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Allianz Q1 profit hit by Japan disaster

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Allianz Q1 profit hit by Japan disaster
14:54 CEST+02:00
Germany's Allianz became on Wednesday the latest insurance giant to see its profits hit by claims related to a string of natural disasters, most notably Japan's monster earthquake and tsunami.

Europe's biggest insurer said that first-quarter net profit slumped 44 percent to slightly more than €900 million ($1.3 billion) because of €750 million in expenses related to natural catastrophes.

Of this, some €320 million related to insurance claims from Japan's strongest-ever recorded quake and resulting tsunami on March 11 that left nearly 26,000 people missing or dead.

Japan's government has estimated that direct damage from the 9.0-magnitude earthquake and tsunami, which also triggered the world's worst nuclear accident since Chernobyl 25 years ago, could reach $300 billion.

Other natural disasters in the first three months of 2011 included devastating floods and a typhoon in Australia in January and February and an earthquake in New Zealand in late February.

Germany's Munich Re, the world's top re-insurance company, warned last month that it would post a loss in the first quarter, saying the natural disasters would cost it €2.7 billion.

Hannover Re, which is also German, cut its 2011 profit outlook. Switzerland's Swiss Re estimated in March that Japan's earthquake and tsunami have cost it some $1.2 billion, but warned this could be revised upwards.

In the United States, AIG said in March that claims in Japan would cost its property insurance unit Chartis some $700 million, while losses from other natural catastrophes would hit it to the tune of around $200 million.

Allianz said that first-quarter operating profits were around €1.7 billion, close to the year-earlier level, while also sticking to its full-year earnings forecast.

"Although we spent almost €200 million more on natural catastrophes ... we were able to keep our operating profit close to the previous year's level," chief executive Michael Diekmann said. "This is testimony to the broad-based nature of our business portfolio. We are on track to achieve our operating profit target for 2011."

Full results will be published on May 12.

AFP/mdm

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