The latest set of financials from Hannover Re;
Hannover Re generated a very good half-year result in an increasingly challenging market landscape and considers itself on track to achieve the full-year earnings guidance of at least EUR 2.7 billion.
“We can look back on a successful six months. Our partnership-based approach and lean organisation remain pivotal in our ability to operate successfully in an increasingly challenging market environment,” said Clemens Jungsthöfel, Chief Executive Officer of Hannover Re. “It is precisely for this reason that we were able to selectively acquire further market shares side-by-side with our clients in the first half-year.”
Group net income up by 7.0% to EUR 1.4 billion
Reinsurance revenue (gross) fell by 3.1% to EUR 12.9 billion (previous year: EUR 13.3 billion). Growth would have reached 0.7% at unchanged exchange rates.
The reinsurance service result (net), reflecting the profitability of underwriting activity after deduction of business ceded (primarily retrocessions and insurance-linked securities), climbed to EUR 1.7 billion (EUR 1.4 billion). The reinsurance finance result (net) before exchange rate effects, which is structurally negative and captures the interest accretion on technical reserves discounted in prior years, totalled EUR -773.4 million (EUR -667.6 million).
The currency result amounted to EUR -52.9 million (EUR 236.1 million). While the previous year’s result had benefited from the depreciation of the US dollar in the first half of 2025, the strengthening of the US dollar in the first six months of 2026 gave rise to opposing effects. The adoption of euro / US dollar hedge accounting in the second half of 2025 made it possible to limit the impacts on the result. Other income and expenses stood at EUR -235.1 million (EUR -272.1 million).
The operating profit (EBIT) grew by 9.7% to EUR 1.9 billion (EUR 1.8 billion). Group net income increased by 7.0% to EUR 1.4 billion (EUR 1.3 billion). Earnings per share came in at EUR 11.66 (EUR 10.90).
Return on equity reaches 21.5%
Shareholders’ equity amounted to EUR 13.3 billion as at 30 June 2026 (31 December 2025: EUR 12.9 billion). The book value per share reached EUR 110.00 (31 December 2025: EUR 107.21). The annualised return on equity came to 21.5% (23.0%).
The contractual service margin (net), which quantifies the unearned future profit embedded in the business written, increased by 11.4% to EUR 8.8 billion (31 December 2025: EUR 7.9 billion). The risk adjustment for non-financial risk amounted to EUR 4.0 billion (31 December 2025: EUR 3.7 billion).
The capital adequacy ratio under Solvency II, which measures the risk-carrying capacity of the Hannover Re Group, stood at 254% at the end of June (31 December 2025: 256%). Taking into account the foreseeable dividend for 2026 on a pro-rata basis as well as the planned business growth in 2026, it remains comfortably above the threshold of more than 200%.
Combined ratio in property and casualty reinsurance improves to 83.2%
The new business CSM (net) contracted by 13.3% to EUR 1.7 billion (EUR 2.0 billion). This was driven primarily by price declines in the most recent rounds of renewals as well as exchange rate effects, partially offset by volume growth due to increased new business – especially in the second quarter.
Reinsurance revenue (gross) in property and casualty reinsurance retreated by 8.0% to EUR 8.8 billion (EUR 9.5 billion). A decrease of 3.9% would have been booked at unchanged exchange rates.
Payments for large losses in the first half-year totalled EUR 784.7 million (EUR 976.1 million) and thus came in below our budgeted expectation of EUR 1,024.6 million. As usual, the entire large loss budget for the first six months was used as the basis for calculating the half-year result.
The largest net individual losses from natural catastrophes for Hannover Re were Winter Storm Fern in the United States and Canada at the start of the year in an amount of EUR 130.4 million, the severe Atlantic windstorms that impacted the Iberian Peninsula and Morocco to the tune of EUR 126.4 million as the year got underway and the June earthquake in Venezuela, for which an amount of EUR 75.0 million has initially been reserved.
Hannover Re has set aside altogether roughly EUR 200 million for potential impacts of the Iran war. The company also made provision for additional risks in the reporting period and further strengthened the resilience of its loss reserves.
The reinsurance service result (net) increased to EUR 1.3 billion (EUR 975.1 million). The combined ratio improved to 83.2% (88.4%), beating the full-year expectation of less than 87%.
The operating profit (EBIT) in property and casualty reinsurance grew by 17.7% to EUR 1.5 billion (EUR 1.3 billion).
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