Munich Re poised to increase capital investment in EU reinsurance mark

Munich Re announced on Monday that it is "prepared" to invest more capital in the European market, anticipating that the continent's reinsurance sector will continue to be "dynamic."

Munich Re poised to increase capital investment in EU reinsurance market

The Munich-based reinsurer expressed confidence in the ongoing growth of property reinsurance protection. The company stated, "With a robust capital base, a globally diversified business model, and a proven ability to deliver effective solutions to clients, Munich Re is well-equipped to meet this demand under favorable terms and conditions." The firm highlighted that annual insured losses from natural disasters often surpass USD 100 billion, with losses reaching USD 62 billion in the first half of this year, significantly higher than the USD 37 billion average over the past decade. Munich Re expects this upward trend to persist, pointing to recent US hurricanes and floods, wildfires, and severe thunderstorms in Europe as contributing factors. The company underscored the importance of establishing a "sound pricing system" to account for climate risks and encourage measures that mitigate those risks. Munich Re noted that it is "explicitly incorporating relevant climate change trends into its risk model."

Motor insurance sector is in "recovery mode"

Additionally, the firm reported that the motor insurance sector is in a "recovery mode" following a period of volatility since the pandemic, as rising repair costs are outpacing primary rate increases. "Munich Re has supported its long-standing clients and will continue to be a reliable and well-capitalized partner for those demonstrating appropriate pricing for risk," the company stated. With low market penetration yet strong growth potential, the European cyber insurance market is a key focus for Munich Re. The company aims to expand its presence in this area while maintaining strict guidelines on the risks it is willing to cover, specifically excluding systemic risks such as cyber warfare and critical infrastructure failures.