Annual Report 2003 - Hannover Re

Management report
property and casualty reinsurance
Successful year
in France and the
Benelux countries
by the withdrawal of two leading providers, we
recorded a highly satisfactory result with no unusually
large losses.
All in all, Hannover Re can look back on a
most successful year in France and the Benelux
countries in 2003.
Italy
The general market conditions in the insurance
sector improved in the year under review.
Motor business, by far the largest line in property
and casualty reinsurance, recorded an underwriting
profit, while the other lines of private
customer business were also in the black. Commercial
and industrial insurance, on the other
hand, failed to show any significant market
hardening. General third party liability business
in these segments remained largely unprofitable,
despite a variety of rehabilitation efforts.
The primary problem here is that claims inflation
continues to outpace premium increases.
Italian insurers nevertheless find themselves
in a hard market climate. Further rate increases
were obtained in the year under review,
accompanied by more precise specification of
the individual scope of coverage and clearer definition
of natural hazards exposures. These developments
were made possible primarily by the
shortage of market capacity brought about by
the (partial) withdrawal of a number of significant
players. There were no major losses to report
in the year under review.
Northern Europe
As in previous years, market conditions in
Northern Europe were not uniformly positive.
Although rates and conditions for reinsurance
protection varied considerably from country to
country and cedent to cedent, it could generally
be observed that supply substantially outstripped
demand – a situation which the withdrawal of
certain market players did little to change. Compared
to the previous year, though, we can report
a largely unremarkable year in Northern
Europe.
Our most important market in this region
is Denmark, which produces more than half of
our total premium income. Our main lines here
are fire and motor reinsurance, with a special
focus on non-proportional business. We are the
leading market provider of reinsurance for the
country's mutual insurance societies. Our geographical
proximity to Northern Europe gives
us an edge in these markets. Overall, we were
pleased with the development of the 2003 financial
year.
Eastern Europe
Disproportionately strong growth is the
hallmark of the insurance markets in Eastern
Europe, both in the life and non-life sectors. With
a number of Central and Eastern European countries
in the process of joining the European
Union, we anticipate harmonisation with EU directives
and legislation – not only among the
candidate countries but also among their neighbours.
We continued to enjoy a hard market phase
in the reinsurance sector in the year under review,
benefiting especially in liability business
from the withdrawal of some competitors. We are
active in the major markets of Eastern Europe
as a leading provider in all lines. In Russia and
Ukraine we significantly stepped up our presence,
as was also the case in Romania – where
our efforts were recognised with the title of "Reinsurance
Company of the Year".
In a year largely spared significant losses
we enlarged our premium volume by concentrating
principally on increasing our shares in
selected, profitable treaties. In Eastern Europe as
in other markets we heavily emphasise non-proportional
business in line with our global strategy.
Our most important lines here continue to be
motor and fire insurance.
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