Letter to shareholders

Dear Shareholders,

Throughout 2024, we sharpened our focus on improving profitability and increasing the resilience of our businesses as we built a solid foundation for future growth. The Group reported improved full-year net income of USD 3.2 billion and a return on equity (ROE) of 15%, a level that exceeds our multi-year target.

This robust result, achieved during a year in which Swiss Re took decisive action to boost overall Property & Casualty reserves to the higher end of our best-estimate range, shows we are on the right track. The Group's earnings power as well as its strong capitalisation supports the Board of Directors' decision to propose a dividend of USD 7.35 per share, which represents an 8% increase.

In 2024, Swiss Re fulfilled its core mission: supporting clients with risk knowledge and protection against peak perils – the traditional domain of reinsurers. Disciplined underwriting helped us manage a fifth consecutive year in which insured natural catastrophe losses exceeded USD 100 billion, a level now built into expectations as economic expansion, inflation and intensifying climate-related hazards contribute to losses.

Swiss Re again demonstrated its value as a shock absorber, paying claims totalling more than USD 37 billion across the Group in 2024. This included supporting our clients with life insurance claims, helping protect complex global supply chains from a multitude of threats, and mitigating the impact of natural catastrophes on individuals, institutions and economies.

A turbulent start to 2025 highlights the importance of continued vigilance. The tragic Los Angeles wildfires and powerful winter storms that hit Europe in January once again illustrate that bolstering society's defences against natural catastrophes has never been more important.

In addition, geopolitical fragmentation, macroeconomic uncertainty and changing trade conditions are driving volatility on numerous fronts, underpinning demand for insurance and reinsurance protection.

Against this backdrop, Swiss Re is working from a position of strength characterised by an outstanding client franchise and strong capitalisation. Our core businesses aim to deliver on their full potential by focusing on technical excellence, sharpening data and technology capabilities, and strengthening our client-centric performance culture. With our increased focus on cost discipline and efficiency, we are targeting a reduction in run-rate operating expenses of approximately USD 300 million by 2027. 

As we focused on our core businesses, we also announced our decision to withdraw from the white label digital insurance platform iptiQ in May 2024. This process is proceeding as planned.

Group and business performance

Swiss Re reported Group net income of USD 3.2 billion, up from USD 3.1 billion in 2023, helped by resilient underwriting and investment contributions from all Business Units. Insurance revenue increased to USD 45.6 billion, from USD 43.9 billion in the previous year. 

Swiss Re's investment portfolio also experienced continued improvement, with our full-year return on investments (ROI) increasing materially to 4.0%, up from 3.2% in 2023. The improved 2024 performance of Swiss Re's investment portfolio was driven by a continued contribution from recurring income where the yield rose to 4.0%, from 3.5% in 2023. In the fourth quarter, the reinvestment yield was 4.6%.

As part of our asset management activities, we also made progress on key sustainability targets, including achieving a 50% reduction of the weighted average carbon intensity of Swiss Re's corporate bond and listed equity portfolio as of 2024, relative to the 2018 baseline¹.

Swiss Re's capital position continues to be strong, with a Group Swiss Solvency Test (SST) ratio as of 1 January 2025 of 257%², above the target range of 200–250%. 

The robust underwriting performance of Property & Casualty Reinsurance (P&C Re) was impacted by net prior-year reserve additions of USD 2.6 billion for the full year 2024. Nevertheless, the Business Unit reported net income of USD 1.2 billion, compared with USD 1.5 billion in 2023.

P&C Re achieved an insurance service result of USD 1.8 billion versus USD 2.8 billion in 2023, and a combined ratio of 89.9%³, which fell short of the target of less than 87% for 2024 following decisive third-quarter reserve strengthening. 

Corporate Solutions, the commercial insurance arm of Swiss Re, delivered another outstanding performance in 2024, with net income rising 26% to USD 829 million, up from USD 658 million in the prior-year period. Corporate Solutions achieved a full-year combined ratio of 89.7%⁴, outperforming the target of below 93% on the strength of disciplined underwriting and stringent portfolio steering.

Life & Health Reinsurance (L&H Re) achieved its net income target of USD 1.5 billion, improving from USD 1.4 billion in 2023. This reflects healthy in-force margins and strong investment income, partially offset by adverse experience and assumption updates. With this assumption review, we have increased the resilience of L&H Re's results going forward. These updates are fully reflected in the 2025 net income target. 

Sustainability remains a lever of how we do business. We are focused on supporting our clients in the transition to a net-zero economy and building societal resilience. In accordance with Swiss regulations, our Climate Transition Plan is being published in Swiss Re's Sustainability Report 2024.

Outlook and new profitability targets 

Our businesses have begun the year in a strong position, and we remain focused on delivering on our 2025 financial targets announced in December 2024.

The Group aims for a net income of more than USD 4.4 billion, while L&H Re targets a net income of USD 1.6 billion. P&C Re targets a combined ratio of less than 85% and Corporate Solutions targets a combined ratio of less than 91%. The Group maintains its multi-year ROE target of more than 14% and aims for dividend per share growth of 7% or more per year in the 2025–2027 period. 

Built into these projections, we expect P&C reinsurance pricing to remain attractive, with growing demand for protection in an elevated risk environment. On 1 January 2025, P&C Re renewed treaty contracts resulting in USD 13.3 billion in premium volume, reflecting a 7% volume increase compared to the business up for renewal. The resulting portfolio quality is consistent with the Group's 2025 financial targets.

For 2025, Swiss Re is continuing its focus on improving profitability through underwriting excellence and cost discipline. We are resolute in our commitment to strengthening key processes, boosting our efficiency and serving our clients' needs as we work toward extending Swiss Re's role as a reinsurance industry leader.

With a successful 2024 behind us and strong potential for improvement in the current year, we would like to thank Swiss Re's 15 000 global employees for their passion, energy and dedication to our company. 

To our shareholders, we again thank you for your steadfast support and trust as we renew our commitment to fulfilling your expectations of Swiss Re.

¹ Covering Scope 1 and 2 emissions.

² Estimated Group SST ratio as of 1 January 2025, subject to regular review by FINMA.

³ P&C Re combined ratio is defined as [–Insurance service expense (net) / Insurance revenue (net)].

⁴ Corporate Solutions combined ratio is defined as [–(Insurance service expense (gross) + Reinsurance result + Non-directly attributable expenses) / Insurance revenue (gross)].