Bertrand Labilloy, Chairman & CEO of CCR Re, has suggested the firm is well placed to benefit from the new market environment in 2023 as it managed to “deliver a clean sheet in a turmoiled market” in 2022.
The French state-owned reinsurer reported a total premium income of €987m in its full year results, up 17% compared with 2021.
Labilloy noted that 2022 was “a year of continuity” as the firm’s operational performance fell in line with the five previous years.
Yet, at the same time, he also saw 2022 as a year of disruption. “Disruption with the resurgence of inflation, disruption with the comeback of war in Europe, and disruption with the extension of the impact of climate change across all the continents,” Labilloy said.
He continued, “The specificities of our underwriting policy, in terms of geographical scope, cat exposure and commitment rules, protected us against later shocks.
“The same DNA of prudence led us to increase massively our reserves to tackle the inflation risk.”
The impact of this on technical profitability was +564 bp on the Non-Life combined ratio and -123 bp on the Life technical margin.
Costs related to natural disasters (gross €62m and €35m net of retrocession) were lower than in 2021 (gross €79m and €43m net), though were offset by the increase in man-made claims.
In Life, CCR Re notes that the profitability of the portfolio improved despite the consequences of inflation, with a technical margin of 3.6%
In a market “hit by a combination of major shocks,” CCR Re’s combined ratio stood at 98.7%, up only slightly from 96.6% in the prior year.
The reinsurer’s net income for the year was €42m, stable with 2021’s €41m.
Labilloy concluded, “For 2023, the perspectives are even better thanks to the favourable duration gap between the asset and liability side of our balance sheet. The interest rate increase in 2022 increased the solvency of CCR Re.
“You can imagine we are well placed to benefit fully from the new market environment with the increasing demand for capacity and the increasing tariffs.”