Swiss Re’s profit beats estimates on lower catastrophe claims

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(Bloomberg) –Swiss Re AG’s net income for the first half of the year beat estimates as the reinsurer avoided higher losses from natural catastrophes that have hit the insurance industry in general.

Second-quarter profit was $996 million, on net income of $2.1 billion for the six months to June, the Zurich-based insurer said in a statement on Thursday. The return on the group’s investment portfolio was 4% in the first half of the year, compared with 2.8% a year earlier.

“After a strong start in the first half of this year, we are maintaining our targets for 2024, including group net income of more than $3.6 billion,” chief executive Andreas Berger said in a statement.

In its key property and casualty businesses, Swiss Re reported net income of $989 million in the first half of the year, mainly due to lower claims reported by major natural catastrophes, which were partially offset by selected additions to reserves natural disasters and man-made losses.

Swiss Re’s performance contrasts with the battering experienced by insurers at a time when weather events have jumped well above the 10-year average. Both Allianz SE and Zurich Insurance Group AG reported weaker results in property and casualty following events including floods in Germany, although they reported higher profits.

The reinsurer attributed part of its result to “disciplined underwriting”. Earlier this month, the company warned that global insured losses from natural catastrophes reached $60 billion in the first half of the year.
Swiss Re said the planned exit from its digital insurance business iptiQ is progressing, while revealing a net loss of $182 million for the first half of 2024.

Read more: Swiss Re to ditch digital white-label insurance after a decade

European insurers have seen their share prices hit over the past month as Hurricane Beryl caused billions of euros in damage after becoming the Atlantic’s earliest Category 5 hurricane.

Earlier this year, Swiss Re named Andreas Berger as its new CEO in a surprise management reshuffle. Berger took over from Christian Mumenthaler, who resigned after a quarter of a century with the company. The firm has also appointed Anders Malmstrom as its next chief financial officer to replace John Dacey, who will retire from his executive role in March 2025.