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For the current financial year we believe that both non-life reinsurance and life and health reinsurance offer sufficient growth potential to be able to achieve our goals. Based on constant exchange rates we expect gross premium for the Hannover Re Group to increase by around 5%.

Although the business environment in non-life reinsurance is more competitive than it was in the previous year, we still see attractive growth opportunities in a number of areas, including for example emerging markets.

We are satisfied with the outcome of the treaty renewals as at 1 April 2013. Following the significant rate increases of the past two years in Japan, market conditions here are very pleasing. Rates remain on a comparatively high level. The company therefore enlarged its shares under existing treaties and booked premium gains of around 6% in the original currency. In Korea, on the other hand, the market climate is more challenging. We therefore scaled back our involvement in proportional business while at the same time expanding our higher-margin non-proportional acceptances. In US property catastrophe business only a small number of treaties are renewed on 1 April 2013. Additional capacities from the non-traditional market meant that the further price increases which had been anticipated on the back of last year’s losses from Hurricane Sandy failed to materialise.

For 2013 we are looking to generate growth in total non-life reinsurance in the range of 3% to 5% at constant exchange rates. The EBIT margin should be at least 10%. A combined ratio of ≤ 96% is anticipated.

For our overall life and health reinsurance portfolio we expect to see promising business potential as the year progresses. Most notably, the demographic trend in mature insurance markets such as the United States, Germany, Japan and the United Kingdom is helping to boost demand for protection, especially in the area of retirement provision, pension and annuity insurance. Similarly, increasingly exacting regulatory requirements (including for example the implementation of Solvency II) are prompting stronger demand for reinsurance solutions designed to optimise solvency and liquidity management and ease the strain on primary insurers’ capital resources. In dynamically growing emerging markets such as China, India, Brazil and key Eastern European countries, greater affluence has created a middle class with purchasing power that is more keenly interested in safeguarding the financial security of the family and providing for retirement. These regions are seeing widespread demand for capital-oriented reinsurance solutions. We are therefore looking at organic growth in gross premium of between 5% and 7% for the current financial year. For the areas of Financial Solutions and Longevity we are aiming for an EBIT margin of 2%, while for Mortality and Morbidity business the target is 6%.

The expected positive cash flow that we generate from the technical account and our investments should – subject to stable exchange rates – lead to further growth in our asset portfolio. In the area of fixed-income securities we continue to stress the high quality and diversification of our portfolio. We are targeting a return on investment of 3.4% for 2013.

In view of the good overall business conditions in non-life and life and health reinsurance and bearing in mind our strategic orientation, we anticipate Group net income in the order of EUR 800 million. This is subject to the premise that major losses do not significantly exceed the expected level of EUR 625 million for the full year and also assumes that there are no drastic downturns on capital markets. In accordance with our strategic orientation we are again aiming for a dividend payout in the range of 35% to 40% of IFRS Group net income.


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