HDI Global Specialty tops €3bn premiums as Talanx posts strong results
HDI Global Specialty, the unit created in 2019 as a joint venture between Talanx’s Hannover Re and HDI Global, has more than tripled its premium volume since launch and added 20% more premium last year alone.
The German group’s specialty operation was launched four years ago with just over €1bn in premium volume. Parent group Talanx revealed that HDI Global Specialty continued its successful development last year after growing premium income by €660m year-on-year to €3.1bn.
The Talanx Group as a whole generated record premium income and group net income in financial year 2022. Gross written premiums were up 17.4% to €53.4bn, or 13.2% on a currency-adjusted basis.
Large loss claims totalled €2.18bn, mainly driven by natural disasters and reserves booked for Russia’s war against Ukraine.
Despite these adverse effects, group net income rose 15.9% to a record €1.172bn. At 12.9%, the return on equity was well above the minimum target of 8.4%.
“We grew profitably in a strongly changed market environment, increased our very strong earnings even further, and proved our resilience. Net income at both our primary insurance and our reinsurance operations improved, driven substantially by our international business. Foreign premium income now accounts for 83% of the total gross written premiums – three percentage points more than in the previous year,” said Torsten Leue, chairman of Talanx’s board of management.
The company’s industrial lines division grew its premium income by 17.9% last year to €8.9bn from €7.6bn in 2021.
Key growth areas were liability, property and the division’s specialty lines. Growth was driven both by new business and by rate adjustments, partly as a result of inflation, said the group.
A drop in frequency losses pushed down the combined ratio for industrial lines to 95.7% in 2022 from 98.7% the year before. Talanx said this was in line with the group’s strategy, despite an increase in total large losses and inflation effects.
“As a result, the division has almost reached its mid-term target of 95% well ahead of schedule. This reflects the positive effects of the measures taken to increase profitability since 2019,” said Talanx.
High large loss claims due to natural disasters such as Hurricane’s Ian and Fiona, as well as floods in Australia, impacted business by €270m. In addition, reserves for losses in relation to Russia’s war against Ukraine totalled €36m, said the group.
But Talanx said low losses of just below €17m from Winter Storm Elliot in the fourth quarter reflect the strict restructuring of the industrial businesses property portfolio.
Operating profit for the industrial lines division climbed to €252m in 2022 from €196m in 2021. The division contributed €177m to group net income up from €143m in 2021.
