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Munich Re profit up 4.1% in second quarter

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Munich Reinsurance Co. on Thursday reported second-quarter profit of €1.08 billion ($1.19 billion), up 4.1% from the same quarter in 2014, reflecting a below-average incidence of major losses and good investment results.

“Munich Re looks back on a very successful second quarter,” CEO Nikolaus von Bomhard said in the company’s earnings statement. “Despite a persistently uncertain environment, including ongoing competition in reinsurance, the profitability of our core business remains remarkable.”

Gross premiums written in the second quarter increased 5.2% from the year-ago period to €12.47 ($13.70 billion) billion, Munich Re said.

The firm’s reinsurance business posted consolidated profit of €842 million, up 33.9% from the prior-year period, and the combined ratio for the property/casualty reinsurance business improved to 93.3% from 101.4%.

Munich Re said flooding caused by heavy rainfall in northern Chile and a fire at a South Korean warehouse were major sources of claims for the quarter.

First-half 2015 profit totaled €1.87 billion ($2.05 billion), up 9.6% from the first half of 2014; gross premiums written were €25.51 billion ($28.02 billion), up 2.9%; and the combined ratio for property/casualty reinsurance was 92.8% compared with 94.1%.

“Thanks to our strict cycle management, our portfolio remains profitable even after the price falls in recent renewal rounds,” Torsten Jeworrek, Munich Re board member with responsibility for global reinsurance, said in the statement.

“To make sure we retain our competitiveness and profitability in the future, we will increase our efforts to make the most of the opportunities offered by digitalization, and to open up new business potential by designing innovative solutions,” Mr. von Bomhard said.

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