UK Markets closed

Swiss Re reports net income of USD 1.3 billion for first nine months of 2021

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·10-min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

EQS Group-News: Swiss Re Ltd / Key word(s): Quarter Results
29.10.2021 / 07:01

Ad hoc announcement pursuant to Article 53 LR

Zurich, 29 October 2021 - Driven by the performance of its property and casualty businesses, Swiss Re reported a Group net income of USD 1.3 billion in the first nine months of 2021, despite significant large-loss events, particularly in the third quarter. Swiss Re's capital position remained very strong, with a Group SST ratio of 234% as of 1 July 2021.

Swiss Re's Group Chief Executive Officer Christian Mumenthaler said: 'Thanks to the Group's sustained focus on portfolio quality and disciplined underwriting, our property and casualty businesses delivered excellent results in the first nine months of 2021. At the same time, we were able to support communities impacted by natural catastrophes and the COVID-19 pandemic.'

Swiss Re's Group Chief Financial Officer John Dacey said: 'P&C Re and Corporate Solutions are delivering on their ambitious targets for this year, with a combined net income of just below USD 2 billion in the first nine months. We are also pleased with the underlying performance of L&H Re, which offset the impact from the pandemic, resulting in a reported profit for the second consecutive quarter.'

Swiss Re significantly improves profitability across businesses

Swiss Re achieved strong results for the first nine months of 2021 and reported an ROE of 6.6%, against the background of the continued COVID-19 pandemic and large natural catastrophe events. Net premiums earned and fee income for the Group rose by 5.9% to USD 32.0 billion in the first nine months of 2021 compared with the same period last year, with all businesses reporting increases. Swiss Re's net income excluding COVID-19 increased by 38% year on year to USD 2.3 billion.

Swiss Re achieved a return on investments of 3.0% in the first nine months of 2021. The investment result was largely driven by recurring income as well as equity valuation gains, combined with no credit impairments, as Swiss Re successfully navigated the low-yield environment.

P&C Re reports strong profit despite large natural catastrophe losses

P&C Re reported a net income of USD 1.5 billion in the first nine months of 2021, compared with a net loss of USD 201 million in the same period last year. This result was achieved while the business absorbed large natural catastrophe losses and reflects the improved quality of the portfolio, dramatically lower COVID-19 impacts as well as strong investment results. P&C Re's net premiums earned grew by 6.0% to USD 16.4 billion, reflecting the continued price momentum as well as favourable foreign exchange developments.

Large natural catastrophe losses for the first nine months of the year amounted to USD 1.7 billion - higher than expected, but still below the premiums earned for this class of business. The losses mainly related to Hurricane Ida and the floods in Europe in the third quarter, as well as the US winter storm Uri in the first quarter. In addition, large man-made losses amounted to USD 272 million year to date.

The combined ratio significantly improved to 97.5% for the first nine months of 2021 from 110.3% in the same period last year. On a normalised[1] basis, P&C Re achieved a combined ratio of 94.0% and is well on track to meet its target of less than 95% for the full year.

L&H Re's improved underlying performance, driven by management actions, largely compensates continuing significant COVID-19 impacts

In the first nine months of 2021, L&H Re reported a net loss of USD 62 million. This compares with a net income of USD 72 million in the prior-year period, as the business incurred significantly higher COVID-19-related claims of USD 1.2 billion in the first nine months of 2021, primarily originating in the US. Despite the impact from the pandemic, L&H Re reported positive net income for the second and third quarters of 2021.

Net premiums earned and fee income increased by 10.2% to USD 11.1 billion, buttressed by large transactions and favourable foreign exchange developments.

Excluding COVID-19 losses, L&H Re's underlying business performed well, increasing net income by 45% year on year to USD 899 million and achieving an ROE of 17.5%. This was primarily driven by solid underwriting performance across all regions, supported by in-force management actions and favourable investment results.

Corporate Solutions delivers very strong combined ratio

Corporate Solutions reported a net income of USD 425 million in the first nine months of 2021, compared with a net loss of USD 357 million in the same period last year. The Business Unit continued to benefit from the implemented strategic actions, allowing it to successfully absorb large natural catastrophe losses of USD 286 million, mainly relating to Uri and Hurricane Ida, and large man-made losses, totalling USD 212 million for the first nine months of 2021.

Net premiums earned rose 6.2% to USD 3.9 billion, thanks to rate increases, selective new business growth and favourable foreign exchange developments, while the impact of the previous portfolio pruning actions diminished. Year to date, Corporate Solutions achieved risk-adjusted price increases of 12%[2], as the attractive pricing momentum continued.

The Business Unit reported a combined ratio of 91.1% for the first nine months of the year, down from 116% for the same period last year, as a result of disciplined underwriting, strict expense management, continued rate increases and very limited COVID-19-related impacts in 2021. With a normalised combined ratio of 95.7% for the first nine months of the year, Corporate Solutions is well on track to meet its target of less than 97% in 2021.

iptiQ continues dynamic growth

iptiQ continued to successfully grow its business. Compared with the same period last year, gross premiums written for the core business rose by 118% to USD 520 million, with good contributions across all markets.

Outlook
Swiss Re's Group Chief Executive Officer Christian Mumenthaler said: 'We continue to reap the benefits of our strategic underwriting actions and see opportunities across all businesses to deploy capital at attractive returns. This gives us confidence for the remainder of the year and into 2022, with all our businesses well positioned to continue their strong performance.
'

Details of 9M 2021 performance

USD millions, unless otherwise stated

9M 2020[3]

9M 2020

Excluding

COVID-19[4]

9M 2021

9M 2020

Excluding

COVID-19[4]

Consolidated
Group (total)

Net premiums earned and fee income

30 164

31 950

Net income/loss

-691

1 643

1 258

2 261

Return on equity
(%, annualised)

-3.3

7.5

6.6

11.7

Return on investments (%, annualised)

3.4

3.0

Recurring income yield
(%, annualised)

2.4

2.2

31.12.20

30.09.21

Shareholders' equity

27 135

23 568

Book value per share (USD)

93.90

81.55

9M 2020[3]

9M 2020

Excluding

COVID-19[4]

9M 2021

9M 2020

Excluding

COVID-19[4]

P&C Reinsurance

Net premiums earned

15 517

16 443

Net income/loss

-201

1 039

1 460

1 513

Combined ratio (%)

110.3

100.1

97.5

96.9

Return on equity
(%, annualised)

-3.2

15.5

21.2

22.0

L&H Reinsurance

Net premiums earned and fee income

10 102

11 136

Net income/loss

72

620

-62

899

Recurring income yield
(%, annualised)

3.0

2.8

Return on equity
(%, annualised)

1.2

9.7

-1.3

17.5

Corporate Solutions

Net premiums earned

3 715

3 944

Net income/loss

-357

183

425

406

Combined ratio (%)

116.0

97.6

91.1

91.8

Return on equity
(%, annualised)

-20.2

9.3

22.3

21.4

Details of 9M 2021 COVID-19 losses in USD millions

9M 2021

P&C Reinsurance

L&H Reinsurance

Corporate

Solutions

Group items

Total

Event cancellation

54

-60

-6

Business interruption

34

24

58

Credit & surety

-5

-9

-14

Mortality

1 179

12

10

1 201

Other lines

18

3

6

27

Total

101

1 182

-27

10

1 266

Media conference call

Swiss Re will hold a media call this morning at 08:30 CEST. In order to participate, please dial in 10 minutes prior to the start using the following numbers:

Switzerland: +41 (0) 58 310 5000

United Kingdom: +44 (0) 207 107 0613

United States: +1 (1) 631 570 5613

Germany: +49 (0)69 5050 0082

France: +33 (0)1 7091 8706

Hong Kong: +852 5808 1769

Investor and analyst conference call

Swiss Re will hold an investors' and analysts' call at 14:00 CEST, which will focus exclusively on Q&A. You are kindly requested to dial into the conference call 10-15 minutes prior to the start using the following numbers:

Switzerland: +41 (0) 58 310 5000

United Kingdom: +44 (0) 207 107 0613

United States: +1 (1) 631 570 5613

Germany: +49 (0) 69 5050 0082

France: +33 (0) 1 7091 8706

[1] Assumes expected large natural catastrophe loss burden and excludes prior-year reserve development as well as the COVID-19 impact.

[2] Excludes elipsLife.

[3] For Corporate Solutions, 9M 2020 has been revised to reflect the results of elipsLife, which as of 1 January 2021 is reported as part of Corporate Solutions following the disbandment of the Life Capital Business Unit at the end of 2020.

[4] This column is for reference only and excludes the impact of the reserves established for COVID-19-related claims, including estimated tax impacts.

For further information please contact Swiss Re Media Relations: + 41 (0)43 285 7171 or Media_Relations@Swissre.com.
Please use this link to access the
Swiss Re website.

Swiss Re
The Swiss Re Group is one of the world's leading providers of reinsurance, insurance and other forms of insurance-based risk transfer, working to make the world more resilient. It anticipates and manages risk - from natural catastrophes to climate change, from ageing populations to cyber crime. The aim of the Swiss Re Group is to enable society to thrive and progress, creating new opportunities and solutions for its clients. Headquartered in Zurich, Switzerland, where it was founded in 1863, the Swiss Re Group operates through a network of around 80 offices globally.

Cautionary note on forward-looking statements
Certain statements and illustrations contained herein are forward-looking. These statements (including as to plans, objectives, targets, and trends) and illustrations provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to a historical fact or current fact. Further information on forward looking statements can be found in the Legal Notice section of Swiss Re's website.


End of Media Release

Language:

English

Company:

Swiss Re Ltd

Mythenquai 50/60

8022 Zurich

Switzerland

Phone:

+41 (0) 43 285 71 71

E-mail:

Media_Relations@swissre.com

Internet:

www.swissre.com

ISIN:

CH0126881561

Valor:

12688156

Listed:

SIX Swiss Exchange

EQS News ID:

1244629


 

End of News

EQS Group News Service

show this
show this
Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting