Germany: Corona and natural catastrophes had a strong impact on German insurers business results in 2021

27 January 2022 — Daniela GHETU
The Corona pandemic and the flood disaster on the Ahr have had a strong impact on the business results of German insurers, data presented by the German Insurers Association (GDV) show. For the first time since 2013, companies in the P&C insurance sector were in the red last year.

The insurance industry saw, overall, a as a 1.1% increase in the GWP volume in 2021, to EUR 223.4 billion. Yet, the previous year the growth rate stood at 1.6%. "Under the difficult conditions of the corona pandemic, this is solid," stated GDV President Wolfgang Weiler, at the association's annual media conference on the overall result. "We can be satisfied with the premium growth, even if we had hoped for a little more at the beginning of the year."

2021 the most expensive natural hazard year of all time for German insurers

In P&C insurance, the result was shaped by the devastating July flood: with insured losses of over EUR 8 billion, it was the most expensive catastrophe of this kind in Germany and made 2021 a year with an unprecedented loss, of EUR 12.5 billion, from natural hazards alone, which is a much higher sum as compared with 2020, when it was of EUR 2.0 billion.

The total claims expenditure increased significantly, by 20%, to EUR 62.3 billion, while the segment's premium income increased slightly, by 2.2%, to EUR 76.6 billion. As such, the combined ratio - the ratio of costs and benefits paid to premium income - climbed to 102% from 90.7% the previous year. "In view of the record damage, this is still a presentable result," said Weiler. "It makes it clear that insurers can also shoulder such extreme damage - and do their job."

Life insurance: Significant growth in new Riester business

Life insurance developed stably in 2021. The premium income of life insurers, pension funds amounted to around EUR 102 billion in 2021, 1.4% down y-o-y. This development can be attributed to a slightly reduced single-premium business (down by 4.7% to EUR 36.5 billion), which had reached a record level in 2020. Current premium income, on the other hand, increased slightly to EUR 65.3 billion.

Riester new business developed positively in 2021 with a significant increase of 12%, to 310,500 new contracts. The portfolio remained largely stable at around 10.4 million contracts. In the case of basic pensions, the number of newly brokered policies even rose by almost 40% to almost 119,000 contracts. As a result, the total portfolio increased by 4%, to 2.5 million contracts.

Significant contract growth in private health insurance

The premium income of private health insurance companies increased by 5%, to EUR 45.0 billion in 2021. Out of this total, a EUR 40.5 billion sum is attributable to health insurance (up by 4.7%), while long-term care insurance reached a revenue of EUR 4.5 billion, an increase of 7.3%.

The insurance benefits paid out reached EUR 31.4 billion, by 2% up y-o-y. Health insurance accounts for EUR 29.3 billion and long-term care insurance for EUR 2.1 billion. The portfolio of full and supplementary insurance increased by almost 950,000 to 37.1 million, an increase of 2.6%.

The full statistical data for 2021 provided by the GDV is available on the association's website, as well as the video recording of the press conference, in German.

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