Allianz Group has reported its highest net income of the past decade for 2018, of €7.5 billion ($ 8.5bn), helped by increased operating profit within its property and casualty (P&C) business, despite strong market volatility.
A higher overall operating profit of €11.5 billion and reduced income taxes more than offset Allianz’s non-operating result decline, contributing to a 9.7% year-on-year increase in net income for the global insurer.
Allianz Nigeria Insurance plc (Allianz Nigeria) formerly Ensure Insurance plc, it will be recalled was acquired by the Allianz Group in July 2018 and has commenced business as subsidiary of the group.
Commenting on the firm’s performance in 2018, Allianz SE Chief Executive Officer (CEO), Oliver Bate, said: “I am very proud of the global Allianz family for delivering such a great set of results. We reached the highest net income of the past ten years despite strong market volatility, especially in the fourth quarter. Our customers continue to rely on us, and it’s with them in mind that we are focusing on simplicity in the next iteration of our strategy.”
The insurer’s 2018 result was boosted by strong performance within its P&C segment, which saw gross premiums written (GPW) increase slightly to €53.6 billion. P&C operating profit jumped to €5.7 billion in 2018, mainly driven by a strong underwriting result, aided by a lower expense ratio and also a lack of high severity losses from natural catastrophe events.
Furthermore, Allianz said that its P&C operating investment result also had a positive impact on the unit’s performance in 2018. As a result of the above, Allianz recorded a P&C combined ratio of 94%, which is an improvement of 1.2% when compared with the previous year.
“I am pleased by our strong internal growth and our good operating performance in the Property and Casualty business segment. We reached our goal of a 94 percent combined ratio by our consistently disciplined underwriting and moreover by a substantially improved expense ratio,” said Allianz SE Chief Financial Officer (CFO), Giulio Terzariol.
Somewhat offsetting the strong P&C performance, Allianz’s Life and Health division saw its operating profit decline to €4.2 billion, although this is still within the mid-point of its range. The Life and Health unit continued to expand in 2018, with the new-business margin increasing to 3.6%, from 3.4% a year earlier.
“Allianz achieved excellent results in 2018 with operating profit of 11.5 billion euros, reaching the upper end of the Group’s announced target range of 10.6 to 11.6 billion euros.
“Our healthy and well-diversified business makes us confident that we will continue to deliver a strong financial performance again this year. The Group looks to generate an operating profit of 11.5 billion euros in 2019, plus or minus 500 million euros, barring unforeseen events,” said Terzariol.
