By Favour Nnabugwu
Munich Re report a group profit of €589million for the first quarter of 2021.
Lower Covid-19 losses doubled Munich Re’s operating result to €798million, with reinsurance accounting for €558m and ERGO €240m.
Munich Re’s CFO Christoph Jurecka said the group is on track to meet its full-year profit target of €2.8bn. The firm’s gross premium forecast has increased by €2bn on the back of anticipated reinsurance growth to €57bn for 2021. Gross premiums for Q1 2021 were up 1.9 percent to €14.6bn, split €9.4bn to reinsurance and €5.2bn to ERGO.
ERGO added €178m to group profit in Q1, up 146 percent from €72m, buoyed by a 2 percent rise in premium income to €5.16bn and a 3 percent rise in its investment result. Munich Re said higher claims from man-made losses were mitigated by lower claims linked to Covid-19.
The group’s reinsurance account recorded a 176 percent rise in profit to €410m in Q1 driven by P&C, which added €358m (up 155 percent).
The P&C reinsurance business improved its combined ratio for the quarter to 98.9 percent from 106 percent, despite major losses – more than €10m each – totalling €892m.
Lower man-made losses, including €100m of Covid-19 claims, fell to €247m from €973m in Q1 2020. This helped balance a rise in nat cat losses, which more than tripled to €646m after Munich Re booked €450m from the freezing conditions in Texas during Q1.
Reinsurance renewals for April 2021 recorded rate increases of 2.4 percent Munich Re said prices were higher in markets such as Japan but at the lower end in Europe. It expects further rate increases during the next renewal round in July.