Outlook for the full 2014 financial year

Outlook for the full 2014 financial year

In the current year, despite a challenging environment both on the capital market and in reinsurance business, we anticipate a good overall result for the Hannover Re Group.

Reflecting the assumptions described for the development of non-life and life and health reinsurance, we expect to generate stable or slightly higher gross premium for the current 2014 financial year based on constant exchange rates.

In view of the relatively soft market conditions in non-life reinsurance and our correspondingly selective underwriting policy, the premium volume for the current year is expected to remain broadly stable. Going forward, too, we shall not make any concessions to our systematic underwriting discipline and we shall reduce our shares in areas where the risks are not adequately priced. In terms of the targeted combined ratio, we expect a figure under 96%. We are aiming to generate an EBIT margin of at least 10%.

For our total life and health reinsurance portfolio we are looking to book organic, currency-adjusted growth in the low to mid-single-digit percentage range for 2014. The Value of New Business (VNB) should be in excess of EUR 180 million. We continue to anticipate EBIT margins of 2% for Financial Solutions and Longevity business and 6% for Mortality and Morbidity business.

The expected positive cash flow that we generate from the technical account and our investments should – subject to stable exchange rates – lead to further growth in our asset portfolio. We are targeting a return on investment of 3.2%. In both non-life and life and health reinsurance it is our assumption that we shall accomplish our minimum IVC targets of 2% xRoCA for non-life reinsurance and 3% xRoCA for life and health reinsurance.

Assuming that the burden of major losses does not significantly exceed the expected level of EUR 670 million and that there are no downturns on capital markets, Hannover Re expects to generate Group net income in the order of EUR 850 million for the 2014 financial year.

As for the dividend, we continue to aim for our payout ratio of 35% to 40% of Group net income.

Our strategic objective is to generate a minimum return on equity within the Group that is 750 basis points above the risk-free interest rate. We also seek to increase both the earnings per share and the book value per share (including dividends paid) by at least 10% annually.


Your last visited pages:

More Information

Topic related links within the report:


Download this chapter as a PDF file:

Topic Navigation and sitemap

Close Window

Build your tailor-made report with the topic navigation feature. By selecting the topics of your interest & choice, all relevant pages will be listed below. From there you can directly jump to the corresponding page.

By clicking the "send" button you can save the topics of your choice and consequently navigate through the report within your selection. Not relevant contents will be marked as inactive in the first navigation level and hidden in the lower navigation levels. To change or remove your selection and return to the entire report, please click on "remove selection".

My Annual Report

Your page has been added successfully. Please click on "My Annual Report" in the service section to see your selection.

Link für Popup