Allianz: Operating profit grows by 7.4% to €3.5bn in 3Q

Munich - Allianz Group. one of the world's leading insurers and asset managers has today announced its financial results for Q3, and the nine months of the year 2022.

In a statement released this morning, Allianz said its total revenues for Q3 increased 1.3% to €34.8bn (3Q 2021: €34.4bn), driven by the Property­ & Casualty business segment, with positive price effect and volume growth. This was partially offset by the Life/Health business segment, primarily due to softer sales in Italy and Germany, it said, and added that its Asset Management business segment was slightly down as a result of lower assets under management (AuM)-driven revenues and performance fees. Internal revenue growth, which adjusts for foreign currency translation and consolidation effects, was minus 3.7%.

The insurer said for the nine months of the year, its total revenues increased 5.3% to €116.0bn (9M 2021: €110.1bn), largely driven by the Property & Casualty business segment due to positive price and volume effects. This was supported further by the Asset Management business segment as a result of higher AuM-driven revenues, while the Life/Health business segment remained stable. Internal revenue growth was 1.6%, driven by the Property & Casualty business segment.

"Our excellent results this quarter again prove the resilience and strength of Allianz amid a dramatic geopolitical and market environment. Buoyed by outperformance in our Property-Casualty business, our operating profit and net income demonstrate to our stakeholders the benefits of our global scale and diversification, as well as our customer-centric strategy. Further, our capital management capabilities and balance sheet create valuable optionality for Allianz, allowing us to confidently confront a changing economic landscape" says Oliver Bate, Chief Executive Officer of Allianz SE.

Over the nine month period, Allianz said its operating profit increased 3.2% to €10.2bn (€9.9bn), driven by higher operating profit in the Property-Casualty business segment. Operating profit growth was driven by a strong rise in the investment result and further improvement in the underwriting result. Growth was partially offset by the impact of unfavourable market developments on the Life/Health and Asset Management business segments. Its net income attributable to shareholders was €4.7bn (€6.9bn), reflecting the provision booked in the first quarter in relation to the AllianzGI U.S. Structured Alpha proceedings and a lower non-operating investment result, it said.

Solvency II Capitalization Ratio

The Solvency II capitalization ratio was 199% at the end of the third quarter of 2022 compared with 200 percent at the end of the second quarter of 2022, the insurer said, adding that including the application of transitional measures for technical provisions, the Solvency II capitalization ratio was 227% at the end of the third quarter compared with 227% at the end of the second quarter.

Property-Casualty insurance: Strong operating profit (9 months)

Total revenues jumped 12.7% to €53.8bn (€47.7bn) for the nine months. Adjusted for foreign currency translation and consolidation effects, internal growth was strong at 8.8%, supported by a price effect of 5.3%, a volume effect of 2.9% and a service effect of 0.6%. Gross premium written (GPW) of Allianz Global Corporate & Specialty (AGCS) increased year-on-year by €1.063 billion (14%) to €8.486 billion (Q3 2021: €7.424 billion), driven by higher rates on renewals (13% incl. adjustment of terms and conditions), a higher renewals base, new business, an increased retention rate as well as favourable foreign exchange effects. Most lines of business experienced year-on-year growth, especially Financial Lines, Property, Entertainment and MidCorp.

Operating profit surged 13.5% to €4.7bn (€4.2bn), mostly driven by a significantly higher operating investment result and further improvement in the underwriting result. For AGCS, the operating profit for Q3 2022 of €459 million (Q3 2021: €205 million) is €254 million better than prior year due to both better underwriting performance and improved investment result. 

The combined ratio was 94.1% (93.9%) as the impact of higher attritional losses related to claims inflation as well as higher weather-related losses was partially offset by a favourable run-off result. The expense ratio rose slightly to 26.8% (26.7%) due to higher acquisition costs. For AGCS the combined ratio for Q3 2022 is 3.9% better than prior year and stands at 95.4% (Q2 2021: 99.3%). This improvement is mainly driven by a favourable current accident year loss ratio across all segments due to lower claims activity resulting from portfolio improvements. AGCS also saw lower claims activity for natural catastrophes, but nevertheless was affected by Hurricane Ian in the United States and a major hailstorm in France.

Life/Health insurance: New business margin expansion continues

PVNBP was €49.6bn (€58.9bn), reflecting the impact of two events - a group contract renegotiation in Italy and a one-off reinsurance treaty at Allianz Reinsurance - in the prior year as well as lower single premium business in Germany.

Operating profit was €3.4bn (€3.7bn), mainly due to the reasons mentioned above.

The new business margin increased to 3.8% (3.2%), driven by a better business mix across entities. The value of new business was unchanged at €1.9bn (€1.9bn), as the positive effect of a better business mix was offset by softer volumes.