Annual Report 2010 - Hannover Re

The rating agency Standard & Poor’s has awarded the company
a rating of “A” (stable outlook), which is higher than that
of the country of South Africa.
Central and South America
The markets in this region are served directly from Hannover,
although our offices in Mexico City (for Central America) and
Rio de Janeiro (for Brazil) are assigned an important service
role.
A groundbreaking development occurred in this regard in the
first half of 2010 with the first-ever completion of a financing
arrangement for the in-force portfolio of a mid-sized primary
insurer in the local currency – a transaction that we executed
in close cooperation with and with the explicit consent of the
China Insurance Regulatory Commission (CIRC). In the second
half of the year we were able to close another transaction
of this type and we anticipate further potential in the years
ahead.
Whereas in Central America we support a broad range of primary
insurers first and foremost through services in the areas
of underwriting and claims management, our focus in South
America is on bancassurers. We moved forward with our strategic
cooperation in Brazil with Malucelli Re.
By carefully selecting our ceding companies we enlarged our
business volume to EUR 131.4 million, after EUR 101.5 million
in the previous year. Of this amount, roughly EUR 30 million
was attributable to the markets of Central America (incl.
Mexico) and EUR 102.1 million to South America (incl. Brazil).
Profitability again proved to be highly satisfactory.
Asia
Within the Hannover Life Re network the major growth region
of Asia is served by a number of branches and service
offices of Hannover Re. In this context the life branches in
Kuala Lumpur and Hong Kong take on regional coordination
and service functions in addition to their own direct market
responsibilities.
Business in ASEAN markets – with a focus on Malaysia, Singapore,
Thailand and Vietnam – is written in Kuala Lumpur,
while our service office in Mumbai handles the Indian market
and the strategic cooperation with GIC Re.
For the region of South Asia/Southeast Asia we booked premium
of EUR 21.4 million in the year under review; results
were thoroughly gratifying.
Business in East Asia is coordinated through our regional centre
in Hong Kong, which also bears direct responsibility for
the markets of Hong Kong, Macau and Taiwan. Responsibility
for the Chinese and Korean markets rests with our branches
in Shanghai and Seoul respectively, while the Japanese market
is served by our Tokyo office.
Total premiums from the East Asian region (Greater China,
Korea and Japan) amounted to EUR 201.6 million, an increase
of more than 60% compared to the previous year.
Premium income for the entire Asian region thus surpassed
the EUR 200 million mark for the first time to reach EUR 223.0
million (EUR 147.2 million). Despite fierce competition, most
notably in Korea and Hong Kong, the technical results were
again quite satisfactory.
Australia and New Zealand
Both these markets are served by our Sydney-based subsidiary
HLR Australasia, which we acquired in 1993. The company
writes traditional risk-oriented business from Australia
and New Zealand, with an emphasis on mortality and critical
illness covers as well as disability annuity business.
In addition, in the role of primary insurer, we assume the biometric
risks of Australian funds for occupational retirement
provision (superannuation funds) and cooperate with a major
Australian direct sales organisation to offer a range of riskoriented
products. We see both these activities as an important
source of diversification.
Although the Australian reinsurance market showed scarcely
any growth potential, HLR Australasia succeeded in significantly
expanding its business volume overall. Premium income
rose to EUR 324.4 million after EUR 251.3 million in
the previous year, due in part to the strength of the Australian
dollar against the euro.
The highly unsatisfactory biometric risk experience in some
areas was largely cushioned by quota share retrocessions,
leaving an attractive operating profit of EUR 23.7 million for
the net retention. This was equivalent to an EBIT margin of
15.4%.
Management report
Business in the entire East Asian region is growing at a very
dynamic pace. Particularly in China, we were able to extend
our position as one of the two leading foreign life reinsurers.
Hannover Re Group annual report 2010
Life and health reinsurance Management report
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