Hannover Re achieved its increased earnings guidance for the 2025 financial year, reporting a sharp 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% under its new dividend strategy targeting around 55% of IFRS group net income.
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 underwriting performance. The operating profit (EBIT) rose 5.7% to EUR 3.5 billion. Earnings per share reached EUR 21.90, up from EUR 19.31.
In property and casualty reinsurance, the combined ratio improved to 84.0% from 86.6%, with net large losses of EUR 1,725 million below the budgeted EUR 2.1 billion. Notable events included the California wildfires (EUR 595 million), Hurricane Melissa (EUR 329 million), the Myanmar earthquake (EUR 118 million), and Australian hailstorms (EUR 102 million). The reinsurance service result (net) rose to EUR 2.6 billion.
Life and health reinsurance saw the reinsurance service result (net) climb to EUR 903.0 million, beating the guidance of more than EUR 875 million. Reinsurance revenue (gross) increased to EUR 8.0 billion, with 6.8% growth at constant exchange rates.
The return on investment was 2.5%, below the guided 2.9%, due to active realisation 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 ratio under Solvency II was 256%, comfortably above the 200% threshold. The contractual service margin (net) declined to EUR 7.9 billion, primarily due to exchange rate effects.
For 2026, Hannover Re confirms guidance of group net income of at least EUR 2.7 billion, assuming large losses do not significantly exceed the budgeted EUR 2.3 billion and no capital market distortions. The property and casualty segment expects mid-single-digit percentage revenue growth and a combined ratio below 87%, while life and health targets a reinsurance service result of around EUR 925 million. The return on investment is projected at about 3.5%.
Further details are available in the financial supplement at https://www.hannover-re.com/en/investors/results-and-reports/#2025.
