SCOR

January 2019 P&C Renewal Results

Press Release
February 7, 2019 - N° 5

January 2019 P&C Renewal Results

SCOR grows reinsurance premiums 9.7% in a more favorable market; expected profitability stable

SCOR grew P&C reinsurance premiums by 9.7% at constant exchange rates at the January 2019 renewals, from EUR 2.9 billion to EUR 3.2 billion. The outcome of these renewals is in line with the September 2018 IR Day update at 5%-8% p.a. of the "Vision in Action" strategic plan growth assumption for SCOR Global P&C.

SCOR's client-focused strategy, based on long-term relationships with core clients across business lines and geographies, has facilitated the Group's continued business expansion. As planned in "Vision in Action", the largest renewal growth was in the U.S., where SCOR maintains a balance between short and long-tailed business. SCOR declined business with less attractive margins or risk profiles, particularly when pricing was insufficient, which included some very large proportional treaties.

Overall risk-adjusted pricing improved 1.3% compared to January 2018. Expected profitability, which is measured by both technical profitability (loss and commission ratios) and return on risk-adjusted capital, remained stable on both measures.

Reinsurance pricing is broadly stable across nearly all lines of business and geographic markets. SCOR benefits from improving P&C insurance pricing through both Reinsurance (e.g. proportional) and Specialty Insurance, which includes SCOR Business Solutions, the Channel Syndicate, and the MGA business.

Approximately 64% of SCOR's P&C reinsurance premiums renew in January. There are no substantial changes to the division's risk appetite and profile. 

Treaties renewal book at January 2019:

	Gross Premiums renewed (in EUR millions)	Growth rate vs. January 2018	Notable drivers
P&C Lines1)	2,370	+8.3%	United States
Global Lines2)	836	+13.7%	Credit & Surety, Agriculture (in progress)
TOTAL	3,206	+9.7%

1. P&C Lines include: Property, Property Cat, Casualty, Motor, and other related lines (Personal Insurance, Nuclear, Terrorism, Special Risks, and Inwards retro).
2. Global Lines include: Agriculture, Aviation, Credit & Surety, Inherent Defects Insurance, Engineering, Marine and Offshore, Space, Cyber, and Motor Extended Warranty.

Looking forward to the April, June & July renewals, the market is expected to stay firm, with the possibility of further hardening as contracts affected by the high number of nat cat and man-made losses in Q3 and Q4 2018 come up for renewal. In addition to being well above average in terms of the total amount of insured nat cat losses, 2018 presents an unusual loss profile due to the geography of those losses and the diversity of the perils that caused them.