Hannover Rück SE Hannover Re generates very good half-year result and remains on track to achieve full-year guidance

Hannover Re generates very good half-year result and remains on track to achieve full-year guidance

• Group net income up by 7.0% to EUR 1.4 billion
• Reinsurance revenue (gross) on the Group level grows by 0.7% adjusted for exchange rate effects
• Return on equity reaches 21.5%
• Large losses in property and casualty reinsurance below expected level
• Combined ratio improves to 83.2%
• Life and health reinsurance develops in line with expectations
• Return on investment of 3.7% ahead of roughly 3.5% target
• Earnings guidance for 2026 confirmed

Hannover, 12 August 2026: 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).

Life and health reinsurance develops in line with expectations

The Life & Health reinsurance business group developed as anticipated in the first half of the year. The new business generated was in line with expectations, driven in particular by attractive market opportunities that opened up in the US financial solutions segment.

New CSM generation (net), comprised of new business (net) and contract extensions (net), rose to EUR 384.8 million (previous year: EUR 364.7 million). The contractual service margin (net) grew by 6.1% to EUR 6.7 billion (31 December 2025: EUR 6.3 billion). The increase would have reached 3.6% adjusted for exchange rate effects.

Reinsurance revenue (gross) was up by 9.1% to EUR 4.1 billion (EUR 3.8 billion). Growth of 12.1% would have been recorded at constant exchange rates.

The reinsurance service result (net) climbed by 7.5% to EUR 478.0 million (EUR 444.5 million) and is thus very well on course to reach the full-year target of around EUR 925 million. The included new business LC (net) amounted to EUR 4.9 million (EUR 16.3 million).

The operating result (EBIT) in life and health reinsurance declined by 13.1% to EUR 408.2 million (EUR 469.9 million).

Return on investment ahead of target at 3.7%

“Our investment result and further strengthening of the interest rate level in our asset portfolio in 2025 through the realisation of unrealised losses played a major part in Hannover Re’s profitability,” said Christian Hermelingmeier, Chief Financial Officer of Hannover Re. “With our robust capital base and disciplined capital management, we are able to offer stability and create sustainable value even across market cycles.”

The investment portfolio was clearly higher than at the end of the previous year with a volume of EUR 69.4 billion (31 December 2025: EUR 66.3 billion). A positive operating cash flow boosted the portfolio overall despite adverse currency effects.

The investment result came in at EUR 1.3 billion (EUR 1.0 billion). The annualised return on investment reached 3.7%, surpassing the full-year target of around 3.5%.

Guidance for 2026 confirmed: Group net income of at least EUR 2.7 billion

Hannover Re expects Group net income of at least EUR 2.7 billion for the 2026 financial year.

“The very good half-year result puts Hannover Re in an excellent position,” said Clemens Jungsthöfel. “Taken together with our resilience, which we again strengthened considerably in the previous year, and our lean operating model, I am looking to the full 2026 financial year and our long-term profitability with confidence.”

The treaty renewals in property and casualty reinsurance as at 1 June and 1 July 2026 brought continued price declines for Hannover Re. Parts of the North American portfolio, especially natural catastrophe risks, are traditionally renewed in June and July as well as business from Australia and New Zealand and in the credit and surety lines. The volume increased by altogether 12.3%. Prices on the renewed business retreated by 4.5% on an inflation- and risk-adjusted basis.

Reinsurance revenue in traditional property and casualty reinsurance grew more modestly than originally anticipated in the first half of the year, with an increase of 0.2% year-on-year adjusted for exchange rate effects. The successful treaty renewals in the year under review are expected to have an appreciable positive impact on reinsurance revenue (gross) over the remainder of the year. With this in mind, currency-adjusted growth in reinsurance revenue (gross) in traditional business (excluding structured reinsurance) in the mid-single-digit percentage range remains attainable for the full financial year. In addition, Hannover Re expects a combined ratio of less than 87%.

Hannover Re anticipates a reinsurance service result (net) of around EUR 925 million in life and health reinsurance.

The return on investment is projected to reach around 3.5%.

Achievement of the earnings guidance for 2026 is based on the premise that large loss expenditure does not significantly exceed the expected level of EUR 2.3 billion and that there are no unforeseen distortions on capital markets.

In accordance with Hannover Re’s dividend policy, it is envisaged that the payout ratio for the dividend will be around 55% of IFRS Group net income. Furthermore, the goal is to distribute a dividend per share at least on the level of the previous year and to increase it over the long term.

Hannover Re is one of the world’s leading reinsurers. We transact all lines of property & casualty and life & health reinsurance and are present worldwide with around 4,000 staff. Property and casualty reinsurance in Germany is written by the subsidiary E+S Rück. Established in 1966, Hannover Re is recognised as a reliable partner for innovative risk solutions, exceptional customer intimacy and financial soundness. The rating agencies most relevant to the insurance industry have awarded both Hannover Re and E+S Rück very good financial strength ratings: Standard & Poor’s AA- “Very Strong” and A.M. Best A+ “Superior”.

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You can access further information, including the financial supplement, at the following link: https://www.hannover-re.com/en/investors/results-and-reports/#2026   

 

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