HANNOVER, Germany, Sept. 24, 2001 (PRIMEZONE) Contrary to the press announcements of our competitors on Sept. 20, 2001, we see no reason to increase the loss estimate of Hannover Re resulting from the terror acts in the United States. Nearly two weeks after this unparalleled event for the insurance industry, the estimate of net loss exposure for the Hannover Re Group remains as previously stated at approximately EUR 400 million.
The current market speculation that Hannover Re will also publish increased loss estimates in the next few days is incorrect.
One of the main reasons for the very stable initial loss prognosis is due to the longer period of time Hannover Re allowed itself (in contrast to the above-mentioned companies) in piecing together its initial estimates. The extended time meant that losses arising from buildings neighboring the World Trade Center could be incorporated in the total figure.
Furthermore, as it turns out, the more accurate loss estimate is also due to the fact that Hannover Re did not rely on initial forecasts of the total market loss when estimating its own losses. Rather, staff examined every individual contract and estimated losses per contract and line of business to calculate the total expected loss for Hannover Re. This procedure also led to the early realization that not all retrocessionaires may be able to comply with all their obligations under retrocession contracts. Even this fact has already been taken into account by Hannover Re.
Even including the exposure from the terror acts in the United States and taking into account the current falls in the international stock markets, the financial strength of the company means that it will be able to benefit fully from the significantly improved market conditions for 2002. With this background, Hannover Re is confident that it will be possible to produce an extremely positive result next year.
For further information, please contact Ralf Arndt (tel. +49/ 511/ 56 04-15 00; fax +49/ 511/ 56 04-16 48, e-mail ralf.arndt@hannover-re.com).
Hannover Re, with gross premiums of EUR 8.3 bn., is the fifth-largest reinsurance group in the world. It transacts all lines of property/casualty, life/health and financial/finite-risk reinsurance as well as program business. It maintains business relations with more than 2,000 insurance companies in over 100 countries. Its worldwide network consists of more than 100 subsidiaries, branch and representative offices in 20 countries. The American rating agencies Standard & Poor's and A.M. Best have awarded Hannover Re their second-highest rating of AA+ ("Very Strong") and A+ ("Superior"), respectively