SCOR has unveiled a new set of ambitious growth targets as part of its strategic plans for 2022, which include a significant boost to premiums within its P&C business, as well as an increased focus on natural catastrophe lines of business.
Alongside its Investor Day 2021, the reinsurer said it plans to make the most of the current heightened risk awareness environment by rebalancing its exposure to P&C business and capitalising on hard market and attractive pricing conditions.
Accordingly SCOR’s new strategic plan, which will be fully unveiled in March 2022, includes estimated GWP growth for SCOR Global P&C of 15-18% for 2022, up from its previous ‘Quantum Leap’ target of 4-8%.
At the same time, the P&C unit will target a combined ratio trending down to ~95% and below, better than the ‘Quantum Leap’ assumption of ~95% to 96%, with an increase in the nat cat budget from 7% to 8% to reflect the influence of climate change and rising trends of mid-sized catastrophic events.
In particular, SCOR sees strong reinsurance growth opportunities in Europe, Fast Growth Markets, and Global Lines, with Specialty Insurance being seen the most attractive segment of the market and expected to make up 30% of P&C premiums.
SCOR Global P&C will pro-actively reduce the adverse impact of nat cat volatility on its portfolio by limiting growth on cat business, as well as further optimizing the P&C retrocession program in 2022 to better cover against cat frequency claims, the company explained.
“SCOR’s franchise has never been stronger, the Group is poised to reap the benefits of its leadership position and seize the attractive long-term growth opportunities emerging from the fast-changing risk environment,” said SCOR CEO Laurent Rousseau.
“The Group Executive Committee is focused on delivery and operational improvement to create sustainable, franchise-strengthening value for our shareholders. In the next strategic plan, to be unveiled in March 2022, we will focus on Culture & People, Business Leadership, and Financial Performance to transform the Group and build a differentiated value proposition for all stakeholders.”
Turning to life business, SCOR is targeting GWP for 2022 up 1.0%, pursuing profitable growth in the core protection business of 3-4% and focusing on markets where SCOR Global Life can have an impact amid the continued challenge of the pandemic.
The reinsurer’s net technical margin for FY 2021 estimated at ~10%, or between 5.5% and 6.0% excluding the “day one” impact from the recent in-force transaction.
And in terms of investments, SCOR is finalizing the reinvestment of its excess liquidity into corporate bonds exposure by the end of 2021 and actively diversifying invested assets into value-creation assets, which are expected to represent over 10% of total invested assets by the end of 2022.
Under current market conditions, the return on invested assets is expected to be between 1.8% and 2.3% for the full year 2022.
