Munich Re boosts profit in 2006

Munich Re has recorded a profit of EUR2.86 billion (Cdn$4.12 billion) in the first nine months of 2006, compared to a EUR1.39-billion (Cdn$2-billion) profit during the first nine months of 2005.Gross premiums written amounted to EUR28.1billion (Cdn$40.5 billion), which, after adjustments, “is about the same as last year’s,” the company noted in a press release.Munich Re saw its reinsurance group rebound from heavy losses in 2005. During the first three quarters of 2006, Munich Re’s reinsurance sector recorded a combined ratio of 92.1%. The reinsurance group posted a profit of EUR2.36 billion (Cdn$3.4 billion) during the first three quarters of 2006.In property-casualty reinsurance, premium grew slightly to EUR11 billion (Cdn$15.9 billion), and the result jumped to EUR1.93 billion (Cdn$2.8 billion). The combined ratio came to 92.1% .”In the two previous years, severe tropical cyclones had burdened the [property-casualty reinsurance] results,” said Torsten Jeworrek, a member of Munich Re’s board of management in charge of reinsurance operations, in a press release. “The moderate hurricane season to date does not break the trend. “The cyclical warm phase in the Atlantic and man-made global warming entail a substantial increase in extreme weather anomalies. There are no grounds for relaxing or being complacent.”We must continue to face the prospect of severe natural catastrophes whose loss potential is huge and growing, given the increasing concentration of values. It is to this loss potential that we will have to gear our prices, terms and conditions.”Based on its results, Munich Re announced its intention to buy back and retire EUR1 billion (Cdn$1.44 billion) of its own stock.