German reinsurer Munich Re AG, parent of Hartford Steam Boiler Inspection and Insurance Co. lost nearly $1.43 billion (euro1billion) in the first quarter as natural disasters in Japan, New Zealand and Australia took their toll, The Associated Press reports.
The Munich-based firm said it lost euro948 million in the first quarter, compared with a net profit of euro485 million in the same quarter last year.
The group had to cope with reinsurance losses of euro2.7 billion in the quarter, almost euro2.5 billion more than anticipated, the company said.
“The earthquake in Japan and the natural catastrophes in Australia and New Zealand have made this the most difficult start to a financial year we have experienced for a long time,” said Chief Financial Officer Joerg Schneider. “Such major losses — even several within a few weeks — are possible in our reinsurance business.”
Reinsurance companies sell backup insurance to primary insurers so the industry can cover big losses.
Schneider said that even with the tough quarter, the company was still on track for a positive yearly result.
Overall, the company posted a pretax operating loss of euro1.38 billion in the quarter, compared to a pretax profit of euro770 million last year.
Billionaire investor Warrant Buffett owns just over 3 percent of Munich Re.
