Company Reports

Over the first quarter, Swiss Re delivered great results. Over the second quarter, the business again delivered numbers that are better than company-compiled consensus, albeit a bit worse than what we were expecting.

For almost a decade, Swiss Re has been missing its stride. Yet we think this is a top-quality business with some unique assets. More than any other European reinsurer we cover, Swiss Re puts research and development, data and technology, customer relationships, analytics, and insights front and center when trying to carve out a pure underwriting-based competitive advantage. It has delivered the leading property and casualty claims ratio by a minimum of 1 percentage point under IFRS 4. Whether the business is delivering superior underwriting under IFRS 17 remains unclear. We think it operates with strong natural catastrophe underwriting skills, driven by its proprietary risk models and collaboration with leading scientists. Barriers to entry are high because of potential losses should a business fail to properly underwrite. A new entrant's entire capital base could easily be wiped out. That entrenches Swiss Re with customers, enhances trust, and increases switching costs.

For almost a decade, Swiss Re has been missing its stride. Yet we think this is a top-quality business with some unique assets. More than any other European reinsurer we cover, Swiss Re puts research and development, data and technology, customer relationships, analytics, and insights front and center when trying to carve out a pure underwriting-based competitive advantage. It has delivered the leading property and casualty claims ratio by a minimum of 1 percentage point under IFRS 4. Whether the business is delivering superior underwriting under IFRS 17 remains unclear. We think it operates with strong natural catastrophe underwriting skills, driven by its proprietary risk models and collaboration with leading scientists. Barriers to entry are high because of potential losses should a business fail to properly underwrite. A new entrant's entire capital base could easily be wiped out. That entrenches Swiss Re with customers, enhances trust, and increases switching costs.

Swiss Re has delivered knockout results for first-quarter 2026. Against the backdrop of a softening market, the business has delivered quality through and through. Swiss Re has blasted through company-compiled consensus in all areas and is making our full-year estimates look a bit trivial, too.

For almost a decade, Swiss Re has been missing its stride. Yet we think this is a top-quality business with some unique assets. More than any other European reinsurer we cover, Swiss Re puts research and development, data and technology, customer relationships, analytics, and insights front and center when trying to carve out a pure underwriting-based competitive advantage. It has delivered the leading property-casualty claims ratio by a minimum of 1 percentage point under IFRS 4. Whether the business is delivering superior underwriting under IFRS 17 remains unclear. We think it operates with strong natural catastrophe underwriting skill sets, driven by its proprietary risk models and collaboration with leading scientists. Barriers to entry are high because of potential losses should a business fail to properly underwrite. A new entrant's entire capital base could easily be wiped out. That entrenches Swiss Re with customers, enhances trust, and increases switching costs.

Despite the life and health review, for 2025, Swiss has reported impressive results. Net income of $4.74 billion is ahead of management's $4.4 billion target, in line with company-compiled consensus, and ahead of our forecast. Property and casualty and corporate solutions were the drivers.

Swiss Re has announced that its corporate solutions division is to acquire the global trade credit and surety business of QBE.

While we think Swiss Re has reported decent numbers for the third quarter of 2025, the company has missed company-compiled consensus on life and health net income quite dramatically.

In taking a closer look at European reinsurers, we think that while the industry could be faced with higher volume as a result of climate change, buoyant returns from a harder market have attracted capital. That has led to the cycle turning, and that is more important in the medium term.

For almost a decade, Swiss Re has been missing its stride. Yet we think this is a top-quality business with some unique assets. More than any other European reinsurer we cover, Swiss Re puts research and development, data and technology, customer relationships, analytics, and insights front and center when trying to carve out a pure underwriting-based competitive advantage. It has delivered the leading property and casualty claims ratio by a minimum of 1 percentage point under IFRS 4. Whether the business is delivering superior underwriting under IFRS 17 remains unclear. We think it operates with strong natural catastrophe underwriting skill sets, driven by its proprietary risk models and collaboration with leading scientists. Barriers to entry are high because of potential losses should a business fail to properly underwrite. A new entrant's entire capital base could easily be wiped out. That entrenches Swiss Re with customers, enhances trust, and increases switching costs.

While Swiss Re delivered a solid beat in the first quarter of 2025 from positive one-offs, the business continues with solid underlying financial performance in the second quarter, delivering $1.330 billion of net income to shareholders, ahead of $1.197 billion as per company-compiled consensus.

Swiss Re has delivered strong results for the first quarter of 2025, ahead of company-compiled consensus. However, a major part of the beat has been driven by one-off positives that are likely nonrecurring.

For almost a decade, Swiss Re has been missing its stride. Yet we think this is a top-quality business with some unique assets. More than any other European reinsurer we cover, Swiss Re puts research and development, data and technology, customer relationships, analytics, and insights front and center when trying to carve out a pure underwriting-based competitive advantage. It has delivered the leading property and casualty claims ratio by a minimum of 1 percentage point under IFRS 4. Whether the business is delivering superior underwriting under IFRS 17 remains unclear. We think it operates with strong natural catastrophe underwriting skill sets, driven by its proprietary risk models and collaboration with leading scientists. Barriers to entry are high because of potential losses, should a business fail to properly underwrite. A new entrant's entire capital base could easily be wiped out. That entrenches Swiss Re with customers, enhances trust, and increases switching costs.

We think Swiss Re's 2024 earnings release outlines a business with a focus on discipline that continues. This started out with the ambition and perseverance over five years ago to improve corporate solutions. However, this approach has spread to the wider group, as evident in Feb. 27's numbers.

For almost a decade, Swiss Re has been missing its stride. Yet, we think this is a top-quality business with some unique assets. More than any other European reinsurer we cover, Swiss puts research and development, data and technology, customer relationships, analytics, and insight front and center when trying to carve out a pure underwriting-based competitive advantage. It has the leading property-casualty claims ratio by at least 1 percentage point under US GAAP. We think it operates with strong natural catastrophe underwriting skill sets, driven by its proprietary risk models and collaboration with leading scientists. Barriers to entry are high because of potential losses, should a business fail to underwrite properly. A new entrant's entire capital base could easily be wiped out. That entrenches Swiss with customers, enhances trust, and increases switching costs.

Economic and insured losses from natural catastrophes are increasing by at least midsingle digit percentage points annually. This is likely to provide a volume tailwind in the near term for Swiss Re, which is probably one of the largest reinsurers of natural catastrophes globally. Natural catastrophe reinsurance is volatile and a company has to be able to withstand heavy loss years. However, when written well it can be nicely profitable, assuming the business has the expertise to do it and a solid balance sheet. We think Swiss Re is one of the better underwriters in the industry and is likely to benefit more than others from this natural catastrophe tailwind. We maintain our no moat rating for Swiss Re. Our fair value estimate is CHF 135 per share and shares are fairly valued at current levels.

Swiss Re reported sound results for the third quarter and first nine months. They are below company-compiled consensus, but the sum of it is first nine-month net income of $2.2 billion. That should be put in the context of a maintained full-year target of $3 billion. We maintain our CHF 133.40 per share fair value estimate and our no-moat rating.

Swiss Re has announced it has strengthened its United States property and casualty liability reserves by $2.4 billion in the third quarter of 2024. This takes the total amount added to property and casualty reinsurance US liability reserves over the first nine months of the year to $3.1 billion. Around $400 million of reserve releases have partially offset these reserve additions and this means the net addition amounts to $2.0 billion. The additional reserving should take Swiss Re’s reserves to the upper end of its best estimate range and addresses reserve developments in its entire US liability portfolio, according to the business.

Swiss Re has announced that it has agreed to sell its iptiQ's European property and casualty business to Allianz Direct with the expectation that this transaction will close in the second or third quarter of 2025. iptiQ is a digital insurer that delivers property and casualty and life and health insurance to end consumers through a business-to-business to consumer structure. We think it therefore fits well with Allianz Direct. The transaction means that Allianz Direct will take over 130,000 iptiQ customers. We welcome the agreement because it leaves Swiss Re with three core business units that sit well with the company's core competencies. These are property and casualty reinsurance, life and health reinsurance, and corporate insurance. The sale also leaves investors with a clearer picture of Swiss Re's improvement.

Swiss Re has reported a stable set of results for the first half of 2024 with net income of $2.09 billion. Interim and second-quarter numbers are marginally ahead of company-compiled consensus and the results position the business well against its full-year targets at group level and throughout its divisions. The group reported a 4.0% recurring income yield versus 3.4% in the prior year, with $2.07 billion of net investment income and $155 million of unrealized and realized gains. The full-year net income target is better than $3.6 billion and results so far, provide a 10.2% return on equity. Our forecasts are broadly in line with the full-year target, so we maintain our CHF 133.40 per-share fair value estimate and no moat rating.