Hannover Re achieved its increased earnings guidance for the 2025 financial year, reporting a 13.4% rise in group net income to EUR 2.6 billion, up from EUR 2.3 billion in the prior year. The reinsurer also proposed a 39% higher dividend of EUR 12.50 per share, reflecting a payout ratio of 57%, in line with its new dividend strategy targeting around 55% of IFRS group net income.
The company's reinsurance revenue (gross) grew by 1.5% to EUR 26.8 billion, or 4.7% adjusted for exchange rate effects. The reinsurance service result (net) increased 15.8% to EUR 3.5 billion, driven by strong performance in both property and casualty (P&C) and life and health (L&H) segments. The operating profit (EBIT) rose 5.7% to EUR 3.5 billion.
In P&C reinsurance, the reinsurance service result (net) climbed to EUR 2.6 billion from EUR 2.1 billion, with the combined ratio improving to 84.0% from 86.6%. Large losses totaled EUR 1,725 million, below the budgeted EUR 2.1 billion, with major events including the California wildfires (EUR 595 million) and Hurricane Melissa (EUR 329 million). The company strengthened loss reserves to enhance resilience.
In L&H reinsurance, the reinsurance service result (net) reached EUR 903 million, surpassing the guidance of more than EUR 875 million. Reinsurance revenue (gross) increased to EUR 8.0 billion, with currency-adjusted growth of 6.8%.
Investment income fell to EUR 1.7 billion from EUR 2.0 billion, resulting in a return on investment of 2.5%, below the targeted 2.9%. This was primarily due to the strategic realization of hidden losses in the fixed-income portfolio to boost future earnings. The return on equity stood at 21.4%, well above the strategic target of more than 14%.
Shareholders' equity rose to EUR 12.9 billion, and the Solvency II ratio remained robust at 256%, incorporating the proposed dividend and planned business growth. CEO Clemens Jungsthofel emphasized the company's strengthened balance sheet and commitment to reliability.
For 2026, Hannover Re confirms its guidance of group net income of at least EUR 2.7 billion, with P&C reinsurance expected to achieve mid-single-digit revenue growth and a combined ratio below 87%. L&H reinsurance targets a service result of around EUR 925 million, and the return on investment is projected at approximately 3.5%.
Additional details are available in the financial supplement at https://www.hannover-re.com/en/investors/results-and-reports/#2025.
