Letter from the Chairman of the Executive Board

Dear shareholders, ladies and gentlemen

Jean-Jacques Henchoz,
Chairman of the
Executive Board

Our robust market position and superlative risk management were once again on show in the first six months of the financial year and we delivered a thoroughly satisfactory business performance. Hannover Re generated Group net income of EUR 671 million in the first half of 2021, marking a return to the earnings level achieved prior to the pandemic.

With vaccination rates rising around the world and case numbers falling in many places, we are seeing the cautious restoration of some degree of normalcy. Although we are looking to the future with optimism and economic activity is opening up step by step in many countries, this pandemic is not yet behind us. We are still facing an epidemic situation and the health and safety of our employees is our number one priority. The Covid-19 crisis has called many things into question and led to lasting changes in how we work together. The switch to working from home passed off smoothly for Hannover Re and demonstrated once again that our team spirit is not defined by spatial proximity alone.

The devastating floods in Germany and neighbouring parts of Europe serve as a reminder that we have no time to lose in our efforts to address climate change and minimise its impacts. As a reinsurer, we are at our customers’ side as we help them to navigate the consequences of such catastrophic events. We are playing our part in the development of joint solutions for future coverage concepts. Not only that, we intend to progressively realign all areas of our business towards a more sustainable footing. In a reflection of this shift, Hannover Re has signed the Principles for Sustainable Insurance and the Principles for Responsible Investment supported by the United Nations. Furthermore, we are actively reducing the carbon intensity of our investments in accordance with the Paris Agreement on climate change.

In addition, our sustainability strategy attaches importance to the need for the private sector and governments as well as public institutions to work together. Hannover Re is involved in a number of public- private partnerships. The latest example is our cooperation with Willis Towers Watson and the international development and humanitarian aid organisation Global Communities to design an insurance Stand: 2. August 2021, 16:25 Uhr 4 Hannover Re | Half-yearly Financial Report 2021 product for communities in Colombia at risk from natural disasters such as floods and earthquakes. By means of innovative parametric covers we want to play our part in further reducing the protection gap, especially in developing and emerging countries. Similarly, when it comes to accumulation risks such as pandemics – in other words risks that scarcely lend themselves to diversification – public-private partnerships offer a promising solution roadmap.

Turning now to a brief summary of the development of your company’s business in the first half-year 2021, Hannover Re can look back on a highly satisfactory first six months that were in line with our expectations overall. Group net income in the first half-year is also back to pre-crisis levels, as is true of the return on equity. At the same time, our reinsurance coverage continues to enjoy strong demand, as is evident from the profitable growth in Group gross premium. The treaty renewals in property and casualty reinsurance in April, June and July similarly bore this out in impressive numbers. Pricing momentum has been sustained. With a capital adequacy ratio under Solvency II of 250% as at 30 June 2021, Hannover Re’s financial position remains extremely robust. It continues to be the case that we offer our customers the high-quality reinsurance protection they need in times like these. Our excellent financial strength was also underlined recently by the rating agency Standard & Poor’s, which confirmed our rating of AA- (“Very Strong”). Based on the results for the first six months, I am optimistic for the development of Hannover Re’s business over the remainder of the year. We are well on track to achieve our ambitious goals in the current financial year.

On behalf of the entire Executive Board I would like to thank you, our valued shareholders, for the trust that you place in us. I would further like to thank our employees, whose considerable dedication is vital to our success. My thanks also go out to all our business partners and clients for their trusting and positive cooperation – in times of crisis and beyond.

Yours sincerely,

Jean-Jacques Henchoz
Chairman of the Executive Board