Hurricanes blast Munich Re with Q3 loss

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German reinsurance giant Munich Re reported a huge loss for the third quarter Thursday after a series of natural disasters, confirming a warning issued last month and forecasting its full-year result would also suffer.

In line with its October prediction, the group reported a net loss of 1.4 billion euros ($1.7 billion) between July and September, compared with a 685-million-euro profit in 2016's third quarter.

Hurricanes Harvey, Irma and Maria combined inflicted a 2.7-billion-euro blow, while other natural disasters including devastating earthquakes in Mexico brought the total damages to 3.2 billion.

Munich Re made an operating, or underlying loss of 1.7 billion euros, even as its gross income from insurance premiums remained roughly stable year-on-year, at 12.3 billion.

The natural disasters meant that "despite business otherwise being good, we can only post a small profit in 2017," chief executive Joerg Schneider said in a statement.

Nevertheless, "we are able to take full advantage of opportunities arising from the likely market recovery," including higher prices in the disaster-struck regions, he added.

The group may see a boost to its bottom line later if the high levels of provisions it has set aside to cover claims turn out to be bigger than needed.

Munich Re forecast a "small profit" for the full year, "on the proviso that business performs in line with expectations in the fourth quarter".

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© 2017 AFP

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