A scan of the top 2023 news stories reveals a series of earthquakes, severe storms, political tensions, war and economic volatility. It is against this backdrop that our Property & Casualty Reinsurance (P&C Re) business has offered stability and resilience, delivering on our commitments to our shareholders, clients and employees. Our own headlines for the year tell a story of transformation built on 160 years of understanding, anticipating and managing the world’s risks. As a new standalone Business Unit, we reimagined the way we operate our P&C business to be more streamlined, agile and responsive to local market and client needs. This transformation and the resulting organisational change fuelled P&C Re’s contribution to group earnings as we delivered on our target of a combined ratio below 95%.

Strength in diversification and client franchise

P&C Re generates roughly USD 25 billion in gross written premiums, which represents about 10% of the global P&C reinsurance market, according to Swiss Re Institute. Such scale brings the benefits of diversification, and P&C Re is well-positioned across different geographies as well as property, casualty and specialty lines. Our strength is derived from our leading client franchise and strong relationships rooted in years of partnership. We are often the first port of call for our clients, who lean on Swiss Re’s risk expertise and look to us for guidance, particularly as they navigate today’s growing list of uncertainties. Effective engagement and P&C Re’s insights are just two of the reasons clients continue to rank us as the number one P&C global reinsurer [1].

Specialised expertise brings competitive edge

P&C Re has a culture of commitment and expertise, supported by more than 2 500 talented colleagues across 70 different countries and five continents. Among them are engineers, underwriters, claims experts and data scientists – all of them experts in their field and many of them working side by side with local clients. This means we are accessible, and our teams are intimately familiar with important nuances of the risks we share with our clients.  

Our risk expertise runs deep. For our natural catastrophe business alone, we have more than 50 experts in areas like seismology, oceanography and meteorology who can tap into 200 proprietary risk models covering a wide range of risks. 

We also have more than 200 colleagues who are dedicated to specialty insurance, covering engineering, marine and aviation, credit and surety, agriculture and cyber. These specialists bring years of hands-on, seasoned experience and understanding.  

Increased understanding of renewable energy risk

The passion of our Specialty teams is demonstrated by a talented team in our engineering business who fulfilled their vision to create a Centre of Competence for Renewable Energy.

Building on work that was ongoing within the Specialty teams, the centre launched in 2023 with a mission to help our clients understand the range of new and emerging risks needed to insure the energy transition in coming years. The team’s work will strengthen financial protection for wind farms, solar plants and hydro installations. It also provides important security to investors who fund the trillion-dollar transformation of our global energy supply.

Post-earthquake recovery and rebuilding

The tragic earthquake in Turkey and Syria in February was the largest natural catastrophe loss event in 2023. It provides a timely example of how we can pair expertise and the financial strength of the Swiss Re Group to multiply the benefit for clients and for society. 

P&C Re provided over USD 500 million in claims support to our clients in Turkey. The most significant of these payments was to the Turkish Catastrophe Insurance Pool (TCIP), a government-backed programme to increase insurance protection for households that typically fall outside the insurance safety net. TCIP is the result of years of engagement between Turkish authorities and Swiss Re’s Public Sector Solutions (PSS) teams.  

In this case, our PSS team’s understanding of public needs provided an important complement to our Reinsurance work with insurance clients in Turkey, and made us uniquely suited to be able to help.

Servicing clients across a diversified business

The example of Turkey is a reminder that natural catastrophe protection is at the heart of P&C Re’s business. The trend of the past years strongly suggests that insured natural catastrophe losses exceeding USD 100 billion per annum have become the new normal. We expect to see this trend continue, especially as the impact of secondary perils increases. Unfortunately, uninsured economic losses are also growing, and Swiss Re continues to work with its clients to keep addressing this protection gap. 

Our experts have expanded P&C Re’s capabilities to develop customised tailored transactions for clients to address complex capital management needs. This is highly specialised work that strengthens our client relationships. 

Our clients also benefit from Swiss Re’s insights and technologies of our Solutions suite. Examples include CatNet®, Swiss Re’s natural catastrophe underwriting tool, and the Rapid Damage Assessment (RDA) platform, which is revolutionising the speed at which insurers can assess and pay claims in the wake of a natural catastrophe.

Outlook

We enter 2024 with a robust and diversified portfolio. P&C Re has a strong value proposition and client franchise. In the face of an increasingly volatile risk landscape, there is strong recognition of the value insurance and reinsurance deliver to society as a critical financial safety net. We have worked diligently to build the right risk-reward mix for the capital we deploy and P&C Re will continue to leverage a combination of global risk expertise paired with local market understanding delivered through engaged, empowered and talented teams. 

Under the new IFRS reporting framework, the P&C Re financial target is to achieve a combined ratio of less than 87%.

[1] NMG Consulting’s Global P&C Re Study 2023.