Swiss Re has reported a net income of $2.2 billion and a return on equity (ROE) of 13.4% for the first nine months of 2024.
This result was attributed to steady underwriting performance and contributions from investments across all business units, partly offset by increased reserves for the property & casualty reinsurance (P&C Re) unit’s US liability business during the third quarter.
Swiss Re’s net income for the third quarter alone was $102 million, primarily driven by disciplined underwriting and consistent investment returns. The group’s insurance revenue totaled $33.7 billion, with an insurance service result – reflecting underwriting profitability – of $2.9 billion.
The return on investments (ROI) for the nine-month period stood at 3.9%, with recurring income yielding 4.0% and a reinvestment yield of 4.6% in the third quarter.
The company reported a Group Swiss Solvency Test (SST) ratio of 284% as of July 1, 2024. The Group noted that updates to its SST methodology have reduced reported solvency levels but have lowered the sensitivity of this ratio to interest rate changes.
The P&C Re unit posted a nine-month net income of $603 million, aided by strong underwriting in the current year, which helped balance the strengthening of U.S. liability reserves. Insurance revenue for this period was $15 billion.
During the third quarter, P&C Re added $2.4 billion to its US liability reserves, bringing reserve additions to $3.1 billion for the year to date. Offsetting releases in other business lines resulted in a net reserve increase of $2 billion for the third quarter.
Large natural catastrophe claims for P&C Re totaled $813 million, primarily attributed to the hailstorm in Calgary, Storm Boris in Europe, and hurricanes Debby and Helene.
The combined ratio for P&C Re was 92.8% for the first nine months, with reserve strengthening accounting for a 13.3 percentage point impact on the combined ratio. As a result, Swiss Re expects P&C Re to fall short of its 2024 target combined ratio of under 87%.
Life and health reinsurance (L&H Re) achieved a net income of $1.2 billion over the nine months, benefiting from investment income and steady in-force business margins. While US mortality experience remained slightly favorable, EMEA outcomes were less favorable.
L&H Re recorded insurance revenue of $12.6 billion and an insurance service result of $1.2 billion, and remains on track to achieve an annual net income target of approximately $1.5 billion.
Corporate solutions recorded a nine-month net income of $642 million, driven by solid underlying business performance and investment income. Insurance revenue totaled $5.8 billion, with underwriting supported by low man-made losses and large natural catastrophe claims of $294 million from events like Tropical Cyclone Megan in Australia and the hailstorm in Calgary.
The segment also achieved a combined ratio of 89.4% and is expected to stay under its target of 93% for the year.
The company’s exit from its iptiQ business is on track, with iptiQ reporting a net loss of $241 million for the nine-month period. Allianz Direct is set to acquire iptiQ’s European property & casualty business, including over 100 employees across several countries, with the transaction expected to close in 2025 pending regulatory approval.
Looking ahead, Swiss Re anticipates a net income of over $3 billion for 2024, assuming typical loss activity for the remainder of the year. Losses related to Hurricane Milton are expected to be under $300 million, affecting fourth-quarter results.
"The significant strengthening of reserves in the third quarter creates a resilient base for success in the coming years. The group's capital position remains strong, putting us in a favorable position for the upcoming renewals. We expect to update the market with new targets for 2025 next month,” said CEO Andreas Berger (pictured above).
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