China Re posts big increase in profits

China Re posted a huge increase in profits for the first half of 2024 despite what president Zhuang Qianzhi described as a “complex business situation” and “arduous reform and development tasks”.

As he presented the latest results, Qianzhi also highlighted the progress made in efforts to tackle the impact of climate change in partnership with the government.

He said that China Re has “proactively aligned itself” with the national strategy for addressing climate change.

China Re has established a working mechanism to address climate change and studied and formulated an action plan and roadmap for addressing it.

It has signed a strategic cooperation agreement with the China Meteorological Administration to jointly innovate a new model of “meteorology + insurance” to address climate change and explore new roles for insurance in the risk diversification and transfer of meteorological disasters, he said.

The reinsurer has also stress-tested the physical risks of climate change for the People’s Bank of China, exploring ways to more effectively manage and control climate risks, explained Qianzhi.

He also said that China Re has been “fully committed” to serving the national catastrophe insurance protection system and building the reinsurance market as it faces up to the challenges of climate change.

The reinsurer independently developed catastrophe models for earthquakes, typhoons and floods in China, with most indicators outperforming similar foreign products, said Qianzhi.

China Re participated in catastrophe insurance pilot projects in 19 provinces and cities in China, and served as the lead reinsurer in more than 80% of these projects.

The reinsurer also implemented the first comprehensive catastrophe insurance policy in China, covering all types of catastrophes, with broad coverage and a long duration, and served as the lead reinsurer. “[This is] a typical example of promoting the development of catastrophe insurance business,” said the China Re president.

The reinsurer also facilitated the official opening of the Shanghai Reinsurance Operation Center of China Continent Insurance and successfully completed its first transaction, “fully supporting the development of the Shanghai International Reinsurance Exchange”, he said.

The first-half results were impressive as the group recorded consolidated insurance revenue of RMB51,784m, representing a year-on-year increase of 6.8%. Net profit was RMB5,727m, representing a year-on-year increase of 184.6% and resulting in an annualised ROE of 11.85%.

Qianzhi said that the group’s consolidated underwriting profit reached a record high last year, with a year-on-year increase of over 30%, with each insurance business segment achieving underwriting profitability.