is spokesman of Deutsche Rück and head of our Communications Department
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Düsseldorf, 31 May 2017 – Deutsche Rück achieved a positive operating result in 2016 and further strengthened its position. In terms of gross premium income, the Group, consisting of Deutsche Rückversicherung AG and its subsidiary Deutsche Rückversicherung Switzerland Ltd, recorded significant growth of 9.1 % to around €1.2 billion. The net profit for the year came to €14.5 million, the same level as in the previous year. Equity capital before appropriation of profit rose by €13 million to €511.9 million. Surplus reinsurance capacity continued to put pressure on prices and conditions. “We have succeeded in stabilising our good market position in Europe, improving our results and strengthening our capital base,” the Chief Executive Officer, Dr Arno Junke, said.
The situation on the reinsurance market was once again shaped by ongoing low interest rates, low entry barriers to the market and intense competition in 2016. “We are operating from a solid position without pressure to grow, with a clear focus on sustainable performance,” Junke explained.
As well as an increase in premium income across all lines of business, a lower gross loss ratio also contributed to this positive performance. It improved from 62.3 % to 58.1 %. Junke also appeared satisfied with life reinsurance business: “Our services, such as those protecting against biometric risks, provided impetus for growth, which we were able to exploit in order to expand our business volume, particularly with existing cedants.” In this way, the Deutsche Rück Group managed to increase its business volume in life reinsurance by more than 11 % to around €46 million.
The low claims burden in the fire insurance lines and from natural hazards had a positive impact in non-life reinsurance. However, the Group continued to strengthen its claims provisions cautiously and in line with risk.
The increase in premium volume and favourable overall claims experience led to a further significant improvement in the technical account before changes to equalisation reserves. This increased to a profit of €11.2 million in 2016. The Group added to its equalisation reserves with net allocations of more than €25 million.
Despite persistently low interest rates on the capital markets, Deutsche Rück was once again more than satisfied with its investment income, with regular income of €46 million.
After taking into account the technical result, the Group posted an operating result of more than € 23 million before tax and a net profit of €14.5 million.
“In the context of renewal negotiations and in view of our unchanged profit-oriented underwriting policy, we anticipate a positive business performance in the current financial year, allowing us to further strengthen our position in a challenging market environment,” Junke said.