Munich Re confirmed its earnings target

Munich Re confirmed its earnings target

Management raised the annual forecast for total premium income by 1.5 billion to 58 billion euros.

Management also estimates that the company and its subsidiary, Ergo, may be burdened with floods, particularly in Germany, to the tune of around 500 million euros.

In addition, the pandemic will not spare the Bavarian concern, and deaths due to infection – particularly in the US, India and South Africa – could cost the group about an additional 400 million euros this year.

However, Munich Re’s consolidated profit nearly doubled in the second quarter compared to the same period last year, to 1.1 billion euros, while operating profit rose from 755 million euros to 1.55 billion euros.

Under difficult conditions, the company owes its stable results to the renewal of reinsurance contracts. By the end of June, the value of new contracts had risen by 11 per cent to 3.9 billion euros, and fees had risen by an average of 2 per cent on specific terms. The company says the business environment continues to allow for increased volume and premiums.

Munich Re shares rose 1.7% to over €240 in the news.

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