Structured reinsurance

We are satisfied with the development of structured reinsurance products, which offer our cedants risk equalisation over time and serve to reduce their capital requirements. Whilst the premium income contracted due to our discontinuation of certain high-volume arrangements, the operating profit nevertheless showed a very pleasing increase.

Hannover Re is one of the two largest providers of structured reinsurance solutions in the world and can draw upon many years of experience as regards actuarial balance sheet, accounting and underwriting expertise. Our range of products is geared to optimising our clients’ cost of capital.

In the year under review we further intensified cooperation with our treaty departments writing traditional reinsurance, thereby enabling us to offer our clients the full spectrum of our company’s products and its extensive range of services.

Demand for structured reinsurance covers remained strong in the year under review, despite the fact that primary insurers were able to rebuild the capital that they had lost in the economic crisis; in the previous year this had served to drive demand for surplus relief contracts.

In keeping with our strategy of regional diversification, we further stepped up our activities in Europe. Yet we were also able to enlarge our client base in Latin America. In the United States we continue to target smaller and mid-sized companies with our surplus relief contracts. Our business opportunities in Asia are improving as some countries have implemented solvency requirements based on a risk-based capital framework.

We do not anticipate any strains on our structured reinsurance covers from major losses occurring or reported in the year under review.