REINSURANCE giant Hannover Re yesterday slashed its profit outlook for the year after a glut of expensive claims linked to the recent earthquakes in Japan and New Zealand.
The downbeat news, largely expected by the market, saw the firm cut its net profit forecast from €650m to €500m (£585m to £450m) for the year, providing losses from the ongoing US hurricane season stay below €410m.
Net income for the three months to the end of March was €52.3m, a third of the level seen this time last year.
Chief executive Ulrich Wallin told shareholders he expects to see strong premiums this year, particularly in new markets, and that high demand for pensions in the UK would also bolster future results.
Group premiums are expected to rise by seven to eight per cent this year, Wallin added, compared to an earlier forecast of five per cent growth.
The firm has seen €509m of claims linked to the five biggest natural catastrophes so far this year – the Australian floods and cyclone, frosts in Mexico, as well as the Japan and New Zealand quake.
The firm’s €24.8bn assets under management are helping to recoup the losses, generating €222.7m of income during the quarter.