Combined revenue for the insurer’s UK businesses reached £5.6bn in 2022, its financial results showed
Allianz Holdings’ combined operating ratio (COR) for its operations across 2022 reached 99.2% – up six percentage points from 2021’s figure 93.2%.
The insurer’s full year financial results for 2022, published today (17 January 2023), also showed that operating profit for the 12 months of 2022 fell by 58.3% to 132.3m – down from £317.6m the previous year.
Despite this, revenue for the business’ UK operations rose by 4.4%% to £3,966m from a 2021 figure of £3,798m.
Colm Holmes, chief executive of Allianz Holdings, commented: “Undoubtedly, 2022 was a tough year for the industry and trading performance was impacted by several large weather events and ongoing inflationary pressures which have impacted profitability.
“Despite these challenges, we have still achieved growth across our business and these results demonstrate that we have the scale and diversity to withstand even the most difficult of market conditions.”
A rise in COR and fall in operating profit was primarily impacted by “double digit claims inflation, several significant weather events and the company’s exposure to the motor market”, said the insurer.
Speaking to Insurance Times, Holmes said: “2022 was the year where we had somewhat of a perfect storm in terms of impacts on the insurance industry and Allianz obviously wasn’t spared that.
“We had the three wind events in February, material subsidence losses as a result of a dry hot summer and when we thought we were through all that we had the impact of the freeze in December.
“In terms of gross losses however, Allianz in the UK was well protected against some of that because we have a very prudent approach to reinsurance purchases.”
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Across Allianz’ insurance businesses in the UK – including Allianz Holdings, Allianz Global Corporate and Specialty, Allianz Trade and Allianz Partners – combined revenue for 2022 hit £5,612m, up 11.2% from a 2021 figure of £5,045m.
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The insurer’s Global Corporate and Specialty business saw revenue increase significantly to £1,1135m for 2022 – up 29.7% on 2021’s figure of £858m.
Growth in this area of business has been the result of a multiyear strategy, according to Holmes.
He explained that “there’s been a huge focus on [pricing] discipline” that initially shrunk the business’ profits, but was now paying dividends.
“That’s been coupled with a really strong hard market in the corporate and specialty space globally, because [Allianz Global Corporate and Specialty] is about writing global risks in the UK,” explained Holmes.
“I frequently say the UK is the centre of insurance globally and it’s something we need to ensure that we never lose.
“Those results that our corporate and specialty partners can deliver are a result of the strong presence of London as the centre for that insurance – they’ve benefitted from that strong rate environment.”
Looking to the future, Holmes explained that Allianz “[expected] 2023 to be difficult”.
He said: “As we get into this year, clearly inflation and supply chain disruption haven’t gone away and remain with us – we expect the market to continue to need to harden.”
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