Munich Re’s shares dropped by round 5% this morning in Europe, after the reinsurer firm reported a steep fall in its first-quarter web revenue. The online end result got here in at €1.09 billion within the first quarter of 2025. This compares with €2.12bn within the earlier yr. In line with the German reinsurer’s quarterly report, the drop in earnings was primarily pushed by main claims and the volatility within the capital markets.
Wildfires in Los Angeles have been the primary supply of a significant lack of expenditure, costing the corporate €1.1bn.
In line with reinsurance dealer Gallagher Re’s newest Pure Disaster and Local weather Report, the Los Angeles wildfires accounted for an estimated $65bn in financial losses and as much as $40bn in insured losses.
“Though Munich Re didn’t emerge unscathed from the devastating wildfires in Los Angeles in January 2025, we nonetheless managed to generate a quarterly revenue of €1.1bn,” Munich Re’s CFO, Christoph Jurecka, stated. “This exemplifies the Munich Re Group’s resilience, boosted as soon as once more by the prudent administration of our enterprise portfolio.”
Past the losses attributable to the US wildfires, the corporate’s funding end result was additionally driving down the general end result, coming in at €1.32bn for the primary three months, down from €2.16bn within the earlier yr, primarily as a consequence of noticeable swings in rates of interest.
The corporate additionally misplaced half a billion euros in foreign money change, primarily pushed by the influence of the weakening greenback.
Insurance coverage income from insurance coverage contracts rose to €15.8bn. Inside this phase, the group’s personal ERGO, one of many largest insurance coverage teams in Europe, introduced in one-third of this income and confirmed notably robust development in worldwide enterprise. Ergo Worldwide elevated its income by the quickest charge amongst Munich Re’s divisions, by 8.8%, in comparison with the earlier yr.
ERGO has lately gained entry to the US small enterprise insurance coverage market after Munich Re acquired Subsequent Insurance coverage in March. This might increase the general earnings of Munich Re, which has simply reaffirmed its fiscal outlook.
“We’re sticking with our revenue steering of €6bn for the 2025 monetary yr – thanks in no small half to ongoing beneficial market circumstances and the top quality of our portfolio,” Jurecka stated.