Ladies and gentlemen, good morning. Welcome to our call on the full year 2024 earnings and '25, January renewals.

I think I don't have to introduce today's speakers, Joachim Wenning, our CEO; and Christoph Jurecka, CFO of Munich Re. Same procedure as every year, Joachim and Christoph will kick it off with their remarks.

Afterwards, there's plenty of opportunity for Q&A. So Joachim, please.

Thank you very much, Christian. Ladies and gentlemen, welcome to our conference today.

2024 was again a very successful year for Munich Re. Thanks to strong operating performance across all segments and a pleasing investment return, we have clearly exceeded our profit target with a net income of EUR 5.7 billion.

Uncertainty triggers demand for solutions, making our clients more resilient. As we have not been observing any significant inflow of new capacity or new capital into the reinsurance space so far, we remain confident that the attractive market environment will continue to prevail.

And we want our shareholders to participate in our strong financial performance, so we decided to substantially increase the dividend per share by 33%, proposing a dividend of EUR 20. In addition, we continue with share buybacks also on a larger scale of EUR 2 billion until the AGM next year.

Looking at the achievements of our current ongoing Ambition 2025 so far, we delivered, or even overdelivered, on all our targets. In terms of return on equity, we are noticeably ahead of our target range of 14% to 16%.

This is well above our cost of capital, so we create substantial value for our shareholders. And we have, of course, seized opportunities of an attractive market environment.

Our Solvency II ratio continues to be well above the optimal range. Now while this is a happy problem and protects us against adverse developments, we don't want to sit on excess capital.

Therefore, we are committed to further deploying capital into attractive markets, yes, but in addition to repatriating a substantial share of our earnings to bring excess capital down over time. The chart that you can see on Slide 6 summarizes the journey of our ROE improvement.

Taking the rather mechanical impact of the accounting change to IFRS 17 aside, there are fundamentally three levers. Underwriting.

Here, we achieved both business growth by doubling our premiums in reinsurance and margin improvements. The second driver is investment income.

There is a passive element of just benefiting from increased interest rates as everybody else as well. But in addition, we have accelerated this tailwind through active investment management, increasing the return contribution.

Shareholders' equity, third point, increases with growing earnings naturally. And to manage capital efficiently, we are returning a significant portion of the capital buildup.

So in the following slides, I will dig a little bit deeper into these three dimensions, but I start on Slide 7 with a new reporting segmentation as from this year on. As Global Specialty Insurance has grown significantly, already accounting for more than 30% of P&C reinsurance premiums, we decided to make it a separate segment.

This provides more transparency on our earnings drivers, in particular, as regards to the share of less cyclical and less volatile business segments, which has been growing significantly over past years. Already today, the net profit of ERGO and the net profit of life and health reinsurance fully finance our annual dividend payment.

So we are in a comfortable position to manage the reinsurance cycle more rigorously than ever. Global Specialty Insurance is a fast-growing segment and is expected to stay so.

We are steering the unit as one unified specialty business and are leveraging its platform to realize synergies in multiple ways. We are harmonizing processes and systems.

We strengthen distribution relationships, and we share, of course, data risk insights and best practices across the specialty insurance units. We are also focusing on managing P&L volatility of the unit as a whole.

Over time, we should see it gradually decreasing. The financial track record of Global Specialty Insurance is remarkable.

The business has been growing organically by more than 10% every year. Attractive market opportunities, for example, in select U.S.

casualty business and personal property are expected to continue to fuel growth in 2025. And underlying performance is sound, while also impacted by major losses in single years.

What can you expect from the specialty insurance units in this year? In our niche personal lines business written out of American Modern, where there is elevated weather-related loss potential, we have adjusted our pricing and risk selection criteria.

And additionally, underwriting actions taken last year already will earn through 2025. In Hartford Steam Boiler, continued solid growth and strong profitability are provided through exceptional customer service and innovative solutions.

In our North American commercial, small and mid-market business, elevated loss trends are driving good rate environment, and we expect continued growth, in particular in the U.S. surplus lines market.

Munich Re Specialty global markets - so covering everything beyond North America - here, business growth is expected to slow a bit in the London market, partially offset by growth in additional geographies outside the U.K. And this brings me to the January renewals in P&C reinsurance, which had a really good outcome in an ongoing attractive market environment.

High profitability levels were largely sustained. The slight price decline of 0.6% is, as always, fully risk-adjusted considering most recent loss trend assumptions as conservatively as we have been doing all the time.

Specifically, against the backdrop of somewhat moderating price dynamics, the high degree of diversification in our portfolio is paying off. We could hold on to improvements of terms and conditions achieved in large -- in last renewals, and this is important.

While this is not fully captured in the price development and cannot be, it continues to maintain the high quality of our portfolio. So this includes wording improvements as well as exclusions and clearer coverage definitions, but also high attachment points, of course, make the portfolio more robust.

Rigorous portfolio management, rigorous cycle management means being serious about giving up business when required. We deliberately reduced business which did not meet our risk return requirements.

Partially, this could be offset by selective growth in other areas. On an aggregate level, volumes declined by 2.4%.

I'm on Slide 12. Let's there have a look at the single lines of the P&C business in more detail.

The chart nicely shows that we quite consistently gave up business with negative rate changes and expanded business with positive price momentum. The market environment in nat-cat continues to be healthy with attractive margins.

In some European markets, we increased the exposure. In other markets, we reduced business if rates were not adequate.

In property proportional business, we actively managed the portfolio. Overall, we slightly reduced business.

We gave up some businesses and added some other new businesses. More importantly, overall, we could improve the portfolio mix, leading to better margins.

Our cautious assumptions as regards loss cost trends become obvious when looking at the development per casualty subline of business. In particular, in casualty proportional, ex motor, our prudent inflation expectations more than offset nominal rate increases.

Hence, we substantially reduced exposure to these casualty lines, especially in the U.S. And this also includes cyber business where we remained steadfast on our view on accumulation risk or on excluding systemic risk to be more concrete.

In motor proportional, on the other hand, volume increase driven by growing original rates and by seizing selective business opportunities. In life reinsurance, earnings continued to develop much better than anticipated.

The technical result has grown strongly. In 2024, all earnings drivers worked in our favor and the underlying performance of the business has improved noticeably.

The exceptionally strong new business growth has benefited the contractual service margin, which has increased to EUR 14.5 billion. And you know thereof around 7% will be annually released into earnings.

ERGO showed a continued successful development, further increasing its net result and meeting its guidance. This was driven by both the German and the international business.

In Germany, ERGO achieved a top line growth of 2%. In P&C, they focus on lines of business with attractive margins, hence has a significantly -- ERGO has a significantly lower share of motor business than the market.

This, together with sizable price adjustments and better claims cost control through network expansion of car repair shops, helped to keep the combined ratio at a very good level. In International, ERGO achieved very pleasing results.

In Europe and Asia, top line growth was above market, particularly so in India and Thailand as a consequence of organic business expansion, price adjustments and M&As. Overall, we are very confident that ERGO continues to be a reliable deliverer of good results for the group.

I come to the investment results. And on this slide, we are experiencing tailwind from higher interest rates, as said in Capital Markets, which enables us to increase sustainable investment income.

We reinvested new money in 2024 at around 4.4%. And currently, we are reinvesting at 4.2%.

However, we are also actively managing our portfolio to earn a spread in excess of high interest rates only. For example, by reallocating funds to higher-yielding asset classes as well as by exploiting opportunities in the currency and equity markets, and a more longer-term strategy is to earn us an illiquidity premium by continuous expansion of so-called alternative investments.

With regard to capital repatriation, Slide 17, I can say that over the last 10 years, Munich Re repatriated EUR 24 billion or around 85% of its net earnings. Dividend growth is particularly close to our hearts.

As you know, we have a track record of more than 50 years not cutting the dividend even in dire times. And after raising the dividend by around 30% for 2023, we take another big step in the same order for 2024 and we'll propose a dividend of EUR 20 to the AGM.

To manage excess capital, we continue to make use of share buybacks. Following on from last year, we are once more increasing the amount by EUR 500 million to then EUR 2 billion.

As regards to our nonfinancial targets, you can see on Slide 18, we are making steady progress in all three core dimensions: assets, liabilities and own operations. And on the social dimension, we set ourselves a target of achieving 40% share of women in leadership positions across all geographies and the Group with 39.5% end of 2024, we are almost there.

Over the last 4 years, starting Ambition 2025, Munich Re significantly outperformed almost all its European primary insurance and reinsurance peers with a total shareholder return of 135%. We have the capital strength, and we have the financial flexibility to grow our business, increase the dividend and execute share buybacks at the same time.

And this brings me to the end of my presentation. We are heading for a net result of EUR 6 billion in 2025, which is 20% higher than what we had initially targeted for 2024.

Christoph will now lead you through the financials in more detail.

Thank you, Joachim. And yes, good morning also from my side.

And let's start immediately on the next page with the mentioned overview of the result. 2024 was indeed another successful year for Munich Re.

And the very pleasing financial development across all lines of business led to the net result of EUR 5.7 billion, again, clearly above our target of EUR 5 billion. I'm particularly pleased not only by the amount of the result, but also by its quality as we once again strengthened our future earnings power by setting up additional reserve prudency in P&C reinsurance and by reinvesting at higher yields, deliberately accepting disposed losses in the fixed income portfolio.

Our Solvency II ratio is 287%, very comfortable and even exceeds last year's high level despite substantial business growth and the proposed increase in capital repatriation. The main driver was [ likened ] IFRS, the sound operating performance, which is reflected in high economic earnings of around EUR 9.3 billion.

In Q4, the economic earnings also benefited from capital market effects like FX. The German GAAP or HGB result mirrors the strong development according to IFRS and also increased to EUR 4.8 billion.

Our high stock of distributable earnings continues to comfortably support a high capital return for 2024 and beyond, and our capital management strategy continues to be very well funded. Now before turning to the full year figures, let's have a look at the financial development in Q4 and isolated Q4 on the next slide.

And due to various anticipated seasonality effects, we expected Q4 to fall somewhat short of the high earnings levels of the first three quarters. However, the actual Q4 net earnings of almost EUR 1 billion continued to benefit from strong underwriting performance across all lines of business, but also by currency gains of EUR 450 million.

Building on our strong operating performance, we realized losses on our fixed income assets, and we strengthened the prudency of our reserves. Starting with reinsurance, life and health again showed a positive development in Q4, and the upwardly revised full year guidance for the total technical result could even be exceeded.

Ongoing favorable biometric experience was negatively impacted by single large claims, which, in this case, means claims above EUR 10 million. The result from insurance-related financial instruments came in higher than expected.

The FinMoRe business continued to develop favorably, and we also benefited from currency effects of EUR 180 million. In P&C reinsurance, the underlying profitability of our business remained strong, while the headline result was as expected, somewhat below the level of the first 3 quarters.

In light of the strong profitability, we built additional prudency for reserve uncertainty for new business of around EUR 0.5 billion, which explains the higher normalized combined ratio of 86.6%. The headline combined ratio benefited from benign major losses in Q4 and this just 9.7 percentage points.

Just very briefly on ERGO, as expected, Q4 was below the quarterly run rate for the full year earnings. In Life and Health Germany, the CSM release was disproportionately low due to the decreased level of CSM driven by the lower interest rates compared to end of Q3 and amplified by the year-to-date effect.

In addition, we saw some negative one-off effects such as write-downs and tax-related effects. P&C Germany experienced seasonally high acquisition costs due to the main renewal of motor business, leading to an elevated combined ratio of 98.5%.

Finally, ERGO International achieved a very good net result with a combined ratio of 90.3%, thanks to the continued favorable technical performance. Back to the Group.

The investment result came in solid, but with an ROI of 2.5% somewhat lower than in previous quarters. We once more incurred disposal losses aiming at accelerating the increase of future regular income.

This time, approximately EUR 670 million. They're of 2/3 in reinsurance.

We benefited from significant fair value changes, primarily driven by private equity and other alternative investments. The full year investment return of 3.1%, as shown on Slide 23, exceeded our guidance of at least 2.8%.

A benign capital market development led to positive fair value changes of around 50 basis points, which were largely offset by, as just mentioned, disposal losses. By the end of the year 2024, the reinvestment yield remained at a high level of 4.2%.

This should help to further increase the running yield, which stood at 3.5% at the end of 2024. Now turning to the full year financial development of the two business fields, starting with ERGO on Slide 24.

All three ERGO segments contributed to the strong bottom line performance with a return on equity of 16.5%. The technical performance of Life and Health Germany remained sound with the CSM release as expected but was affected by higher claims in the short-term PAA business.

In P&C Germany, the combined ratio of around 89% fully met the guidance. The strong technical result confirms ERGO's outstanding portfolio quality.

The achievements of ERGO International are particularly pleasing. Profitable growth and a strong technical performance are reflected in a 92% combined ratio, also in line with expectations, considering high nat-cat losses.

Let's move to reinsurance on Slide 25(sic) [ 27 ]. The reinsurance field of business continued to record significant business growth at a high profitability level with an 18.5% return on equity.

Life and health reinsurance substantially exceeded its guidance with a total technical result of EUR 2.1 billion. Overall, a very strong performance with a CSM and risk adjustment release in line with expectations, with very healthy new business and with positive experience variances.

Also, the FinMoRe business once more developed very favorably, including positive currency effects. I would like to emphasize that the particularly strong result should not be taken as a run rate for 2025.

In that regard, I would like to repeat that the annual CSM release will reduce to around 7% going forward. In P&C reinsurance, we took advantage of attractive market conditions and expanded our business, particularly in GSI.

Despite the year with industry nat-cat losses of $140 billion, major losses were in line with our budget. This confirms our strong portfolio quality and good diversification, which is reflected in the headline and normalized combined ratio, both fully meeting expectations despite prudently reflecting reserve uncertainty.

On Slide 26(sic) [ 28 ], just a quick view on GSI, Global Specialty Insurance. As mentioned earlier, GSI exhibited pleasing strong growth in 2024 based on business expansion and rate increases in an attractive market environment.

American Modern showed the strongest growth while additional growth was achieved in the U.S. surplus line market.

In terms of profitability, HSB delivered another strong year. However, the overall combined ratio of GSI came in higher than last year due to major losses and reserve prudency.

American Modern was adversely impacted by weather-related losses, while Global Markets business experienced an unusual level of large man-made losses. The Specialty North America business was strained by some strengthening of U.S.

casualty reserves, along with generally prudent reserve practices on its growing book of business. All in all, the underlying profitability is sound and supports the full year combined ratio guidance of around 90%.

Let's take a closer look on our reserving on Slide 27(sic) [ 29 ]. Our reserving position remains at a very comfortable level, including the mentioned additional prudency.

This is despite the cautious reaction on U.S. liability where social inflation trends have not abated.

Overall, the outcome of the reserve review was again very positive. The result of the actual versus expected analysis now has, for 13 consecutive years, consistently shown a very favorable indication, or very favorable indications, and allowed for releasing the aspired 5 percentage points of reserves.

All lines of business have developed favorably, the main driver being property, where underlying rate improvements clearly have a positive impact. Having released 5 percentage points of reserves despite a substantially growing portfolio and managing potential upcoming loss trends is a clear statement on the strength of our reserves.

Before I come to the economic disclosure, I would just like to close the IFRS chapter with a chart which summarizes the main assumptions behind the KPIs of our outlook 2025, as well as some accounting changes we will implement as of Q1, 2025. As you know, we will change segmentation and present GSI as a separate segment.

There are two more technical changes I would like to briefly mention. In the total technical result for life and health reinsurance, we will show the FX result from insurance-related financial instruments in the currency result.

And for the German ERGO P&C business, acquisition costs will be spread evenly over the calendar year. Now economic disclosure on Slide 29(sic) [ 31 ].

Capital generation was very strong, and our Solvency II ratio remained at a very convenient level of 287%, benefiting from a sound operating earnings, positive capital market effects like FX and an only moderately increased required capital. Please note that the ratio already reflects the dividend payment, while the share buyback will only be deducted in Q1.

Our resilience remains very high. Even after significant shock events, we would still be above our optimal range.

The strong Solvency II number gives us significant strategic optionality to further develop our Group. Having said that, we will continue the journey to repatriate substantial parts of our earnings to bring the Solvency II ratio closer to the optimal range over time.

As you can see on Slide 30(sic) [ 32 ], we maintained a balanced profile between insurance and investment risk in 2024. And overall, we continue to have a stable diversification benefit between all risk categories of around 30%.

Looking into more details on the SCR development on Slide 31(sic) [ 33 ]. The moderate increase of 5% is mainly driven by currency effects and the somewhat higher investment exposure.

Now concluding with our third capital metric, HGB local GAAP, Slide 32(sic) [ 34 ]. And here, I can make it very brief given the further improved result of EUR 4.8 billion.

This result mirrors the strong business performance I touched upon throughout my presentation. Distributable earnings of more than EUR 9 billion provide comfortable caution for continued attractive capital return.

With these final remarks, Joachim and I look forward to answering your questions. But first, I'll give it back to Christian.

Thank you. So time for Q&A.

My usual remark, please I would like to ask you to limit the number of your questions to a maximum of two. And should you have more questions, then please rejoin the queue.

Let's go ahead.

The first one is just on the EUR 20 DPS. Just curious on sort of your thinking and how you arrived at this number.

I know you mentioned last year sort of you were thinking around the 4% dividend yield level. Just wondering if that sort of was that 4% was in your thinking this year and how you arrived at that DPS number?

And then secondly, just on the EUR 6 billion net income target for 2025. Clearly, given the wildfires, Q1 losses are going to come in above budget, but you've maintained a target.

So just curious what gives you confidence here? Is it simply that you expect large losses to normalize across the year?

Or is there conservatism in the original plan? Or has there been a sort of fundamental change in your view in any parts of your business since you set the plan?

Andrew, good morning, Christoph here. And I'll start with the second question.

No, no fundamental change in the way we look at our plan. As you know, we always have a significant budget for large losses reserved in our planning anyway.

And the wildfire losses are not at all sizable enough that we would already, that early in the year, think that our budget would not be sufficient. So therefore, it remains to be seen.

The year is still young, but this is just one event into a long year. So nothing has to be changed at all.

The dividend, well, I mean, the considerations are the same like more or less every year. First of all, we think about what is a sustainable level of dividend where we are 100% certain that we will never ever have to reduce it anymore, given the history of more than 50 years where we never reduced the dividend.

And this has to be very much the starting point. On top of the obvious comment that we want to have our shareholders participating in our success and in our increased earnings.

So therefore, the overall amount became very obvious. I mean the payout ratio of 82%, I think it is, is a very high number.

But then the split, how much do we allocate on dividend and how much on a buyback is really the question about sustainability of the result. And if you look at the dividend of EUR 20 per share, that's roughly the amount where we think that our more stable business models will be easily in a position to finance the dividend also going forward.

So this is a dividend volume which is independent of P&C reinsurance and the result of P&C reinsurance. And even more, it feels very sustainable and the right amount to announce today.

A couple of questions from me. Just interested in, I guess, on the capital return.

Look at your HCB numbers and obviously, we looked at this a lot over the years. You've got a huge amount of headroom.

You've given back kind of about 50% of it, adjusting for the earnings this year. What stops you getting more aggressive?

Because I understand what you're saying about the cycle, you understand you're saying it's attractive, prices are down, you reduce your volume, which to me is maybe a slight negative. So what stops you doing kind of more on that side?

And I guess, going forward, do you think at some stage, you will say, okay, the cycle is not as good as it should be, margins are going down, et cetera, we will get a little bit more aggressive. Obviously, the EUR 20 dividend's though, kind of welcomed.

The second question is just on P&C Re performance in 2024. Obviously, we can see how GSI did and it was a little bit worse than target.

How did P&C Re do in 2024 versus the 79% that you're aiming for? I assume it must have been a little bit stronger than the 79%.

so that you can still hit the numbers.

I start with the capital repatriation. And your question was "what stopped us?"

Well, basically, I think two elements. The first one is, obviously, what we would do in the area of capital repatriation is always meant to be sustainable.

So you should never expect from us peak repatriations in 1 year and then a reduction in the year thereafter. So the question of sustainability also going forward was a key driver in our discussions.

But then the second element also was that we wanted to keep also the optionality, the strategic optionality to grow in whatever way we would like to grow or to develop the Group also in whatever way we would like to develop the Group further. And this could be M&A as well -- and as mentioned.

And then, of course, I mean, the year has just started. You can never rule out, bad years can happen over time.

So having some buffers obviously feels to have -- be the right thing anyway. So a combination of those thoughts, we increased the payout, as you know, by 33%.

I think that's a very significant step up and should just reconfirm our dedication to really have our shareholders participating to a large extent and early on, but in a sustainable way in our earnings. P&C reinsurance, the performance, we are not giving any detailed numbers on the split between GSI and reinsurance today.

So I can only qualitatively, but confirm that reinsurance had a good year.

My question to begin with is really around the excess capital position. So you've addressed the flow of the capital to a large extent, but I hear what you just said about wanting to keep strategic optionality.

But when I think about the upcoming CMD and your ability to, I suppose, compound earnings growth over the medium term, do you see yourselves able to kind of grow at the mid-single-digit kind of EPS level without dipping into that stock of excess? I guess what I'm trying to get at is to what extent will the upcoming plan allow for deployment of that excess?

Do you actually need to deploy it in order to be able to grow at kind of single-digit kind of levels even through a soft cycle? That's my first question.

Secondly, I'd just like some comments around the potential impact from, well, both tariffs and reinsurance trade surplus. So by tariffs, I kind of mean to what extent you've reflected that uncertainty in your pricing, particularly at 1/1.

And by reinsurance trade surplus, I mean the extent to which President Trump could potentially look at the extent of reinsurance buying from outside of the U.S.

Okay. So I think on the first question, I can be really very brief because indeed, there is a Capital Markets Day coming up at the end of the year, where we will obviously speak about capital management strategy going forward also on a -- in a more long-term perspective.

And so nothing I think I could mention already today, but absolutely, it will be on the agenda and it needs to be on the agenda, and we will have a conversation then in December. On the second question, could you maybe just briefly repeat because we had some issues here with the sound?

Yes, sure. So yes, just on tariffs and the potential -- and to what extent you've reflected uncertainty around tariffs in your pricing through the January renewals?

And then also kind of just on the reinsurance trade surplus point and the potential for President Trump to potentially take a different view.

I think the general answer, and I don't want to be too specific here is we feel very well diversified, both globally, but also our U.S. business, which we are running in various ways.

And so therefore, politically, we don't see any big threats at this point.

First one is, I guess, linked to the EUR 500 million or so new business conservatism, understanding if there's a split of that between loss component versus underlying. And in what lines have you booked these in specifically?

And can you explain why you took this step despite seemingly very high reserve cushions already other than perhaps a little bit of management here? And when you consider that, you've delivered a full year 82% underlying delivery.

Is it really closer to 80%, if we assume this isn't a new methodology change? And the second question is linked with the capital distribution as well.

And sorry to challenge you on this when you just distributed a hell of a lot more year-on-year. But that solvency target of 287%, significantly above.

I'm trying to understand really under what time frame that you're thinking about this? You've been over it for a long time now.

Under a distribution basis, and I recognize there can be inorganic, what macro assumptions or is it post-event scenarios that you consider that they would take you to closer to the target range?

Yes. Will, thank you.

So the reserve strengthening is reserve strengthening. So no loss component affected or no other items in the P&L or balance sheet.

So we really strengthened the reserves. And we did it, so kind of an overarching IBNR reserve strengthening, let's put it that way.

I don't want to be specific in a way that it could affect certain lines of business more than others. I don't think that level of detail would help us here in the call because in a way, it's not really relevant, given the fact that if you have excess reserves, of course, you can also move them around a bit in case the risk situation would change.

So therefore, let's just accept for a moment that we increased the prudency of our reserves. Why did we do it?

Well, our strategy is to keep the balance sheet as safe as possible in times when we can afford it, just to be prepared that in times when we need it, we can really make use of it. And what does making use of it mean?

Well, it's meant to dampen volatility. We'll never use it to subsidize unprofitable business because that's really not what we should be doing, but -- because for that, we have pricing and we have underwriting and we conduct our business in a profitable way, but we could be affected by volatility, and it did happen a lot in the past already.

And nowadays, our business footprint is much more stable given the increased weight of less volatile lines. But still, there could be volatility.

We cannot rule it out. And it just feels good to be prepared for volatility by having a reserving policy, which brings us to the upper end of what the reasonable best estimate could be.

And this is what we do. By the way, our book is also growing.

So in relative terms, the prudency obviously needs to already be increased in order to maintain the relative prudency given that our book is significantly bigger this year now compared to a couple of years ago. So this also has to be kept in mind, not always, only the absolute amount of prudency is relevant, but sometimes we're also looking at it in relative terms.

In any case, we strengthened it significantly, and it feels very comfortable and we feel very, very good about it. Solvency, 287%.

As mentioned before, it's clearly -- what we have in mind is also strategic optionality when we look at that number. What we do have in mind is that certain shock events could reduce the number.

And on one of the slides, you could see that an Atlantic hurricane event, a 200-year event would bring it down quite a bit. You know that we will have to deduct from that number the share buyback in Q1 anyway.

So there -- and we'll grow. So there is -- I mean, there's reasons to believe it will come down.

But the most important element, how it will come down is obviously our repatriation strategy, which is meant to sustainably reduce it in a sustainable way without peaking in 1 year and reducing the payout in another year, but will sustainably increase it year-on-year. And then we'll get there.

And it will take some time, obviously, given where we are. But on the other hand, I think this company and all its shareholders benefit from the really big and safe balance sheet we're having, given our business model and again, given the potential volatility, which we shouldn't forget.

Just two really quick follow-ups on that. Just thinking about that.

The first one was just, is it right to really think that this 82% was effectively closer to 80% then or not, given that the size of the reserves did grow? And the second one is just -- there's a bit of echo, there we go.

Just thinking about -- you mentioned that Solvency II post the scenario. I guess the target range, is that post a scenario?

Or is that pre a scenario? Just trying to understand how we think about those two relatives.

So the second is very brief. No, the scenario doesn't lead us close to the EUR 220 million yet.

And this is what I meant. It's a combination of strategic optionality, a potential scenario which might happen.

And obviously, most importantly, the payout, but we are not there yet that this 200-year event on the hurricane would bring us close to the optimal range, it doesn't. The 80% versus 82% debate, I mean, mathematically for Q4, if you deduct around EUR 500 million from the actual combined ratio, you'll end up at a number closer to 80% than to 82%.

But a big, big warning here, our view clearly is that the starting point for the year 2025 is 82%. And there is always quarters which are a bit higher or a bit lower.

And again, mathematically, you could deduct now a bit lower number for Q4. Don't take it too seriously.

82% is the starting point, and this is the underlying profitability of our book as we currently see it.

The first one is just on the GSI growth outlook. You're guiding to some pretty strong growth in GSI for next year.

I was just wondering if you could give a bit more detail on sort of the split between the different segments within GSI and particularly the split between rate and volume. I assume most of that is coming from volume.

So just why you feel confident about the volume growth you're anticipating there? And the second one is just on the renewals, obviously shrinking the business outside of everything, outside of the proportional motor.

I'm just wondering if you could talk about -- is this reflective of a lack of growth opportunity in some of those other lines, where you would definitely say that rates are still above an adequate level. So if you could just talk about the growth opportunity.

And does this also mean that we should not expect any growth in P&C Reinsurance revenues this year when we think about the guidance of 5% growth combined with the GSI growth and Life and Health Re growth in insurance revenues we should expect?

Thanks, Ian. This is Joachim.

Thanks for asking questions that can be allocated to me, by the way. So one thing with regard to GSI growth outlook, I think if we think a couple of years ahead, we are not yet there defining Ambition 2025 plus.

But I think -- taking into account that GSI has grown in the past 4 years by more than 10% every year. The question is, will they grow by another more than 10% going forward?

Will it be slightly slower? On the cautious side, I would say we firmly believe it will be somewhere between 5% to 10%.

So this is not an accurate estimate. It's just the statement that maybe slightly slower than the organic growth that we have seen in the past 4 years.

Which of the business legs will be outstanding with the single highest growth expectation? For the time being, I would still expect this to be the Munich Re Specialty business in North America.

With regard to the renewal outcome in traditional P&C reinsurance, is there a lack of growth opportunities? Ian, no, there isn't.

But let me specify this a little bit because it's right that volumes have come down 2.4% in the 1/1 renewal. And of course, we have looked into the volumes that we have not renewed.

And here's the analysis. So the volume decreases, they are related to a relatively small number of very large treaties or very high-volume transactions.

And here the -- we considered the returns as unsatisfying, Hence, we didn't renew. But beyond this, we would have seen a flattish volume development.

And this very nicely corresponds to the rate experience that we have had, which is a flattish, pretty flattish rate development. And then you see a pretty flattish volume reaction.

This makes total sense to us. I could say have we shown premium increases on 1/1 of 2%, 3%, 5%, 10%, you could have rightly challenged our cycle management rigor.

How is the outlook for the remaining renewals in this year? Honestly, it would be speculative.

We don't know. So for the time being, I think the best assumption is the 1/1 renewal has set the tone.

And then we're going to see if there are any more, I would say, short-term impacts upwards or downwards for 1/4, 1/6 or 1/7.

My first question would be on GSI. It's -- the slides mentioned that you're trying to limit exposure to weather losses through underwriting actions.

Maybe you could expand a little bit on that. I mean how exactly would you be reducing volatility?

And also with that, perhaps might be interesting of how the GSI portfolio you think is performing year-to-date, especially through the wildfires? And the second question is also on P&C.

It's actually on aviation and probably a two-part one. One, we are starting to see some acceleration of settlements related to Russia and Ukraine.

Maybe you could remind us how large are the reserves that you're still carrying and what the developments have been recently? And secondly, there's been also quite a lot of activity, unfortunately, in the hull and viability in Q1.

So maybe you can comment anything on how you guys are trading through that.

Thank you, Ivan. Let me take the first question, and Christoph will take the aviation one.

So reducing the weather risk-related exposure, how does it mean? It means that the business is exposed to those weather risks that they are mapping their risks, I would say, more granularly at a micro level, making sure that they don't concentrate or accumulate in certain regions because that logically then would increase their exposure to one single weather-related event.

The other one is looking at harmonizing or homogenizing the limits that are out there, so avoiding any peak exposures by limiting it, by sub-limiting it. It's simply by mapping more granularly what is sitting in the portfolio.

Christoph?

On aviation, no big news in our view. The reserve level we have is a mid-triple-digit number for the entire loss complex, Russia, Ukraine.

Not all of that is aviation, but obviously, a significant part of that is aviation. We are still comfortable with our legal position and await the things how they will happen.

Apologies for coming back to the capital return. So I'm just curious, do you have some sort of theoretical limit in your mind of the sort of total payout ratio you would not want to cross in the medium term?

I mean is 90% feasible, for instance? Or is the low 80%'s the new norm?

So that's the first question. And the second question, what sort of insurance industry loss did you base your EUR 1.2 billion California wildfires estimate on?

And do you think this event could lead to some sort of rising premium rates in the high layer cat or not?

Darius, I'll take the first one. Well, capital return, that's a bit of a theoretical question, what kind of payout ratio we think is possible.

And as mentioned before, we'll speak about that in more detail in the Capital Market Day. But what I can share with you is the way how we would look at it methodologically.

So as you know, I talked about sustainably increasing the payout. So what we would do is for a new multiyear strategy, be it 3 years, be it 5 years, whatever the number will be, we will look into our projection of the P&L and the capital over these 5 years.

And if we then see that 80% is feasible, then why not 80%. But if a lower or even higher number would be possible, why not?

So I don't see any theoretical limitation, but the sustainability of what we will be doing. This is absolutely key.

And for that, we need multiyear projections supporting us in our belief that it will be possible to maintain something like that for a longer period of time.

And Darius, with regard to what market loss scenario we have based our EUR 1.2 billion wildfire estimate on, is more built on analyzing our portfolio of what we have actually insured and how we consider this being exposed to losses than any of these various market loss estimates, which practically vary between, I don't know, EUR 30 billion to -- was it up to EUR 50 billion or EUR 45 billion? That matters less.

So it's more based on our own portfolio analysis. What rate impact might this wildfire loss have going forward?

It will certainly have an impact, of course, on ensuring wildfires going forward. That's for sure.

But beyond wildfire, I think it will be highly speculative. You read voices that they say it should not have any impact.

You see others that said it should have an impact, but this is all interest driven. Nobody knows we're going to see it.

Congratulations on an impressive full year results update today. So I just noticed on Slide 72, the Atlantic hurricane aggregate value at risk component has risen year-on-year.

And one of the reasons you cite is due to model assumption changes. So I was just curious if you can share what the assumption changes were and why this led to a marked increase in exposure?

And then just on -- the second question was on the new specialty lines businesses. Just curious to know how these -- the growth of these lines will impact your SCR going forward?

And if there's any particular lines that have a greater capital strain that we should be mindful of? That's all.

So thank you, Shanti. First on the Atlantic hurricane, a lot is FX driven as we do write a lot of -- obviously in U.S.

dollar and U.S. dollar strengthened so much.

What else is in there is just the regular portfolio update and obviously a model update wherever we updated the model, given either model updates or assumption updates in the course of our modeling. The specialty insurance on our STI, the effect will be very neutral.

I mean we do have a lot of that already. We are broadly diversified, very well diversified anyway, so I would expect any growth impact to be well absorbed by the diversification.

Once again, congratulations on a very strong set of results. I wanted to come back to the net income guidance for 2025.

I know you mentioned that there's a long way to go in the year. But assuming we get an in-line nat-cat loss for the rest of the three quarters, what tools do you have to offset some of that potential higher large loss burden?

Could you potentially use the EUR 500 million prudence that you put away at the end of this year? And the second question is on the GSI business.

The combined ratio is running above the 90% in 2024, and you highlighted a few drivers of that. Just want to understand if you had a normal large loss burden and potentially no prudence added for casualty, what would the underlying combined ratio be?

And could you also elaborate on what the underwriting actions taken in American Modern would mean for the combined ratio?

Okay. The first one on the guidance.

I mean the question you ask is a very theoretic one because what you're asking is that everything else would be 100% according to plan and only one single item, one single event would be deviating from the plan. I mean that's obviously never ever going to happen like that.

So in reality, every single item we have is developing differently than how we planned it. And then the combination of all these smaller or bigger differences and also due to the fact that we are so well diversified will lead to the fact that we are going to make the plan.

I'm 100% convinced that this is going to be the case. What I cannot tell you is where the outperformance will come from in your theoretical scenario.

But it will happen. I'm 100% certain about that.

And this is the reason why I don't have to think about individual items like our reserve releases. It might happen elsewhere, maybe in the investment results, maybe in Life/Health Re, maybe ERGO.

Who knows? We'll see and we'll see together.

More seriously, obviously, having buffers in the reserves is meant to dampen volatility to some extent, but also we have to be careful because we have those buffers, obviously, not without any reason. So they are allocated to certain perils and certain risks, so you cannot just take them out as you go to your [indiscernible] and then take something out.

It's a bit more complicated than that. But again, I don't think we are going to need that in any case.

Sorry, can you remind me the second question? [indiscernible]

It was on the GSI, and the combined ratio.

Ah. So without prudency and more normal large losses, obviously, we would be significantly closer to where our target is also for this year.

We still left ourselves some room for operational improvements. Targets need to be ambitious, but we would be significantly closer to the 90%.

Congrats on the results. Just one for me, if I could.

Just -- if I could just ask a little bit on the result from insurance-related financial instruments and life and health reinsurance, a significant bump up year-on-year. Could you kind of just talk a little bit about what it is -- what's driving it higher and the FX impact?

Yes, absolutely. I think that the dominating driver is really FX.

And we book FX in that line of business, still we're going to change the accounting treatment going forward. But so far, FX booked in that line of business, which resulted in quite a bit of volatility also in the past.

This year, it's in our favor. But FX, more generally spoken in our P&L is a bit of a volatile item.

And I mentioned earlier today that we benefited a bit from it now in the fourth quarter. And so please all have in mind that it could also go the other way.

FX is a bit volatile.

Is that mainly -- sorry, is the product there, is that mainly related to reinsuring long-term savings such as variable annuities and things like that? Or have I got that wrong?

No, Fin Re business is basically financing business, but very often written in U.S. dollar or in currencies outside of the Eurozone, and therefore, we have this currency element in the result.

Other than that, it's most of the time, financing business structured by -- in a way of what is a reinsurance contract. And this is the reason why we account for it in IFRS 9 as it's financing, but it's still reinsurance, and that's the way we do the business.

A couple of just quick questions. I just wanted to go back to the renewals experience.

And I guess it's difficult to sort of marry the comments you make on industry profitability with the sort of lack of new business growth and of course, the very strong capital position that you're starting from. So just wondering what -- if you can just give a little bit more color on what the philosophy is there?

But also, I think importantly, I mean, it's a good signal to the market, but is the rest of the market following your discipline, given the margin available? And secondly, just on Motor.

I see, I think on the ERGO P&C side, the motor share has grown and also motor stands out within the reinsurance renewal. So I was wondering also if you could sort of update us on your thoughts on what you're seeing and trends and pricing broadly across Motor and in particular, Germany.

Thank you, Chris. This is Joachim.

So on the P&C side, what is our philosophy? First of all, it is all based on technical assessment of the risks on technical pricing of the risks.

And whatever conclusion then we draw technically translate into how we behave commercially. We have seen the market in 2023 and 2024 very disciplined, at least as we would describe it from our perspective, disciplined, meaning employing capital into markets that made sense, charging risk premiums that at least seem making sense to us.

So this is what we call a disciplined market. Do we have any evidence, not gossip, but any evidence that the market in 1/1 renewal has become undisciplined?

No, I wouldn't go that far. But based on what we have heard some of our peers reporting from their 1/1 renewals, we have heard that they not totally coincide with their rate experience and with regard to their actual growth that they show.

So from that, you have to make your own conclusions whether we walk our talk of being rigorous even if that comes at letting some volume go away the best or not. This is our philosophy and where we cannot technically renew something meaningfully.

We reduce it. We bind then and employ less risk capital because we would give up business.

This would increase our excess capital and increase then your challenges to Christoph Jurecka with regard to how it's going to return all this. But we will not stay in the market employing risk capital desperately because we are sitting on excess.

The motor business is standing out a little bit. It's not a phenomenon of original rate increases and sufficient original rate increases and growth across all geographies.

So one geography that you mentioned, Motor Germany, I would explicitly take out of that equation, but we have seen single other markets where our motor exposure is more material where the original rate development is very healthy.

Yes. So my two questions.

First is on the large losses. The man-made was very high, and apologies if you commented already, but is there anything you can add further to that?

Is it somewhat linked to GSI or anything else you can add? But also on the nat-cat, you mentioned reserve releases already.

If you could just provide any more color. In the same line, I would even sneak in one more that even in the life, we've heard about these large claims?

Are they a worrying sign for you? And if I may allow second question on renewals.

It's more a theoretical one, let's say. The commentary about maintain terms and conditions.

So I noted that you mentioned wording and such things. But isn't it also true that we are hearing from a lot of people in the press releases, presentations that attachment points have been slipping a bit.

How concerned are you about the attachment points? Are they much more important or in your view, they are one of many factors that drive P&C stability.

So I'm just curious to hear some thoughts on that, Joachim.

Thanks, Vinit, for your questions. This is again Joachim.

So on the Life reinsurance side, large losses, there is no large loss development that is raising any eyebrows. It's slightly going up, slightly going down.

It's all within expected ranges. You asked for the large loss exposure.

If I understood you correctly, with regard to GSI being exposed to this wildfire loss, it's a small chunk of the big number, the EUR 1.2 billion. So GSI is carrying the far smallest part of that.

And with regard to terms and conditions, and attachment points particularly, you mentioned that some in the market have been saying that it has been slipping, I cannot confirm that from our end.

That's great to hear. Joachim, I meant also large losses in the man-made P&C Re piece, in the fourth quarter being very high.

Yes. But it is nothing -- you mean Life Re, right?

No, no, I meant. .

.

Oh, the large losses on P&C?

Yes, please. Yes.

The Man-made [indiscernible] P&C Re. So I did ask about Life Re, but also P&C.

Apologies for that.

Yes. So yes, in Q3 -- thank you, Christoph.

He's helping me out because I couldn't relate it to the numbers. So man-made large losses were relatively higher in Q4 and non-man-made were smaller, if that is the detail that you're asking for.

I join all the others saying fantastic results. I had two questions.

One is a very cheeky one and the other one is just numbers. On the cheeky one, when you split GSI from P&C Re, are the two buses going to fight over the excess reserves?

How are you going to deal with that? That was actually a big problem at Swiss Re for many years.

But probably in your case, it makes no difference. And then the other more numbers question, Joachim, you very kindly said that the dividend is covered by ERGO and Life Re.

I just wondered if you could also give us -- and I know it's a little bit premature, but it would help so much an indication of how much GSI kind of helps diversify P&C Re or profit. I mean just to give you a number, I was trying to work it out very roughly, I'm getting that GSI is about, I don't know, operating profit somewhere between EUR 700 million and EUR 1 billion out of the EUR 4.7 billion P&C Re, but I don't know.

So thank you very much for your question. I'll start with the second one.

Christoph, if you can prepare for the first question. I mean just add it up, ERGO take EUR 0.9 billion expected as a result for 2025, then add up -- and I'm rounding now, add up another EUR 0.5 billion.

This is really net-net-net, bottom-bottom line for GSI. I'm rounding the number again, the Life and Health reinsurance technical result, not net-net income is supposed to end up EUR 1.7 billion.

So how much of that will be net-net income? If you add up these numbers, then you get to, I would say, the full potential of the less cyclical nonvolatile businesses.

GSI over time is supposed to become, yes, an increasingly relevant third bit of stabilizing volatile P&C reinsurance results. Yes.

I'll take the first one, and I understood it that your question was how is the prudency in our reserves distributed between P&C reinsurance and between GSI. And I think that the answer is pretty straightforward.

The opportunities to book conservatively are significantly higher in reinsurance as you have more long-tail business, higher uncertainties. So therefore, also the posited possible range of best estimate is significantly higher in reinsurance than in primary insurance.

That's something we see today already when we compare our reserving position in ERGO with reinsurance. ERGO is also very, very conservatively reserved, but still the amount of buffers in absolute terms is smaller because the uncertainties are also significantly smaller.

So having said that, you should expect that a major part of our reserve prudency will sit in the reinsurance business also going forward, while the amount of excess reserves or prudency reserves in GSI will be comparatively smaller. Having said that, it will be probably similar like what we do in ERGO.

So a typical approach for primary insurance business, whereas for reinsurance, you have just other means how to run that.

I would like to come back to Life and Health reinsurance and the growth outlook there for new business. What are your expectations from current regarding mortality, longevity, FinMoRe business, which of these pillars promise the best growth [indiscernible] expectations?

I think, Roland, the best assumption going forward for Life Re in growth is that with regard to the bread and butter businesses, and that is mortality business, that is living benefits businesses, if you just assume sort of a mid-single-digit growth growing with the underlying original markets, I think that will be a fair assumption, at least that's ours. On the longevity space, we have seen growth in the past years slightly above that level, mainly in the U.K.

market. We have started with first steps expanding this line of business into non-U.K.

market step by step cautiously. So I would say longevity could be potentially growing more than the bread and butter business.

But what for the time being is supposed to grow the most is what we call the very large transactions. They are mainly sitting in North America and they're really primarily in the U.S.

market. At some point, they might spread into select Asian markets, which we haven't yet seen.

But that is the single largest thing. And these are block deals where incumbent direct insurers really outsource, if you like, and see the way huge blocks of their biometric book, where the asset management of the related assets is done by asset managers, third-party asset managers, and where the biometric risks related to those blocks are ceded to reinsurance.

And here, we have -- we are sitting in a poor position.

On your target solvency range, can I just clarify my understanding? 175 to 220 is the optimal range.

Will you actually run your business at any point in that range? I think the question came from earlier in terms of should we look at that as a post-stress kind of level.

So i.e., you'll be above it, but then you look at where your exposures are and you think kind of, okay, post-stress, that's the kind of level that you want to be at. So you'll be consistently above that over any sensible time frame?

That's my first question. And the second question, again, just on GSI.

So the 90% combined ratio target for '25, that hasn't actually changed from the previous guidance that you gave. And yet there is wildfire losses to come in that?

I know you said that it's a relatively small part of the EUR 1.2 billion, but it will be a contributing factor. What is the clean number kind of ex-wildfires, if you like?

I'm just trying to get a feel for the sustainable combined ratio target at GSI at this point.

James, the target Solvency II ratio is meant as a target Solvency II ratio. So we wouldn't be concerned at all if the number would be in that range.

And it was historically. It's not so long ago that we were in that range.

And so therefore, no problem with that. It's calibrated in a way that even if you were in that range, you would still be able to absorb a shock and continue to run the business as we do.

So therefore, I can only repeat it's a target range. And the intention is not to, long-term, stay above that target.

But obviously, for a shorter period of time, a few years, no problem, we can also stay above that. And sometimes, it feels quite good to be above it as well, given, again, strategic options or also large events or geopolitical uncertainties or whatever you look at.

The GSI 90% target is the target for the full year. After the first couple of months now, I have nothing really to add to that.

It's still early days and a lot of opportunities and also risks obviously for GSI, but I'm pretty sure they'll make it. So nothing else to be mentioned here.

One is coming back to the normalized combined ratio for Q4. I mean you're very clear that 82% is the right starting point.

But just trying to tie that back to your comments earlier on in the year where you had the potential headwind from motor proportional. That just can't be seen once you adjust for EUR 500 million prudence.

I just want to understand, is there any sort of volatile items in Q4 that we should sort of factor in? And I guess, in part, the growth in motor proportional at January renewals, will that have an impact on the combined ratio?

And second, one sort of a clarification on Slide 45 and 46, where you give the commentary around the runoff. It appears that all years are developing favorably, but then you had the negative runoff in the accident year 2023.

Do we just square that up with prudence? If you could just explain that.

The second question first, that's a usual pattern we always have. Indeed, this is prudency, which -- and usually in the first development year hits us a bit and the same this year as well.

So yes, prudency is the right answer. On the normalized combined ratio and volatility, I just -- I think we -- you have to keep in mind, the threshold for large losses is EUR 30 million in the meantime.

So even in the basic losses, there is room for volatility. So it just makes a difference if you have a few claims with EUR 25 million or not, and they would not even show up in the normalization and not even be visible in the EUR 30 million threshold.

I'm not aware of any specific event which would have increased the volatility, but it's more normal nowadays with this EUR 30 million threshold that the single quarters also in the basic losses, they are a bit moving up and down and more or less all the time. If you remember, the first half of the year, I think particularly Q1, but also Q2, for example, quite good quarters when it comes to the basic losses.

So it's not uncommon. We have that sometimes.

On top of that, there is, of course, this overlay of business mix effects you were also referring to. And this comes on top and sometimes it's more the business mix effect you're seeing, sometimes it's more the quarterly volatility.

But I just want to make sure that we're all on the same page that from a quarter to another, given the size of our book, but also given the threshold for large losses, which is EUR 30 million, there is some volatility always possible. It's not like that the basic losses are running and without any ups and downs from one quarter to the other that shouldn't be expected.

By the way, also an interest rate component. So we -- obviously, we do have all these elements from discounting from loss components.

So it's probably fair to say that the basic losses are less stable now than they would have been in the past under IFRS 4.

That does make sense, thank you very much.

There was one quick question, whether the January renewals would have any impact on our expected combined ratios going forward? The answer is no.

The renewals, they match or they met what we had planned for.

I've got two. One is a kind of cheeky one.

I'm not sure whether you mentioned the room to change leverage. I'm sure you'll discuss that on the 10th of December, but any kind of thinking on that would be super interesting.

And then the second, I think you mentioned many times the strategic optionality. And I'm just wondering whether you can give us a feel for -- is there anything in the pipeline ?Or what you're thinking of or how big could it be?

Anyway, any hints would be gratefully received.

Yes. Michael, thank you for the question.

I mean the short answer for both questions would be nothing changed. A bit more elaborate.

Obviously, our leverage ratio is still very low in the industry comparison. We don't want it to be in the middle of where the others are.

But over time, which means multiyear, approaching the pack from the lower end, getting a bit closer to where the others are still seems to make sense. Sometimes it's a bit hard to get there once you're so profitable, but we are getting there.

It just takes time. The other point -- sorry, I forgot the second one.

Strategic optionality.

Strategic optionality.

Strategic optionality, yes. As always, we were interested to grow our business, particularly in lines which would help us to even more stabilize our footprint.

In that regard, we are open to M&A options once they come up and would look into whatever target is presented to us. And if then the strategic fit, but also the financial details are attractive enough, then we would go into a transaction.

Obviously, it didn't happen so often. But still, I mean, this is unchanged, and this is how we look at it.

Thank you very much, everyone, for attending this call, for your questions. Further questions, please don't hesitate to get in touch.

Otherwise, I wish you a nice remaining day and hope to see you all very soon again. Bye-bye.