Cat Losses Drag Down Hannover Re's First-Half Results

Higher than expected major losses in the 2010 first half led to a 28.3 percent decline in group net income for Hannover Re compared to the 2009 first half.

The Hannover, Germany-based reinsurer said group net income for the first half of 2010 was EUR311 million ($410.8 million at current exchange rate), compared to EUR434 million ($573.2 million) a year ago.

The company suffered EUR407.6 million ($538.4 million) in catastrophe losses from 12 events for the 2010 first half, with the two largest being the Chilean earthquake at EUR182.1 million ($240.5 million) and the Deepwater Horizon oil rig explosion at EUR88.9 million ($117.4 million).

Net written premiums increased to EUR4.8 billion ($6.3 billion) in the first half, compared to EUR4.5 billion ($5.9 billion) in the 2009 first half--EUR2.6 billion ($3.4 billion) was from non-life reinsurance in 2010 compared to EUR2.5 billion (3.3 billion) in the 2009 first half.

The combined ratio rose to 99.4 in the half compared to 98.4 a year ago.

The company reported EUR77 million ($101.7 million) in realized investment gains compared to EUR55 million ($72.6 million) in the 2009 first half.

For the 2010 second quarter, group net income was EUR176 million ($232.5 million).