Hannover posts profit despite 123.8% non-life COR

Hannover Re has reported an operating profit of Euro 46.1m (Q1 2010 Euro 238.8m) for the first three months of 2011.

However, it added its combined ratio in non-life reinsurance was 123.8% (previous year: 99.3%).

Gross written premium climbed by 10.3% to Euro 3.1bn (Euro 2.9bn) as at 31 March 2011. At constant exchange rates growth would have come in at 8.7%.

Hannover Re noted the level of retained premium decreased slightly to 89.3% (90.8%). Net premium earned increased by 8.8% to Euro 2.5bn (Euro 2.3bn).

Chief executive officer Ulrich Wallin continued: "The current financial year has been dominated so far by severe natural catastrophe events, which have produced an exceptional major loss burden of Euro 572m for our company.

"This is around Euro 452m higher than the loss expectancy for the first quarter - equivalent to 41.6% of net premium in non-life reinsurance - and caused net income after tax to fall well short of our expectations at Euro 52 m"

He added: "On a positive note, though, I would point out that even in this challenging quarter we still posted a net profit."

Mr Wallin put this down to run-off profits booked on reserves constituted for losses in prior years, very healthy investment income, the refund of taxes paid for the years 1993 to 2001 as well as a "satisfying performance" in its life and health reinsurance business.