Markets, floods hit profits at Munich Re
FRANKFURT, Germany (AP) — German reinsurer Munich Re says first-quarter net profit fell 33 percent to 543 million euros ($722 million) as losses from floods in central Europe weighed on earnings.
The company said Tuesday it paid out 230 million euros in claims for the June floods. The burden on earnings from major losses rose to 605 million in the quarter from 452 million a year earlier.
Gross premiums written rose 1.6 percent to 12.81 billion euros.
The company also saw smaller returns on its investments, which are mostly in bonds and other fixed-income securities. The company's investment result fell by 250 million euros to 1.56 billion euros and it had increased writedowns on interest rate derivatives and options.
Reinsurance companies provide backup coverage to primary insurers so that the industry can handle losses from major disasters.