We are highly satisfied overall with the development of our business in property and casualty reinsurance, even though competition was even more intense than in the previous year. Despite our selective underwriting policy, we were able to modestly grow our premium income. Gross premium increased by 1.1% as at 31 December 2014 to EUR 7.9 billion (previous year: EUR 7.8 billion). At constant exchange rates the increase would have been 1.2%.

Investment income from assets under own management for property and casualty reinsurance rose by 7.4% year-on-year to reach EUR 823.2 million (EUR 766.2 million). This was assisted inter alia by an improved result from the fair value development of the inflation swaps, which stood at -EUR 28.8 million after -EUR 41.0 million in the comparable period, and higher realised gains. We use inflation swaps to help hedge inflation risks associated with part of the loss reserves in our technical account.

The underwriting result was also thoroughly gratifying at EUR 351.5 million (EUR 335.5 million). With major loss expenditure coming in well below the expected level, the combined ratio of 94.7% showed another slight improvement on the previous year’s very good figure (94.9%). The operating profit (EBIT) as at 31 December 2014 climbed by 12.2% to EUR 1,190.8 million (EUR 1,061.0 million). The EBIT margin amounted to 17.0% (15.5%), thereby comfortably beating the target of at least 10% and reflecting the outstanding performance in property and casualty reinsurance. Group net income in property and casualty reinsurance reached EUR 829.1 million (EUR 807.7 million), the highest figure to date in the company’s history. This represents an increase of 2.7% on the previous year.