What were Euro insurers Q3 results?

Some of Europe’s biggest re/insurers have released their Q3 results, revealing that NAT CATs hammered underwriting but investment returns were bullish.

Copy Of Copy Of FO Black 1200 (7) @SCOR.
French SCOR was one of the 'big four' European reinsurers that recently announced Q3 results.

Several of Europe’s largest re/insurers have announced their Q3 results, which revealed continued divergence between underwriting and investment returns: those suffering worsening underwriting returns laid at the door of natural catastrophes (NAT CATs).

In a recent report, financial data revealed that reinsurers were suffering from losses in their investment portfolios due to poorly performing fixed income stocks, with the European reinsurance field experiencing a drop off in net investment ratios.

A report from Hong-Kong-based Value Partners highlighted the change in fortunes for fixed income returns. “Despite the overall restrictive monetary tone for most of the year, economic data for the US has remained surprisingly resilient in [Q3 2023], which bolstered hopes of a soft landing,” it said. “The Fed’s hawkish tone is expected to prevail as more time is needed to ensure inflation returns to its target and as it considers the cumulative effect of monetary tightening on the economy. We believe the Fed’s narrative on keeping rates 'higher for longer' will stay for the remainder of 2023 – underlying growth appears to remain quite solid, and inflation is still some way far from the target.”

Market conditions year-on-year

In a pre-Rendez-Vous de Monte Carlo report published by AM Best, the ratings agency compared the returns of Europe’s four largest reinsurers – Swiss Re, Hannover Re, Munich Re, and SCOR – in a Market Segment Report called “Global Reinsurance – The European Big Four”.

Swiss Re’s return on investments (ROI) was 3.5%, and its Q3 recurring income yield increased to 3.7%, it said in its statement.

In Q2 2022, Swiss Re saw a $442 million loss and listed “significantly lower investment results” as one of the reasons for it. "With interest rates continuing to rise, we see improvements in the recurring income yield and in our overall investment results,” said Swiss Re's Group Chief Financial Officer (CFO) John Dacey. “Combined with the improved underwriting performance, this has significantly strengthened the Group's earnings capacity."

The company saw a profit of $1 billion in Q3, and Swiss Re reported a net income of $2.5 billion and a return on equity (ROE) of 25.9% for the first nine months of 2023. “This compares with a net loss of $285 million and an ROE of –2.1% for the first nine months of 2022,” it said. “The significant improvement was mainly driven by the underwriting performance in P&C Re and L&H Re, supported by increasing investment results.”

"With interest rates continuing to rise, we see improvements in the recurring income yield and in our overall investment results.”

The Group saw an ROI of 3.5% in the first nine months of 2023 compared with 1.6% in the prior-year period.

“In the third quarter, the ROI was at 4.8%, supported by net realised gains stemming from real-estate sales, which were partially offset by losses from targeted sales of lower-yielding fixed-income securities,” the statement said. “Overall, the investment portfolio continues to benefit from higher interest rates. The recurring income yield reached 3.7% in the third quarter, while the fixed income reinvestment yield settled at 4.9%.”

“In light of the good performance year to date, we maintain our targets for the full year including a Group net income of more than $3 billion,” said Swiss Re's Group CEO Christian Mumenthaler. “We continue to focus on our disciplined underwriting strategy that provides a strong base for the future."

The results of most European re/insurers match those of US and Bermuda-domiciled companies that had a healthy Q3 and nine months to 30 September in 2023. Many have attributed their return to profits after a volatile comparative time in 2022 to stabilising inflation, a pause in the rise of interest rates, and an overall healthier economy. Some saw higher profits due to these factors.

Fixed income probability, however, remained an issue for some, given the ongoing effect of these aforementioned inflation and interest rate rises. This uncertainty was likely to continue, with most experts still believing there could be at least one more rise in interest rates by the Federal Reserve (Fed) in the next few months.

Munich Re

In Germany, Munich Re said it saw a quarterly profit of €1.169 billion and raised its full-year forecast for 2023 to €4.5 billion.

“Munich Re’s business performance continued seamlessly in the third quarter,” said Christoph Jurecka, CFO. “Unlike last year, we benefited from a comparatively mild hurricane season in the North Atlantic. Accordingly, major-loss expenditure in property-casualty reinsurance was lower than expected, despite various other natural catastrophes.”

He added that a strong performance in other operating segments rounded out the positive results. “We can report a net result of nearly €1.2 billion for the third quarter and €3.6billion for the first nine months of the year. We are confident that we will surpass our previous annual target of €4 billion and have raised the guidance to €4.5 billion.”

“[These] losses from the disposal of investments chiefly concerned fixed-interest securities, which were sold for the purpose of reinvesting.”

The investment result rose to €760 million compared to €691 million in Q3 2023.

The reinsurance field of business contributed €995 million to the Group’s net result in Q3 compared to €851 million in 2022. “[This was] primarily due to the continued rise in interest rates. The balance from write-ups and write-downs was –€26 million (in 2022 it was –€832 million) and the balance from gains and losses on the disposal of investments came to –€196 million (€729 million in 2022). [These] losses from the disposal of investments chiefly concerned fixed-interest securities, which were sold for the purpose of reinvesting and thus more quickly benefiting from the higher interest rates currently available.”

They concluded the Q3 investment result represented a return of 1.4% on the average market value of the portfolio. The running yield was 3.3% and the yield on reinvestment was 4.5%. As at 30 September 2023, the equity-backing ratio including equity-linked derivatives amounted to 3.2% (2.0% as at 31 December 2022). The investment portfolio totalled €209.95 billion as at 30 September 2023.

Zurich Insurance Group

Zurich saw P&C insurance revenue of $31.4 billion for the nine months to 30 September, which was a 9% increase in the same period in 2022.

“The Group has seen further growth in both commercial and retail business, with particular strength in Life,” it said in its statement.

Gross written premiums (GWP) in P&C rose 9% compared with the prior-year period on a like-for-like basis, adjusting for currency movements.

GWP rises were higher in Latin America and Asia Pacific, 32% and 11% respectively in terms of the like-for-like basis for GWP.

Zurich’s capital management results will be announced on 16 November.


French company SCOR, saw a group net income of €147 million for Q3, implying an annualised Return on Equity of 13.7%. “For the first nine months of 2023, the net income stands at €650 million, implying an annualised Return on Equity of 20.2%,” it said in its statement.

“Our objective as we prepare the 1.1 renewals is to continue to take advantage of the hard market with new business generation at attractive margins.”

SCOR said it “benefit[ted] from high reinvestment rates and reports a noticeable increase in the regular income yield”, which was 3.4% in Q3 2023 compared to 3.1% in Q2 2023 and 2.6% in Q3 2022.

“On the P&C side, we are below our [natural catastrophe] budget over the first nine months of 2023, but continued attention is required on the attritional loss ratio,” said Thierry Léger, CEO. “Our objective as we prepare the 1.1 renewals is to continue to take advantage of the hard market with new business generation at attractive margins. In L&H and Investments, we deliver[ed] stable and positive results.”

As of 30 September 2023, SCOR’s total invested assets amount to €22 billion. SCOR’s asset mix is optimised, with 78% of the portfolio invested in fixed income. “SCOR has a high-quality fixed income portfolio with an average rating of A+ and a duration at three years,” it said.


Total business volume increased 4.5% to €36.5 billion for Q3 2023, and the company remained upbeat despite slumps elsewhere for the Munich-based giant.

Nat CATs were blamed for a lower core net income of €2.06 billion compared to 2022’s same period seeing €2.91 billion, but this was seen as not affecting the group’s overall profitability. ”A lot of good news,” said the representatives on the media results call.

“Operating profit soften[ed] by 14.6% to €3.5 billion; driven by the Property-Casualty business segment affected by a 7.3 percentage point impact by natural catastrophes on the combined ratio, the highest in a decade," said the company’s statement on the results.

“[Our] level of sensitivity and Solvency II is very strong.”

However, operating profit did increase for the nine months to 30 September by 3.6% to €11 billion – compared to €10.6 for the same period in 2022. This was mainly due to a higher operating investment result in our Life/Health business segment, supported by our Property-Casualty business segment. “Operating profit from our Asset Management business segment developed in line with lower assets under management-driven revenues, partially compensated by higher performance fees and lower expenses,” said Allianz.

The operating investment result was €802 million for Q3 2022 compared to €673 million in Q3 2022.

“[Our] level of sensitivity and Solvency II is very strong,” said Allianz’s representative during the media call on the results.

For the P&C segment, investment results were up 19%, and the current yield in debt securities was 0.85% for Q3 2023, compared to 0.66% in Q3 2022.