Swiss Re Reports a Net Income of USD 472 Million for 2022, Targets More Than USD 3 Billion for 2023
Swiss Re, the Zurich-based reinsurance company, has announced its financial results for 2022. The company reported a net income of USD 472 million for the year, with a net income of USD 757 million in the fourth quarter. Swiss Re’s return on investments (ROI) was 2.0%, reflecting the decline in global equity markets, while the recurring income yield rose to 3.0% in the fourth quarter.
Despite the challenging environment, Swiss Re’s Property & Casualty Reinsurance (P&C Re) unit had a net income of USD 312 million, with a combined ratio of 102.4% for 2022 and 91.0% in the fourth quarter. P&C Re increased premium volume by 13% in the January 2023 renewals and achieved price increases of 18%.
Swiss Re’s Life & Health Reinsurance (L&H Re) unit had a net income of USD 416 million, with COVID-19-related claims decreasing to USD 588 million in 2022 from almost USD 2 billion in 2021. Meanwhile, Swiss Re’s Corporate Solutions unit had a net income of USD 486 million, with a combined ratio of 93.1%.
Swiss Re’s Group Chief Executive Officer Christian Mumenthaler commented on the results, saying: “2022 was a challenging year, marked by the war in Ukraine, surging inflation, the tail end of the COVID-19 pandemic and elevated natural catastrophe losses. We have focused on addressing these challenges proactively, all while maintaining our very strong capital position. This has enabled us to take advantage of attractive market conditions at the January renewals, while continuing our commitment to the ordinary dividend.”
Based on Swiss Re’s very strong capital position, the Board of Directors will propose a dividend of USD 6.40 per share at the Annual General Meeting on 12 April 2023. For 2023, Swiss Re targets a net income of more than USD 3 billion, supported by successful P&C Re renewals, an expected decline in COVID-19 claims, higher interest rates, and cost discipline.
Swiss Re’s Group Chief Financial Officer John Dacey said: “After absorbing a significant impact from COVID-19 in the early part of 2022, L&H Re has returned to attractive levels of profitability. Corporate Solutions continued to deliver resilient results and outperformed its full-year target. We are pleased to end the year with a solid fourth-quarter result that was driven by strong operational performance from our main businesses.”
In 2023, P&C Re will move away from its normalisation approach to target a reported combined ratio of less than 95%, while L&H Re will aim for a net income of approximately USD 900 million, and Corporate Solutions will target a reported combined ratio of less than 94%. Swiss Re aims to maintain its very strong capitalisation in 2023, with a Group Swiss Solvency Test (SST) ratio materially above the target range, given the level of geopolitical and macroeconomic uncertainty.
Mumenthaler added: “2023 has started well, with successful January renewals reflecting our ambition to drive profitability and create value for shareholders, while continuing to support clients. Our investment portfolio is well-positioned to benefit from rising interest rates, and we do not expect a return of high COVID-19 claims that we had seen over the past years. Despite the uncertain macroeconomic environment, we are confident in the Group’s ability to deliver on the new ambitious targets.”
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