Second quarter 2024 result s impacted by higher claims in Norway
This release contains inside information related to Gjensidige Forsikring ASA pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act.
Higher claims for motor and property insurance in Norway had a negative impact on the insurance service result. Adverse development in claims in the first quarter 2024 also contributed to the deterioration of the underlying frequency loss ratio in the second quarter. Ongoing pricing measures have been further strengthened to improve profitability. The insurance service result was positively impacted by changes in the risk adjustment. Delivery on the combined ratio target for 2024 will be challenged by the results for the first half of 2024.
| Highlights | Second quarter | Year-to-date | |||
| 2024 | 2023 | 2024 | 2023 | ||
| Group | |||||
| Profit or loss before tax | NOK million | 1,830.5 | 1,333.9 | 2,906.7 | 2,825.3 |
| Earnings per share | NOK | 2.72 | 2.04 | 4.31 | 4.30 |
| General Insurance | |||||
| Insurance revenue | NOK million | 9,831.7 | 8,959.5 | 19,305.6 | 17,491.3 |
| Insurance service result | NOK million | 1,433.6 | 1,508.6 | 2,137.7 | 2,623.4 |
| Combined ratio | Per cent | 85.4 | 83.2 | 88.9 | 85.0 |
| Cost ratio | Per cent | 13.2 | 13.6 | 13.3 | 13.5 |
| Financial result | NOK million | 514.2 | -199.3 | 961.8 | 594.8 |
| Solvency ratio, approved Partial Internal Model | Per cent | 169.8 | 179.8 | 169.8 | 179.8 |
Development during the quarter
-The second quarter results were significantly impacted by higher claims in Norway, but we continue to have a very strong growth momentum, and our capital position is solid, says CEO Geir Holmgren.
-We are fully committed to improve profitability. The increase in claims is being met with significant and targeted pricing measures. We will improve the combined ratio for the Group and the underlying frequency loss ratio for Private and Commercial over time, and we maintain all the financial targets for 2025 and 2026, Holmgren says.
General insurance
Insurance revenue increased by 9.7 per cent to NOK 9,831.7 million in the quarter, or by 10.0 per cent measured in local currency. This was mainly driven by effective and differentiated pricing measures and solid renewals.
The insurance service result decreased by 5.0 per cent, reflecting 2.7 percentage points increase in the loss ratio. A change of the risk adjustment, and a higher discounting effect contributed positively to the loss ratio. The underlying frequency loss ratio rose 5.6 percentage points primarily driven by higher claims frequency and claims severity for motor and property insurance in Norway. Adverse development in claims in the first quarter 2024 for Private and Commercial in Norway also contributed with approximately 2 percentage points to the deterioration of the underlying frequency loss ratio in this quarter.
Ongoing pricing measures have been further strengthened to improve profitability.
The cost ratio improved by 0.4 percentage points mainly due to efficiency measures and growth in insurance revenue.
Pension
The pension segment recorded a profit before tax expense of NOK 185.9 million, mainly driven by a higher net finance income.
Financial result
The financial result for the quarter was NOK 514.2 million, which corresponds to a return on total assets of 0.8 per cent. The result for the quarter was positively impacted by high running yields and positive equity markets. Higher interest rates had a negative impact on the result.
This release contains alternative performance measures (APMs). APMs are described at www.gjensidige.com/reporting
This release is issued by Christian Haraldsen, media relations officer at Gjensidige Forsikring ASA.
Date and time of publication: 07:00 CET, 15 July 2024
Contact persons
Head of Communication, Øystein Thoresen. Tel: +47 952 33 382
Head of Investor Relations Mitra Hagen Negård. Tel: +47 957 93 631
Gjensidige is a leading Nordic insurance group listed on the Oslo Stock Exchange. We have about 4,500 employees and offer insurance products in Norway, Denmark, Sweden and the Baltic states. In Norway, we also offer pension and savings. The Group's operating income was NOK 36 billion in 2023, while total assets were NOK 148 billion.