In view of the ongoing COVID-19 crisis and the associated uncertainties surrounding both the claims development and the capital market environment, Hannover Re and its parent company, Talanx, have withdrawn their profit guidance for 2020.
“It is still too soon to estimate the expected negative impacts of the COVID-19 crisis over the course of the year in light of the prevailing uncertainties at this point in time,” said Hannover Re in a statement. “Particularly the investment result as well as property and casualty reinsurance may see increased burdens.”
Based on preliminary figures for the first quarter of 2020, Hannover Re anticipates group net income of about €300 million (US$325.4 million), compared to €293.7 million (US$318.5 million) for the same period last year. Hannover Re emphasized, however, that figures for the first quarter were not significantly affected by the worldwide spread of the virus, indicating the impact will be felt in future quarters.
In a separate announcement, Talanx said its existing 2020 net income target of between more than €900 million (US$976.1 million) and €950 million (US$1 billion) is subject to too many uncertainties to be maintained during the COVID-19 crisis.
While its preliminary consolidated net income for the first quarter 2020 of €223 million (US$242 million) is roughly in line with the previous year figure of €235 million (US$254.9 million), Talanx said it is “impossible” to project the full-year results for 2020 based on first quarter results. The company explained that “the corona-related impact on our investment results and on our insurance business is only reflected in one out of three reporting months.”
Source: Hannover Re and Talanx
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