Corona depresses Swiss Re’s balance sheet

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February 22, 2021 –  The  reinsurer posted a loss of $ 878 million in 2020. Without Corona, the result would have been clearly positive, emphasizes Swiss Re. Nonetheless, the company is confident. © www.de24.news The  Covid-19 damage is “largely behind us”. © www.de24.news The  group also feels it is well positioned, not least because of the most recent treaty renewals.

© www.de24.news The  pandemic is reflected in the business figures of the Swiss Re Group: © www.de24.news The  reinsurer reports a loss of 878 million US dollars for 2020.

“Excluding Covid-19 claims and provisions (before taxes) of $ 3.9 billion for the year, Swiss Re’s profit was $ 2.2 billion, much higher than 2019’s $ 727 million Dollars, “says the company.

Group CEO Christian Mumenthaler emphasized that Swiss Re had set up provisions from the beginning of the pandemic, although initially only a few actual claims were reported.

Swiss Re: Covid-19 claims and provisions 2020

category

P&C*

L&H**

Body. Sol. ***

Life Capital

total

Event cancellations

411

404

815

Business interruption

1.104

294

1.398

Kredit & Kaution

53

198

251

mortality

889

23

912

Others

342

110

47

4

503

total

1.910

999

943

27

3.879

Covid-19 damage “largely behind us”

Mumenthaler is meanwhile optimistic: “We are confident for 2021, because the Covid-19 damage is largely behind us.” Although some more Covid-19 damage is to be expected this year, We have drastically reduced liability lines ”.

Swiss Re expects additional Covid-19-related losses and provisions of less than $ 0.5 billion in property and liability business in 2021. Because of the uncertainties surrounding the pandemic, the actual claims development could be both more positive and more negative.

Contract renewals at the beginning of the year

Mumenthaler said he was “very optimistic”, “Improvements in portfolio quality and underwriting margins at P&C Re and Corporate Solutions”, to which the renewals in January also contributed.

According to the company, P&C Re (Property & Casualty Insurance) renewed contracts with a premium volume of 7.8 billion US dollars on January 1, 2021.

This means that the volume has fallen by eleven percent compared to the business that was due for renewal. “This reflects the focus on underwriting quality and improved contract terms,” said Swiss Re.

In this renewal round, P&C Re achieved a nominal price increase of 6.5 percent, “which more than compensated for the lower interest rates and the higher loss assumptions”.

1.7 billion dollars in damage from natural disasters

Swiss Re estimates the damage caused by natural disasters for 2020 at 1.7 billion US dollars. © www.de24.news The  Atlantic hurricane season “with its record number of 30 named storms” and numerous secondary natural hazards worldwide were responsible for this.

© www.de24.news The  effects of major man-made losses were primarily shaped by the explosion in the port of Beirut in the third quarter.”

3.5 percent return on investments

Swiss Re puts the return on investments (ROI) at 3.5 percent. © www.de24.news The  investment result was due to early portfolio management measures taken to reduce exposure to those sectors that were particularly hard hit by Covid-19.

In addition, the group has “secured sustainable income by keeping long-term fixed-income securities investments with high unrealized profits”.

Despite Covid-19 and natural disasters, capitalization “remained very strong throughout 2020,” commented John Dacey, Group Chief Financial Officer of Swiss Re.

© www.de24.news The refore, and “also in view of the positive outlook”, it is possible to apply for an unchanged dividend payment to the shareholders, ie in the amount of 5.90 Swiss francs per share.

Further information

More detailed information on the business figures is available on a Swiss Re website.





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Corona depresses Swiss Res balance sheet

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