Media Relations

Despite the failure of the UN Climate Change Conference in Copenhagen, climate protection cannot be allowed to retreat into the shadows. However, leading climate researcher Prof. Mojib Latif takes the view that little can be achieved at UN level. Instead, he advocates deploying all the technological means at our disposal.

>> Click here to read full press release

20.01.2010

Munich Re estimates its claims burden from the earthquake in Haiti as follows: overall burden in the range of a single-digit to a low double-digit million US$-amount, net before tax. No claims are expected to stem from the Caribbean Catastrophe Risk Insurance Facility (CCRIF), in which Munich Re participates. The CCRIF offers 16 countries in the Caribbean insurance cover against hurricanes and earthquakes.

14.01.2010

The storms and snowfall forecast for the weekend are not likely to cause major insured losses. Although snow breakage and heavy icing are being predicted, record events such as those that occurred in Bavaria in January 2006 or in Münsterland in November 2005 are not to be expected, according to a current statement by Munich Re geo experts.

Winter has a firm grip on Europe. Further aggravation of the wintry conditions in central Europe that have persisted since late December is expected for the coming weekend. Southwestern Europe and northern central Europe will be hardest hit.

The cause is cold air extending as far as northern Africa. In addition, a strong low-pressure system (Daisy) over the Mediterranean is moving from the region south of the Alps towards Eastern Europe, causing heavy precipitation on the southern flanks of the Alps, and precipitation over large parts of central Europe. Furthermore, a high-pressure system over Scandinavia is gaining force. Its interaction with the low pressure system will produce storms in the region between the northern edge of the low mountain ranges and the coast.

For an area covering all of western Europe to North Africa, this indicates freezing temperatures with some heavy snowfalls, even in coastal regions. Even in lower lying areas of central Europe, 10 to 50 cm of snow are being forecast for the coming days. Up to one metre of new snow is being predicted at higher elevations on the south side of the Alps.

At present, almost all of Europe is under snow cover. Unusually high levels are to be found in the areas adjoining the North Sea and Baltic Sea, for example, some 30 cm on Rügen.

Fig.: Snowfall forecast in cm by Sunday afternoon for central Europe (source: www.wetteronline.de)

Repercussions

In Germany, the main focus is on the combination of the moderate windstorm conditions with the heavy snowfall in some areas and persistent low temperatures, which can cause considerable drifting. This will particularly affect the central and northern part of Germany and Poland. Considerable disruptions are to be expected in all forms of transportation here. Widespread snow breakage and icing (as occurred in Bavaria in January 2006 or in Münsterland in November 2005) are, however, not to be expected in Germany. In southwestern Europe and the western Mediterranean, the main focus is on frost damage and local snow breakage.

08.01.2010

On November 19 ,2009 Munich Re held a Press Conference in London about the current status of Solvency II. Speakers were CFO Jörg Schneider, CRO Joachim Oechslin and Margarita von Tautphoeus, Head of Solvency Consulting. Here are some noteworthy excerpts from the speakers:

Jörg Schneider: "Europe is a kind of frontrunner with the Solvency II initiative which is an excellent masterpiece of all parties involved. It is the right answer to the crisis: Regulatory systems should be harmonized, they should be fully risk-based, fully economic and on a very sophisticated level".

Joachim Oechslin: "There is quite some discussion in the ongoing implementation phase. The latest consultations seem to indicate a disproportionate increase in conservatism, even in areas that have little to do with the recent financial crisis. We are optimistic that in the end regulators and policymakers will decide on a reasonable calibration that is consistent with economic principles adopted in the framework directive."

Margarita von Tautphoeus: "A strong rating becomes a clearer competitive edge for reinsurers. Financial strength of reinsurers will be more important than diversification by number of counterparties. To quote an example: The capital relief of a reinsurance treaty with only one AA-rated reinsurer will be greater than with a panel of six A-rated reinsurers."

19.11.2009

The financial crisis has shown that the supervision of insurance undertakings by the German Federal Financial Supervisory Authority (BaFin) has contributed to effective consumer protection and stability in the insurance sector. This model of success should be retained. We are therefore of the opinion that integrating the supervision of insurance undertakings in the German Bundesbank would be a step in the wrong direction. Insurers have a fundamentally different business model from that of banks. Insurance supervision cannot function according to the rules governing the supervisions of banks. This is also why separate supervisory authorities are being established at European level for banks and insurance companies.

Besides, a major restructuring of insurance supervision would lead to considerable efficiency losses, which is not justifiable in the light of the current economic challenges and the ongoing implementation of Solvency II.

09.10.2009

"The financial crisis has shown that you always have to be vigilant where risks are concerned. Munich Re possesses a high level of expertise in professional risk management and uses its sophisticated know-how to advise clients and to develop individual client solutions", explains Thomas Blunck, member of Munich Re’s Board of Management.

Solvency II strengthens Munich Re’s role as a reinsurer in two ways. For European insurers, the central question is how they can achieve the requisite risk-capital relief. Reinsurance will play an increasingly vital role in this respect. "Thanks to our broad and globally diversified portfolio, our risk capital costs less than that of our clients. However, companies will not always simply look for the least expensive option. Solvency II opens up a whole new range of services for reinsurers, as it affects the entire spectrum of risks to which an insurance company is exposed. This is why clients seek the expertise they need for effective risk management based on holistic corporate management. And this means a new and broader role for reinsurers. They must be able to help their clients establish and further develop their risk management", says Blunck.

It was for this reason that back in 2006 Munich Re decided to establish the Solvency Consulting Team as part of Integrated Risk Management. As a reinsurer with an outstanding position and a wealth of experience in Enterprise Risk Management, Munich Re offers its clients a wide range of advice, workshops and tools:

• —
  
  With the actuarial instrument PODRA (PillarOne Dynamic Reinsurance Analysis), the primary insurer can – on the basis of the open-source modelling software PillarOne – calculate its risk-capital requirement and the effect of various reinsurance structures.
• —
  
  ALPHA (Asset Liability Portfolio Hedge Administration), Munich Re’s innovative ALM service, has proven itself in pilot tests. Using this instrument, asset-liability-management experts have developed proposals for clients’ investment portfolios, which help to significantly improve returns or make substantial savings on risk capital.
• —
  
  Amid the flood of information, Munich Re offers insurers vital support on prioritising the key tasks in preparation for Solvency II. Munich Re’s GoST (Governance Solvency II Training) workshop helps clients to better understand the qualitative requirements of Solvency II. In the Knowledge series, a number of experts publish practical analyses and statements online.

The brisk demand from clients also gives Blunck reason to be optimistic: "Munich Re’s risk management has proven its worth during the economic crisis. Now we are using this knowledge and experience to develop products that will open up a profitable field of growth for us".

07.09.2009

03.09.2009

31.08.2009

On 2 July, Thomas Blunck, member of the Board of Management at Munich Re, spoke at the London press conference of the Geneva Association in Lloyd’s Old Library, alongside other representatives from the insurance industry. The conference was held to mark the publication of the research report "The insurance industry and climate change – Contribution to the global debate". The study underlying the report examined the management of the risks caused by climate change and the economic opportunities that may arise from actively tackling the problem.

The Geneva Association (International Association for the Study of Insurance and Economics), chaired by Munich Re’s CEO, Nikolaus von Bomhard, is made up of 80 CEOs from the world’s most important insurance companies. The think tank’s objective is to research the growing importance of global insurance activities for economic growth and social development.

In London, Blunck said: “The insurance industry was the first to identify and draw attention to the risks that may result from the consequences of global warming. It has since developed many products that can mitigate the consequences of climate change or take account of adaptation to the changed conditions.” He added that the 400-page work proved the significance of the insurance industry’s role in the debate on climate change.

The report takes a concrete look at the management of these risks as well as the business and economic opportunities that may arise from actively tackling climate change. In addition, it explains why the insurance industry needs to be more involved in the political processes when it comes to mitigating the effects of climate change. Blunck congratulated the Geneva Association on the report, which he believed would become a standard work for the whole insurance industry in the coming years.

The most important results of the research report can be taken from the press release (below). Further detailed information on the activities of the Geneva Association, and the report itself, are available on the think tank’s website, which can also be accessed via the link below.

03.07.2009

Leading scientists and representatives of international organizations and companies agreed that the Global Earthquake Model (GEM) should become the key instrument for estimating earthquake risk worldwide. The GEM Outreach Meeting, held 8-10 June in Schloss Hohenkammer and hosted by GEM’s main private founder Munich Re Group, brought together 130 key stakeholders (both public and private) and distinguished experts from over 40 countries. This first global meeting since the constitution of the GEM Foundation in March 2009, reinforced the need for an independent, uniform standard for calculating earthquake hazard and risk as well as for a critical instrument to support decisions and actions to reduce earthquake losses worldwide. GEM, a genuine public-private initiative, offers a unique chance for countries and organizations to obtain state-of-the art information on seismic risk and its socio-economic impact, via open-source software.

19.06.2009

Today, at its General Branch in London, Munich Re presented its unique state-of-the-art tool designed to identify new focal points in underwriting complex risks from natural hazards. The so-called Globe of Natural Hazards contains extensive knowledge in the field of geo risks. The DVD tool is intended to support Munich Re’s clients and society in general in the evaluation of these risks. It represents a progression from the World Map of Natural Hazards, a very successful series of Munich Re publications which, since first appearing in 1978, has established itself as a standard work for the identification and evaluation of natural hazards.

Board member Georg Daschner: "For Munich Re, risk research is a crucial discipline that enables us to steer the course of our business in the long term, while performing our role as the insurance industry’s knowledge carrier. Products like the Globe of Natural Hazards and the know-how incorporated in it assist in profitable underwriting of complex natural hazard risks. At the same time, we strive to put our clients in a position to control their risks more efficiently, too."

The unique service product shows users the degree of exposure to storms, floods, earthquakes, hailstorms, or other natural hazards at any point on earth.

With claims burdens constantly increasing worldwide, detailed analysis of natural hazards is of immense significance, not only for the insurance industry. Land-use planning at regional and municipal level and disaster reduction can all benefit from the information contained in the Globe of Natural Hazards. New hazard maps for hailstorms, tornadoes, and hazards in coastal regions have been integrated. A further central element is the integration of the hazard scenarios impacted by climate change. In recent years, for example, there have been relevant increases in the hurricane hazard in the Caribbean and on the coasts of North America and in the hazard of extreme atmospheric events like hailstorms and heavy rain in Europe.

"The work of our risk research team, whose findings are conveyed in part by the Globe of Natural Hazards, helps us and our clients to identify new focal points in underwriting. This is important to keep these risks insurable. In addition, we use this expertise to develop profitable business, enabling us to offer insurance solutions in new areas like offshore wind farms and large solar and geothermal plants," Board member Daschner continues. "Independent of the question of insurance, politics and society bear a major responsibility in terms of steering exposure and reducing loss potentials. This includes, for example, the adaptation of land use to the respective hazard situation and the stipulation and enforcement of building regulations. This is exactly where our new product can provide good support."

"The Globe of Natural Hazards is unique both in its makeup and in the knowledge it incorporates. It is a means of contributing towards enhanced risk awareness – on the part of our clients, but also on the part of the public, companies, and authorities," says Andreas Siebert, project leader and head of Geospatial Solutions at Munich Re.

6.5.2009

EU finance ministers today adopted the directive regulating the European insurance industry. It sets high risk management and monitoring standards and is aimed at making the sector more stable and thus better equipped for difficult economic times. Implementation of the directive involves translating the strict principles it has laid down into formal regulations.

As Thomas Blunck, member of the Board of Management of Munich Re, sees it, "We want to have a level playing field in an integrated European insurance market. The standards defined should not be watered down in the next phase of the process. We want safety. And safety must be given top priority to protect the industry and its clients. Solvency II will play an important role in the insurance industry's development."

By 2012, when Solvency II comes into force, all insurers will have to have established professional risk management in all areas – from product design to investment policy. In future, reinsurance will play a more significant role in measuring risk capital and helping insurers meet their capital requirements, as it is an effective way of achieving risk-capital relief. Munich Re’s Solvency Consulting Team supports insurers in adjusting to Solvency II requirements and helps them design suitable reinsurance solutions.

Joachim Oechslin, Munich Re’s Chief Risk Officer, commented, "Companies that are well aware of their risks will be able to manage them more professionally. Munich Re has already been managing its business for a number of years along the lines of Solvency II principles and this has brought us success. Solvency II will make European insurers even more competitive. However, it is unfortunate that for the time being Solvency II does not make provision for group support and that it will not be possible for its principles to be implemented consistently everywhere because of some special national arrangements that have been agreed. Nevertheless, as the first risk-based supervisory system founded on principles, Solvency II has the potential to become a forerunner beyond the borders of Europe."

5.5.2009

As from 1 January 2009, Munich Re will be applying the accounting standard IFRS 8. As announced information regarding this change and also the adjusted figures for the business year 2008 are now available.

A major step forward has been achieved in the preliminary negotiations for the 2009 climate summit in Copenhagen. In the UNFCCC climate negotiations in Bonn, an agreement has been reached on the framework for insurance solutions for developing countries. Consequently, the chances are good that such insurance solutions for weather-related catastrophes in developing countries will be integrated in a new climate protection convention for the years following 2012.

Prof. Peter Höppe, Head of Munich Re's Geo Risks Research unit: "The decision reached in the climate negotiations in Bonn makes it very likely that insurance solutions will be incorporated as one element of climate change adaptation measures in the new climate convention on which the world will hopefully agree in Copenhagen."

Within the framework of the climate negotiations, Munich Re's initiative, the Munich Climate Insurance Initiative (MCII), submitted proposals on the design of insurance solutions and the avoidance of risks. The proposals include the establishment of an international risk pool financed by greenhouse gas emitters to cover losses caused by weather-related natural catastrophes in poor and exposed countries.

At this year’s conference of the All-Russian Insurance Association (ARIA), Munich Re received the award "Best foreign reinsurer 2008" based on the results of a survey of Russian insurance companies. "I am delighted that our consistent and long-term commitment to the Russian insurance market has received the widespread recognition of Russian insurers", said Peter Müller, Director of Munich Re Moscow.

ARIA’s 13th annual conference took place on 24 and 25 March. Alongside numerous presentations on current insurance topics, this conference also provided a forum for intensive contact between participants from the Russian insurance industry and international reinsurers.

2.4.2009

There has been a breakthrough in Solvency II, with representatives from member states and the European Parliament reaching agreement on the remaining outstanding issues. This clears the way for adoption of the directive before the European Parliament election this summer, though the result is a compromise and differs in some aspects from the original European Commission proposal. It is now possible for the directive, which will introduce strictly risk-based supervision with consistent economic valuation of all risks incurred by insurance companies, to come into force in 2012 as planned.

As Thomas Blunck, member of the Board of Management of Munich Re, put it, "Any company that has not given much thought to Solvency II should do so now. Munich Re has been successfully managing its business along the lines of Solvency II principles for some time. The application of the principles to the entire insurance industry will make risk management in the sector more stable and bring it closer to economic reality, thus making it more effective. And reinsurance will gain in importance under Solvency II, as it is clearly an effective way of achieving risk-capital relief. Indeed, Munich Re’s Solvency Consulting Team has long been at work, advising clients on gearing up to Solvency II requirements and devising reinsurance solutions adapted to companies’ specific needs."

Joachim Oechslin, Munich Re’s Chief Risk Officer, commented, "We are very pleased that after such a long time a compromise has been reached on the last few outstanding issues, so that Solvency II can proceed. The importance of this step cannot be overestimated. Risk-based supervision is central to the development of the insurance industry, not least in difficult economic times. However, it is regrettable that group support, whereby parent companies of international groups could have issued capital guarantees to cover subsidiaries in other countries, will not be possible, as it would have reflected economic reality. We fully expect that this issue will be looked at again after three years as planned. We also do not believe that the special national rules on valuing equity risks in repurchase agreements are sustainable."

>> Solvency II

30.03.2009

The Pan European Insurance Forum (PEIF) has spoken out in favour of carefully balanced regulatory consequences to the financial crisis. The key demands and proposals by PEIF, a group of CEOs from leading European insurance undertakings, are outlined in a discussion paper entitled "Insurance View: Regulatory Consequences of Financial Crisis".

Following initial reactions by politicians, insurers are pushing for a balanced reform of regulatory framework conditions in the financial sector. Future regulation of financial services providers should be more closely geared to risks and reward good risk management, as provided for by the European Commission’s Solvency II draft directive for the insurance industry. Regulatory systems should be adapted to the increasing internationalisation of companies, large undertakings being more efficiently overseen by means of group supervision instead of by many national authorities.

Insurers are also calling for more transparency, especially in connection with structured finance products. These had substantially exacerbated the financial crisis, mainly because dealers and buyers alike no longer had any clear idea of the risks they contained.

PEIF members regard the measures deployed by the state to combat the financial crisis as a threat to competition. It is important to ensure that sweeping government support does not distort competition by giving preferential treatment to individual companies or specific branches of industry. The measures therefore have to be in harmony with European competition rules, limited in time, and contain clear exit rules.

"Stakeholders reacting to the financial crisis need to take into account that the business model of the insurance industry differs substantially from that of the other financial services providers", said Henri de Castries, AXA CEO and PEIF Chairman. He added that "insurers do not generate the kind of systemic risk that arises in banking".

Members of the PEIF insurance forum are committed to restoring confidence in the financial sector and to designing a sound and stable financial system. They therefore strongly welcome the ongoing debate to redefine the regulatory and supervisory model of the EU financial sector.

Munich, 24. February 2009

Pan European Insurance Forum

The Pan-European Insurance Forum (PEIF) is a group of CEOs of major insurance companies in Europe, consisting of AEGON, Allianz, AVIVA, AXA, GENERALI, ING, MAPFRE, Munich Re, RSA, Swiss Re, UNIQA and ZURICH Financial Services.

The Presidency of the PEIF rotates every two years. The PEIF is currently chaired by AXA. PEIF members strive for a strongly competitive and fully integrated European insurance market.

This paper is supported by the following members of the PEIF:

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  Mr. Sergio Balbinot – Managing Director – Assicurazioni Generali S.p.A
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  Mr. Henri de Castries – Chief Executive Officer, Chairman of the Management Board – AXA Group
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  Mr. Michael Diekmann – Chairman of the Board of Management – Allianz SE
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  Mr. Andrew Haste – Group Chief Executive – RSA Insurance Group plc
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  Dr. Konstantin Klien – Chief Executive Officer and Chairman – UNIQA Versicherungen AG
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  Mr. Stefan Lippe – Chief Executive Officer – Swiss Re
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  Mr. José Manuel Martinez – Chairman and Chief Executive Officer – MAPFRE
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  Mr. Andrew Moss – Chief Executive Officer – AVIVA plc
• —
  
  Mr. James J. Schiro – Chief Executive Officer – Zurich Financial Services
• —
  
  Dr. Nikolaus von Bomhard – Chairman of the Board of Management – Münchener Ruckversicherungs-Gesellschaft
• —
  
  Mr. Alex Wynaendts – Chairman of the Executive Board – AEGON N.V.

>> Insurance View - Regulatory Consequences of Financial Crisis (PDF, 537 KB)

24.02.2009

Together with seven European-based insurers, Munich Re jointly established PERILS, an independent Zurich-based company that aims to aggregate and supply European catastrophe insurance data to subscribers in the insurance industry.

PERILS will provide two main products:

• 1.
  
  Aggregated industry-wide insurance exposure data (insured values) which will be catalogued by risk type and CRESTA zones. The data will be provided on an annual basis.
• 2.
  
  Industry loss estimates per risk type and CRESTA zones, following large natural catastrophe events

The aggregated data sets will be derived from data voluntarily provided by European-based insurers. The provided data will be kept strictly confidential. Subscribers are likely to include insurers, reinsurers, brokers, risk modellers, banks and other insurance industry stakeholders.

The data services will aid in the risk management and underwriting of natural catastrophe risk. Overall, the combination of consistent industry exposure portfolio data and corresponding event loss information is likely to enhance the modelling of natural catastrophe risk. Additionally, the industry loss estimates are likely to further facilitate the establishment of loss triggers for catastrophe bond structures, industry loss warranties (ILWs) and other capital markets products.

>> Press Release PERILS (PDF, 119 KB)

18.02.2009

Munich Re is set to expand its operations in Switzerland by developing new fields of business. At the same time, it is relocating New Re’s headquarters from Geneva to Zurich.

By concentrating its business activities in Zurich as well as establishing and expanding new fields of business, Munich Re is deliberately taking full advantage of the opportunities offered by the Swiss reinsurance and labour market. In this context, a decision was taken recently to use the new Zurich office as a platform for developing special insurance solutions for life insurance companies. Further new business opportunities are currently being reviewed.

New Re will be responsible for expanding business operations in Switzerland. In order to tap into all the opportunities the business location Switzerland offers the Munich Re Group, New Re will be transferring its head office from Geneva to Zurich. The main idea behind the move is to exploit the advantages of Zurich as one of the central financial and insurance market places in Europe while at the same time enhancing client proximity.

Thomas Blunck, member of Munich Re's Board of Management: "New Re will play a key role in establishing new, specialised fields of business. The Zurich location offers us a distinct edge, especially if we want to take on additional highly qualified personnel."

The move is due for completion in spring 2010. The Geneva office is scheduled to close down operations on 30 September 2010.

29.01.2009

Recently there has been speculation on the financial markets about possible write-downs by insurance undertakings on investments in hybrid securities. Munich Re wishes to issue the following statement with regard to its own exposure in this area:

As at the end of 2008, the Munich Re Group had participation certificates, dormant holdings and similar hybrid instruments rated as tier 1 and upper tier 2 capital amounting to a good €600m. A continuation of the crisis in particular may lead in individual cases to interest losses and capital reductions. As a precautionary measure, Munich Re has already included limited write-downs in its 2008 annual financial statements.
In addition, we hold so-called lower tier 2 and tier 3 instruments, such as subordinated bonds with limited remaining terms, amounting to around €1.7bn. From today’s perspective, it is highly improbable that these instruments will generate any losses.

CFO Jörg Schneider: "Altogether these make up less than 1.5% of our well diversified investment portfolio, meaning our exposure is moderate and gives no particular cause for concern."

26.01.2009

As from 1 January 2009, Munich Re will be applying the accounting standard IFRS 8. The changes, which are of limited scope, mean that the operating performance in underwriting business will be given more prominence both in the Group figures and in the segments, thus also enhancing assessability.

Concrete changes will result for the segment reporting and the income statement. In segment reporting, the subdivision into segments and the disclosure of key figures will be based more on the management view in future. This contrasts with the segment reporting based on the standard IAS 14, applied up to now, which prescribes a more rigid subdivision according to products or regions.

The two main changes:

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  In segment reporting, life and health business in primary insurance will be shown separately.
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  In the income statement both for the Group as a whole and for the segments, the operating result will be presented in a more differentiated way, with the technical result and the non-technical result shown separately. The technical result is the balance of earned premiums plus income from technical interest, less expenses for claims and benefits and operating expenses.

Munich Re will not be availing itself of the option to show the operating result adjusted to eliminate effects from fluctuations on the capital markets or major losses. Both are part of its core business and will thus continue to be fully included in the operating result in its income statement.

"Our figures will become that much more transparent, which is in the interests of investors and the public at large. As our shareholders are accustomed to from us, there will be no smoothing or glossing in the presentation of the operating result. We have fared well to date with this policy of clarity and openness," said CFO Jörg Schneider.

Munich Re’s first financial report applying the new rules will be the interim report for the 1st quarter of 2009, scheduled to be published on 6 May. The changeover to IFRS 8 as from the financial year 2009 is compulsory.

>> IFRS 8 Operating Segments - Implementation in the Munich Re Group (PDF, 444 KB)
>> IFRS 8 – Implementation in the Munich Re Group – Questions and Answers (PDF, 330 KB)

26.01.2009

January 15, 2009 - Munich Re, Munich Re America, and the Insurance Information Institute have teamed once again to present their second webinar designed to provide journalists with an overview of 2008 natural catastrophes. The presentation included information about major natural catastrophes worldwide and their economic impact, compared 2008 cats with prior years, and discussed how global warming and climate change is likely influencing cat trends.

Driven by high losses from weather-related natural catastrophes, 2008 was – on the basis of figures adjusted for inflation – the third most expensive year on record, exceeded only by the hurricane year of 2005 and by 1995, the year of the Kobe earthquake. Throughout the world, in 2008 more than 220,000 people died as a result of natural catastrophes. Overall losses totaled some US$ 200bn (2007: US$ 82bn) but were still below the record set in 2005 (US$ 232bn in current values). Insured losses in 2008 rose to US$ 45bn, about 50% higher than the previous year.

Insured losses in the United States in 2008 were above $30 billion – the 4th highest in U.S. history. The biggest contribution to these figures came from hurricanes (six tropical cyclones made landfall in the U.S., three at hurricane intensity: Dolly, Gustav, and Ike), record insured losses due to thunderstorms, damaging wildfires in Southern California and floods in the Midwest.

15.01.2009

Beaufort is pleased to announce that Syndicate 1318 has received Lloyd's approval to begin underwriting for the 2009 year of account. Beaufort, which currently manages MSF Pritchard Syndicate 318, has appointed Gordon Breslin to be Active Underwriter and Steve Anderson as Deputy Underwriter for the new venture.

Syndicate 1318 will trade as G J Breslin Syndicate 1318 (one-three-one-eight) and will initially have premium capacity of £35m. The Syndicate is backed fully by Munich Re, which also owns Beaufort and will underwrite a book of predominately North American small commercial property and home owners' business sourced exclusively through binding authorities.

Michael Pritchard, Director of Beaufort and Active Underwriter of Syndicate 318 said: "We are delighted to have been able to appoint Gordon and Steve I look forward to working with them and their team in the coming years to take Beaufort to its next stage of development both within Lloyd's and as part of the Munich Re Group."

Gordon Breslin, Active Underwriter of Syndicate 1318 commented "With a number of Lloyd's entities focussing on start up operations in the USA, there is a tremendous opportunity to develop and expand a SME business account here in London. These types of risks have been written in Lloyd's for many years, and with the backing of Munich Re I am confident that Syndicate 1318 will be successful in continuing this tradition, providing our coverholders and their policyholders with a viable alternative market."

G J Breslin Syndicate 1318	Gordon Breslin	020 7220 8200
Beaufort Underwriting Agency Ltd & MSF Pritchard Syndicate 318	Mike Pritchard	020 7220 8200
Beaufort Underwriting Agency Ltd	Andy Dawe	020 7220 8200

Profile of Gordon Breslin

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  Gordon Breslin has over 30 years experience in the insurance industry, and for much of this he has held underwriting positions.
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  Joined Beaufort in October 2008, prior to which he spent over six years as Senior Property Underwriter with Ace Global Markets.
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  A member of the International Committee of the North American Professional Surplus Lines Offices ("NAPSLO").

Profile of Beaufort

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  Formed in 1999, Beaufort has acted as managing agent for Syndicate 318 since 2001.
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  The agency, as a subsidiary of MSP Underwriting Ltd, was acquired by the Munich Re Group in November 2007.
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  For 2009, Beaufort has managed capacity of £237million.

Profile of MSF Pritchard Syndicate 318

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  Syndicate 318 is a Lloyd's non-marine syndicate specialising in the underwriting of a UK and international property account, and an aviation account.
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  Michael Pritchard has been the active underwriter since 1985 during which time he has achieved an unbroken run of profitability with the Syndicate.
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  The Syndicate has an underwriting capacity of £202million for the 2009 year of account, of which Munich Re provides 71.8%, with third party capital providers representing the balance. Syndicate 318 is intending to underwrite approximately £137million of income for the year (after brokerage).

16.12.2008

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  Munich Re investment and counterparty risk policy is based upon principle of diversification across large institutions and stringent limitation for individual exposures
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  Munich Re's total exposure to Lehman Brothers including derivatives used for hedging is roughly €350m
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  Munich Re's investment exposure to AIG is not material
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  Munich Re's capital repatriation program remains unaffected by the recent capital market developments

16.09.2008

According to Munich Re's estimates, Hurricanes Gustav and Ike together gave rise to market losses of up to US$ 20bn. Munich Re puts the market loss caused by Gustav at up to US$ 5bn, and that caused by Ike at up to US$ 15bn.

The Munich Re Group estimates its own claims burden from the two hurricanes as follows: Overall burden in the region of US$ 500m net before tax, with around US$ 100m from Gustav and around US$ 400m from Ike.

Statement from Dr. Torsten Jeworrek, Board member with responsibility for Munich Re's global reinsurance business:
"Climate change will result in a further increase in weather-related natural catastrophes and also in the losses they cause. Events like Hurricanes Ike and Gustav fit in with this pattern, even if individual natural catastrophes cannot be explained by climate change alone. As a leading reinsurer, we are ready to deal with this: we have been concerning ourselves with climate change for decades, and after the record number of hurricanes and hurricane losses in 2004 and 2005, we adjusted our models to take account of the previously unexpected loss patterns."
"At the same time, events like the latest hurricanes endorse our insistence that risks be consistently written at adequate prices, despite years with comparatively low losses like 2006 and 2007. Along with the financial crisis, with its impact on the capital base of insurers, events like the recent hurricanes are contributing to a tightening of the reinsurance market and the advent of a phase of harder markets with rising prices."

29.09.2008