Nürnberger posts losses and slashes dividend
Increasing costs in property and casualty insurance have hit the Nürnberger insurance group hard. At its annual results presentation, the company reported a loss of 77 million euros for 2024 – the largest deficit in its corporate history. Write-downs on deferred tax assets in the property and casualty segment contributed to the poor result.
The net loss was in line with the profit warning issued at the end of November last year. At that time, Nürnberger Beteiligungs-AG, the listed holding company of the primary insurer, warned of a loss in the range of 65 to 85 million euros. A year earlier, the group’s profit had already dropped by nearly two-fifths to 43 million euros.
Big dividend cut
As a result of going deep into the red, the holding company is drastically cutting the dividend per share to 0.14 euros, down from 3.50 euros the previous year. The total dividend payout will fall from 40.3 million to 1.6 million euros. Among the major institutional shareholders of the Nürnberger Group is Munich Re, the world’s largest reinsurer.
Around two-thirds of the shareholder base consists of other insurers, while banks hold 5 %. As per the company, 29 % of the share capital is held by institutional and private investors and distribution partners.
Inflation and major claims weigh heavily
The main reason for the dismal result was a sharp increase in losses from major claims due to flooding and fires. In addition, significantly higher prices for spare parts and repairs in the motor segment impacted the balance sheet. The crisis had been looming: earlier, management had already complained about a cost explosion affecting the entire industry.
Following the slump in profits in 2023, CEO Harald Rosenberger had already expressed dissatisfaction with the result. At the time, increased claims in natural hazard insurance and rising repair costs in motor liability insurance already weighed on margins.
Due to these challenges, the holding company was forced in 2024 to support its subsidiary, Nürnberger Allgemeine Versicherung (NAV), which consolidates the Group’s property and casualty business. According to the annual report, NAV received a capital injection of 142 million euros from the parent company. The property and casualty segment posted a loss of 157 million euros.
Rosenberger is countering the difficulties with a restructuring programme targeting the troubled segment. It includes substantial premium increases in motor liability insurance. The goal is to achieve break-even in the property and casualty division by 2027.
The restructuring now underway is intended to help the Nürnberger Group return to profitability this year. CEO Harald Rosenberger is targeting a group result of 40 million euros in 2025.
