Focus on the Alpine region
Natural disasters spoil Allianz’s summer
November 10, 2023, 9:51 a.m
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With further inflows and better investment results from the asset manager, Europe’s largest insurer can offset the increased costs caused by severe storms. In addition, Allianz can sometimes enforce higher prices. This means that the profit at the end of the summer exceeds expectations.
Costly natural disasters spoil the alliance’s summer. The operating result fell by almost 15 percent to 3.5 billion euros in the past quarter on an annual basis. The combined ratio was impacted by natural catastrophes to the tune of 7.3 points, the highest value in a decade, the company said. Storms with storms and hail in August caused severe damage, particularly in Bavaria, and there were floods in many countries in the Alpine region. Europe’s largest insurer confirmed its forecast for the full year.
However, the decline in profits is not as strong as analysts had expected: the adjusted net profit for the period fell by almost 30 percent to 2.1 billion euros, while analysts had forecast just under two billion euros. Allianz explained that a higher investment result partially offset the additional costs due to the higher damage.
The business volume rose by 4.5 percent to 36.5 billion euros. Higher prices and volumes played a role in property and casualty insurance, and high one-off premiums in the USA also occurred in life and health insurance business.
Allianz confirms the goal “with confidence”
For the first nine months, Allianz reported revenues of 122.1 billion euros, 4.7 percent more than a year ago. Operating profit improved during the period by 3.6 percent to eleven billion euros. Allianz is sticking to its profit target of 14.2 billion euros plus/minus one billion euros for the current year. Allianz confirms the goal “with confidence,” said CEO Oliver Bäte, according to the statement.
The result in asset management was stable. The segment, which consists of Allianz Global Investors and Pimco, achieved its third consecutive quarter of net inflows of €10.5 billion. Last year, customers had withdrawn money. Assets managed for third parties increased only slightly by 8 billion euros compared to the previous quarter to 1.67 trillion euros, which was due to negative market effects.
Allianz remains very adequately capitalized. “Our ability to grow and generate attractive returns for our stakeholders is supported by an excellent capital position with a Solvency II capitalization ratio of 212 percent,” said Chief Financial Officer Giulio Terzariol. To do this, own funds and regulatory requirements for capital resources are compared. The manager, who has been with the DAX group since 1998, recently announced his move to Italian competitor Generali. His successor at Allianz will be Claire-Marie Coste-Lepoutre, currently chief actuary and controller.