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Mapfre Re Q1 CoR falls to 95.1% amid decline in catastrophe losses

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The reinsurance unit of Spanish composite insurer Mapfre reported a 14.2-point improvement in the Q1 combined ratio to 95.1% after a quiet period for large losses.

Mapfre Re, which includes the previously standalone global risks operation, returned to overall profitability with a EUR32.4mn ($39.2mn) profit, after Puerto Rico earthquake-related claims had pushed the unit to a EUR29.4mn loss a year earlier.

Top line: Non-life premiums at Mapfre Re rose 8.7% to EUR1.4bn. Including life, Mapfre Re accounted for almost 24% of group premium in the first quarter.

Catastrophe and Covid-19 claims: The company said it experienced limited impacts within Mapfre Re from Covid-19 and major losses in Q1. Storm Filomena in Europe cost Mapfre Re EUR15.7mn net of reinsurance. It said direct pandemic-related claims reached EUR4.1mn at the unit. However, it warned once again about uncertainty related to BI claims subject to litigation or arbitration, even though it believes exposure only exists for the company in exceptional circumstances, given its policies’ typical material damage trigger.

Return on equity: The reinsurance return on equity improved to a positive 4.6% from a negative 1.4% a year earlier.

Group: At group level Mapfre reported a 37% increase in net profit to EUR173.3mn and a 5.7% improvement in the combined ratio to 94.3% as the company benefited from reduced auto claims amid Covid-19-related lockdowns. Covid-19 claim costs amounted to EUR109mn, of which 77% came from Latin America.

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