Hannover Re expects catastrophe reinsurance prices to rise

Commenting on the outlook for the January 2024 reinsurance renewals, German reinsurer Hannover Re said this morning that further price increases are expected for natural catastrophe risks in its home country.

E+S Rückversicherung AG (E+S Rück), the Hannover Re subsidiary that writes the group’s German reinsurance business, “expects further price increases and improved conditions in the 1 January 2024 renewals in property and casualty reinsurance,” the company said this morning.

Citing continued high natural disaster and weather losses, as well as high inflation, the company says the German insurance industry has suffered again this year, exacerbated by the ongoing rise in reconstruction and repair costs, the upshot is an adverse impact to the insurance sector’s profitability in the country.

“We must assume that the multi-year trend towards higher claim payments will continue. Adequate prices are indispensable if we are to be able to offer our clients the best possible reinsurance capacity in the future, as we have in the past,” explained Dr. Michael Pickel, Chief Executive Officer of E+S Rück, speaking around this year’s Baden-Baden reinsurance meeting. “Particularly at a time of many different interrelated challenges, it is therefore vital for us as a reinsurer to tackle these issues and design solutions jointly with our partners. Moving forward, then, we shall continue to stand by our clients as their partner in managing losses caused by climate change and natural catastrophe risks – just as E+S Rück has done for 100 years.”

Just like around the rest of the world, the German insurance industry has been affected by extreme weather throughout this year, and while the first-half was a little below-average, a series of storms centred on southern Germany in August boosted losses considerably.