By Ranamita Chakraborty
Munich Re registered COVID-19-related reinsurance losses totalling about EUR700m ($800,00) in 2Q2020, according to an official statement from the reinsurer.
The largest share of these losses is attributable to cover for major events with a lower impact reported in life and health business as well as other lines of P&C insurance including business interruption.
Munich Re nevertheless posted a satisfactory net result of approximately EUR600m in the second quarter as a result of lower-than-average major losses (excluding COVID-19) and good performance at its subsidiary ERGO.
As scheduled, the reinsurer will provide final Q2 results on 6 August.
Against the backdrop of COVID-19 developments, Munich Re announced on 31 March that it would discontinue implementation of the 2020/2021 share buy-back programme until further notice and until there was greater clarity both on the actual burdens arising from COVID-19 and on capital requirements for potential organic or inorganic business opportunities.
At this time, the reinsurer said it perceives considerable ongoing uncertainty for the rest of this year with respect to the macroeconomic development and the financial impact of COVID-19
In addition, Munich Re has recently identified favourable conditions for growing its reinsurance business and therefore the active use of its capital. For these reasons, it said it will definitely not implement its discontinued 2020/2021 share buy-back programme.
Asia Insurance Review