HANNOVER, Germany, Feb. 16, 2006 (PRIMEZONE) -- Hannover Re has completed a transfer of life insurance risks into the international financial market with effect from 31 December 2005. Labelled "L6 securitisation", the transaction covers individual unit-linked policies from Germany and Austria and has been placed through a private placement with a leading European bank.
Through this transaction Hannover Re has monetised EUR 100 million of "embedded value" and converted a future earnings stream into a current liquidity position, thereby promoting greater financial flexibility and capital efficiency.
"This transaction, which follows five life transactions in the late 1990s and early 2000s -- the so-called L1-L5 securitisations -- enables Hannover Re to optimise its capital efficiency, improve its exposure profile and provide internal funding to support growth in international life business. What is more, it clearly demonstrates that "embedded value" is more than just an actuarial stipulation but constitutes a tangible asset that can be monetised under attractive terms and conditions in today's financial market", Wolf S. Becke, CEO of Hannover Life Re, explained.
Since 2000, the Hannover Re Group has managed its worldwide portfolio in life, health and annuities under the common brand name of "Hannover Life Re." Using a systematic CRM approach, this business group enjoys a substantial growth potential, and the financing of new business acquisition expenses has for many years been one of its core activities.
Hannover Re has pioneered the transfer of insurance risks into the capital market, completing the first securitisation of natural disaster risks in 1994. Including the life securitisations mentioned above, the Group has already successfully launched 12 securitisations to date. It can be expected that further life securitisation will follow in due course.
For further information please contact:
Press and Public Relations / Investor Relations: Eric Schuh (tel. +49 / 511 / 56 04-15 00, e-mail: eric.schuh@hannover-re.com)
Press and Public Relations:
Gabriele Handrick (tel. +49 / 511 / 56 04-15 02, e-mail: gabriele.handrick@hannover-re.com)
Investor Relations:
Gabriele Bodeker (tel. +49 / 511 / 56 04-17 36, e-mail: gabriele.boedeker@hannover-re.com)
Hannover Re, with a gross premium of approximately EUR 10 billion, is one of the largest reinsurance groups in the world. It transacts all lines of property/casualty, life/health and financial/finite-risk reinsurance as well as specialty insurance. It maintains business relations with more than 5,000 insurance companies in about 150 countries. Its worldwide network consists of more than 100 subsidiaries, branch and representative offices in 18 countries. The rating agencies most relevant to the insurance industry have awarded Hannover Re very strong insurer financial strength ratings (Standard & Poor's AA -- "Very Strong" and A.M. Best A -- "Excellent").
Disclaimer
Some of the statements in this press release may be forward-looking statements or statements of future expectations based on currently available information. Such statements are naturally subject to risks and uncertainties. Factors such as the development of general economic conditions, future market conditions, unusual catastrophic loss events, changes in the capital markets and other circumstances may cause the actual events or results to be materially different from those anticipated by such statements. Hannover Re does not make any representation or warranty, express or implied, as to the accuracy, completeness or updated status of such statements. Therefore, in no case whatsoever will Hannover Re and its affiliate companies be liable to anyone for any decision made or action taken in conjunction with the information and/or statements in this press release or for any related damages.
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