Natural disasters weigh on Generali’s first-half results

(Reuters) — Generali said Friday its first-half operating profit was boosted by its life and wealth management businesses, while its nonlife segment suffered from the impact of natural disasters.

The Italian insurer’s first-half operating income rose 1.6% year-over-year to €3.72 billion ($4.04 billion), broadly in line with a company-provided consensus.

However, the nonlife segment’s operating profit fell 6.7%.  Jefferies analysts said that was “the most material component of the group’s miss.”

European insurers are facing escalating challenges as climate change intensifies, with more frequent and severe natural disasters such as floods and wildfires.

Generali is studying a “specific approach” to natural catastrophes as part of a new strategy it will unveil in Venice on Jan. 30, General Manager Marco Sesana said.

In a statement, CEO Philippe Donnet said the insurer was “fully on track” to meet all the “ambitious” targets of its current strategic plan, including annual earnings per share growth of between 6% and 8% in 2022-2024 and cumulative dividends of up to €5.6 billion ($6.12 billion).