Swiss Re strengthens US liability reserves, following a comprehensive reserve review

Ad hoc announcement pursuant to Article 53 LR

• Swiss Re strengthened US liability reserves by USD 2.4 billion[1] in Property & Casualty Reinsurance (P&C Re) in Q3 2024
• Swiss Re's overall reserves across P&C businesses positioned at the higher end of the best-estimate range[2]
• Swiss Re expects Group net income for Q3 of approximately USD 0.1 billion; approximately USD 2.2 billion for the first nine months of 2024
• Swiss Re on track to meet its 2024 targets in Life & Health Reinsurance (L&H Re) and Corporate Solutions, but expects to miss P&C Re combined ratio target due to the reserve strengthening

Zurich, 7 November 2024 – Swiss Re announced today the strengthening of its P&C Re reserves in the third quarter, following a comprehensive review. Consistent with the decision to accelerate the achievement of its goal to position overall reserves at the higher end of the best-estimate range, Swiss Re added USD 2.4 billion to P&C Re's prior year US liability reserves in the third quarter of 2024, bringing the total reserve additions to USD 3.1 billion for the first nine months of the year.

The additions were partly offset by releases in other lines of business, resulting in a net prior year reserve strengthening in P&C Re of USD 2.0 billion in the third quarter of 2024. Following these actions, the Group estimates overall reserves across property and casualty businesses to be positioned at the higher end of the best-estimate range. The recent introduction of an uncertainty allowance on new business will continue to support the strength of overall reserves going forward.

Swiss Re's Group Chief Executive Officer Andreas Berger said: "Enhancing the overall resilience of the Group has been a key priority for the management team. We conducted a comprehensive review of our P&C reserves, considering the latest industry data and legal trends. With the decisive actions in the third quarter, we have reached our goal of positioning reserves at the higher end of the best-estimate range. Importantly, we have addressed reserve developments in our entire US liability portfolio, including all prior underwriting years."

Swiss Re expects to report a Group net income of approximately USD 0.1 billion for the third quarter and approximately USD 2.2 billion for the first nine months of 2024. Outside the US liability reserving actions, the third quarter featured strong underlying underwriting and investment results across all of the Group's Business Units.

L&H Re and Corporate Solutions remain on track to achieve their respective 2024 targets of approximately USD 1.5 billion net income and a reported combined ratio of less than 93%. P&C Re is now expected to miss its combined ratio target of less than 87% in 2024, given the reserving actions taken in the third quarter. Assuming normal loss activity, Swiss Re expects to achieve a Group net income of more than USD 3 billion for 2024.

The Group's results for the first nine months of 2024 will be published on 14 November 2024.

[1] Represents a nominal (undiscounted) amount.

[2] Swiss Re defines its best estimate range as the distribution of reasonable estimates within which the currently booked reserves are expected to fall. Following the reserving actions of the third quarter, the Group estimates overall P&C reserves to be positioned at the 90th percentile of the best-estimate range.