Europe's biggest insurer, Allianz of Germany, has reported better-than-expected earnings for the second quarter of the year. It appeared unfazed by damage claims resulting from the floods in Europe in June.
Munich-based Allianz announced Friday that its second-quarter operating profit rose by 5 percent to 2.4 billion euros ($3.17 billion). Bottom-line earnings jumped by an impressive 27 percent to total 1.6 billion euros and thus much more than analysts had expected.
"We look back at a very successful quarter and half year all in all," CEO Michael Diekmann said in a statement. "Our business has grown profitably despite record floods in central Europe, continuously low interest rates and volatile capital markets."
Allianz said its damage adjustment division accounted for earnings of 1.2 billion euros mainly because of strong growth in Latin America and Turkey. It said the floods in Europe would eventually cost the company some 300 million euros, taking into account loss-containing reinsurance deals.
Life insurance a weak spot
Allianz reported its asset management had once again proven to be a reliable pillar of the firm's overall business operations. Its subsidiaries Pimco and Allianz Global Investors had a huge share in securing a 40-percent increase in operating profit in the second quarter.
By contrast, the life insurance division remains the company's Achilles' heel. Because of record-low interest rates, profit in the segment dropped by 18 percent to 669 million euros.
Allianz looked for new products to make its life insurance division more profitable again, but they were only introduced in July of this year.
hg/tj (Reuters, dpa,)