Hannover Re entering 2024 with stronger balance sheet as it targets net income of at least €2.1bn

Speaking during Hannover Re’s earnings call for the 2023 financial year earlier today, Jean-Jacques Henchoz, the company’s chief executive officer (CEO), confirmed that the company is aiming to deliver a group net income of at least €2.1 billion in 2024.

He did note however, that this net income expectation is under the proviso that incurred large losses remain within Hannover Re’s budget for 2024.

He explained that this amounts now to €1.825 billion, and also under the proviso that the firm does not see any unexpected turmoil on the capital markets.

Henchoz also went on to explain that Hannover Re is entering the 2024 financial year with an “improved balance sheet strength”, providing additional confidence on the delivery of the reinsurer’s targets.

“The property & casualty (P&C) renewals fully support our growth outlook for the reinsurance revenue of more than 5%. Within that 5% target for the group we’d expect stronger contribution to growth from P&C reinsurance, versus life and health given the current market dynamics in P&C.

“The strong and further improved quality of our P&C portfolio should put us in a good position to deliver on our combined ratio target of below 89%.”

“Due to the time lag in earning the underwriting year premium, the financial year 2024 will also benefit from the strong quality of the underwriting year 2023,” he added.

Further, Henchoz highlighted how interest rates have decreased since Hannover Re’s planning process, but, he did emphasize that the overall investment income expected for 2024 still remains in line with the company’s assumptions.

He added: “Therefore, I can also confirm our minimum target of 2.8% for the return on investments. The volatility and the evaluation of real estate and private equity remains a slightly more uncertain part of this equation. But, as of today, we do not expect any developments which are not within our assumptions for this target.”

Henchoz concluded by stating that Hannover Re is very pleased with its performance in 2023.

“We have delivered on our targets and more than delivered on our plan to increase the resiliency of our balance sheet. We are therefore confident on the outlook for 2024 and beyond.”

In their results for the 2023 financial year, Hannover Re generated net income of €1.8 billion, up from €800 million in 2022 and beating its guidance of at least €1.7 billion. 

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