Net income up at Swiss Re

Net income up at Swiss Re

Reinsurer Swiss Re has reported net income of $3.3bn for the first nine months of the year, up from $3.2bn in 9mo 2013. The income represents a 13.3% return on equity.

Annualised return on investments was 3.7%. Net investment income for the year to date was $3.1bn, up from $2.9bn in the same period last year.

The company said that it remained on track to meet its previously stated 2011 to 2015 targets. Swiss Re said that it would be stating new multi-year targets from 2016 when it announces the full-year results on February 19 2015.

In property-casualty reinsurance there was net income of $2.4bn, up from $2.2bn in the same period last year. Swiss Re said that the positive result was driven by a benign year for natural and man-made catastrophes, plus reserve releases from the prior year. The combined ratio of 82.7% compared to 83.6% in 9mo 2013. Earned premiums were up 10% year on year to $11.7bn.

In life & health reinsurance the company reported net income of $272m, down from $420m, a decline mainly as a result realised losses during the period under review. Premiums earned rose to $8.4bn from $7.3bn, while the operating margin rose to 8.8% from 8.2%.

Swiss Re said that "throughout 2014 L&H Re has shown that it is well-placed to write new large deals".

Meanwhile the Corporate Solutions division reported that net income for 9mo 2014 was $249m, up from $227m year on year. Net premiums were up 23% year on year to $2.6bn.

At Admin Re there was net income of $219m, down from $338m in 9mo 2013.

Although the sale of subsidiary Aurora National Life in the US was expected to generate an after-tax loss of "less than $200m" in Q4 2014, Swiss Re said that the disposal was "an important step in Swiss Re's strategy to redeploy capital and capture attractive growth opportunities for Admin Re".

For Q3 the property-casualty division booked a net gain of $842m, up from $784m in Q3 last year. The improvement reflected benign natural cat experience, favourable prior-year development and the release of a premium tax provision.

Earned premiums for the quarter were up 9% year on year to $4.3bn.

In life and health reinsurance, net income grew to $160m from $35m, on premiums earned and fee income of $2.9bn, up from $2.5bn. Swiss Re said that this was driven mainly by growth in Asia, Europe Middle East and Africa, and "a large longevity transaction in the UK". The operating margin for the quarter was 9.2%, up from 5.6%. That was partially due to favourable mortality experience in the Americas and an absence of reserve strengthening in the Australian disability business.

Swiss Re said that it had made progress in its previously announced efforts to improve the profitability of its in-force life and health business.

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