MUNICH RE, the world’s biggest reinsurer, expects to beat its 2012 net profit target of €2.5 billion after rising premiums and improved underwriting performance boosted the German group’s quarterly earnings.
Munich Re cited the potential for big damage claims from hurricanes in the second half and expected triple-digit million euro restructuring costs at insurance unit Ergo as reasons for not raising its 2012 target more significantly. Munich Re shares were up 1.1 per cent to €118.85 yesterday.
Its second quarter saw payouts for big damage claims fall nearly a third to €452 million. Munich Re expected claims for crop failure after a drought in the US to cost around €160 million.
In contract renewals with insurance company clients in Australia, Latin America and the US in July, Munich Re managed to boost premium volumes by 18.5 per cent while also raising prices 2 per cent.
Munich Re said low yields on its €190 billion portfolio of fixed-income securities remained a major threat for which it was trying to compensate through price increases and greater underwriting discipline. – (Reuters)
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/VR3765MFOBH2NMV2QNICYDF67M.png)