Swiss Re’s net income would have been a gain of $158m if there was no COVID-19 impact
Swiss Re announces 2020, Q1 results. (Credit: Swiss Re.)
Switzerland-based insurer Swiss Re announced a group net loss of $225m for the first quarter of this year due to the impact of COVID-19 (coronavirus) pandemic.
The company recorded a pre-tax charge of $476m for the property and casualty businesses in the quarter.
Its first quarter results were also adversely impacted by the mark-to-market valuation of Phoenix Group Holdings shares.
Swiss Re will receive Phoenix Group Holdings shares upon completion of the ReAssure sale.
As per Swiss Re, the group’s net premiums and fee income earned for this year’s first quarter was $9.6bn compared to last year’s first quarter income of $8.9bn.
Excluding COVID-19 impact, Swiss Re’s net income could have been $158m
The company also stated that its net income could have been $158m, if the impact of COVID-19 was excluded.
As per Swiss Re, its underwriting and investment heads were affected by the pandemic to the extent of $476m and $300m, respectively for the period.
Under the Property & Casualty Reinsurance head, the company earned net premiums of $4.7bn, with a net income of $61m. Excluding COVID-19 impact, the net income could have been $272m, the company stated.
Swiss Re stated: “The COVID-19 crisis impacted the result by USD 253 million as reserves were established primarily for expected claims for cancelled or postponed events.”
Under the Life & Health Reinsurance head, the company’s net premiums earned and fee income earned stood at $3.34bn with a net income of $299m.
Under the Corporate Solutions head, its net premiums earned was $986m, which had fallen from $1.02bn in the first quarter of last year. The head also suffered a loss of $167m, which was widened from last year’s $55m.
Under the head Life Capital, Swiss Re’s net premiums earned and fee income was $497m, compared to $548m recorded in the corresponding quarter last year.
Swiss Re Group CEO Christian Mumenthaler said: “The COVID-19 pandemic is far from over and its broader economic and social consequences will be far-reaching. Our industry plays an important part by absorbing some of the pain caused by this crisis.
“At Swiss Re, we continue to be here for our clients, run our business without interruptions, and use the flexibility allotted by our capital strength. We are confident that we will make a positive contribution.
“In the longer term, we will need to draw lessons from the current situation and look at public-private partnership solutions to ensure society can better deal with such large-scale disruptive events in the future.“