Hannover Rück (HNR1) Status Update summary

Impact of LA wildfires and loss estimates

• Preliminary net loss from LA wildfires estimated at EUR 500–700 million, exceeding the Q1 large loss budget but manageable within the annual budget and retrocession protections.

• Losses are net of retrocession, with the K-Cession and whole account protections mitigating higher loss scenarios.

• Despite the significant event, guidance for 2025 remains unchanged due to strong balance sheet, retrocession, and resiliency reserves.

Market environment and renewal highlights

• Reinsurance supply increased, mainly from retained earnings, outpacing demand growth; no major new market entrants.

• Demand for reinsurance rose due to exposure growth, with less inflationary pressure than prior years.

• Overall reinsurance prices saw a slight decrease, with the most pressure on NatCat business; casualty pricing stable or improving.

• Terms, conditions, and retention levels remained broadly stable, supporting combined ratio targets for 2025.

• Pricing remains rational and responsive to loss experience.

January 2025 renewals and portfolio development

• Premium volume for renewed traditional treaty reinsurance grew by 7.6% to EUR 11.0bn, fully supporting FY2025 targets.

• 59% of traditional treaty reinsurance (EUR 10.3bn) was up for renewal, representing 37% of total P&C inforce premium.

• Proportional business premium increased by 8.1%, non-proportional by 6.6%; price changes were -1.8% and -2.8% respectively.

• Risk-adjusted prices decreased by 2.1% on average, with orderly renewals and disciplined competition.

• Portfolio quality remains high, supported by disciplined underwriting and selective growth.