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Reinsurer Swiss Re closed the first quarter of 2020 with losses. For example, the postponement of the Summer Olympics and the resulting costs, the restructuring of the Corporate Solutions division or the distortions in the stock exchanges around the world have put pressure on the results.
From January to March, the Swiss Re account incurred a loss of $ 225 million, the company said Thursday. In the same period last year, the group had made a profit of 429.0 million. And analysts were even expecting a $ 325 million deficit in advance.
Swiss Re is also feeling the effects of the crown pandemic. This can be seen, for example, in the non-life reinsurance division, where the postponement or cancellation of major events and natural disasters burdened the bill in the initial quarter.
Losses due to weakness in the stock market.
At 110.8 percent, the loss / loss ratio relevant to business in the division was above the 100 percent threshold, as in the prior year (110.3 percent). This means that subscription losses are written. Without Covid 19 influences, it would have been 97 percent.
In the Corporate Solutions primary insurance division, the combined ratio stood at 125.8 percent after 116.3 percent in the prior year at a very high and therefore poor level. The reason for this is also the consequences of Covid-19 and the restructuring of the business, which costs money. Provisions totaling $ 223 million have been built, resulting in a loss of $ 167 million.
The market crisis triggered by the corona crisis put pressure on Swiss Re’s investments. Therefore, the group recorded revaluation losses of $ 300 million in its assets in the first quarter. However, hedging supported the result, which resulted in a 3.2 percent return on investment. Swiss Re is well capitalized in today’s turbulent times. The capital ratio according to the Swiss Solvency Test (SST) is still significantly above the 200 percent threshold and therefore at a very good level. (sda / ise)
