Hannover Re now second-largest P&C reinsurer
Risk-adjusted rate increases and 'robust' demand for risk transfer contributed to an average 15% growth in property/casualty premiums in 2022
German reinsurance giant leapfrogs Swiss Re on gross written premiums as Munich Re maintains pole position, according to analysis by Aon
Hannover Re is now the world’s second-largest property/casualty (P&C) reinsurer after overtaking Swiss Re.
The German reinsurance giant reported P&C reinsurance gross written premiums of close to $25bn in 2022, marginally ahead of Swiss Re’s total of $24bn, according to analysis by Aon.
Munich Re maintained its position as the largest P&C reinsurer with gross written premiums slightly ahead of Hannover Re.
The three carriers were well ahead of their peers, with fourth-placed Everest Re writing P&C reinsurance premiums of less than $10bn last year, closely followed by RenaissanceRe and Scor, the Aon analysis revealed.
Including P&C insurance premiums written, Munich Re was also the largest carrier with nearly $45bn of premiums, followed by Swiss Re, Fairfax and Hannover Re.
Risk-adjusted rate increases and “robust” demand for risk transfer contributed to an average 15% growth in P&C premiums in 2022, according to the Aon data.
Lancashire Holdings reported the highest growth of 35%, followed by Arch Capital at 27% and Hannover Re with premium growth of 26%.
Aon analysed the financial results of 19 companies that together underwrite more than half of the world’s life and non-life reinsurance premiums.
Total P&C gross premiums written by the group increased 9% last year to $272bn.
Despite Hurricane Ian and other catastrophe losses, the group of companies reported an underwriting profit of $8bn, representing a 13% increase on the previous year.
The net combined ratio improved 0.1 points to 96.2%, taking the six-year average since 2017 to 100.3%.
Last year was the fifth-most expensive year for insured natural catastrophe losses. In addition to Hurricane Ian, re/insurers also faced losses from record floods in Australia and South Africa, hailstorms in France, winter storms in Europe and the US, and droughts in Brazil.
Overall, reinsurers' pre-tax profit more than halved to $12.5bn in 2022, driven by mark-to-market losses on bond portfolios.
“Reinsurers’ underlying underwriting results were generally strong in 2022 despite the unusual amount of volatility in the capital markets. Significant unrealised investment losses on bond portfolios weighed heavily on overall earnings and reported capital positions,” Mike Van Slooten, Aon’s head of business intelligence, said. “However, these losses are viewed as temporary and largely non-economic in nature.”
Van Slooten added: “Looking ahead, renewal outcomes in 2023 and the tailwind of higher interest rates have improved the outlook for reinsurers and we expect new capital inflows to begin relieving current capacity constraints when earnings delivery is confirmed in reported results.”
