March 19, 2004 by Canadian Underwriter
The world’s largest insurer, Munich Re, is posting a loss of
EUR434 million (Cdn$710.9 million), despite a strong underwriting performance.
“With the net loss for 2003, we are drawing a line under three difficult years impacted above all by the bear market on the stock exchanges. As the underwriting result for the year under review showed, we are gearing our operations closely and consistently to profitability in all fields of business,” says Munich Re management board member Jorg Schneider. The insurance and reinsurance company posted underwriting profit of EUR2.0 billion (Cdn$3.3 billion) last year.
Premium income was up just slightly to EUR40.4 billion (Cdn$66.2 billion) from EUR40.0 billion (Cdn$65.5 billion) the year prior. And the company brought in a combined ratio of 96.7% in reinsurance, with pre-tax profit of EUR2.7 billion (Cdn$4.4 billion). The primary insurance segment brought in a combined ratio of 96.4% and pre-tax earnings of EUR248 million (Cdn$406.2 million).
But results were hampered by a tax charge of EUR1.8 billion (Cdn$3.0 billion), exclusive of which the company posted earnings of EUR1.3 billion (Cdn$2.1 billion). Catastrophes also hit the company’s books, including the U.S. tornadoes (EUR90 million; Cdn$147.4 million); California wildfires (EUR50 million; Cdn$81.9 million); Hurricanes Fabian, Isabel and Typhoon Maemi (EUR110 million; Cdn$180.2 million); the August blackout (EUR50 million; Cdn$81.9 million); Canadian oil refinery explosion (EUR60 million; Cdn$98.3 million)
The company plans a dividend payment of EUR1.25 (Cdn$2.05) per share, subject to approval at its annual general meeting.