Last month’s devastating floods in Germany and Belgium will cost Axa, the French insurer, about €400 million, according to a preliminary estimate.
The figure came as the group, the second biggest insurer in Europe after Allianz, reported that it made nearly €4 billion of net profit in the first half, more than double the €1.43 billion a year earlier. The rise of 180 per cent came as the insurer rebounded from an increase in pandemic-related calaims that led to a €1.5 billion charge last year.
Axa said its company-focused XL unit, hit last year by business interruption and event cancellation claims, recorded €619 million in underlying income against an €843 million loss a year ago.
Thomas Buberl, chief executive, said a turnaround at the division was showing its first results. “Taking advantage of the continued favourable pricing momentum, Axa XL is well positioned to deliver its €1.2 billion earnings target in 2021,” Buberl added.
Axa’s underlying profit rose by 93 per cent in the first half to €3.64 billion. Excluding last year’s Covid-19 related claims, underlying earnings rose by 12 per cent, the group said.
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Shares in Axa rose by 4.7 per cent to €22.81.
“Axa’s results are a clear beat to consensus expectations with XL’s underlying earnings up being a particularly pleasing source of strength,” analysts at Jefferies, the broker, said in a note.
The company reached a €300 million settlement with 15,000 restaurant owners in France over their pandemic-related insurance claims. Alban de Mailly Nesle, chief financial officer, said nearly half of the restaurant owners had expressed interest in the settlement.
They have until September 30 to accept the offer. The group has also faced legal challenges in Germany, Switzerland and the UK.
Separately, Axa said that its board of directors had proposed renewing Buberl’s mandate as chief executive and a director for another four years and the proposal will be put to shareholders next April at the annual meeting.
