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Munich Re Report of the Board of Management
Gross premiums in DM million
8,209
14,816
8,874
16,682
Direct insurers
Reinsurers
9,579
19,059
1991 1992 1993 1994 1995
Earnings per share in DM
31.20
28.80
45.70
10,126
18,848
67.60
Previous years adjusted
owing to 1995 capital increase
10,482
18,507
140.00
91/92 92/93 93/94 94/95 95/96
Board of Management’s report for the Munich Re
Group and the Munich Reinsurance Company
Seen as a whole, the business year 1995/96 was a very satisfactory one for
the Munich Reinsurance Company and its subsidiaries.
The companies consolidated in the Group accounts recorded a total
premium income of DM 28,989 million. Of this, around two thirds was
written by the reinsurance companies and one third by the direct insurance
companies.
The Group’s premium volume was almost the same as in the previous year.
Whilst changes in exchange rates resulted in a decrease of DM 341 million
in premiums from reinsurance business, the premiums from direct
insurance business increased by DM 356 million.
Net premiums rose by 1.1 %, amounting to DM 26,232 million as compared
with DM 25,937 million in the previous year.
The Group’s underwriting result again improved markedly, the Munich
Reinsurance Company being largely responsible for this favourable
development. Following a loss of DM 100 million in the previous year
(figure before changes in the claims equalization provisions and adjusted
to take account of the new accounting regulations) an underwriting profit of
DM 573 million was achieved in the year under review.
Owing to the much more favourable development of the Munich
Reinsurance Company’s business, another very substantial addition was
made to the claims equalization provisions and similar provisions. At
DM 952 million, this sum even surpassed the previous year’s very large
allocation of DM 788 million.
In addition, the Munich Reinsurance Company was again able to make
very substantial special allocations to its provision for outstanding claims,
amounting to DM 500 million as compared with DM 250 million in the
previous year.
The profit from investments was again very satisfactory. Owing to the
increase in the volume of investments, investment income rose further.
Writedowns were appreciably lower than in the previous year. Altogether,
our investment profit increased from DM 7,322 million to DM 7,935 million
year on year. In accordance with accounting regulations, DM 5,685 million
of this has been included in the underwriting result.
The Group result before tax improved by DM 408 million, or 56 %, to
DM 1,134 million. The Group’s profit for the year amounted to
DM 595 million as compared with DM 325 million in the previous year.
On account of the improved underwriting result, the earnings per share –
calculated in accordance with the DVFA/GDV system – were more than
double those of the business year 1994/95. They amounted to DM 140.00
as compared with DM 67.60 in the previous year.
The Munich Reinsurance Company’s profit for the year is DM 233 million.
After allocation of DM 100 million to the revenue reserves, the balance
sheet profit remaining is DM 133 million. This has been earmarked for
distribution to shareholders in the form of an increased dividend of DM 16
per share (previous year: DM 13.50).
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