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EQS-News: Hannover Rück SE
/ Key word(s): Miscellaneous
E+S Rück expects further improvements in prices as well as terms and conditions in Germany after losses caused by severe weather events
Baden-Baden, 21 October 2024: E+S Rückversicherung AG, the Hannover Re subsidiary responsible for the Group's German business, anticipates further price increases and improved terms and conditions in the 1 January 2025 renewals in property and casualty reinsurance. "For a number of years now, the insurance industry in Germany has been faced with numerous natural catastrophes causing considerable losses and damage. Once again this year, we have already seen devastating floods, following extraordinary severe weather events of previous years with hail and heavy rain, as well as flash floods and winter storms. At the same time, motor insurance remains in deficit for structural reasons. We are also concerned about increased loss advices from our clients for prior-year claims," said Michael Pickel, Chief Executive Officer of E+S Rück, at this year's reinsurance meeting in Baden-Baden. "As a reliable partner for our clients, we always offer them the best possible reinsurance capacities and support them actively in managing claims. Adequate prices, terms and conditions are absolutely essential for this." E+S Rück expects that motor insurance, the largest line of property and casualty insurance by volume, will likely remain in deficit. The tariff adjustments made by primary insurers have so far failed to achieve the desired effect owing to persistently high claims inflation. Sharp increases in the costs of repairs and spare parts have led to a further rise overall in claims expenditure for physical damage. Higher costs can be observed in connection with major bodily injury claims due to increased care expenses. "Claims frequency is not diminishing, while the increase in spare parts and workshop costs is well above inflation. This is taking a heavy toll on the results posted by motor insurers," said Michael Pickel. "Over the coming years, primary insurers will have no alternative other than to make further significant price increases in motor insurance. This is the only way they can move out of the loss-making zone and restore motor business to a profitable footing for the long term." From the perspective of E+S Rück, the need for adjustments to prices and terms and conditions is more marked for non-proportional covers with rather low retentions as well as for proportional reinsurance treaties. As for natural catastrophe covers, the claims trend seen in prior years has been sustained. Following the hail events of 2023, the claims picture for insurers in the current financial year has been especially notable for multiple flood events. All in all, 2024 is again expected to see considerable losses from natural disasters. For the coming year, E+S Rück anticipates growing demand overall for natural catastrophe covers, combined with a sharp increase in purchased capacities, while at the same time prices and terms and conditions will show further risk-adjusted improvements. After an increased frequency of large fire losses in 2023, industrial and commercial business is reporting continued poor market numbers in property insurance for 2024 as well. Adjustments are still needed even though inflation has normalised. The focus is increasingly turning to new exposures such as SRCC risks. Emerging risks, including for example the insurability of forever chemicals (PFAS), are growing in significance in the liability line. The market for cyber covers had already levelled off in 2023 due to softening prices and increased competition. At the same time, there is pressure to make adjustments as losses caused by cyber-attacks are rising. The aggregation risk is also taking on added relevance. Reflecting the advance of digitalisation, cyber insurance is a growing line of business that requires the appropriate expertise. "Particularly given the current state of the market, we aim to be a reliable partner for our clients and continuity will remain a key factor in our future success," said Thorsten Steinmann, a member of the E+S Rück Executive Board, who is set to take over as Chief Executive Officer of E+S Rück starting 1 January 2025. "Going forward, as in the past, we see a wide range of opportunities to profitably grow our business together with our clients. I am convinced that we will achieve this by building on our proven strengths and continuing to evolve."
Please note the disclaimer: Contact External Communications: Verena Lilge Investor Relations: Axel Bock
21.10.2024 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG. |
| Language: | English |
| Company: | Hannover Rück SE |
| Karl-Wiechert-Allee 50 | |
| 30625 Hannover | |
| Germany | |
| Phone: | +49-(0)511-5604-1500 |
| Fax: | +49-(0)511-5604-1648 |
| Internet: | -re.com |
| ISIN: | DE0008402215 |
| WKN: | 840 221 |
| Indices: | DAX |
| Listed: | Regulated Market in Frankfurt (Prime Standard), Hanover; Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange; Luxembourg Stock Exchange |
| EQS News ID: | 2011643 |
| End of News | EQS News Service |
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2011643 21.10.2024 CET/CEST
