Munich Re says capital base remains strong despite big hit from hurricanes

Munich Re has quashed talk of cutting the dividend amid a €1.4 billionn loss and profit warning.

The reinsurance giant has been hit by Hurricanes Harvey, Irma and Maria leading to the €1.4 billion third quarter loss.

“From today’s perspective and depending on the further course of the year, a dividend cut is not to be expected,” a spokesman said according to Reuters

Munich Re now expects only a ‘small profit’ for 2017.

Jörg Schneider, chief financial officer of Munich Re: “High losses from severe natural catastrophes are part and parcel of our business; that is why we are here. Our capital base remains very strong.”

The hurricanes, expected to trigger $100bn insured losses, are likely to cause a rise in reinsurance prices that will feed through to primary insurers, who may themselves have to hike rates.