Talanx, the parent company of Hannover Re, generated a record net income of €923 million during 2019 despite higher-than expected large losses.
Total large losses amounted to €1.3 billion, due above all to events in non-life reinsurance.
€363 million of this figure was attributable to primary insurance, while reinsurance accounted for the remaining €956 million.
While the first half of the year saw extremely moderate large losses from natural disasters, the second half was well above expectations.
At 98.3%, the combined ratio was flat year-on-year due to higher large losses from the hurricanes on the Bahamas and in the US, and the typhoons in Japan.
Large losses also pushed down the underwriting result by 11% to a €1.8 billion loss.
The reinsurance division hit its growth and earnings targets in 2019 despite large losses exceeding expectations.
Gross premiums rose by 18% and operating profit improved 12% to €1.8 billion despite above-average losses from natural disasters.
“We grew premiums by 13 percent and profits by 31 percent in 2019, generating record net income of EUR 923 million. In other words, our ambitious Strategy 2022 initiative already bore its first fruit last year”, said Torsten Leue, Chairman of Talanx AG’s Board of Management.
“Encouragingly, all four divisions contributed to the rise in profits. Retail Germany, Retail International, and Reinsurance all continued their strong performance, while Industrial Lines recorded an impressive improvement.
“The latter significantly exceeded its price adjustment target of 20 percent for fire insurance and is now clearly generating an operating profit again. Our growth initiatives are having an effect.
“For example, HDI Global Specialty lifted its premium income by more than 30 percent to EUR 1.4 billion. The commercial business in the Retail Germany Division recorded growth of 8 percent. We also made substantial progress in modernising our IT in 2019 by retiring the BS2000 mainframe system.
“We are convinced that we will position Talanx for even greater growth and stronger profits in the coming years by encouraging an entrepreneurial mindset and independent action among our employees. This is expressed in our new Talanx Purpose: ‘Together we take care of the unexpected and foster entrepreneurship’.”