What happened?
We spoke with Swiss Re ahead of its Q3 results on the 14th of November. There was no change to full year guidance, and this report should be viewed as our interpretation of the discussion. We summarise our key takeaways below.
BNPP Exane View:
Topline- higher revenues expected in H2: Swiss Re reiterated that it expected group gross insurance revenues in H2 to be $1.5bn higher vs H1, with most of this growth coming from PandC Re. PandC reported $4.5bn of gross insurance revenue in Q2. This implies a gross insurance revenue of $5bn for Q3 in PandC Re.
Seasonality- increase expected: Seasonality is expected to be more pronounced under IFRS 17 with seasonality expected to come through a lower CSM release in H2. This impact from seasonality will be visible in the attritional combined ratio. The seasonality contributes a 2.5% headwind in Q3 vs H1 with a slightly smaller impact in Q4.
Large losses and nat cat budget- shift to commercial players: Their nat cat budget is USD 700mn in Q3 and USD 500mn in Q4. They do not have a man-made budget specifically but as a reminder, their average man-made quarterly losses are USD 75mn. The recent Gallagher Re report outlined the Q3 insured losses of $15bn. The company highlighted that CorSo might see some impact given the nature of the losses incurred in the quarter.
Life and Health : The Experience Variance was -200mn in H1 and it was mostly driven my mid-size portfolios reviews. There will be ongoing reviews of portfolios in H2. We anticipate that could lead to some further experience variances.
CorSo: Swiss Re reminded us of the headwind to insurance revenues from the disposal of the Irish Medex business. The company expects an increased impact in H2. The impact was $0.2bn in H1 2025 vs H1 2024. It is expected to be $0.6bn in total in 2025 and $0.4bn in 2026. Combined ratios are expected to remain roughly in line with targets on an underlying basis.
Investments- FX impact: Adjusting the Q2...
