Europe's four largest reinsurers are finding it increasingly difficult to make money from their core line of business, but there remains little reason to expect that they will be able to charge clients more any time soon.
Data compiled by SNL Financial, an offering of S&P Global Market Intelligence, shows a marked deterioration in the combined ratios for Munich Re, Hannover Re, Swiss Re Ltd. and SCOR SE in the second quarter. The combined ratio is a measure of underwriting profitability that expresses claims and costs as a proportion of premiums, with a figure above 100%, such as the 101% posted by Swiss Re, suggesting an underwriting loss.
After several quarters of below-average losses, earthquakes in Ecuador, Japan and Taiwan, storms in Europe and massive forest fires in Canada hit the quartet, which share many of the same exposures. For market leader Munich Re alone, the forest fires are expected to cost €400 million.
All four also reported year-over-year declines in net profit and return on average equity, but none shows any sign of retreating, as gross written premiums were stable or marginally lower year over year.
Data from the SNL Insurance product, an offering of S&P Global Market Intelligence, shows the top 50 EMEA Insurance Groups By Gross Premiums Written.