Munich Re Quarterly Profits Drop on Wildfires and Choppy Markets

German reinsurer Munich Re’s fourth quarter profits fell 56 per cent year-on-year to €238m as the group was hit by the California wildfires in November and turbulent financial markets at the year-end.

Source: Financial Times | Published on February 6, 2019

Munich Re Q1 profits 2024

The fourth-quarter performance was in line with analyst expectations. For the full year, Munich Re announced a sixfold profit increase to €2.3bn as overall losses related to natural catastrophes were significantly lower than in 2017.

Back then, a series of powerful hurricanes in the US and Caribbean wiped 85 per cent off its annual profits.

In 2018, natural catastrophe losses were two-thirds lower than in the previous year.

With costs of €440m, Typhoon Jebi which hit Taiwan and Japan in September, was the costliest natural disaster. The two wildfires in California in November caused losses of €430m.

“We are very satisfied with the overall result for 2018,” said chief financial officer Christoph Jurecka in a statement.

The group announced it is planning to increase dividend payouts to €9.25 a share, up from €8.60 last year.

The restructuring at Munich Re’s primary insurer Ergo was exceeding internal plans, with full-year profits rising 51 per cent to €412m, compared to the targeted €250m to €300m.