One of the world’s largest reinsurers, Munich Re, has announced a new net profit target of €5 billion for 2024, as well as Group revenue of €59 billion, and an improved return on investment to above 2.8%.
In announcing its Q3 2023 results back in November, Munich Re said that it was confident of beating its initial annual target of €4 billion and raised the guidance to €4.5 billion for 2023. This has increased by a further €500 million for next year, taking 2024’s target €1 billion higher than the first target of this year, which is quite an increase.
Within its reinsurance arm, Munich Re anticipates an expansion of insurance revenue to €39 billion and a net profit of €4.2 billion in 2024, as the firm targets profitable growth in an ongoing favourable market.
In property and casualty reinsurance, Munich Re expects the combined ratio to strengthen to 82%, reflecting operating improvements from the earn-through of the 2023 renewals and from the expected outcome of the 2024 renewals.
“Moreover, on the basis of Munich Re’s very strong reserving position, it is not planned to build up reserve prudency any further by offsetting part of the discounting impact, as was the case in 2023,” says the firm.
In its life and health reinsurance business, the company expects a total technical result of €1.45 billion in 2024, driven by annual releases of CSM and risk adjustment, and an ongoing strong contribution from business with non-significant risk transfer.
Turning to ERGO, and Munich Re says that this part of the business is expected to generate insurance revenue of €20 billion in 2024, continuing its strong development in recent years with a profit contribution of €800 million.
The reinsurer notes that these forecasts are subject to increased uncertainties from geopolitical and macroeconomic developments, to major losses remaining within normal bounds, and to its income statement not being impacted by severe fluctuations in the currency or capital markets.
