This is despite the fact that some natural disasters have weighed on the bill. However, the reinsurer has succeeded in further tightening the price screw with a view to inflation.
Consolidated profit in the first quarter totaled 643 million US dollars after a minus of 248 million in the previous year, as Swiss Re announced on Thursday. The group thus closed roughly as expected by analysts. Group net premiums increased 4.1 percent to $11.1 billion. At constant exchange rates, the increase was as much as 7.5 percent.
More profitable core business
In property and casualty reinsurance (P&C Re), the combined ratio improved by 2.1 percentage points to 97.2 percent, although this year was also affected by the devastating earthquake in Turkey and Syria, Cyclone Gabrielle and the floods natural disasters in New Zealand weighed on the bill.
For the earthquake in Turkey and Syria, the group is an expected damage of 426 million dollars. No information has yet been given about further events. However, the division’s profit climbed to 369 million from just 85 million in the same period last year. However, provisions for the Ukraine war were still being formed at the time.
In the second largest pillar, life reinsurance (L&H Re), profit amounted to 174 million dollars after a minus of 230 million dollars in the previous year caused by corona costs. And the Corporate Solutions primary insurance business also contributed more to the profit at 168 million (previous year: 81 million).
The better condition of the financial markets also helped. This year, Swiss Re’s return on investments climbed to 2.8 percent from a low 0.7 percent in the first quarter of 2022.
Higher prices enforced
To improve profitability and be better prepared for inflation trends in the insurance industry, Swiss Re continues to increase prices. In the P&C Re business, the group has been able to increase premiums by a significant 19 percent since the beginning of April.
With these improvements, Swiss Re continues to target full-year 2023 Group profit of more than $3 billion. CEO Christian Mumenthaler is quoted in the statement as saying that everything will be done to achieve this goal in an uncertain macroeconomic environment. In addition, the combined ratio should be below 95 percent at the end of the year.
Meanwhile, the planned conversion of accounting according to IFRS 17, which will essentially result in adjustments in the valuation of balance sheet items, is not yet significant. Swiss Re will only do this in the 2024 financial year.
Swiss Re shares on the SIX fell 0.31 percent to CHF 89.28 in places.
mk/ra
Zurich (awp)