Munich Re reported a net result of €1.1 bn for the first quarter of 2025, maintaining its full-year profit guidance of €6 bn despite incurring around €1.1 bn in losses from January’s Los Angeles wildfires. Reinsurer had previously projected a loss of €1.2 bn linked to the event.
The P&C reinsurance business absorbed €800 mn of the wildfire-related loss. Major natural catastrophe losses for the P&C segment reached €757 mn in Q1 2025, up from €189 mn a year earlier, while man-made major losses declined slightly to €251 mn from €262 mn.
Total major loss costs for the P&C segment exceeded €1 bn, more than double the €450 mn reported in Q1 2024.
These claims pushed the combined ratio for P&C reinsurance to 83.9%, up from 69.7% in Q1 2024. The segment’s net result dropped to €343 mn from €1.2 bn, although insurance revenue rose to €4.9 bn from €4.7 bn.
Munich Re reported Global Specialty Insurance (GSI) as a standalone segment. GSI posted a net result of €8 mn in Q1 2025, down from €163 mn in the prior year.
Its combined ratio rose to 95.5% from 87.6%, with wildfire losses accounting for approximately €200 mn. GSI insurance revenue increased to €2.3 bn from €2.1 bn.
The life and health reinsurance segment offset part of the decline in P&C and GSI. It delivered a technical result of €608 mn, up from €484 mn, and a net result of €501 mn, up from €487 mn. Insurance revenue increased slightly to €3.1 bn.
Overall, the reinsurance segment contributed €853 mn to the Q1 2025 net result, down from €1.9 bn in Q1 2024. Segment-wide insurance revenue rose to €10.3 bn from €9.9 bn, but the technical result fell to €1.5 bn from €2.1 bn and the operating result declined to €1.1 bn from €2.6 bn.
In the April renewals, Munich Re increased its written premium volume by 6.1% to €2.8 bn, citing ongoing favourable market conditions.
The firm noted that despite pricing pressure, overall rates remained stable due to contractual discipline and continued portfolio optimization.
Pricing adjustments mostly accounted for rising loss expectations tied to inflation and other factors. Adjusted for portfolio effects, average rate levels declined by 1.7%.
ERGO, Munich Re’s primary insurance business, posted a net result of €241 mn, up from €226 mn. Insurance revenue rose to €5.6 bn from €5.2 bn. The firm highlighted international growth and a stronger technical result outside Germany.
Munich Re’s result declined to €1.3 bn from €2.2 bn, with regular investment income increasing to €2.1 bn from €1.8 bn. The investment return stood at 2.2%, compared with 3.8% a year earlier.
Group-wide, insurance revenue rose to €15.8 bn from €15.1 bn. The total technical result declined to €2.1 bn from €2.7 bn, while the operating result fell to €1.5 bn from €2.9 bn. The annualised return on equity dropped to 13.3% from 27.2%.
CFO Christoph Jurecka said that, despite the significant wildfire impact, the group delivered strong results. He pointed to continued strength in life reinsurance and ERGO, as well as the high quality of Munich Re’s portfolio and market conditions, as reasons for maintaining the €6 bn profit target for 2025.
Although Munich Re did not emerge unscathed from the devastating wildfires in Los Angeles in January 2025, we nevertheless managed to generate a quarterly profit of €1.1bn
Christoph Jurecka, Munich Re CFO
“This exemplifies the Munich Re Group’s resilience, boosted once again by the prudent management of our business portfolio. For example, the impressive contributions to the net result from life reinsurance and from ERGO partially offset the higher combined ratios for property-casualty reinsurance and Global Specialty Insurance. We’re sticking with our profit guidance of €6bn for the 2025 financial year – thanks in no small part to ongoing favourable market conditions and the high quality of our portfolio,” said Christoph Jurecka, Munich Re Chief Financial Officer.