HDI Global reports promising first quarter 2023
The industrial insurer HDI Global SE, part of the Talanx Group, has made a good start to the new financial year. The combined ratio of 93.2 percent came in below the stated medium-term target of 95 percent. The insurance revenue generated totalled EUR 2.1 billion. Improvements were also reported in the operating profit (EBIT), which came in at EUR 86 million, as well as the contribution to Group net income, which amounted to EUR 69 million. HDI Global is publishing financial key figures for the first time in accordance with the international financial reporting standards IFRS 17/9.
Having made a promising start, German based industrial insurer HDI Global is looking to the remainder of the year with optimism. The first three months benefited from a decrease in large loss expenditure compared to the corresponding quarter of the previous year. The transition to the new financial reporting standards IFRS 17 for insurance contracts and IFRS 9 for investments also had a slightly positive effect.
The insurance revenue generated by HDI Global in the first quarter came in at EUR 2.1 (1.8) billion. The favourable development can be attributed to liability business as well as the fire and engineering lines. Specialty business also played a part in the positive result, delivering insurance revenue of EUR 681 (615) million. Dr Edgar Puls, Chief Executive Officer of HDI Global, welcomes “a compelling indicator of the expertise in our organisation. The profitable growth extends to both commercial and specialty business. The good numbers demonstrate the quality of our underwriting, but they also underscore how we consider ourselves a partner for our clients: We stand ready to support them over the long term, including in a preventive advisory role with our range of services aimed at ensuring that many losses do not even occur in the first place.”
The underwriting result increased to EUR 141 (69) million thanks to a modest volume of large losses and an improved frequency loss ratio. The largest individual loss event was the earthquake in Turkey and Syria at a cost of EUR 15 million. Total payments for large losses were less than in the comparable period, coming in at EUR 34 (91) million. The combined ratio consequently decreased to 93.2 (96.2) percent, a level below the medium-term target of 95 percent, further assisted by a low volume of frequency losses and the rise in the interest rate level.
“This success is a testimony to the effectiveness of our optimisation programmes implemented since 2019”, said Dr Puls. “We have completed the turnaround and are now in a phase where the focus is on consistently reinforcing worldwide our claim to be a leading international industrial insurer by supporting our clients with tailor-made solutions. With this goal in mind, we have put in place a robust foundation in recent years.“
The net insurance finance and investment result before currency effects amounted to EUR 21 (54) million, reflecting reduced income from investments under own management and higher interest accretion on technical reserves owing to the rise in interest rates. The operating profit (EBIT) reported by HDI Global came in at EUR 86 (60) million. The contribution to the Group net income of Talanx AG stood at EUR 69 (35) million.
“Based on the good operating profit as well as the near doubling of our contribution to Group net income, HDI Global is doing justice to its traditional importance within the Talanx Group. Since HDI was first established some 120 years ago, industrial insurance has formed the core of our business. Today, there are more than 4,500 members of staff around the world who I would like to thank for their expertise and dedication. Furthermore, my thanks go out to the brokers and clients with whom we have enjoyed partnership-based relationships in most cases spanning quite a number of years. Going forward, as we have in the past, we shall support and enable their entrepreneurial progress.”
Authored by HDI Global
