Press release

• Katrina and Rita: Munich Re estimates total insured market losses at up to US$ 40bn 
  
  
• Possible own burden of around €650m after tax on the basis of this scenario 
  
  
• Still significant uncertainties regarding coverage issues 
  
  
• Result target of 12% return on equity still achievable 
  
  
• Mounting exposures from natural catastrophes not insurable without risk-adequate prices and conditions

Nikolaus von Bomhard, Chairman of the Board of Management: "The natural hazard events to date have cost substantially more than the amount anticipated for the first nine months of this year. We are nevertheless optimistic of achieving our result target of 12% return on equity. This presupposes that the acquisition of HVB by UniCredit is completed in 2005. As usual, the proviso applies that in the remaining three months of the business year, there are no exceptional developments as regards major losses or on the capital market."

As the full extent of the devastation caused by Hurricane Katrina has gradually emerged, natural catastrophe risk management specialists and other companies have revised their loss estimates upwards. Experts from Munich Re and American Re have now also concluded and evaluated a loss inspection of the hurricane-affected region. On the basis of this information, Munich Re now puts the overall insured market loss for Katrina at up to US$ 30bn. This figure does not include the flood and storm-surge losses covered under the National Flood Insurance Program (NFIP). However, there are still significant uncertainties regarding coverage issues and thus also about the actual loss burdens facing the insurance industry, with substantial differences between the highest and lowest loss estimates.

At this stage, therefore, it is only possible to make general assumptions about the potential loss burden for the Munich Re Group from Katrina. On the basis of a market-loss scenario of up to US$ 30bn, the loss burden for the Munich Re Group could be in the region of €1.1bn gross or around €500m after retrocessions and taxes. In the case of a higher insured market loss, which other institutions estimate at up to US$ 60bn, there could be a gross loss burden of some €1.3bn and a net burden (after retrocessions and taxes) of just under €650m.

The US Gulf Coast was again hit by a severe hurricane when Rita made landfall on 24 September 2005. This event, too, involves a complex loss situation with extensive flood damage, including fresh levee breaches in New Orleans. Munich Re currently puts the insured market loss at US$ 5bn-10bn. For the Munich Re Group, the gross loss to be expected from this would be of up to €230m, with a loss burden of around €150m after tax.

Catastrophes on the scale of Katrina and Rita can occur on virtually all continents. The upcoming round of renewals in reinsurance business must take account of the rising loss trends and greater risk potentials. Substantially higher prices are necessary to continue covering natural hazard risks in the future.

Münchener Rückversicherungs-Gesellschaft
signed von Bomhard           signed Küppers