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