Hannover, 29 January 2007:
Winter storm 'Kyrill' – which swept across large parts of Europe on 18 and 19 January 2007 – caused insured losses in the order of EUR 4 to 7 billion. The exact scale of insured damage cannot yet be reliably assessed in view of the multitude of small- and medium-size losses and the large number of countries affected. Against this backdrop Hannover Re expects a net loss burden of EUR 120 to 180 million before tax; the bulk of this expenditure is attributable to claims in Germany. The total loss amount was alleviated by the 'K5' risk securitisation which had been expanded to USD 520 million as at January 1, 2007 (see NewsLetter published on January 16, 2007).
"Even after 'Kyrill' we are within the bounds of our loss expectations", Chief Executive Officer Wilhelm Zeller explained. Hannover Re's budget for major claims assumes a loss experience within the multi-year average for the full year; it corresponds to around eight percent of net premium expected in property and casualty reinsurance.
Mr. Zeller added: "This severe storm will have a favourable effect on rate movements in European catastrophe reinsurance in the coming year. 'Kyrill' brought home to European insurers that wind is just as much a force to be reckoned with in Europe as it is in the United States."