Covid-19-related losses in reinsurance during the third quarter amounted to nearly €800m
Main building of Munich Re in Munich, Germany. (Credit: Munich Re / Marcus Buck, München)
Munich Re revealed that it expects a reduced profit of around €200m for the third quarter of 2020 compared to €865m made in the same quarter in last year.
The German insurance firm said that its Covid-19-related losses in reinsurance during the third quarter are nearly €800m. In the first quarter of this year, the insurer registered similar Covid-19-related losses.
During the second quarter, the losses arising from Covid-19 totalled €700m, while the reported net profit was €579m.
Munich Re said that the pandemic-related losses in the third quarter are due to multiple business lines. These include insurance for major events and also other property-casualty lines, and the life and health business.
The German insurance group said: “As a result of high losses from natural disasters – particularly several severe hurricanes and wildfires in the United States – and man-made losses, the largest of which was the explosion in Beirut’s port, Munich Re also registered what was an above-average claims burden from “non-COVID-19 major losses” for a single quarter.”
Beirut explosion resulted in €250m loss for Munich Re
Last month, the insurance group revealed that it is expected to be hit by a loss of €250m because of the powerful explosion in Beirut, Lebanon that took place on 4 August 2020. The ammonium nitrate explosion which killed more than 200 people had resulted in property damage of $10bn-$15bn, which Munich Re said will account for most of its exposure.
Apart from the losses, the German insurance group said that its ERGO business had shown a good performance once again during the third quarter, while not revealing the exact figures. In the second quarter of the year, ERGO registered a net income of €173m, an increase of 27.4% compared to Q2 2019.
The insurer is due to announce its Q3 2020 results on 5 November.