Swiss Re’s net income rises to $3.2bn for 2024 as P&C Re book grows 7% at Jan 1 renewals

Global reinsurer Swiss Re generated net income of $3.2 billion in 2024, up roughly 3% on 2023’s $3.1 billion, driven in part by disciplined underwriting of new business as the firm’s underwriting profit declined by approximately 9% to a still strong $4.3 billion.

Group-wide, Swiss Re has today reported an ROE of 15% for full year 2024, compared with 16.2% in 2023, as insurance revenue climbed from $43.9 billion to $45.6 billion.

The reinsurer highlights underwriting discipline and investment contributions from all business segments as drivers of the Group result, partially offset by the $2.4 billion of reserve additions in Q3 2024.

Swiss Re’s ROI for the full year increased to 4% from 3.2% in 2023, driven by a continued contribution from recurring
income.

Within the property and casualty (P&C) reinsurance business, net income fell 20% year-on-year to $1.2 billion, as the robust underwriting result was impacted by the aforementioned US liability reserve strengthening.

On the P&C reinsurance prior-year reserves, Swiss Re notes that additions were partly offset by releases in other business lines, resulting in net prior-year reserve strengthening of $2.6 billion for 2024.

“This positions overall P&C reserves at the higher end of Swiss Re’s best-estimate range which, coupled with the uncertainty allowance on new business, continues to support reserving strength going forward,” explains the firm.

Large claims from natural catastrophe events totalled $1 billion in 2024, mainly related to claims from Hurricanes Milton, Debby, and Helene, the hailstorm in Calgary in Canada, Storm Boris in Europe, and flooding in the Gulf region.

On the subject of losses, Swiss Re has provided a preliminary loss estimate of less than $700 million for claims related to the Los Angeles, California, wildfires, which will impact its Q1 2025 results, and which is based on an industry loss of around $40 billion.

Back to the 2024 results, and the P&C Re insurance service result, so underwriting profit, decreased 33% year-on-year to $1.8 billion in 2024, as the combined ratio deteriorated to 89.9% from 85% in 2023, with reserve strengthening accounting for 10.2 percentage points of the full year combined ratio. This means that P&C Re missed its combined ratio target of less than 87% for the year.

The segment’s insurance revenue increased slightly to $19.8 billion from $19.6 billion, supported by strong margins, continued price increases and targeted growth in property and specialty, while the firm continued to prune casualty lines.

At the January 1st, 2025, reinsurance renewals, Swiss Re grew its P&C book by 7% resulting in premium volume of $13.3 billion, achieving an overall price increase of 2.8%. The firm states that based on a prudent view on inflation and updated loss models, loss assumptions increased by 4.2% at the renewal round.

Life and health (L&H) reinsurance generated net income of $1.5 billion in 2024, up on 2023’s $1.4 billion, reflecting a recognition of in-force margins supported by a strong investment income, partially offset by adverse experience and assumption reviews. The assumption review was announced by Swiss Re back in December, and led to reduction in L&H Re’s Contractual Service Margin of USD 1.1 billion, taking the CSM balance to USD 17.4 billion by year-end.

The segment’s insurance service result rose 15% year-on-year to $1.5 billion, as insurance revenue increased to $17.1 billion from $16.4 billion.

Turning to Swiss Re Corporate Solutions, the commercial insurance arm, net income increased 26% year-on-year to $829 million.

Large nat cat losses totalled $344 million, mainly driven by tropical cyclone Megan in Australia, Hurricanes Milton and Helene in the US, and the Calgary hailstorm in Canada.

The business produced an insurance service result of $1 billion, an increase of 23% in 2023’s $831 million, as the combined ratio strengthened and came in below the full year target of 93% at 89.7%, which is also stronger than 2023’s 91%.

In terms of iptiQ, Swiss Re explains that the withdrawal is going as planned, with the sale of the entity’s European P&C business to Allianz Direct, while the Americas and APAC businesses have been placed into run-off.

“Our focus in 2024 was on profitability and resilience. Our results for the period reflect this and show that we are on the right track: we have delivered strong net income and ROE, while achieving our goal of positioning overall P&C reserves at the higher end of our best-estimate range,” said Swiss Re’s Group Chief Executive Officer, Andreas Berger.

“The strong underlying Business Unit performance is being supported by continued underwriting discipline and recurring investment income. The Group’s earnings power, combined with the reserving actions taken in 2024, give us confidence to increase the pay-out to investors by proposing an 8% higher ordinary dividend of USD 7.35 per share,” added John Dacey, Group Chief Financial Officer.

Looking ahead, Swiss Re has confirmed the financial targets announced in December 2024, including net income across the Group of more than $4.4 billion. P&C Re is aiming for a combined ratio of less than 85%, L&H Re is targeting net income of $1.6 billion, and Corporate Solutions targets a combined ratio of less than 91% for 2025.

“All our businesses have started 2025 in a strong position, thanks to the resilient foundation we have created and disciplined underwriting as evidenced by the successful January renewals. We remain focused on delivering on our targets for the year and reaching our cost efficiency goals,” said Berger.

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