(Bloomberg) –Swiss Re AG, the world’s biggest reinsurer, reported first-quarter net income that beat analyst estimates after a quiet period for natural catastrophes.
Net income fell to $1.23 billion from $1.44 billion a year earlier. Six analysts surveyed by Bloomberg estimated net income of $969 million.
Reinsurers including Munich Re, Swiss Re and Hannover Re sell backup coverage to insurance companies, protecting them against big risks such as natural disasters. While losses from catastrophes last year fell to the lowest since 2009, earnings in the industry continue to be squeezed by record-low interest rates and declining prices for coverage.
Reinsurance prices have been falling to their lowest in four years due to competition from alternative-capital providers that started offering products.
Hedge funds, sovereign wealth funds and other providers of alternative capital set aside $72 billion for reinsurance last year, a 12 percent increase from 2014, even as allocations from traditional capital fell 4 percent to $493 billion, according to research by Aon Plc. That led to price cuts when policies were renewed on April 1, according to reinsurance broker Willis Re Inc.
Swiss Re appointed Moses Ojeisekhoba to become the head of the reinsurance unit to succeed Christian Mumenthaler, who will take over as chief executive officer as of July 1 from the retiring Michel Lies.