Hannover Re lifts net income 6.9% to 2.1 billion euros in 9 months
Key Facts
Hannover Re raised group net income 6.9% to 2.1 billion euros in the first nine months of 2026, from 2.0 billion euros in the same period of 2025, according to results published by the company on 9 November. The increase came alongside a 16.5% rise in operating profit to 2.9 billion euros from 2.5 billion euros. Net reinsurance service result also rose to 2.6 billion euros, from 2.4 billion euros a year earlier. Chief Executive Clemens Jungsthöfel said the continued focus on disciplined underwriting and a lean operating model supports profitable growth through market cycles. He added that the company was "very confident" of achieving its full-year guidance.
In property and casualty reinsurance, large-loss payments totalled 1,316 million euros in the nine months, compared with 1,177 million euros in the same period last year. Although payments increased year on year, they were below the interim budget of 1,786.5 million euros. The company set its large-loss budget for fiscal 2026 at 2.3 billion euros. These lower-than-expected payments contributed to a favourable results environment, alongside improved segment performance. The budget comparison shows actual spending on large losses remained below the level the company had set for this period.
The property and casualty segment's combined ratio improved to 83.7% from 86.0% in the same period, and was better than the company's full-year expectation of less than 87%. The segment's net reinsurance service result rose to 1.9 billion euros from 1.7 billion euros. Its operating profit increased 20.2% to 2.2 billion euros, compared with 1.9 billion euros a year earlier. Hannover Re said disciplined underwriting and a lean operating model support profitable growth, particularly in property and casualty reinsurance. This came as the segment's indicators had already exceeded the annual combined-ratio expectation.
On the investment side, net investment income rose 40.4% to 1.9 billion euros, from 1.3 billion euros in the first nine months of 2025. The company attributed the increase mainly to gains from the sale of investments in the previous year and higher recurring income from fixed-income securities. The annualised investment return was 3.7%, exceeding a full-year target of around 3.5%. Chief Financial Officer Christian Hermelingmeier said growth in the profitable reinsurance portfolio expands the volume of investments, and that the company benefits from higher interest rates when reinvesting funds. He added that both factors support investment income and group profit.
Not all financial indicators rose; gross reinsurance revenue was 19.5 billion euros, compared with 19.7 billion euros in the same period. The company said growth would have been 1.1% at constant exchange rates, putting the impact of currency movements in context. The annualised return on equity was 21.1% at the end of September, compared with 22.0% at the end of September 2025. Solvency II capital adequacy stood at 242% at the end of September, compared with 256% on 31 December 2025. The company said the ratio remained comfortably above the 200% threshold, taking into account expected dividends on a pro rata basis and planned business growth in 2027.
Major individual natural catastrophe losses included the August Colombia earthquake, with a net cost of 215.7 million euros. Atlantic storms that affected the Iberian Peninsula and Morocco cost 135.5 million euros. Winter storm Fern in the United States and Canada resulted in expenses of 107.6 million euros. For the full-year outlook, Hannover Re reaffirmed its target of group net income of at least 2.7 billion euros in 2026. It is scheduled to announce its full-year 2026 results on 11 March 2027, and expects property and casualty contract renewals on 1 January 2027 to take place in a more competitive market, with slightly lower prices and broadly stable terms.