European non-life insurance companies show signs of strength

The 10 largest non-life insurance companies in Europe showed signs of business soundness and strength last year, consolidating their recovery with respect to the year before, according to a report.

The ranking of the largest European non-life insurance groups, published for the seventh consecutive year by Fundacion Mapfre, showed that all the companies achieved an increase in premium revenues as well as excellent results, especially driven by their business development outside their countries of origin.

The report points out that the 10 largest companies achieved non-life premiums of €195,280 million, a 5.2 per cent rise. This performance contrasts with the 1.8 per cent decline recorded a year before, due to the economic difficulties stemming from the global financial crisis. The ranking is still led by the German group Allianz, and the four following positions – Axa, Zurich, Generali and Eureko – remain unchanged.

Mapfre, the only Spanish company in the ranking, continues to rank sixth with non-life premiums of €12,768 million, equivalent to a 7.3 per cent increase compared to 2009.

Mapfre recently acquired Munich Re’s 19.9 per cent shareholding in Middlesea Insurance which means the Spanish company has a controlling interest in Middlesea with a shareholding of 50.98 per cent.

The year 2010 has been marked by a moderate recovery in the developed economies and a strong dynamism of the emerging economies. In general, the increase in the premiums volume of the main non-life insurance groups is due to the growth in portfolios, stronger prices and larger revenues from business abroad.

According to the data provided by the insurance companies, the performance of the retail line, versus commercial insurance, should be underscored, as the latter has been affected by a more restrictive underwriting policy. In 2010, the motor line continues to be the most affected by intense competition and by the financial crisis. Likewise, the impact on the sector of the severe weather that affected Europe, as well as a large number of natural catastrophes (earthquakes in Chile and New Zealand and the storm Xynthia), which impacted significantly the loss ratios, must be noted.

Fundacion Mapfre’s ranking also provides information on the combined ratios. In this year’s edition, the figures of six out of the 10 groups analysed worsened, in most cases due to an increase in the loss experience as a result of severe weather and natural catastrophes.

The results achieved by the ten largest non-life insurance groups increased by 3.4 per cent compared to 2009, to €13,531 million. Only two groups –Aviva and RSA– experienced a decline in their results.

Fundacion Mapfre’s ranking analyses in detail other key events of the companies during the year and breaks down the non-life business over total premiums for the groups analysed and the weight of the international business as a proportion of the total. The ranking also includes information on the solvency levels of the 10 European groups analysed, and these figures reflect the financial strength of these insurance companies.