In an earnings release, Swiss Re accredited the decline to the impact of the economic recession on actual and expected claims in the property & casualty businesses, mark-to-market impacts on listed equity investments and large natural catastrophe claims above expectations. Meanwhile, net premiums earned and fee income for the group rose 0.9% year-on-year to $43.1 billion.
Commenting on the results, group CEO Christian Mumenthaler highlighted that 2022 was a “challenging year”, marked by the war in Ukraine, surging inflation, the tail end of the COVID-19 pandemic and elevated natural catastrophe losses.
“We have focused on addressing these challenges proactively,” he said, “all while maintaining our very strong capital position. This has enabled us to take advantage of attractive market conditions at the January renewals, while continuing our commitment to the ordinary dividend.”
Among the other key financials announced by the group, Swiss Re revealed that Property & Casualty Reinsurance (P&C Re) net income reached $312 million, featuring a combined ratio of 102.4% for 2022. This was supported by a strong Q4 2022 net income of $595 million and a combined ratio of 91.0% for the quarter.
Swiss Re noted that the P&C Re full-year result was negatively impacted by higher-than-expected economic inflation, for which Swiss Re set up reserves of $1.0 billion, while large natural catastrophe claims were above expectations at $2.7 billion. Net premiums earned for the business increased slightly to $22.0 billion, supported by continued price improvements over the year.
The group’s Life & Health Reinsurance (L&H Re) business net income reported an income of $416 million for 2022, compared with a net loss of $478 million in 2021. Of note, COVID-19-related claims decreased to $588 million in 2022 from almost $2 billion in 2021.
Swiss Re’s Corporate Solutions business, meanwhile, reported a combined ratio of 93.1% and a net income of $486 million, down from $578 million in 2021. Swiss Re hailed the result as ‘resilient’ and said it reflected a robust underlying business performance and strong new business growth in selected portfolios despite being impacted by the war in Ukraine and significantly less favourable prior-year developments.
Meanwhile, iptiQ – Swiss Re’s digital B2B2C insurance company - has continued its growth trajectory, increasing its in-force policies to more than 2.1 million from 1.6 million in the prior-year period. GWP for the business arm increased 17.7% from the prior year to $851 million.
Off the back of these results, Swiss Re’s board of directors are set to propose a dividend of $6.40 per share at the Annual General Meeting on April 12, 2023.
For 2023, the group is targeting net income of over $3 billion, supported by successful P&C Re renewals, an expected decline in COVID-19 claims, higher interest rates and cost discipline.
Commenting on the outlook for the year ahead, Mumenthaler said: “2023 has started well, with successful January renewals reflecting our ambition to drive profitability and create value for shareholders, while continuing to support clients. Our investment portfolio is well-positioned to benefit from rising interest rates, and we do not expect a return of high COVID-19 claims that we had seen over the past years. Despite the uncertain macroeconomic environment, we are confident in the group’s ability to deliver on the new, ambitious targets.”
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