Key Takeaways:
Munich Re posted a record €3.9 billion first-half net result and cut its 2026 revenue outlook after July reinsurance renewal volumes fell 9.1 percent.
The results were driven by very low major-loss expenditure in property-casualty reinsurance and a strong investment result, Munich Re said, reiterating its €6.3 billion full-year net profit target.
The German reinsurer generated a net result of €2,211 million in the second quarter, up from €2,085 million a year earlier, while insurance revenue rose marginally to €14,939 million. The property-casualty reinsurance combined ratio came in at 68.9 percent, with major-loss expenditure of €191 million equal to 4.9 percent of net insurance revenue, far below the expected 18 percent. The investment result climbed to €3,159 million from €2,187 million, helped by rising equity markets.
Munich Re now expects 2026 insurance revenue of €62 billion, down from a prior forecast of €64 billion, with reinsurance revenue of €38 billion versus €40 billion previously. At the July 1 renewals, business written fell to €2.9 billion, a decline of 9.1 percent, as the company opted not to renew contracts that failed to meet pricing or terms expectations. Prices declined 5.5 percent on a risk-adjusted basis.
The reinsurance field contributed €1,890 million to the second-quarter result, with life and health reinsurance posting a net result of €489 million on the back of major transaction business, including the largest single longevity deal to date covering €4 billion in pension liabilities. Global Specialty Insurance generated €149 million, while ERGO contributed €321 million. The solvency ratio stood at 304 percent, above the Solvency II minimum of 200 percent.
Munich Re also agreed in August to assume biometric risk on a $3.2 billion block of long-term care policies from Manulife through its US life reinsurance unit, the third such transaction for the Canadian insurer in under three years. The softer pricing environment is being felt across the sector, with rival Swiss Re also reporting a strong first half as competition for property-casualty business intensifies.
The revenue cut stems from softer reinsurance pricing as competition intensifies, though the maintained profit target suggests underwriting discipline is holding. Investors will watch the January renewals for whether favorable price levels can be upheld.
This article is for informational purposes only and does not constitute investment advice.
