Scor braced for surge

French reinsurer SCOR saw net income fall by a third to €315m (£280m) in what it described as “a financial market environment that continues to be very challenging and a higher than average natural catastrophe year”.

Highlights

• Gross written premiums €5,807m up 22.0% On a pro-forma basis and at constant exchange rates, premium volume rose by 3.2%.
• Non-Life GWP increase to €3,106m up 33.3%. On a pro-forma basis and at constant exchange rates, premiums rose by 0.2%.
• Net income €315m
• Annual return on equity (ROE) of 9.0%
• Earnings per share (EPS) of €1.76,
• Non-Life combined ratio of 98.6%, despite major natural catastrophe events such as hurricanes Ike and Gustav and snow storms in China, down from 99.3%
• Life operating margin of 6.0%.
• €71m costs savings to be achieved by the end of 2009, reducing costs by 18%.
• Despite higher Cat losses (6.6 points in 2008 vs. 5.2 points in 2007) the combined ratio for the Group’s Non- Life business has improved by 0.7 pts compared to 2007 on a pro-forma basis.

The company said: “History has shown that the reinsurance industry is anti-cyclical to economic crisis. SCOR expects that the demand for reinsurance will continue to increase due to anticipated capital depletion at primary insurers. In addition, there have been no new entrants into the industry, contrary to previous periods of hardening prices. This will make solid and reliable reinsurance capacity an even more important asset in the near future.”French reinsurer SCOR saw net income fall by a third to €315m (£280m) in what it described as “a financial market environment that continues to be very challenging and a higher than average natural catastrophe year”.

Highlights

Gross written premiums €5,807m up 22.0% On a pro-forma basis and at constant exchange rates, premium volume rose by 3.2%.

Non-Life GWP increase to €3,106m up 33.3%. On a pro-forma basis and at constant exchange rates, premiums rose by 0.2%.

Net income €315m

Annual return on equity (ROE) of 9.0%

Earnings per share (EPS) of €1.76,

Non-Life combined ratio of 98.6%, despite major natural catastrophe events such as hurricanes Ike and Gustav and snow storms in China, down from 99.3%

Life operating margin of 6.0%.

€71m costs savings to be achieved by the end of 2009, reducing costs by 18%.

Despite higher Cat losses (6.6 points in 2008 vs. 5.2 points in 2007) the combined ratio for the Group’s Non- Life business has improved by 0.7 pts compared to 2007 on a pro-forma basis.

The company said: “History has shown that the reinsurance industry is anti-cyclical to economic crisis. SCOR expects that the demand for reinsurance will continue to increase due to anticipated capital depletion at primary insurers. In addition, there have been no new entrants into the industry, contrary to previous periods of hardening prices. This will make solid and reliable reinsurance capacity an even more important asset in the near future.”