVA Re's Audited Annual Report for 2017 is available here

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