LA fire losses hit Munich Re, Hannover Re

(Reuters) — Germany’s largest reinsurers, Munich Re and Hannover Re, Tuesday reported sharp declines in first-quarter profit after a combined €1.7 billion ($1.89 billion) in claims related to the Los Angeles wildfires.

The wildfires killed nearly 30 people and damaged more than 16,000 structures, charring an area bigger than Paris.

“The devastating wildfires in California are another example of how climate change is exacerbating the risks of extreme weather events,” Hannover Re CEO Clemens Jungsthoefel said.

Nevertheless, both companies said they were sticking to full-year profit forecasts.

Munich Re, the world’s largest reinsurer, reported a first-quarter net profit of €1.094 billion, down from €2.115 billion in the year-earlier period. Analysts, on average, had forecast net profit of €1.112 billion.

The company retained its 2025 net profit forecast, however, projecting a rise to €6 billion from €5.7 billion in 2024.

Rival Hannover Re reported a 14% profit decline, citing €631 million in wildfire-related claims.

Hannover’s quarterly profit dropped to €480 million, down from €558 million in the year-earlier period. That was slightly above analyst expectations of €447 million.