(Reuters) — Big damage claims for wildfires, earthquakes and storms hit German reinsurer Hannover Re S.E. hard in the second quarter, contributing to a sharper-than-expected 15% fall in quarterly net profit and driving down its shares.

Quarterly net profit of €215 million ($240.3 million) was below the average forecast of €239 million ($267.1 million) in a Reuters poll of banks and brokerages.

Hannover Re shares fell 3.7% to €87.76 ($98.08) by 0715 GMT, lagging a 1.6% gain in the STOXX Europe 600 insurance index.

Nevertheless, the world's third-largest reinsurer said low losses earlier in the year meant it was well on track to reach its goal of earning at least €950 million ($1.06 billion) in net profit this year.

"Losses incurred by Hannover Re in the second quarter were significantly higher than expected," the reinsurer said, with claims of nearly €300 million ($335.3 million) exceeding its notional quarterly budget by €130 million ($145.3 million).

Claims in the second quarter included €132 million ($147.5 million) for wildfires in Canada in April and May, as well as big claims for earthquakes in Ecuador and Japan and storms in Germany.

Chief Financial Officer Roland Vogel said his company still had a substantial buffer to pay claims before the full-year target would be threatened.

"If claims were clearly above €1 billion ($1.12 billion), then that would certainly have an effect on our profit goals at some point," he told journalists in a conference call.

Hannover Re has seen €353 million ($394.5 million) in big claims so far this year.

Despite the higher claims reported by a number of reinsurers and their insurance company clients so far this year, prices for reinsurance remain under pressure.

An excess of capital available to cover insurance losses and weak demand from insurance companies, who have preferred to keep risk on their books rather than pay reinsurers to shoulder that risk, mean that property/casualty reinsurance prices are still falling. Hannover Re reported a 10% decline in gross premiums in that segment in the second quarter.

"We expect it will become increasingly visible that the company cannot escape from the cycle," Baader Helvea analysts wrote in a research note, adding that they see the stock as overvalued and sticking with their "sell" recommendation.

Hannover Re repeated that it did see some signs that price declines were starting to bottom out, however.

"Premiums and prices will react slowly, not quickly," Mr. Vogel said.