Posted on 04 Feb 2010
Hannover Re, Germany's second-largest reinsurer, said Wednesday it is targeting a return on equity of 15% in 2010 as it expects modest premium growth in the coming year.
Commenting on the January 1, 2010 reinsurance renewals, Hannover Re said it saw only modest pressure on prices, mirroring comments made by Munich Re earlier this week, which reported an overall price decline of 0.3 percent
"Rates and conditions broadly held stable, and we are therefore not dissatisfied with the achieved results. Slight pressure on prices was to be expected after the particularly good 2009 financial year", said Ulrich Wallin, CEO of Hannover Re.
While modest rate erosion was recorded in some property lines, price increases were pushed through in other segments, Hannover Re said. The latter was true of aviation business, and was again the case in credit and surety reinsurance.
In worldwide catastrophe business prices for reinsurance covers slipped back, owing to the relatively unremarkable catastrophe loss experience and the improved capital resources of primary insurers.
Rate reductions were especially marked in the US, although Hannover Re was able to achieve price increases for loss-making programs in some regions.
Business in Hannover Re’s domestic German market fared better than expected. In motor liability rate increases averaging 5% were secured under non-proportional treaties.
"This year we were again able to expand our large market share in Germany through new client relationships and hence consolidate our position as one of the leading reinsurers in the profitable German market", Wallin said.