The reinsurer has announced that it expects to boost its industry coverage business.
Munich Re has made insurance news with its latest statement, which has indicated that it expects to be able to increase the size of its industry coverage business, which offers corporate clients both insurance and reinsurance.
The last cycle has already shown notable increases, and this does not show signs of halting.
The head of the corporate insurance partner unit for Munich Re, August Proebstl, stated that “We have shown that we can achieve profitable growth in the business at a low double-digit percentage range over the cycle.” Proebstl also explained that “Over the last five years our compound annual growth rate was almost 13 percent.” As of yet, there has not been a specific growth target announced in the company’s insurance news.
This is important insurance news as that division, alone, has shown a large growth since last year.
In fact, that unit at this largest insurer in the world, employs 235 people, and its recorded premium income last year was approximately €525 million. This year, however, the company is on track to reach €600 million in its premiums income. The primary focus of that division’s insurance news is on corporations that have a revenue that is greater than €500 million. It has broker-driven industrial coverage business available, in addition to reinsurance for the in-house insurance ventures of large companies.
Proebstl acknowledged that the nature of this area of business is quite a volatile one, particularly because of the high insured values, at the same time, his insurance news statement said that Munich Re believes that they are ready to meet the overall profitability requirements of the group, which is for a 15 percent return on capital, following a risk adjustment. Though the company’s profits have suffered due to the large claims that have occurred, the trends this year seem to be much more promising.
The largest natural catastrophe loss from the company occurred in 2010, primarily resulting from the €100 million lost as a result of the Chile earthquake. Those struggles came with the insurance news that they had lost a very large corporate customer at the same time.