By Ed Frankl 
 

Muenchener Rueckversicherungs-Gesellschaft AG said Tuesday that profit and premiums in the second quarter beat expectations, though losses increased and the cooling economy and higher rates hit its return on investment.

The German reinsurer reported net profit of 768 million euros ($783 million) in the three months to the end of June, down from EUR1.11 billion a year earlier.

Gross premiums written came to EUR15.85 billion, up from EUR14.64 billion in the same period last year, Munich Re said.

That compared with expectations of EUR719 million for net profit and EUR15.8 billion for gross written premiums, according to analysts' estimates provided by the company.

Reinsurance losses increased in the second quarter on year, with major losses over EUR10 million climbing to EUR575 million from EUR432 million a year earlier.

The company took EUR90 million in losses in the quarter from the impact of Russia's invasion of Ukraine, and around EUR200 million for it in the first half, it said.

Natural-catastrophe losses grew nearly 25%, with the costliest natural disaster for Munich Re the drought in South America, with losses at around EUR130 million, it said.

Munich Re cut its guidance for its investment result to a return of over 2.0%, from 2.5% previously, hit by falling share prices and higher interest rates, but kept its other targets, including a net profit of EUR3.3 billion for 2022.

However, July renewals showed premium growth of 6%, though the company said it is being cautious in calculating future loss expectations due to higher inflation.

 

Write to Ed Frankl at edward.frankl@dowjones.com

 

(END) Dow Jones Newswires

August 09, 2022 02:22 ET (06:22 GMT)

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