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Hannover Re increases participation in South African subsidiary

Hannover, 3 July 2000:

Hannover Re has increased its previous 70% participation in Hannover Reinsurance Group Africa, Johannesburg, to 100% with effect from 1 July 2000. The South African subsidiary has thereby become even more fully integrated into the Hannover Re Group. Hannover Re acquired the remaining shares from the Rand Merchant Bank, Johannesburg, and Veritas Re, Switzerland. The purchase price for the deal has not been made public.

On 31 December 1999 the portfolio written in Hannover was transferred to Hannover Reinsurance Group Africa (previously Hollandia Reinsurance Group). By concentrating all its activities in southern Africa in a local operation, Hannover Re has positioned itself superbly in this region. At the same time, the quality of local consulting services can be optimised and significant synergistic potential realised.

The consolidated gross premium income of Hannover Re Group Africa totalled ZAR 1.4 billion or EUR 227 million in the 1999 financial year, making Hannover Re one of the largest reinsurers in South Africa. The non-life reinsurance classes accounted for ZAR 1.0 billion (EUR 162 million). This business is written by Hannover Re Africa, Johannesburg, and Hannover Re Mauritius, Port Louis. Both companies transact property/casualty and financial reinsurance.

The life and health reinsurance business written by Hannover Life Re Africa, Johannesburg, generated gross premiums of ZAR 425 million (EUR 69 million).

Program business is also written in South Africa, and this lies within the responsibility of Hannover Re Africa. Referred to as "agency business" in South Africa, this segment concentrates on profitable niche business. A tradition of special expertise exists in this sector.

Hannover Re nurtures ambitious expansion plans for the region of southern Africa. The goal of Hannover Re Group Africa is to establish itself as the "Finest Reinsurer on the African Continent". Quality of performance is a more consuming obsession than size of premium income. However, meaningful growth in premium income to approximately ZAR 1.8 billion (EUR 292 million) is anticipated in the current financial year.