Global insurer and reinsurer SCOR has reported strong and profitable growth for the first six months of the year, supported by continued growth in Global P&C on the back of strong renewals.
Group net income increased by 9.2% for the first-half of the year to €286 million, as the reinsurer recorded gross written premiums of more than €8 billion, up 6.3% at current exchange rates (2.6% growth at constant exchange rates).
The reinsurer’s operating results reached €480 million in H1 2019, which is actually down 5.5% on the €508 million recorded a year earlier.
SCOR Global P&C continued to perform well in the opening six months of the year, with gross written premium growth of €3.5 billion, up 13.9% at current exchange rates. The reinsurer states that the growth in its Global P&C segment is a result of strong renewals in both 2019 and the H2 2018 renewals, with YTD renewed premiums growing by more than 10%.
YTD price improvements now sits at +1.7%, with mid-year 2019 renewal pricing up 3.8%. SCOR notes that the June – July renewal book accounts for less than 15% of SCOR’s Global P&C book of business, of which around 95% is now renewed. Renewed premiums in June – July are up by 6.2% to €660 million.
For the first-six months of 2019, SCOR Global P&C recorded an impressive combined ratio of 93.7%, which while strong, is down on the 91.4% recorded a year earlier. For Q2, the combined ratio also weakened slightly year-on-year, from 91.1% to 92.9%.
The H1 2019 Global P&C combined ratio includes natural catastrophe losses of 5.2%, of which 4.1% occurred in Q2 2019, coming mainly from various 2019 events, including tornadoes and cyclones in the U.S., floods in Brazil, and a European storm.
Deterioration in Q2 2019 of 2018 cat events, including Typhoon Trami and the Kuwait floods, was offset by favourable development in the estimated cost for California wildfires and 6.5% in Q1 2019 primarily driven by 2018 developments of Japanese typhoons Jebi and Trami.
SCOR expects the growth in its Global P&C unit to normalise in H2 2019 to between 5% and 8%.
Denis Kessler, Chairman and Chief Executive Officer (CEO) of SCOR, commented on the company’s results for the period: “SCOR delivers a strong performance in the first six months of 2019, achieving the solvency target and outperforming the profitability target set out in “Vision in Action”. The Group continues to expand its franchise, recording controlled growth in target geographical areas and lines of business, while delivering excellent technical profitability in both P&C and Life reinsurance.
“We are actively preparing our new strategic plan, which will be presented at the beginning of September. This plan – SCOR’s seventh since 2002 – will be an opportunity for the Group to affirm its ambitions, set its objectives and detail the ways and means used to pursue its strong value-creating strategy over the coming years.”
SCOR Global Life also performed well in H1 2019, recording 1.2% premiums growth to €4.6 billion, and a technical margin of 7.2%, compared with €4.5 billion and 6.9% in H1 2018, respectively.
H1 2019 concludes the reinsurer’s “Vision in Action”, and during the period SCOR Global Investments recorded an average return on invested assets of 3.1%, which is in the upper end of its initial 2.5% – 3.2% range.
Total investments hit €27.5 billion in the period, while total invested assets reached €19.5 billion and funds withheld totalled €8 billion.
Despite industry headwinds during the period, SCOR states that it successfully delivered on its targets for its strategic plan “Vision in Action” on a normalized basis.