Hannover Re increased premium income in traditional property and casualty reinsurance by 3.3% during treaty renewals as of January 1, 2026, demonstrating growth despite recording an average risk-adjusted price decline of 3.2%. The company maintained largely stable terms and conditions, supporting continued high quality of business written during a period of intense market competition.
Based on preliminary unaudited financials, Group net income for the 2025 financial year reached EUR 2.64 billion, achieving the earnings target that had been raised to around EUR 2.6 billion in the fourth quarter. The company confirmed its guidance for 2026, expecting Group net income of at least EUR 2.7 billion, representing a 12.5% increase compared to the previous year's original forecast.
Clemens Jungsthöfel, Chief Executive Officer of Hannover Re, attributed the company's performance to strong market positioning, long-standing client relationships, and cost advantages. "We booked profitable growth in a highly competitive market environment in the renewals at the start of the year," Jungsthöfel stated. "We were able to partially offset more significant price reductions in certain lines within our overall portfolio thanks to our broad positioning."
Treaties with a premium volume of EUR 10,196 million were up for renewal on January 1, 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, noted that while treaty terms and conditions remained largely stable, price declines were more pronounced than anticipated. "The price level is nevertheless above the multi-year average and remains commensurate with the risks," Althoff explained. "We therefore continued to profitably grow our portfolio by strengthening existing client relationships and developing new ones."
Regional performance varied across global markets. In the Americas, premium volume grew by 6.5%, with more than half the business scheduled for renewal throughout the remainder of 2026. The United States maintained stable property business volume with risk-adequate pricing despite declines, while US casualty insurance offered selective growth opportunities against generally stable prices. Canada's renewals reflected continued strong competitive positioning.
The Europe, Middle East and Africa region saw virtually unchanged premium volume with 0.4% growth, maintaining good profitability despite intense competition, particularly in natural catastrophe coverage. The Asia-Pacific region experienced modest 1.9% premium growth in a challenging competitive landscape, with parts of Southeast Asia showing 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 highly competitive conditions. Credit, surety and political risks lines delivered double-digit growth from continued attractive market conditions, while aviation and marine reinsurance implemented more disciplined underwriting policies that reduced volume.
Agricultural business expanded in core markets including Brazil and the United States with unchanged rate quality. Digital and cyber segments maintained market shares while opening new business opportunities. Facultative reinsurance experienced price declines due to capacity oversupply and higher client retentions, particularly in property business, though large parts of the portfolio were successfully renewed based on risk-adequate pricing.
Natural catastrophe business faced intensive competition with risk-adjusted rate reductions of 10% to 20% due to abundant market capacity, though prices remained adequate overall. The successful launch of Hannover Re Capital Partners strengthened cooperation with capital markets in natural catastrophe coverage. Structured reinsurance continued favorable demand development, with most contracts renewed and new treaty relationships established despite increased competition.
For the full 2025 financial year, Hannover Re generated reinsurance revenue of EUR 26.8 billion and operating profit (EBIT) of EUR 3.5 billion. Property and casualty reinsurance contributed EUR 2.6 billion to operating results, while life and health reinsurance accounted for EUR 0.9 billion. Strong underwriting results in property and casualty reinsurance allowed for increased resilience in loss reserves and realization of hidden losses in the investment portfolio during the fourth quarter.
Looking ahead to 2026, Hannover Re projects mid-single-digit percentage growth in reinsurance revenue for traditional business in property and casualty reinsurance when adjusted for exchange rate effects. The company anticipates a combined ratio below 87% in Property & Casualty reinsurance, a reinsurance service result of around EUR 925 million in Life & Health reinsurance, and return on investment reaching approximately 3.5%. Achievement of 2026 guidance assumes large loss expenditure does not significantly exceed the budgeted EUR 2.3 billion and that no unforeseen capital market distortions occur.
Hannover Re will publish its audited annual financial statement on March 12, 2026. The company's performance demonstrates resilience in navigating competitive reinsurance markets while maintaining underwriting discipline and strategic growth initiatives across global regions and specialty lines.
