Major re-insurers announced Monday their expectations for a stable or moderately higher prices for treaty renewals on January 1, 2013. German re-insurer Hannover Re (HVRRF.PK) announced that it expects further price increases for treaty renewals and said it is looking forward to a "pleasing" 2012 financial year.
Meanwhile, Germany's Munich Re (0KFE.L) said it expects that prices, terms and conditions will largely remain stable during the renewal, while Swiss Reinsurance Co. (SSREY.PK) expects re/insurance prices to increase moderately.
Munich Re stated that crisis in the eurozone, uncertainties in the capital markets and sustained low interest rates are impacting the insurance industry. It warned of increasing challenges in the year ahead.
Further, the company said that in 2012 renewals, it has so far improved profitability of its own business by 2.4 percent.
Swiss Re, at the Monte Carlo meeting, said it expects re/insurance prices to increase moderately and is well-positioned to support clients on a sustainable basis.
According to Hannover, the positive outcome of the treaty renewals in the current year was driven by heavy losses from natural disasters in 2011. The company also said that in advance of industry gathering of insurers and re-insurers in Monte Carlo, rating agency A.M. Best has upgraded its rating from 'A' to 'A+.'
Ulrich Wallin, chief executive officer of the company said, "We were pleased with the outcome of our renewals in April and in June/July. Along with the favourable development in global property (catastrophe) lines, we are now seeing the first positive signs - including in the United States - of an improved climate overall in the casualty lines. We are confident that this trend will continue in the treaty renewals as at 1 January 2013."
Looking ahead, Hannover said it continues to see stable or rising demand for reinsurance protection. Both for 2012 and beyond, it expects further growth.
Swiss Re stated that though traditional markets would remain the mainstay of its worldwide business, selected high growth markets offer tangible opportunities for non-life and life solutions. Looking ahead to the 2012-2013 renewals, it expects increased demand for natural catastrophe capacity, frequency protection covers, and capital relief transactions.
Swiss Re's chief executive officer Michel Liès said, "Our industry is facing a particularly turbulent economic and financial market environment. But our strengths as a well-capitalised company with unique expertise in underwriting and a demonstrated track-record in developing innovative solutions mean we are well placed to support them."
Traditional markets will remain the mainstay of Swiss Re's global business, it added.
On Frankfurt's Xetra, Hannover shares are currently trading at 48.72 euros, down 0.82 percent, on a volume of 68 thousand shares, while Munich Re trades at 121.1 euros, up 0.67 percent.
In Zurich, Swiss Re is up 0.24 percent at 61.65 Swiss francs.
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by RTT Staff Writer
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