On Friday, Swiss Re, a major insurance company, announced a significant increase in its annual profit, attributing it to a favorable market environment following a series of challenging years.
The company, headquartered in Zurich, reported a net profit of $3.2 billion for the year, meeting expectations based on a consensus compiled by LSEG.
This marked a 580% surge from the previous year’s $472 million profit. As part of its 2023 proposal, Swiss Re plans to raise its dividend by 6% to $6.80 per share.
These results showcase a remarkable recovery from 2022, when the company faced high inflation rates, claims from Hurricane Ian in Florida, and losses due to the COVID-19 pandemic.
CEO Christian Mumenthaler expressed his satisfaction with the firm’s 2023 performance and projected a positive outlook during an interview with CNBC’s “Squawk Box Europe.”
When asked about the industry’s practice of increasing prices and potentially causing inflation, Mumenthaler stated that it is their responsibility to provide fair pricing for risk and that they may have fallen short in recent years.
Reinsurance refers to insurance for insurance companies. Looking ahead, Mumenthaler cautioned that the effects of the climate crisis would soon be felt by consumers for the first time.
He explained, “With climate change, risks have significantly increased, and this is reflected in our profits, which have not been sufficient in recent years. As a result, we are reassessing the risks and responding accordingly.”
On February 3, 2024, firefighters were seen battling a forest fire in Chile’s Valparaiso region.
The region, along with Viña del Mar, was under a partial curfew to facilitate evacuations and the transport of emergency equipment due to a series of unprecedented fires.
Mumenthaler emphasized that this is the first time regular consumers are directly facing the consequences of climate change and that shareholders should not expect above-average returns. Swiss Re’s shares were down 2.1% at 10:30 a.m. London time.
