Reinsurance Group of America Inc. says unexpectedly high life insurance claim levels hurt its earnings during the second quarter.[@@]
RGA, St. Louis, is reporting $22 million in net income for the latest quarter on $1 billion in revenue, down from $65 million in net income on $976 million in revenue for the comparable quarter in 2004.
RGA’s earnings failed to meet the expectations of securities analysts or RGA executives.
RGA President A. Greig Woodring attributed the disappointing results to high claims levels in the United States and the United Kingdom along with sub-par earnings on the assets of its Argentine pension business, where it was forced to increase reserves.
“We experienced a high volume of claims in excess of $1 million per life during the quarter,” Woodring says. “The dollar volume of such claims was approximately $32 million higher than the prior-year quarter.”