Swiss Re has reiterated its 2024 financial targets, including Group net income of more than USD 3.6 billion, following the announcement of its H1 2024 results last week, which were strong despite reserve additions.

The global reinsurer reported profit of USD 996 million and net income of USD 2.1 billion, with the latter attributed to disciplined underwriting, low claims from natural catastrophes, and strong investment income.

Additionally, the firm’s property and casualty (P&C) and life and health (L&H) reinsurance businesses performed well in the period, with a net income of $989 million and $883 million, respectively.

As the reinsurer focuses on delivering consistent results, it is also aiming to continue to increase its overall resilience by including a reserving uncertainty allowance on new business written across P&C businesses.

These reserves cost Swiss Re approximately USD 0.5 billion in post-tax earnings this year, Jacques de Vaucleroy, Chairman of the Board of Directors and Andreas Berger, Group CEO, noted.

“This reflects the Group’s objective to be sustainably positioned at the higher end of the best-estimate reserving range across the property and casualty businesses,” the executives stated.

H1 2024 saw low natural catastrophe claims, which were offset by USD 500 million additions across natural catastrophe and man-made loss reserves in property and specialty, the large majority of which were in the form of IBNR reserves in Property & Casualty Reinsurance (P&C Re).

P&C Re also increased reserves on specific casualty lines to the tune of USD 650 million. The prudence Swiss Re is building into reserves is important and has been described as positive by investors, as it better protects the company going forwards.

“Looking ahead, we reiterate our 2024 financial targets, including Group net income of more than USD 3.6 billion. The macroeconomic and geopolitical environment remains challenging. Economic uncertainty has intensified in recent weeks, with global markets experiencing a spike in volatility,” Vaucleroy and Berger highlighted.

2024 will see a historic number of elections which will provide citizens in different parts of the world the chance “to help chart a future course for their countries, but also has the potential to heighten political and societal tensions.”

At the same time, wars continue, causing devastation and loss of life while sending reverberations through global supply chains that can lead to costly business interruptions, Swiss Re notes.

Additionally, social inflation in the US is driving litigation costs higher, demanding vigilance on specific casualty lines. Most forecasts suggest an active 2024 hurricane season, which kicked off with the earliest Category 5 storm on record with Hurricane Beryl in late June.

Vaucleroy and Berger concluded: “Given these factors, Swiss Re is closely monitoring downside risks and their potential direct and indirect impacts on the insurance and reinsurance industry, while remaining alert for opportunities that emerge in a dynamic environment.

“Our focus is clear: achieving Swiss Re’s full-year targets and delivering strong, sustainable performance while being client-centric in everything we do.”

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