Hannover Re Achieves EUR 2.64 Billion Net Income in 2025, Confirms Growth Strategy Amid Competitive Market

Hannover Re increased premium income in traditional property and casualty reinsurance by 3.3% in treaty renewals as of January 1, 2026, while recording an average risk-adjusted price decline of 3.2%. The company maintained largely stable terms and conditions, supporting continued high quality of business written. Chief Executive Officer Clemens Jungsthöfel stated the company booked profitable growth in a highly competitive market environment, attributing success to strong market position, long-standing client relationships, and cost advantages. He noted the company was able to partially offset significant price reductions in certain lines through broad positioning and increased market shares in profitable areas.

Based on preliminary unaudited financials, Group net income for 2025 grew to EUR 2.64 billion from EUR 2.33 billion, achieving the earnings target raised to around EUR 2.6 billion in the fourth quarter. Treaties with a premium volume of EUR 10,196 million were up for renewal on January 1, 2026, representing 61% of traditional property and casualty reinsurance business. Hannover Re renewed treaties worth EUR 9,369 million while canceling EUR 827 million, with additional premium from new and restructured treaties bringing total renewed volume to EUR 10,535 million. Sven Althoff, Executive Board member responsible for property and casualty reinsurance, noted treaty terms remained largely stable but price declines were more pronounced than anticipated, especially in competitive lines and contracts with moderate loss experience.

Regional performance varied significantly across markets. The Americas saw premium volume growth of 6.5%, with more than half the business scheduled for renewal later in 2026. United States property business remained stable with risk-adequate pricing despite declines, while US casualty insurance offered selective growth opportunities. The Europe, Middle East and Africa region showed minimal growth of 0.4%, maintaining profitability despite intense competition in natural catastrophe covers. Asia-Pacific premium volume increased by 1.9% in a challenging market landscape characterized by intense competition, with Hannover Re deliberately not renewing business with unexpectedly low prices or poorer terms.

Specialty lines demonstrated strong performance with 5.8% premium growth in a highly competitive environment. Credit, surety and political risks lines delivered double-digit growth benefiting from continued attractive market landscape. Aviation and marine reinsurance saw volume reduction due to more disciplined underwriting policy, while agricultural business expanded in core markets like Brazil and the United States with unchanged rate quality. The company maintained market shares in digital and cyber segments while opening new business. Facultative reinsurance experienced price declines due to oversupply of capacity and higher client retentions, particularly in property business.

Natural catastrophe business faced intensive competition with risk-adjusted rate reductions of 10% to 20% due to abundant market capacity, though prices remained adequate overall. The successful launch of Hannover Re Capital Partners strengthened cooperation with capital markets in natural catastrophe covers. Structured reinsurance saw favorable demand development with most contracts renewed and new treaty relationships established, though reduced premium volume is anticipated due to lower cessions under individual large contracts.

Preliminary 2025 financial results showed reinsurance revenue of EUR 26.8 billion compared to EUR 26.4 billion previously. Operating profit reached EUR 3.5 billion, with property and casualty reinsurance contributing EUR 2.6 billion and life and health reinsurance accounting for EUR 0.9 billion. The strong underwriting result in property and casualty reinsurance allowed increased resilience in loss reserves while realizing hidden losses in the investment portfolio. The company confirmed its 2026 guidance of at least EUR 2.7 billion Group net income, representing a 12.5% increase compared to the previous year's original forecast. Hannover Re expects mid-single-digit percentage growth in traditional property and casualty reinsurance revenue, a combined ratio below 87%, reinsurance service result of around EUR 925 million in Life & Health reinsurance, and return on investment reaching approximately 3.5%.

Achievement of 2026 earnings guidance assumes large loss expenditure does not significantly exceed the budgeted EUR 2.3 billion and there are no unforeseen capital market distortions. The company will publish its audited annual financial statement on March 12, 2026. Hannover Re maintains its position as one of the world's leading reinsurers, recognized for innovative risk solutions, customer intimacy, and financial soundness with strong ratings from Standard & Poor's and A.M. Best.