Swiss reinsurance group, Swiss Re, saw profits plummet for 2005, a year characterized by record natural catastrophe events, as it was forced to absorb a massive CHF3 billion in natural catastrophe claims.

The group reported a 41% decline in profits, with pre-tax profits falling from CHF27.8 billion in 2004 to CHF1.97 billion in 2005.

Premiums earned declined 6% to CHF27.8 billion, a decline Swiss Re attributes to its focus on profitability rather than volume growth. The combined ratio for Swiss Re’s entire non-life business was 108.7%.

The group posted an optimistic outlook, confirming its 10% target for earnings per share growth, and suggested it was confident that the acquisition of GE Insurance Solutions would provide an excellent base upon which it could sustainably grow earnings.

Commenting on the results, Jacques Aigrain, Swiss Re’s CEO, said: 2005 has been a year of contrasts. Swiss Re has benefited from its well diversified business to absorb an unparalleled sequence of exceptionally large natural catastrophe events.