Hannover Re increased premium income in traditional property and casualty reinsurance by 3.3% during treaty renewals as of 1 January 2026, achieving this growth despite recording an average risk-adjusted price decline of 3.2%. The company maintained largely stable terms and conditions, supporting the continued high quality of its written business. This performance occurred within what executives described as a highly competitive market environment.
Based on preliminary unaudited financials, Group net income for the 2025 financial year reached EUR 2.64 billion, meeting the earnings target the company had raised to around EUR 2.6 billion in the fourth quarter. Hannover Re thus confirmed its guidance for 2026, expecting Group net income of at least EUR 2.7 billion. The company's reinsurance revenue for 2025 was EUR 26.8 billion, with an operating profit (EBIT) of EUR 3.5 billion.
"We booked profitable growth in a highly competitive market environment in the renewals at the start of the year," said Clemens Jungsthöfel, Chief Executive Officer of Hannover Re. "Our strong market position, long-standing and partnership-focused client relationships, as well as cost advantages were crucial factors." He noted that the company was able to partially offset more significant price reductions in certain lines within its overall portfolio thanks to broad positioning, adding market shares in profitable areas while maintaining overall portfolio quality.
Treaties with a premium volume of EUR 10,196 million were up for renewal on 1 January 2026, representing 61% of business in traditional property and casualty reinsurance. Hannover Re renewed treaties with a volume of EUR 9,369 million while cancelling treaties worth EUR 827 million. Together with EUR 1,165 million from new and restructured treaties and from changes in prices and treaty shares, the total renewed premium volume grew to EUR 10,535 million.
Sven Althoff, a member of Hannover Re's Executive Board with responsibility for property and casualty reinsurance, stated: "While treaty terms and conditions remained largely stable, price declines were more pronounced than anticipated – especially in highly competitive lines and for contracts with a moderate loss experience." He emphasized that the price level remained above the multi-year average and commensurate with risks, enabling continued profitable portfolio growth through strengthened client relationships and new developments.
Regional performance varied across global markets. The premium volume in the Americas grew by 6.5%, with more than half the business to be renewed over the remainder of 2026. In the United States, property business volume remained stable with risk-adequate pricing despite declines, while US casualty insurance offered selective growth opportunities against generally stable prices. Canada's renewals reflected a continued strong competitive position.
The Europe, Middle East and Africa region saw virtually unchanged premium volume year-on-year with 0.4% growth, maintaining good profitability despite intense competition, especially in natural catastrophe covers. The region offered growth opportunities partially curtailed as individual clients, particularly in Germany, carried higher retentions. Renewals were predominantly price-driven with largely unchanged treaty structures.
In the Asia-Pacific region, premium volume increased by 1.9% amid a challenging market landscape characterized by intense competition. Initial indications of broadening terms and conditions were observed, though business with unexpectedly low prices or poorer terms was deliberately not renewed in some instances. Hannover Re maintained its profitable portfolio stable overall, with Southeast Asia seeing particularly notable demand for natural catastrophe cover in markets hard hit by losses.
Specialty lines, encompassing facultative reinsurance, credit, surety and political risks, aviation and marine reinsurance, agricultural risks, and cyber and digital business, grew premium volume by 5.8% in a highly competitive environment. Credit, surety and political risks lines delivered double-digit growth from an attractive market landscape, while aviation and marine reinsurance saw volume reduction due to more disciplined underwriting. Agricultural business expanded in core markets like Brazil and the United States with unchanged rate quality, while digital and cyber segments maintained market shares and opened new business.
In natural catastrophe business, abundant market capacity resulted in more intensive competition and risk-adjusted rate reductions of 10% to 20% in international markets and the United States, though prices remained adequate overall. The successful launch of Hannover Re Capital Partners strengthened cooperation with the capital market in this area. Demand for structured reinsurance developed favourably, with most contracts renewed and new treaty relationships established despite increased competition, though a reduced premium volume is anticipated due to lower cessions under individual large contracts.
"With the January renewals behind us and following a successful 2025, we are looking ahead with confidence," said Jungsthöfel. "Even in the face of increasing competition, our careful planning and strong market position consistently open up additional profitable opportunities for growth." He noted that conservative reserving in property and casualty reinsurance and active realization of losses in investments have laid the foundation for achieving further sustained earnings growth.
Hannover Re expects Group net income for 2026 of at least EUR 2.7 billion, representing a 12.5% increase compared to the previous year's original forecast. Adjusted for exchange rate effects, traditional business in property and casualty reinsurance is projected to deliver mid-single-digit percentage growth in reinsurance revenue. The company anticipates a combined ratio below 87% in Property & Casualty reinsurance and a reinsurance service result of around EUR 925 million in Life & Health reinsurance, with return on investment reaching approximately 3.5%. Achievement of this guidance assumes large loss expenditure does not significantly exceed the budgeted EUR 2.3 billion and that there are no unforeseen capital market distortions.
Hannover Re will publish its audited annual financial statement on 12 March 2026. The company maintains outstanding financial strength ratings from Standard & Poor's (AA- "Very Strong") and A.M. Best (A+ "Superior"). Further information is available through the company's legal disclaimer at https://www.hannover-re.com/en/legal-information.
