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Excellent 1996 results for Irish Subsidiaries

Dublin, 2 July 1997:

The Irish Subsidiaries of the Hannover Re Group, Hannover Re (Ireland) Ltd. and E+S Re (Ireland) Ltd., report another very successful year 1996. Both companies are the Hannover Re Group's flag carriers for financial reinsurance products. Their combined pre-tax profit has been DEM 64.3 m (USD 37.4 m), an increase of 10% against 1995 (DEM 58.5 m). This allowed a record dividend of DEM 50.0 m (1995: DEM 40.0 m) to the shareholders. The rise was primarily supported by the increase in the companies' net investment income, which showed a 33 % boost to DEM 60.5 m before transfer of some of that income to the non-life insurance business technical account. The underwriting result continues to remain positive (DEM 14.6 m), although somewhat below the comparable figure for 1995 (DEM 19.8 m). The reduction is primarily due to increased profit participation reserves, for which only partial reallocations from the investment income have been made. After a rapid premium growth in the companies first three full business years, the written premium in 1996 (DEM 498 m) remained almost level with 1995 (DEM 501 m). According to Reinhard Elers, Managing Director of the Group's Irish subsidiaries, the companies were not willing to compromise on their underwriting standards just to maintain volume growth. "Our shareholders look for a decent return on their capital, and we are not going to jeopardise their funds either" he said.

On the other hand, the current shareholder's funds of DEM 474 m do easily allow for further expansion should adequate opportunities present themselves. In 1997 the companies have already seized upon some of them, and both profits and premiums are expected to exceed 1996 levels. The Hannover Re Group's "Advanced Solutions" team offers a broad range of balance sheet protection covers to its world-wide client base. "Dublin is an excellent location to develop this business further, and to make the already strong position of the Hannover Re Group in this growing segment even more apparent" said Reinhard Elers, who succeeded to his current position at the beginning of 1997. Under the same management is the Irish reinsurance subsidiary of HDI (Haftpflichtverband der Deutschen Industrie VVaG), the Group's ultimate parent. HDI Reinsurance (Ireland) Ltd. writes a diversified book of mostly European motor business, with written premium of DEM 275 m (1996), up 9 % from 1995 (DEM 252 m). HDI Re too achieved an excellent result in 1996, showing a pre-tax profit of DEM 41.2 m (1995: DEM 31.0 m).