Hannover Re increased premium income in traditional property and casualty reinsurance by 3.3% during treaty renewals effective 1 January 2026, recording an average risk-adjusted price decline of 3.2% while maintaining largely stable terms and conditions. Based on preliminary unaudited financials, Group net income for the 2025 financial year grew to EUR 2.64 billion, achieving the company's raised earnings target. The company confirmed its guidance for 2026, expecting Group net income of at least EUR 2.7 billion.
Chief Executive Officer Clemens Jungsthöfel stated the company booked profitable growth in a highly competitive market environment during the renewals at the start of the year, attributing success to Hannover Re's strong market position, long-standing client relationships, and cost advantages. The company renewed treaties with a volume of EUR 9,369 million from a total of EUR 10,196 million up for renewal, representing 61% of business in traditional property and casualty reinsurance. Together with EUR 1,165 million from new and restructured treaties, the total renewed premium volume reached EUR 10,535 million.
Executive Board member Sven Althoff, responsible for property and casualty reinsurance, noted that while treaty terms and conditions remained largely stable, price declines were more pronounced than anticipated, especially in highly competitive lines. He emphasized that the price level remains above the multi-year average and commensurate with risks. The company continued to profitably grow its portfolio by strengthening existing client relationships and developing new ones while improving its own retrocession protection.
Regionally, premium volume in the Americas grew by 6.5%, with more than half the business to be renewed over the remainder of 2026. In the United States, property business volume remained stable while casualty insurance offered selective growth opportunities. The Europe, Middle East and Africa region saw virtually unchanged volume with 0.4% growth, maintaining profitability despite intense competition. The Asia-Pacific region increased by a modest 1.9%, with Hannover Re keeping its profitable portfolio stable overall despite challenging market conditions.
In specialty lines encompassing facultative reinsurance, credit, surety and political risks, aviation and marine reinsurance, agricultural risks, and cyber and digital business, premium volume grew by 5.8%. Credit, surety and political risks lines delivered double-digit growth, while aviation and marine reinsurance saw a more disciplined underwriting policy lead to volume reduction. Agricultural business continued expanding in core markets, and the company maintained market shares in digital and cyber segments.
Natural catastrophe business faced more intensive competition with risk-adjusted rate reductions of 10% to 20%, though prices remained adequate overall. The successful launch of Hannover Re Capital Partners strengthened cooperation with capital markets in this area. Demand for structured reinsurance continued developing favorably, with most contracts renewed and new treaty relationships established.
For the full 2025 financial year, Hannover Re generated reinsurance revenue of EUR 26.8 billion and operating profit (EBIT) of EUR 3.5 billion. Property and casualty reinsurance contributed EUR 2.6 billion to the operating result, while life and health reinsurance accounted for EUR 0.9 billion. The company's strong underwriting result allowed it to further increase resilience in loss reserves and realize hidden losses in the investment portfolio.
Looking ahead to 2026, Hannover Re expects growth in reinsurance revenue in the mid-single-digit percentage range for traditional business in property and casualty reinsurance, anticipates a combined ratio below 87%, and projects a return on investment around 3.5%. Achievement of earnings guidance is based on the premise that large loss expenditure does not significantly exceed the budgeted amount of EUR 2.3 billion and assumes no unforeseen distortions on capital markets. The company will publish its audited annual financial statement on 12 March 2026.
