Swiss Re p&c segment posts improved earnings for 2003

The world’s second-largest reinsurer, Swiss Re, posted net income of CHF 1.7 billion (Cdn $1.77 billion) for 2003, with the property and casualty segment reporting a solid combined ratio of 98.4%, almost 6% less than 2002.
Premium income was up 16% in the p&c group, to CHF 17.4 billion (Cdn $18.1 billion) from CHF 15.1 billion (Cdn $15.7 billion) in 2002, based on higher premium rates and organic growth, the company says. Excluding the negative impact of currency fluctuations, p&c premium growth would have been 25%. Earnings grew to CHF 1.8 billion (Cdn $1.9 billion), up from CHF 309 million (Cdn $321 million) in 2002. This includes realized gains of CHF 371 million (Cdn $385 million), versus a loss of CHF 611 million (Cdn $634 million) in 2002.
The p&c segment produced a claims ratio of 72.7% last year, down from 77.0% the year prior. Underwriting profit for 2003 came in at CHF 281 million (Cdn $292 million), a vast improvement over the underwriting loss of CHF 613 million (Cdn $637 million) posted in 2002. “This improvement was largely due to rate increases and a disciplined underwriting approach, and was achieved despite a poor result in liability from adverse developments from prior years,” the company notes in its annual report.
Forecasting 2004, the company says that increased price competition in the U.S. is putting pressure on property rates. However, notwithstanding major catastrophes, 2004 results should show further improvement, with price increases and tighter terms still in the offing for many lines.