Swiss Re net income US$820 million for Q2 2015, up from US$802 million in Q2 2014

Swiss Re has reported a net income for the second quarter of US$820 million, compared to US$802 million in Q2 2014, driven by a strong increase in Life & Health Reinsurance. For the second quarter of 2015, Property & Casualty Reinsurance delivered a net income of US$453 million, compared to US$553 million for Q2 2014.

Swiss Re also reported on Thursday an 11% rise in net income to US$2.3 billion for the first half of 2015, compared to US$2 billion a year ago. The insurer said that P&C Re delivered a net income of US$1.3 billion for 1H 2015 (compared to US$1.5 billion in 1H 2014) and a combined ratio of 88.7% (vs. 86.1%). “The current period benefitted from a benign natural catastrophe experience and positive prior-year development, but was affected by price softening and changes in the business mix,” Swiss Re said in a statement. [click image below to enlarge]

For the second quarter of 2015, which ended June 30, P&C Re delivered a “flat” combined ratio for the quarter of 93.3% compared to 93.5% for the same period last year. Premiums decreased slightly to US$3.5 billion (vs. US$3.6 billion), also impacted by unfavourable foreign exchange translations. For 1H 2015, premiums earned were almost flat at US$7.3 billion (vs. US$7.4 billion). “Measured at constant foreign exchange rates, premiums grew by 6%, driven by premium growth in the Americas and EMAS as well as reduced external retrocessions,” the statement added.

Net income in Life & Health Reinsurance showed a strong increase to US$218 million in Q2 2015, compared to US$48 million in the same quarter last year, Swiss Re said in the statement. The operating margin was 11%, significantly above the 7.1% in Q2 2014.

Corporate Solutions net income was US$72 million (vs. US$66 million) in the quarter, “driven by continued profitable business performance on property and credit lines, increased net realized gains from investments and insurance business in derivative form.” Premiums earned were US$843 million, versus US$841 million for the same quarter of 2014. At constant foreign exchange rates, the underlying premium growth was 3.8%, with the highest growth in Asia and Latin America. The combined ratio was 97.3%, versus 93.2%. [click image below to enlarge]

Admin Re delivered a net income of US$43 million for the quarter, versus US$117 million in Q2 2014.

The statement noted that all business units contributed to the Group net income of US$2.3 billion for 1H 2015. Net investment income for the period was US$1.8 billion, a decrease from the prior-year period, in part related to net asset outflows. The year-to-date Group return on investments was 4%, compared to 3.9% in 1H 2014.

“The first half of 2015 has again put our business model to a good test,” said Group CEO Michel M. Liès in the statement. “In a continued volatile capital markets and challenging pricing environment, we were able to leverage our differentiated product and service offering in combination with our global scale to help our clients succeed. Despite the ongoing uncertainty about overall economic growth in many areas of the world – as shown by continued historically low interest rates – we were able to support our underwriting expertise with a strong investment result.”

Swiss Re said that the Group is on track to achieve its 2011-2015 financial targets, with the annualized return on equity for the six-month period at 13.5%.