Key figures for property and casualty reinsurance
in EUR million 20162015
1.1. – 31.3. +/– previous year 1.1. – 31.3.
Gross written premium 2,502.1 -4.4% 2,617.1
Net premium earned 1,961.3 +4.2% 1,882.3
Underwriting result 100.3 +31.0% 76.6
Net investment income 207.2 +6.2% 195.1
Operating result (EBIT) 299.7 +17.4% 255.2
Group net income 204.3 +19.2% 171.4
Earnings per share in EUR 1.69 +19.2% 1.42
EBIT margin1 15.3%   13.6%
Combined ratio2 94.7%   95.7%
Retention 87.9%   88.9%

Property and casualty reinsurance remains intensely competitive in the current financial year. The strong capital position of our ceding companies means that fewer risks overall are being passed on to the reinsurance market. In addition, the inflow of capital from the ILS market – especially in US natural catastrophe business – is leading to appreciable price erosion. These factors were also crucial in shaping the treaty renewals as at 1 January 2016, the date when around 65% of our portfolio was renegotiated. Even though the price decline was considerable in some markets, we still preserved the good profitability of our portfolio thanks to its broad diversification. Our long-standing customer relationships and our very good rating again had a stabilising effect on the treaty renewals.

Early indications of a bottoming out in reinsurance prices could be detected, most notably in the US market. We enlarged our premium volume here. Business with agricultural risks proved to be relatively detached from the rest of the soft property and casualty reinsurance market. Although competition can be felt in some regions, for the most part we achieved stable rates and conditions. Aviation and marine business, on the other hand, experienced sharp rate reductions, prompting us to scale back our premium volume accordingly. The premium volume booked from the treaty renewals as at 1 January 2016 contracted by 1.5% as a consequence of our selective underwriting policy.

In view of these developments, the gross premium booked for our Property & Casualty reinsurance business group fell to EUR 2.5 billion (EUR 2.6 billion); this corresponds to a decrease of 4.4%. It should also be borne in mind here that the comparable period was influenced by a positive special effect in facultative reinsurance in an amount of EUR 93 million. At constant exchange rates the decrease would have been 3.7%. The level of retained premium retreated to 87.9% (88.9%). Net premium earned nevertheless increased on account of the change in unearned premium, rising by 4.2% to EUR 2.0 billion (EUR 1.9 billion); adjusted for exchange rate effects, growth would have amounted to 5.2%.

As in the previous year, net expenditure on major losses came in below the budgeted level at EUR 55.5 million (EUR 62.0 million). The largest single loss event was an earthquake in southern Taiwan, for which we have reserved an amount of EUR 15.6 million. The underwriting result for total property and casualty reinsurance closed at an exceptionally pleasing EUR 100.3 million (EUR 76.6 million). The combined ratio improved again to 94.7% (95.7%) and is well in line with our goal of achieving a combined ratio below 96% for the full year.

The investment income booked for property and casualty reinsurance from assets under own management rose by 6.2% to EUR 203.1 million (EUR 191.2 million).

The operating profit (EBIT) in property and casualty reinsurance increased by a substantial 17.4% to EUR 299.7 million (EUR 255.2 million) as at 31 March 2016. The EBIT margin reached 15.3% (13.6%), thereby surpassing the minimum target of 10%. Group net income increased by 19.2% to EUR 204.3 million (EUR 171.4 million). Earnings per share stood at EUR 1.69 (EUR 1.42).



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