--
- Q2 net result of €2.1bn; annual guidance unchanged at €6.0bn
- Property-casualty reinsurance and Global Specialty Insurance (GSI): very low major-loss expenditure ensures low combined ratios in Q2 (61% and 78%, respectively)
- Life and health reinsurance: random, individual major losses reduce total technical result in Q2 (€305m), new business development remains strong
- ERGO contributes €251m to Q2 net result; H1 result nears €500m
- July renewals emphasise profitability and portfolio optimisation: price decrease of 2.5% and volume decrease of 3.2%
In the second quarter, Munich Re posted a record-breaking profit of €2.1bn. With a half-year net result of €3.2bn, we are well on track to reach our annual target of €6bn. All lines of business contributed to the quarterly result – with excellent combined ratios in property-casualty reinsurance and GSI, and pleasing developments in life and health reinsurance, at ERGO and in our investment business. This also allowed us to mitigate the impact of foreign exchange losses due to the faltering US dollar. As the outcomes of the July renewals show, we continue to enjoy an attractive market environment. Our task now is to continue capitalising on it through stringent discipline.
Joachim Wenning
Chair of the Board of Management
Summary of Q2 figures 1,2
Munich Re generated a net result of €2,085m (1,601m) in the second quarter of 2025 and €3,178m (3,715m) in the first half of the year. Despite organic growth, insurance revenue from insurance contracts issued declined slightly year on year to €14,775m (14,953m) in Q2, which was attributable to negative foreign exchange effects. In H1, insurance revenue climbed to €30,586m (30,014m). The total technical result rose to €3,035m (2,440m) in Q2, while the currency result fell to –€602m (–21m), chiefly due to foreign exchange losses in connection with the weak US dollar. The operating result was €2,917m (2,178m) and the effective tax rate was 27.2% (24.8%).
Equity was lower at the reporting date (€30,762m) than at the start of the year (€32,901m). This was mainly due to dividend payments and share buy-backs, as well as currency translation effects. Munich Re’s solvency ratio3 was unchanged at 287% (31 December 2024: 287%), thus remaining above the optimal range of 175–220%.
The annualised return on equity (RoE) amounted to 25.5% (20.2%) in Q2 and to 19.7% (24.1%) in H1.
Reinsurance: Result of €1,834m 1
Munich Re presents Global Specialty Insurance (GSI) as a separate reinsurance segment since the first quarter of 2025. Previously part of the property-casualty reinsurance segment, GSI now globally bundles those primary specialty insurance activities that are managed by the reinsurance organisation. The comparative information has been restated accordingly.
The reinsurance field of business contributed €1,834m (1,339m) to the Group’s net result in Q2; the H1 result was €2,687m (3,227m). Insurance revenue from insurance contracts issued decreased to €9,629m (9,875m) in Q2. The total technical result was up, at €2,418m (1,940m), as was the operating result of €2,561m (1,847m).
In Q2, life and health reinsurance generated a total technical result of €305m (568m). Despite ongoing very good operational performance, this segment’s result was impacted by a random accumulation of individual major losses in Q2, dropping to €344m (514m). Insurance revenue from insurance contracts issued came to €3,094m (2,961m).
The property-casualty reinsurance segment posted a net result of €1,193m (771m); insurance revenue from insurance contracts issued fell to €4,513m (4,834m). The combined ratio was 61.0% (73.7%) of net insurance revenue; the normalised combined ratio was 79.6%.
In Q2, Munich Re reported major losses amounting to –€87m (644m) after retrocession and before tax, chiefly due to the low major-loss expenditure and the release of claims reserves from previous years. Major-loss expenditure corresponded to –2.0% (13.8%) of net insurance revenue, and was thus substantially below the expected value of 17%. In terms of man-made major losses, Munich Re posted a release of €107m in Q2, compared to an expenditure of €106m in the same quarter last year. Major-loss expenditure from natural catastrophes amounted to €20m (539m). The major-loss figures above take account of the effects from discounting and risk adjustment.
The Global Specialty Insurance segment posted a net result of €296m (54m). Insurance revenue from insurance contracts issued came to €2,022m (2,080m), while the combined ratio improved to 77.9% (93.6%) of net insurance revenue.
In the reinsurance renewals as at 1 July 2025, the volume of business decreased slightly to €3.2bn (–3.2%), as Munich Re selectively opted to not renew or write business that did not meet expectations with respect to prices, terms and conditions. The primary focus of the July renewals was business in North America, South America, Australia, and with global clients. Maintaining stable terms and conditions ensured the continuing high quality of Munich Re’s portfolio.
Our prices largely compensated for the higher loss estimates in some areas, which were primarily attributable to inflation or other loss trends. Despite a 2.5% drop, the good price level of Munich Re’s portfolio was maintained overall. These figures are, as always, risk-adjusted. In other words, price increases are offset if they are associated with increased risk and, consequently, elevated loss expectations. Over the three most important renewal dates in 2025, the reinsurance portfolio experienced a 1.2% decline in prices.
For the next round of renewals in January, Munich Re expects to see a market environment that continues to offer attractive business opportunities.
ERGO: Result of €251m2
Munich Re generated a result of €251m (262m) in its ERGO field of business in Q2 and €492m (488m) in H1. Insurance revenue from insurance contracts issued rose to €5,146m (5,078m) in Q2 and to €10,706m (10,282m) in H1.
In Q2, the ERGO Germany segment increased its result to €155m (116m), largely due to good operational performance. Further, the segment’s Q2 insurance service result improved significantly year on year. At Life and Health Germany, the release of the contractual service margin was up year on year; the insurance service result from short-term health and travel business also rose, due to lower claims and to seasonal effects. The insurance service result also increased at ERGO Property-casualty Germany.
In the ERGO International segment, the net result amounted to €96m (146m) in Q2; last year’s Q2 result had benefited from a positive one-off effect. In Q2 2025, the segment’s insurance service result improved thanks to ongoing profitable growth and favourable claims development. At Life and Health International, the release of the contractual service margin remained stable, which was mainly driven by health business in Spain and by life and health business in Belgium.
The total technical result for the field of business climbed to €617m (500m) and the operating result to €357m (331m) in Q2. The combined ratio for the ERGO Germany segment was 89.1% (91.3%) in Q2, matching the target value for the year as a whole; in H1, it was 88.9% (89.5%). In the ERGO International segment, the combined ratio improved substantially in Q2 to 89.5% (91.7%), driven by property-casualty business in Austria and the Baltic states, and by health business in Spain. Accordingly, it was below the target value for the year as a whole. In H1, the combined ratio declined to 89.3% (90.6%).
Investments: Investment result of €2,187m
Munich Re’s investment result increased to €2,187m (1,470m) in Q2; regular income from investments amounted to €2,222m (2,281m). The balance from write-ups and write-downs was –€28m (–62m), with the balance from gains and losses on the disposal of investments coming to €76m (–145m). The change in fair value amounted to €84m (–393m).
The higher investment result compared to Q2 2024 was primarily attributable to significantly higher fair values. Our equity portfolio in particular benefited from rising stock market prices. In addition, we generated an improved result from derivatives, while having to accept losses on private equity investments due to the weak US dollar. As in the past, we realised losses on the disposal of fixed-interest securities in Q2 2025; however, they were much smaller year on year, while also contributing to the improved investment result.
Overall in Q2, the investment result represented a return of 3.8% on the average fair value of the portfolio. The running yield was 3.8% and the yield on reinvestment was 4.2%. As at 30 June 2025, the equity-backing ratio including equity-linked derivatives amounted to 3.4% (2.9% as at 31 December 2024). The carrying amount of the investment portfolio as at 30 June 2025 was €222,768m (31 December 2024: 230,716m).
Outlook for 2025: Annual guidance unchanged at €6bn
Anticipating sustained advantageous business opportunities in coming quarters, Munich Re continues to expect a net result of €6.0bn for the 2025 financial year. Due to business and exchange rate developments, insurance revenue in reinsurance is now expected to total €40bn (previously €42bn). The Group’s insurance revenue is therefore anticipated to be €62bn, previously €64bn. The other targets communicated for 2025 in Munich Re’s Group Annual Report 2024 remain unchanged.
Please note that all figures are rounded values. As usual, all forecasts and targets are subject to increased uncertainties stemming from geopolitical and macroeconomic developments, to major losses remaining within normal bounds, and to the income statement not being impacted by severe fluctuations in the currency or capital markets, significant changes in the tax environment, or other one-off effects.
1 Previous year’s figures adjusted due to a reclassification of currency translation differences on insurance-related financial instruments to the currency result.
2 Previous year’s figures adjusted due to an accounting policy change for recognition of acquisition costs in the segment ERGO Germany.
3 Does not include any transitional measures or, as at 30 June 2025, any deduction for dividends for the 2025 financial year to be paid in 2026.
Release ID: 89167658
Google
RSS