Swiss Re's Group Chief Executive Officer Christian MUMENTHALER said: "Thanks to the Group's sustained focus on portfolio quality and disciplined underwriting, our property and casualty businesses delivered excellent results in the first nine months of 2021. At the same time, we were able to support communities impacted by natural catastrophes and the COVID-19 pandemic."
Swiss Re's Group Chief Financial Officer John DACEY said: "P&C Re and Corporate Solutions are delivering on their ambitious targets for this year, with a combined net income of just below USD 2 billion in the first nine months. We are also pleased with the underlying performance of L&H Re, which offset the impact from the pandemic, resulting in a reported profit for the second consecutive quarter."
P&C Re reported a net income of USD 1.5 billion in the first nine months of 2021, compared with a net loss of USD 201 million in the same period last year. This result was achieved while the business absorbed large natural catastrophe losses and reflects the improved quality of the portfolio, dramatically lower COVID-19 impacts as well as strong investment results. P&C Re's net premiums earned grew by 6.0% to USD 16.4 billion, reflecting the continued price momentum as well as favorable foreign exchange developments.
Large natural catastrophe losses for the first nine months of the year amounted to USD 1.7 billion - higher than expected, but still below the premiums earned for this class of business. The losses mainly related to Hurricane Ida and the floods in Europe in the third quarter, as well as the US winter storm Uri in the first quarter. In addition, large man-made losses amounted to USD 272 million year to date.
The combined ratio significantly improved to 97.5% for the first nine months of 2021 from 110.3% in the same period last year. On a normalised1 basis, P&C Re achieved a combined ratio of 94.0% and is well on track to meet its target of less than 95% for the full year.
In the first nine months of 2021, L&H Re reported a net loss of USD 62 million. This compares with a net income of USD 72 million in the prior-year period, as the business incurred significantly higher COVID-19-related claims of USD 1.2 billion in the first nine months of 2021, primarily originating in the US. Despite the impact from the pandemic, L&H Re reported positive net income for the second and third quarters of 2021.
Net premiums earned and fee income increased by 10.2% to USD 11.1 billion, buttressed by large transactions and favorable foreign exchange developments.
Excluding COVID-19 losses, L&H Re's underlying business performed well, increasing net income by 45% year on year to USD 899 million and achieving an ROE of 17.5%. This was primarily driven by solid underwriting performance across all regions, supported by in-force management actions and favorable investment results.
Corporate Solutions reported a net income of USD 425 million in the first nine months of 2021, compared with a net loss of USD 357 million in the same period last year. The Business Unit continued to benefit from the implemented strategic actions, allowing it to successfully absorb large natural catastrophe losses of USD 286 million, mainly relating to Uri and Hurricane Ida, and large man-made losses, totaling USD 212 million for the first nine months of 2021.
Net premiums earned rose 6.2% to USD 3.9 billion, thanks to rate increases, selective new business growth and favorable foreign exchange developments, while the impact of the previous portfolio pruning actions diminished. Year to date, Corporate Solutions achieved risk-adjusted price increases of 12%2, as the attractive pricing momentum continued.
The Business Unit reported a combined ratio of 91.1% for the first nine months of the year, down from 116% for the same period last year, as a result of disciplined underwriting, strict expense management, continued rate increases and very limited COVID-19-related impacts in 2021. With a normalized combined ratio of 95.7% for the first nine months of the year, Corporate Solutions is well on track to meet its target of less than 97% in 2021.
iptiQ continued to successfully grow its business. Compared with the same period last year, gross premiums written for the core business rose by 118% to USD 520 million, with good contributions across all markets.
Swiss Re's Group Chief Executive Officer Christian MUMENTHALER said: "We continue to reap the benefits of our strategic underwriting actions and see opportunities across all businesses to deploy capital at attractive returns. This gives us confidence for the remainder of the year and into 2022, with all our businesses well positioned to continue their strong performance."