Gjensidige (GJF) Q2 2024 earnings summary

Executive summary

• Q2 2024 pre-tax profit rose to NOK 1,830.5 million from NOK 1,333.9 million year-over-year, driven by 9.7% insurance revenue growth but offset by high claims in Norway, especially in motor and property lines.

• Insurance service result was NOK 1,434 million, positively impacted by a NOK 402 million change in risk adjustment under IFRS 17.

• Profitability in Norway was pressured by increased claims frequency and inflation, particularly for property (fires) and motor, prompting significant pricing and deductible measures.

• Strong organic growth and high customer retention continued in Denmark, Sweden, and the Baltics, with improved profitability and new agency partnerships.

• The group maintains a solid capital position and high solvency ratio, supporting ongoing dividend payouts and growth initiatives.

Financial highlights

• Insurance revenue increased 9.7% year-over-year to NOK 9,831.7 million in Q2 2024, with strong growth in Norway and Denmark.

• Pre-tax profit increased to NOK 1,830 million from NOK 1,334 million in Q2 2023, aided by a NOK 402 million positive risk adjustment.

• Investment returns totaled NOK 540 million; financial result for Q2 was NOK 514.2 million, with a 0.8% investment return.

• Combined ratio for Q2 was 83.2%, with loss ratio at 72.2% and cost ratio at 13.2%.

• Solvency ratio at quarter-end was 170%.

Outlook and guidance

• Combined ratio target for 2024 (<84%) is challenged by high claims in H1, but all financial targets for 2025 and 2026 are maintained.

• Ongoing pricing and cost control measures are expected to gradually improve profitability and combined ratio as policies renew.

• Claims inflation for property expected to remain in the 5%-7% range for the next 12-18 months; motor claims inflation around 7% in 2024, declining to 4% over 12-18 months.