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Hannover Re expects its large loss budget to be exceeded

By: Hannover Re

The insurance industry currently finds itself faced with a number of severe natural catastrophe events, the losses from which cannot as yet be precisely quantified; they include Hurricanes Harvey and Irma. Hannover Re expects that its defined large loss budget of EUR 825 million will be able to absorb the losses associated with these events. However, the most recent natural disasters, namely Hurricane Maria and the earthquake in Mexico – for which no detailed loss advices are available to date –, will give rise to further substantial strains that will exceed the large loss budget.

Consequently, fulfilment of a major criterion for Hannover Re’s profit guidance is at risk, which means that the targeted Group net income of more than EUR 1 billion may not be achieved.

As things currently stand, a dividend payment on the level of the previous year continues to be possible.

Hannover Re, with gross premium of EUR 16.4 billion, is the third-largest reinsurer in the world. It transacts all lines of property & casualty and life & health reinsurance and is present on all continents with around 2,900 staff. Established in 1966, the Hannover Re Group today has a network of more than 100 subsidiaries, branches and representative offices worldwide. The Group’s German business is written by the subsidiary E+S Rück. The rating agencies most relevant to the insurance industry have awarded both Hannover Re and E+S Rück very strong insurer financial strength ratings: Standard & Poor’s AA- “Very Strong” and A.M. Best A+ “Superior”.

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