Munich Re posts loss for Q1 due to natural catastrophes

Munich Re posted a consolidated loss of €948 million ($1.4 billion) for 2011 Q1, due to exceptionally high costs for natural catastrophes.
Despite the loss in the first quarter, Munich Re still expects to record a profit for the current financial year.
Reinsurance losses arising from natural catastrophes totaled €2.7 billion ($3.9 billion) from January to June 2011, almost €2.5 billion ($3.6 billion) more than expected for this period.
The reinsurer’s return on equity (ROE) for the quarter was -17.4%.
Gross premiums written increased by 11.3% to €13 billion ($18.7 billion).
“The earthquake in Japan and the natural catastrophes in Australia and New Zealand have made this the most difficult start to a financial year we have experienced for a long time,”
CFO Jörg Schneider, said. “Such major losses – even several within a few weeks – are possible in our reinsurance business.
“Thanks to our solid capitalization, we are able to absorb them. Despite these devastating natural catastrophes, we can still achieve a profit for the year as a whole.”