All Posts in "Business"

By Favour Nnabugwu
The Covid-19 health crisis has plunged the world economy into uncertainty. Like several business sectors, insurance has not been spared.
Swiss Re’s projections show a decline in the global insurance market of 1.4 percent in 2020 after the increases of 2.3 percent reported in 2019 and 4.8 percent in 2018.
Moreover, this crisis comes at a time when the market is heavily strained by the resurgence of more severe and devastating natural disasters.
The persistence of low interest rates, the volatility of the capital markets and the low outlook for premium growth are all factors that show very little hope for a return to normal for several years to come.
Cost of the Covid-19 to the insurance market pandemic, According to Standard & Poor’s estimates by the end of June 2020, the cost of this health crisis for the global insurance and reinsurance market would be between 35 and 50 billion USD. The top 20 reinsurers alone will bear 14% of the bill, that is approximately 12 billion USD.
In addition to this heavy bill, market stakeholders expect a drop in profitability and a decline in operational performance. The annual accounts for the year 2020 should be adversely impacted at the level of assets, liabilities, results, revenues.
Impact of the Covid-19 on profitability of insurers
The decline in the results of the leading insurers and reinsurers for the third quarter 2020 has forced some stakeholders to revise downwards their growth prospects for the financial year 2020. Projections for 2021 and the following years are, for their part, put on stand-by or revised downwards.
Among the market leaders, Axa puts forward a projected cost of the crisis on its accounts of 1.5 billion EUR (1.75 billion USD). Allianz’s losses would amount to 1.3 billion EUR (1.52 billion USD). The German reinsurer Munich Re, for its part, forecasts an invoice of 800 million EUR (936.4 million USD) related to the current pandemic for the first nine months of 2020.
Impact of the Covid-19 on claim experience
As a result of the interruption of economic activities, the loss ratio has evolved either downwards or upwards depending on the class of business.
In general, all property and casualty classes of business reported a decline in claims, a trend mainly observed in motor and homeowner’s insurance.
This improvement has led some companies, especially the mutual ones, to grant discounts to policyholders and to pay out dividends even before the 2020 financial statements are closed.
The lines of business hit the hardest by the effects of the crisis are event cancellation and business interruption covers.
Other directly exposed lines such as credit insurance, assistance, travel insurance, health insurance and provident insurance also saw an increase in claims.
Non-physical damage business interruption coverage Insurance: event cancellation coverage Covid-19: Insurers and authorities up against the risk of a pandemic
The exceptional magnitude of the crisis forced the authorities to react. Indeed, to avoid a total collapse of the economy, governments had to take urgent measures to support the various market stakeholders, calling on insurers to participate in this surge of solidarity.
Consequently, some regulators asked and sometimes imposed on private insurers to examine with understanding the claims related to Covid-19. Others, on the other hand, have insisted on the respect of the guarantees as stipulated in the contracts, while requesting financial support from the insurance companies for the benefit of individuals and sectors affected by the crisis.
Nigeria

For insurers, the fallout from the COVID-19 outbreak includes a surge in health, travel and business interruption claims, pressure on sales from reduced business activity, and less use of face-to-face channels. The gathering economic slowdown emanating from the pandemic is also driving interest rates even lower and increasing credit risk exposures from businesses facing possible default.

This raises the possibility of regulators asking for extraordinary solvency tests to ensure insurers can withstand the immediate and knock-on impacts. Put together, this daunting list of issues represents a stern test of resilience for an industry already weighed down by enduringly low interest rates and slow growth in mature markets.

South Africa
Insurers are not required to cover business interruption caused by the pandemic when coverage is not purchased.
Kenya
The Kenyan regulatory authority IRA has ordered insurers to pay all pandemic-related claims.
Cima Zone
The Inter-African Insurance Market Conference, which includes 14 African countries, recommends fair treatment and protection of policyholders’ interests.
Morocco
The Supervisory Authority of Insurance and Social Welfare (ACAPS) has temporarily loosened certain prudential rules. It has also taken mitigation measures to enable the insurance sector to cope with the consequences of the pandemic. Thus, the losses avoided to the market by these measures are estimated at 700 million MAD (76 million USD).
France
The authorities have opted to establish a public-private partnership to find “new insurance solutions to this unprecedented crisis”. The French Federation of Insurers has thus submitted proposals to the government to build a system of protection against “exceptional disasters”.
Faced with exceptional economic costs related to Covid-19, estimated at 86 billion EUR (100.57 billion USD) at the end of 2020, insurers have taken several support measures including: a contribution of 3.2 billion USD to support and indemnify the most affected individuals and companies, a 2.5 billion USD grant to participate in the country’s economic recovery.
United States
In order to alleviate the burden of the pandemic, the United States, the country most affected by Covid-19, adopted a series of emergency measures, including the CARES Act.
The new provisions allowed the federal government to allocate approximately 3 000 billion USD in financial aid to businesses and individuals.
The insurance companies have provided 8.1 billion USD in assistance in the form of refunds, discounts, dividends and credits to motor insurance policyholders.
In most states, companies provide this support on a voluntary basis, although government authorities encourage insurers to take such initiatives. Cigna and New York Life, for example, have created a fund called the Brave Heart Fund. Its purpose is to provide financial support to the families of medical employees who have died from coronavirus.
Patoma Admin by — March 4, 2021 in Insurance 0

Favour Nnabugwu

Capital constraints in local markets are leading to more business flowing to wholesale markets, such as London and Bermuda.

According AM Best, Private equity, industry capital and public placements all contributed to the capital inflow, said Best, supporting the balance sheets of existing players, alongside some material scaleups and a number of true startups.

Listed carriers including Beazley, Hiscox, QBE, Lancashire and Renaissance Re tapped public equity and debt markets, while privately-owned Convex and Fidelis raised capital from new and existing shareholders.

Best said the capital inflow partly reflects the absence of other opportunities for investors, particularly the low interest-rate environment, and the risk and reward calculation posed by the insurance industry in a hardening market may look more attractive to existing and new investors.

The ratings agency noted that Bermudian and London market insurers have been able to raise equity with relative ease, suggesting that investors have confidence in the near-term prospects of the insurance industry, despite claims uncertainty in respect of Covid-19, social inflation and catastrophe exposure.

Third-party capital, for example in the form of collateralised reinsurance vehicles (sidecars) and insurance-linked securities, continues to flow into the market, but the pace has tempered, following a period of high-severity losses and issues surrounding collateral release, said Best.

One area attracting interest as a result of the current hardening market is US casualty business. In recent years, insurers writing US casualty business has been hit by an increase in both the frequency of attritional claims and a rise in the severity of large losses, largely reflecting the issues with social inflation and rising jury awards in the US, said Best.

In particular, directors and officers, errors and omissions, excess casualty and healthcare liability lines have been particularly affected; and as a result these lines have been pruned, with the subsequent squeeze on capacity supporting material rate improvements.

Best said: “Capital constraints in local markets are leading to more business flowing to wholesale markets, such as London. As a result, insurers are seeing attractive opportunities to deploy capital, particularly in specialty excess and surplus markets and more recently in reinsurance.

This was demonstrated by the strong growth recorded by existing London market insurers in 2020, with results announcements detailing double-digit rate increases for some lines of business.”

The impact of all of this could have a dampening effect on price increases, said Best, although it noted that a portion of the additional capital raised in 2020 has already been required to absorb adverse prior-year loss reserve development and upward revisions in Covid-19-related loss estimates.

“The [effect that the] economic consequences of the pandemic will have on demand for insurance is highly uncertain and will largely depend on the length and depth of the economic downturn. As economies shrink, so does the value of insurable risk. But when businesses come under financial pressure, their appetite to retain risk may also reduce – increasing demand for insurance cover,” said Best.

Best also noted that there has been a concern that some risks, even where there have been material rate increases, are still not adequately priced. “The persistent squeeze on capacity means rates have continued to rise in these lines and there does now appear to be growing confidence around price adequacy,” it said.

Best explained that economic volatility caused by Covid-19 may constrain M&A activity in the short term, but in the longer term, consolidation pressures are likely as some insurers come under increased financial pressure. However, Best said it expects to see further portfolio transfers in the forms of disposals of non-core businesses to strategic buyers, financial buyers and runoff specialists.

Patoma Admin by — March 4, 2021 in Insurance 0
Allianz, Munich Re insurance solution ‘Cloud Protection’

Allianz Global Corporate & Specialty (AGCS), the corporate insurer of Allianz SE, and Munich Re have jointly developed a new commercial cyber risk insurance solution called “Cloud Protection +.”

This collaboration provides state-of the-art insurance exclusively designed for customers of Google Cloud enrolled in Google’s new “Risk Protection Program.

The Risk Protection Program consists of two components: Risk Manager, a new tool that helps determine a customer’s security risk posture on the cloud, and Cloud Protection Plus + – a new cyber insurance solution built exclusively for Google Cloud customers.

Under Cloud Protection +, clients are offered, subject to underwriting eligibility, a new type of protection against cyber incidents within their own corporate environment as well as incidents related to Google Cloud. Target customers for this solution are US-based Google Cloud users, though this offering may be offered globally at a later date.

Companies are increasingly using cloud-based solutions: according to Gartner Research, by 2024, more than 45 percent of IT spending will shift from traditional solutions to the cloud. Cloud usage comes with many benefits, such as lowered cost, enhanced data analytics and expanded collaboration, but also new potential risk around security, compliance and data privacy.

“As one of the top three global business risks in the Allianz Risk Barometer 2021, cyber risk is complex and ever-changing, and cloud exposures are among today’s most relevant threats,” stated Thomas Kang, North American Head of Cyber, AGCS.

To address a developing market need with Munich Re along with a major cloud platform provider such as Google Cloud is ideal. We not only obtain valuable insights on a company’s security posture, but remain at the forefront of understanding and managing emerging risks associated with cloud architecture and latest client needs.”

The new product allows both carriers to utilize Google Cloud’s proprietary assessment tools to harness stronger underwriting variables, yielding a more data-driven risk evaluation and underwriting process. Each carrier will use the data from Google Cloud’s Risk Manager reports to simplify the insurance application and risk assessment. Conveniently, carriers receive reports directly from the clients through the Risk Manager tool.

“It is optimal for industry peers to establish custom products that move the needle in today’s corporate environment,” added Jody Yee, Managing Director for Alternative Risk Transfer, AGCS. “We are meeting latest coverage needs with viable solutions to meet changing business dynamics.”

Cloud customers, especially those in regulated markets such as financial services and healthcare, are concerned about security and reliability in the cloud as they run the risk of high-profile data breaches and outages. Some have resulted in great financial and reputational loss or even business closures. Whether it stems from an external cyber-attack, human error or a technical failure, the Allianz Trend in Cyber Risk report further points out that business interruption (BI) due to security issues, is the main cost driver behind cyber claims; it accounts for nearly 60% of the value of all claims analyzed, with the costs associated with data breaches ranking second.

AGCS launched its first standalone cyber insurance product in 2013, and has seen steady growth since in all key markets, globally. As the demand for cyber coverage has evolved, Allianz launched its Cyber Center of Competence in 2018. The center, embedded into AGCS, focusses on coordination and alignment of cyber underwriting for the commercial insurance segment within Allianz Group, adopting a prudent approach as both cyber risks and claims are increasing.

Recent priorities include the development of a new underwriting approach to clarify exposures – particularly silent cyber – across commercial property and casualty policies. Product governance and harmonization as well as the further expansion of the global service provider network for cyber policyholders are also key areas under review.

Patoma Admin by — March 4, 2021 in Insurance 0

By Favour Nnabugwu

Close to 35 years of its existence in Lagos, Nigeria, Continental Reinsurance announces the retirement of Dr Femi Oyetunji, the out going Group Managing Director of the company come March 31, 2021.

According to Oyetunji, 2020 was one of the most challenging years ever experienced globally, following the Covid-19 pandemic. “We faced daunting business conditions, but our teams responded with the enterprise and commitment I have come to expect.  We boldly adapted to the business environment and embraced a range of new opportunities.”

The announcement coincides with the publication of an independent brand survey by Kantar that recognised Continental Re as a truly credible pan-African company.  Conducted in six representative markets, the survey shows that the company exceeds the global reputation benchmark.

“It was gratifying to obtain an overall score of 79 points which is above the global benchmark of 73.  Now, however, our goal is to keep pushing higher”, said Dr Femi Oyetunji.

Not just a marketing exercise, the study is the result of a 360-degree assessment of all aspects of the business.  Reputational gains can clearly be attributed to a successful “inside/out” thinking that considers employees the very foundation and starting point of sustainable business planning.

Today’s announcement was further marked by the opening of the company’s headquarters in Lagos, Nigeria.

Speaking during the unveiling ceremony, Chief Ajibola Ogunshola, Chairman, Continental Reinsurance Plc said, “The new headquarters is a milestone in Continental Re’s ambitious long-term plans.  It is a physical manifestation that positions the company at the heart of Africa’s largest economy. Both the brand survey and the unveiling of the new headquarters coincide with the imminent retirement of Dr Femi Oyetunji, Group Managing Director who has provided decade-long transformational leadership to Continental Re. Dr Oyetunji retires on 31 March 2021.

He leaves a strong legacy of significant contributions that will live on in the company for many years to come.  His key achievements include landing an aggressive strategy to position the company as a pan-African brand with a strong presence across six key geographical locations; under his leadership, revenue grew fivefold, profitability threefold, and productivity more than doubled, along with the transformation of the company’s culture, processes, and standards.  He has collaboratively led the creation of an enabling environment for thought leadership and sound corporate governance agenda in the industry on the African continent.

Commenting on his retirement, Dr Oyetunji said, “We’re passing the leadership on to the next generation. They will be faced with new and sometimes unprecedented challenges but in their stewardship is a company that has a rich legacy.  Our predecessors and ourselves have created a strong foundation; I am confident that my successor will raise the company to lofty heights.”

“It is symbolic that the opening of the new headquarters coincides with the passing of the baton.”

Patoma Admin by — March 4, 2021 in Insurance 0

Allianz is buying Aviva’s Italian P&C operations for €330million, with the deal expected to close in the second half of this year.

The acquisition of Aviva Italia includes its 500 agents and will consolidate Allianz’s position as the third-largest player in the Italian P&C market.

The Aviva Italia portfolio is equally distributed between motor and non-motor business, with gross written premiums of about €400m.

“With its strong focus on customer satisfaction and distribution excellence, Allianz is committed to ensuring a smooth transition for both clients and agents. The similarity of the business models, combined with strong investments in technological innovation by Allianz in recent years, are key elements to drive the effective integration and joint growth,” said the German insurer on the deal.

Giacomo Campora, CEO of Allianz Italia, said the acquisition fits with its strategy for growth based on a solid technical platform and continuous investments.

Patoma Admin by — March 4, 2021 in Insurance 0

By admin

The Board of Continental Reinsurance Plc is pleased to announce Mr Lawrence Mutsunge Nazare’s appointment as the Group Managing Director of the Company, effective April 1, 2021.

Dr. Femi Oyetunji will retire on March 31, 2021 and will support the transition process during this period.

The Chairman of the Board of Directors Continental Re , Chief Ajibola Ogunshola, said “Dr. Oyetunji has remarkably served as Group Managing Director since 2011 and leaves a strong legacy of significant contributions that will live on in the company for many years to come. His key achievements include landing an aggressive strategy to position the company as a pan-African brand with a strong presence across six key geographical locations; under his leadership, revenue grew fivefold, profitability threefold, and productivity more than doubled, along with the transformation of the company’s culture, processes, and standards. He has collaboratively led the creation of an enabling environment for thought leadership and sound corporate governance agenda in the industry on the African continent.

Speaking on Nazare’s appointment, which the National Insurance Commission (NAICOM) has approved, Chief Ogunshola said, “The Board is pleased that following a rigorous selection process, Mr Lawrence Nazare, was chosen to lead Continental Reinsurance Plc”.

“Mr Nazare, a seasoned insurer, has been on the Company’s executive leadership as Group Executive Director/Chief Operating Officer for over ten years. With more than three decades in the industry, he brings to the role a deep understanding and experience of our business, the industry and the markets in which we operate. He is an agile and purpose-driven leader with an impressive track record of delivering consistent, high-quality performance. The Board welcomes him to the role and wishes him a resounding success.”

Dr. Oyetunji remarked, “I congratulate Mr Nazare on his appointment. I know his commitment, and I am highly confident that Continental Re will continue to prosper under his leadership. His appointment demonstrates the strength of Continental Re’s succession planning and talent pipeline.”

Nazare said, “It’s an honour to lead a truly pan-African brand with capable teams across all our regions. Our focus will continue to be the provision of a unique offering to our clients and partners and the delivery of long-term growth and value to all stakeholders. Our people, our systems and processes that conform to global best practices, and our exacting standards and winning culture, are key factors that we leverage on.”

“I wish to extend my gratitude to Dr Femi for his outstanding leadership and mentorship, and I look forward to working with him closely during the transition.”

Mr Lawrence Mutsunge Nazare has over 30 years’ experience in the insurance industry. He started his professional insurance career with Zimbabwe Reinsurance Corporation in 1990. He then moved to Intermarket Reinsurance in 1999 and left as Managing Director in 2010 to join Continental Reinsurance Plc as the Group Executive Director/Chief Operating Officer.

Nazare has held key positions in the insurance industry, including Chairman of the Organization of Eastern and Southern African Insurers (OESAI) – 2012 to 2015; Chairman of Zimbabwe Association of Reinsurance Offices, 2001-2004; Chairman of Insurance Council of Zimbabwe, 2005 to 2008 and Executive Committee/Board Member of East & Southern African Insurers & Reinsurers – 2002 to 2018. He is also a member of the Institute of Directors, Nigeria.

Lawrence Mutsunge Nazare is married with children.

Patoma Admin by — March 4, 2021 in Insurance 0

By Favour Nnabugwu

Enterprise Life has began operation in Nigeria after the company was fully licensed by the National Insurance Commission in November 2020

The significant milestone in the Group’s expansion project into foreign markets, coming a few years after its first venture beyond the shores of Ghana, into The Gambia.

According to the Group CEO, Keli Gadzekpo, Enterprise Group PLC has had its eye on the Nigerian market for quite a few years, due to the strategic importance of that country to the economic development of the West African sub-region.

715202080854-0f72yl3xxs-keli-gadzekpo

Group CEO, Keli Gadzekpo

Gadzekpo further stated that while he is proud of the many successes the Group has chalked in Ghana and The Gambia over the years, there is something especially exciting about entering the Nigerian market.

It not only allows the Group to increase its international footprint, but it also gives opportunity for the Company’s expertise and experience in the insurance sector to be made available to a truly large market.

He further explained that since life insurance plays a unique role in multi-generational wealth creation and preservation, life insurance in Nigeria, the most populous nation in Africa, has great potential to act as a catalyst of change to end the cycle of intergenerational poverty in Africa.

Mrs Funmi Omo, Managing Director of Enterprise Life, Nigeria, disclosed that the aim of Enterprise Life is to expand the insurance net in Nigeria by offering innovative and relevant life insurance solutions, using a needs-based approach to sales.

She expressed confidence that the unique solutions offered by Enterprise Life will appeal to the large population of uninsured Nigerians, who to date have not had the opportunity to experience the peace of mind offered by insurance.

About Enterprise Group PLC

Enterprise Group PLC is a financial services company comprising five operating companies; Enterprise Insurance Company, Enterprise Life Assurance Company, Enterprise Trustees, Enterprise Properties and Enterprise Funeral Services Ghana trading as ‘Transitions – The Funeral People’. It is headquartered in Accra and has operations in The Gambia and Nigeria.

Enterprise Group PLC has a strategic partnership with Black Star Holdings Limited (BSHL), a wholly-owned subsidiary of Leapfrog Strategic African Investments (LSAI), which is a separate account managed by Leapfrog Investments, and in which Prudential Financial, Inc., USA (PFI) is the primary investor.

Among the best advantages that you will get from having your distinctive customized essay composed is that it provides you greater exposure in the

So

A lot of individuals who’ve already

A few folks might discover

When you come up with a good article, the professor will take notice and he’ll assist you in obtaining a better

Writers

They ought to write

Students should always start affordable-papers.net with the introduction for their essay, but move onto the body.

what comes to mind, but do not feel like describing.

can also use the Internet to understand to compose.

grade on your essay.

your paper dull but most of the readers may take an interest in your newspaper.

started out with their research tend to perform these types of papers.

as to compose a well-researched and clear research article, you have to be aware of how to use study and essay writing computer software.

internet world.

Patoma Admin by — March 3, 2021 in Insurance 0

By admin

The Governing Board of the Nigerian Council of Registered Insurance Brokers (NCRIB) has endorsed the appointment of Tope Adaramola as the Executive Secretary/Chief Executive Officer of the Council.

He is expected to take over from Mr. Fatai Adegbenro, who retires from the Council in May, 2021.

Adaramola who is currently the Deputy Executive Secretary of the Council joined the NCRIB in 2004 as the pioneer Public Relations Manager.

A 1989 graduate of Political Science and Industrial Relations (MILR) from the University of Ibadan, Adaramola had earlier worked as a reporter with Ogun Radio, Abeokuta; served as Press Secretary to the Government House, Ogun State between 1991 and 1998, from where he joined the Nigerian Insurers Association (NIA) in 1998 as the second Public Relations Professional to be engaged by the Association.

While in the Council, Adaramola rose meteorically through the ranks and availed the entire industry his expertise in Public Relations and public speaking for which he was renowned.

He also avails the industry of his writing prowess as member of the editorial team of the Chartered Insurance Institute of Nigeria and the NCRIB and served on several Industry Committees, including the Insurance Industry Consultative Council (IICC). He was the pioneer Secretary of the Insurance Industry Image Committee.

Adaramola is a product of the European School of Protocol, a member of the Chartered Insurance Institute of Nigeria (CIIN) where he obtained professional certificate in insurance and has attended several courses and training in Insurance, leadership and management in Nigeria, Malta, USA, Canada, UK, South Africa and the Gambia.

He is expected to bring his rich social capital and leadership skills to bear in directing the affairs of the Council as the head of the Secretariat. Adaramola is married with children

Remember you don’t need to https://www.affordable-papers.net/ place too much data in your newspaper.

Patoma Admin by — March 2, 2021 in Insurance 0

The country’s pension asset under management, as of December 2020, stands at N12.3trillion which represents a modest growth of 20 percent year-on-year and 0.003 percent month-on-month (no significant change), according to the monthly report by National Pension Commission (Pencom).

According to the report, total RSA funds increased by 20% year-on-year while the funds under both existing schemes and Closed Pension Fund Administrator (CPFA) as well, grew by 21% year-on-year.

As of December 2019, investments in FGN Securities accounted for 72 percent of the total pensions assets fund, out of which 73 percent was invested in Bonds and 26 percent in Treasury Bills.

As of December 2020, investments in FGN Securities accounted for 66 prrcent of the total pensions assets fund, out of which 84 percent was invested in Bonds and a paltry 8 percent in Treasury Bills, which is not unrelated to the subsisting very low yield of TB in the money market.

The investments in FG Bonds represent 56% of the total pension assets fund under management. The renewed and increased investments in FG Bonds can be attributed to the attractiveness of the yields of FG bonds over the Treasury Bills.

RSA Fund II and III accounted for 89% of the total RSA funds and 69% of the total pension assets under management as of December 2020, while others – Funds I, IV and V accounted for 31%

All the RSA funds, including existing scheme and CPFA recorded year-on-year growth as follows: Existing scheme (13%), CPFA(28%), Fund I (49%), Fund II(19%), Fund III(21%), Fund IV(18%).

As of December 2020, only N80.54million was invested under the newest RSA fund (Fund V) – specifically created for micro pensions.

Patoma Admin by — February 26, 2021 in Others 0
Munich Re records 55% net profit in 2020

 

Dr Joachim Wenning, chair of the board of management at Munich Re

 

Munich Re reported a 55 percent fall in net profit last year to €1.2bn despite 18 percent growth in ERGO’s contribution to €517m, as the group was struck by €3.4bn of Covid-19 losses.

The group’s reinsurance business saw profit drop 69 percent to €694m in 2020, as the bulk of the group’s heavy Covid-19 losses hit the unit, with primary insurer ERGO reporting just €64m of pandemic claims.

CEO Joachim Wenning said “all the pieces are in place” for the group to return to pre-pandemic profit targets of €2.8bn in 2021. He said Munich Re would have met this target last year without Covid-19.

Munich Re’s combined ratio deteriorated to 105.6 percent last year from 100.2 percent. Major losses in excess of €10m each totalled €4.69bn for 2020 and €1.19bn for Q4.

The group said major loss expenditure at 20.8 percent of net earned premiums exceeded the long-term average of 12 percent. Covid-19 losses together with manmade claims totalled €3.78bn in 2020. But nat cat losses of €906m were lower than expected. Hurricane Laura was the costliest catastrophe of the year for Munich Re at €280m.

The group reported a drop of more than 2 percent in Q4 profit to €212m, on the back of a 35 percent fall in reinsurance to €75m, and an increase at ERGO to €136m.

For full-year 2020, ERGO was close to meeting its pre-pandemic original profit target of €530m after ERGO International saw its profit more than double to €230m from €105m, and its combined ratio improve to 92.7 percent from 94.3bpercent in 2019.

The group’s 2020 operating result dropped 42 percent to €1.99bn, after a 62 percent fall in reinsurance to €984m from €2.6bn in 2019.

Gross premiums written increased almost 7 percent to €54.9bn last year, driven by 10 percent growth in reinsurance business to €37.3bn, while ERGO recorded a drop of 0.5 percent to €17.6bn.

At key renewals in January 2021, Munich Re recorded an 11 percent increase in the volume of business to €11.6bn. Rates were up 2.4 percent across its global portfolio and terms improved, particularly in non-proportional business. Half of Munich Re’s P&C business was renewed in January and the group said it expects further rate hardening in April and July renewals.

Mr Wenning said Munich Re was still able to make a profit and return a dividend to shareholders in 2020, despite the impact of Covid-19. He said the group entered 2021 with confidence.

“Our reinsurance business is ideally positioned to resolutely exploit opportunities for profitable growth in the improved market environment. And ERGO is performing well following the successful conclusion of its strategy programme,” Mr Wenning said.

He added that the group will hold off from the launch of a new share buyback programme. “Our shareholders will benefit more from investments in the attractive business opportunities now emerging,” he said.

Moody’s analyst Christian Badorff said Munich Re performed better than some of its peers and benefited from ERGO as “a good diversifier in 2020”.

“In the recent P&C reinsurance renewals, Munich Re has been able to grow its book by 11 percent also benefiting from price hardening, and we think this will support underlying earnings in 2021. Group Solvency II at 208 percent continues to be strong, but we note a material weakening from the pre-crisis levels of 237 percent at year-end 2019, driven mainly by the growing book of business, low yields and increasing credit risk,” Mr Badorff said.

Patoma Admin by — February 25, 2021 in Insurance 0