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Talanx sees Q1 net income rise 31% to €423 million

15th May 2023 - Author: Kane Wells

The Talanx Group has disclosed that its Group net income increased 31% in Q1 of 2023 to €423 million, while the firm’s overall combined ratio also improved at 93.5%.

talanxTalanx’s insurance revenue in the quarter grew to €10.7 billion, chiefly driven by expansion in primary insurance (+14.2%).

Primary Insurance contributed 42.7% to Talanx’s net income, while Reinsurance contributed 57.3%.

According to the firm, Q1 was dominated by a “strong insurance service result,” which benefited from lower large losses, and from unwinding and discounting effects caused by the new accounting standard.

The Q1 net insurance financial and investment result before currency effects amounted to €330 million, while the operating profit stood at €1,043 million. The Solvency 2 ratio as of 31 March 2023 was 212%.

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Q1 total large losses in Primary Insurance were €54 million, while the figure for Reinsurance was €334 million.

The largest single loss Talanx suffered was the earthquake in Türkiye and Syria, which amounted to €249 million.

Global reinsurer Hannover Re, whose parent firm is Talanx, recently reported reinsurance revenue of €6.6 billion for Q1 of 2023, as the reinsurance service result increased 35% year-on-year to €568 million.

Talanx states that it continues to expect a Group net income of  €1,400 million for the full year.

The return on equity for Q1 2023 was 18.8%, above the firm’s strategic target of more than 10%.

Aside from the aforementioned unwinding and discount effects, this was due to the minor effect of investments accounted for at fair value.

Talanx is expecting the full-year return on equity to be “clearly above 10%”, whereby the new accounting standard may lead to greater volatility in individual quarters.

Torsten Leue, Chairman of Talanx AG’s Board of Management, commented, “We have got off to a good start in the new financial year: our Group continued its growth. Our Group net income showed a very significant increase of 31% to €423 million. Primary insurance made a strong contribution to this performance.

“This clearly shows that the optimisation programmes in the Primary Insurance segments are having a lasting effect. Our Group remains resilient and our strategy is continuing to prove extremely successful.

“Not only are we confirming our forecast for the current financial year, but this is also a strong start to our new strategy cycle for the period up to 2025.”

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