📋 Tender Overview
Swiss Re reported today a 73 increase in Group net income to USD 727 million for 2019. The Groups property and casualty businesses were impacted by USD 2.7 billion in large losses from natural catastrophes and man-made events as well as by increased claims in US casualty. Life and health businesses continued to perform strongly with LH Re delivering an ROE above its target range. Group net premiums earned and fee income rose 12 to USD 38.6 billion primarily driven by premium growth in PC Re. The Groups ROE improved to 2.5 from 1.4. Based on the Groups very strong capital position and supported by confidence in Swiss Res long-term capital generation the Board of Directors will propose to the Annual General Meeting AGM an increased dividend of CHF 5.90 per share and authorisation for a public share buyback of up to CHF 1 billion.Swiss Re Group Chief Executive Officer Christian Mumenthaler said Our 2019 results were impacted by heavy natural catastrophe losses our decisive management actions to reposition Corporate Solutions and increased claims in US casualty. We are taking proactive measures to put us at the forefront of adverse trends. On the other hand we delivered an excellent investment result and strong performance in LH Re demonstrating the power of our diversified business model. We achieved a key strategic milestone with the agreement to sell ReAssure. And we are starting 2020 with an improved quality of our portfolio underpinned by strong January renewals and pricing momentum.Swiss Re continued its strong investment result track record reporting an ROI of 4.7 for 2019 up from 2.8 in 2018. The improvement was driven by a strong equity market performance including a significant contribution from the sale of the Groups investment in the Brazilian insurance group SulAmrica S.A. as well as gains within the fixed income portfolio. The Groups running yield was largely unchanged at 2.8 compared with 2.9 in the declining global yield environment.The Groups capital position remains very strong with a Group Swiss Solvency Test SST ratio above the 220 target level. Taking into account the Groups sustained capital generation Swiss Res Board of Directors will propose a dividend of CHF 5.90 per share for 2019 representing a 5 increase. The dividend will be paid after shareholder approval at the AGM on 17 April 2020. The Board of Directors will also request authorisation from shareholders at the AGM for a public share buyback programme of up to CHF 1 billion purchase value to be executed at the discretion of the Board and subject to the necessary regulatory approvals.Swiss Re Group Chief Financial Officer John Dacey said Despite significant loss events in 2019 Swiss Re maintains its very strong capital position and continued reserve adequacy. PC Re matched strong growth with rigorous expense discipline Corporate Solutions also improved its expense ratio and LH Re continues to deliver robust performance. The strength of our business model allows us to continue to offer an attractive dividend bolstered by a public share buyback programme.PC Re profit impacted by large natural catastrophe claimsPC Re reported a net income for the full year of USD 396 million up from USD 370 million in 2018. The result reflected large natural catastrophe and man-made losses of USD 2.3 billion as well as proactive measures to address ongoing trends in US casualty. This was balanced by profitable business growth driven by large transactions and expansion in natural catastrophe business as well as by a very strong investment result. Net premiums earned increased 20 to USD 19.3 billion. The ROE was 4.4 compared with 3.7 in 2018.The large natural catastrophe losses in 2019 were driven mainly by typhoons Hagibis and Faxai in Japan Hurricane Dorian in the Atlantic and wildfires floods and hailstorms in Australia. The result was further impacted by late claims development from Typhoon Jebi. In addition man-made losses included the Ethiopian Airlines crash and the subsequent grounding of the Boeing 737 MAX fleet.The PC Re combined ratio was 107.8 in 2019 compared with 104.0 reported for 2018. The normalised1 combined ratio was in line with previous estimates and is expected to improve to 97 for 2020.January PC Re renewals show healthy growth in natural catastrophe businessSwiss Re renewed contracts with USD 10 billion in premium volume on 1 January 2020. This represents a 2 volume increase compared with 2019 as increases in property business particularly in the natural catastrophe book were partly offset by a reduction in casualty lines.PC Re achieved a nominal price increase of 5 in this renewal round. Risk-adjusted price quality was unchanged reflecting lower interest rates and more conservative loss assumptions. Business in many loss-affected regions such as Japan and Australia is due to renew later in the year.LH Re continues to deliver strong results ROE above target rangeLH Re reported a strong net income for 2019 of USD 899 million compared with USD 761 million in 2018. Net premiums earned and fee income increased to USD 13.0 billion from USD 12.8 billion in 2018. Adjusted for unfavourable foreign exchange movements and the termination of an intragroup retrocession agreement with Life Capital net premiums earned and fee income rose 6.9.
