Swiss Re COR weakens to 83.4%

Swiss Re’s third quarter combined operating ratio (COR) fell to 83.4% (Q3 2012: 72%).

Group premiums and fee income increased by 14% to $7.5bn in Q3 2013 (Q3 2012: $6.6bn).

Net income for the group was $1.1bn in Q3 2013 against $2.2bn in Q3 2012. Swiss Re sold US business of Admin Re which bolstered Q3 2012 income.

In property and casualty reinsurance net income was $807m in Q3 2013 (Q3 2012: $1bn) despite a 19.9% growth in premiums to $4bn for the quarter (Q3 2012: 3.3bn). COR remained strong at 80.9% in Q3, although this represented a fall against 69.3% posted for Q3 2012. COR benefited from reserve releases from prior year business.

Swiss Re Group chief executive Michel Liès said: “This strong result demonstrates our excellent underlying earning power. P&C Re was clearly in the lead this quarter. Corporate Solutions is making progress against its own growth plans even in a quarter with sizeable large losses. We are following through on our plans to make adjustments in L&H Re while Admin Re continues to generate significant cash for the Group.”

Swiss Re continued to pay down its debt. It repurchased $713m of senior notes and $750m of senior debt matured. The reinsurer aims to reduce its debt by more than $4bn by 2016.

Investment return for the period was 3.5%.  

Group chief financial officer George Quinn said: “Our priority is to achieve our financial targets while providing a sustainable, growing dividend. This growth is ultimately dependent on our ability to deploy capital profitably. We continue to see attractive opportunities. Further capital management measures such as a special dividend are possible, but no decision will be made until we have finalised our year-end results.”