HANOVER (dpa-AFX) - German re-insurer Hannover Re (HVRRY.PK, HVRRF.PK) Monday said it expects further price increases next year, noting that large loss trend, pandemic and rising inflation require further improvements in prices and conditions.
The company also projects improved conditions in property and casualty reinsurance. Hannover Re noted that soaring inflation, major losses and an accumulation of mid-sized frequency losses reflected in property and casualty reinsurance, while pandemic-related expenditures reflected in life and health reinsurance.
The first half of 2022 proved challenging for primary insurers and reinsurers alike, and the company projects a time delay in new investments or reinvesting activities before higher interest rates have a favourable impact.
For the treaty renewals as at January 1, 2023, Hannover Re expects further price increases and improvements in conditions, not only in loss-affected lines and regions. The company sees a number of reasons for rising primary insurance rates including inflation and loss experiences and proportional reinsurance should benefit from that.
Jean-Jacques Henchoz, Chief Executive Officer of Hannover Re, said, 'Combined with the war in Ukraine and given that the pandemic has still not been overcome, this is fuelling the long-standing trend towards ever-higher loss burdens for insurers and reinsurers. Further risk-adjusted rate increases in property and casualty reinsurance are therefore unavoidable. This is the only way for us, as a reinsurer, to continue to offer our clients reliable risk protection in an increasingly challenging market.'
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