Slovenian SAVA Re's 3Q2017 net profit down by 7.5% y-o-y

21 November 2017 — Vlad BOLDIJAR
Slovenian re/insurer SAVA Re said its consolidated 3Q2017 net profit decreased by 7.5% y-o-y to EUR 20.9 million euro. At the same time, the aggregate GWP was EUR 409.2 million, up by 4.8% y-o-y, while gross claims paid amounted to EUR 218.6 million, up from EUR 195.3 million a year before.

"In the first nine months of 2017, the SAVA Re Group generated a net profit of EUR 20.9 million, a y-o-y drop of 7.5%. In the third quarter, the Group experienced an above-average number of claims - both in the reinsurance segment (American storm and a large property claim in Russia) and in the Slovenian non-life insurance operations (a number of hail storms). It is expected that the American hurricane losses will push up reinsurance prices in international reinsurance markets in the January 2018 renewals, as the leading catastrophe reinsurers incurred huge storm-related losses. Although these losses have a negative effect on the current results, they are expected to have a positive impact on the future results of reinsurance operations. The net profit for the period was further eroded by a higher corporate tax rate", the Slovenian reinsurer posted in a statement published on its website.

On insurance classes, the GWP portfolio was formed in proportion of 20.6% - MTPL, 18.4% - MoD, 18% - Fire and allied perils, 7.8% - Other damages to property, 9% life unit-linked, 7.7% - traditional life insurance, 5.3% - accidents, 13.4% - other types of insurance.

As regards the non-life insurance segment (GWP of EUR 264.3 million), the most significant share was generated by the Slovenian insurer Zavarovalnica SAVA (EUR 218.3 million), followed by the Serbian unit (EUR 12.5 million), the Macedonian subsidiary (EUR 9.7 million), Sava Montenegro - EUR 9.6 million, Zavarovalnica SAVA Croatia - EUR 8.3 million, and the Kosovo insurer - Illyria (EUR 6.1 million). Overall, the non-life GWP increased by 6.1%. The activity on Slovenian market was up by 5.3%, while the same indicator outside Slovenia was up by 10.2% y-o-y.

The GWP on life insurance totaled EUR 67.9 million, up by 5.3% y-o-y. The largest share was generated by the Slovenian market (EUR 62.6 million, up by 4.8% y-o-y), while the remaining EUR 5.2 million (+11.6%) was the result of the activity outside Slovenia.

At the same time, the reinsurance operations totaled EUR 77 million in GWP.

"The largest absolute contribution to growth in gross premiums written came from the Slovenian non-life segment (relative y-o-y growth of 5.3%), mainly related to a larger volume of motor insurance business. This is followed by international non-life insurance business (relative growth of 10.2% y-o-y). In international insurance markets, the largest growth was generated in Croatia and Montenegro, while the growth in Serbia is also favourable. There was also an increase in Slovenian life insurance business (relative y-o-y growth of 4.8%). The largest relative premium growth was posted in international life insurance, of 11.6%, and in all markets where the Group is present, members' premium growth exceeded the average market growth. Against the background of the soft market conditions prevailing in international reinsurance markets, reinsurance operations produced no growth".

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