- Swiss Re continues to navigate the COVID-19 pandemic, supported by a proactive reserving approach and very strong balance sheet
- Swiss Re expects the normalised combined ratio in Property & Casualty Reinsurance (P&C Re) to improve to ≤ 96% in 2021, supported by positive rate momentum
- Life & Health Reinsurance (L&H Re) maintains its successful track record, despite COVID-19 impact
- Corporate Solutions’ turnaround is well on track, with the business confident of achieving a normalised combined ratio of ≤ 98% in 2021
- iptiQ’s strong growth trajectory continues; market-implied valuation estimated at approximately USD 2 billion
- Swiss Re’s investment portfolio is well positioned to mitigate the current low interest rate environment
- Swiss Re confirms financial targets and capital management priorities, focusing on superior capitalisation and a stable or increasing dividend
- Swiss Re’s strategy of building risk insights and successful risk partnerships complements its risk transfer business
At today’s Investors’ Day, Swiss Re will confirm its over-the-cycle financial targets and deliver a positive outlook, based on improving market conditions and targeted growth opportunities across the Group’s businesses. The Group will also reiterate its capital management priorities, focusing on superior capitalisation and a stable or increasing dividend.
Swiss Re Group Chief Executive Officer Christian Mumenthaler said: “We are optimistic on the outlook for all of our businesses as we see positive momentum in the underlying earnings power of the Group. Our confidence is underpinned by Swiss Re’s capital strength and the proactive approach we have taken to the Group’s COVID-19 reserves. We expect that COVID-19 will remain an earnings and not a capital event for the Group, with declining exposures going forward. We are focused on delivering on our financial targets and capital management priorities. At the same time, our strategy positions Swiss Re for long-term success.“
Reinsurance is a powerful franchise with strong earnings momentum
Reinsurance is Swiss Re’s key earnings contributor, with a strong franchise that serves 2 300 clients globally. P&C Re is pursuing targeted growth opportunities in a hardening market. The business is focused on expanding underwriting margins, partly to offset the negative impacts of lower interest rates. P&C Re is expected to improve its normalised combined ratio1 to less than or equal to 96% in 2021.
L&H Re has maintained its successful track record despite the impact from COVID-19 in 2020. L&H Re has achieved strong new business generation, in particular in Asia. Together with active management of its in-force business, this lays the foundation for future underlying earnings growth.
Corporate Solutions’ turnaround is well on track
Decisive execution of the management actions announced in 2019 is fuelling the successful turnaround of Corporate Solutions, with the business confident of achieving a normalised2 combined ratio that is less than or equal to its 98% target in 2021. A pronounced hard market offers opportunities for profitable growth in areas where Corporate Solutions has a proven competitive advantage. Over the medium term, Corporate Solutions aims to move towards a better diversified and more cycle-resilient commercial insurance model, which provides complementary access to corporate clients for the Swiss Re Group.
Asset Management continues to deliver strong results
Proactive portfolio management has helped Swiss Re navigate the market volatility in 2020. The Group’s return on investment (ROI) has remained strong despite the low interest rate environment, supported by Swiss Re’s commitment to Environmental, Social and Governance (ESG) principles. The defensive portfolio positioning, combined with the significantly reduced financial market risk profile of the Group after the sale of ReAssure, provides opportunities to enhance investment yields going forward.
Swiss Re is pursuing risk partnerships to open up new long-term opportunities
Swiss Re’s strategy focuses on risk insights and partnerships to complement its risk transfer business. In this spirit, the Group’s white-label digital insurance platform, iptiQ, continues to grow. iptiQ’s core business now has 40 distribution partners, more than 500 000 customers and USD 300 million in gross premiums written. Based on the current growth trajectory and peer valuation, iptiQ’s market-implied valuation has grown to approximately USD 2 billion.
1, 2 Assuming an average large natural catastrophe loss burden and excluding (i) prior-year reserve development and (ii) COVID-19 impacts.
Investors’ Day webcast
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