About Christoph Jurecka
In a 2023 interview, Jurecka discussed the costs and challenges of EU sustainability reporting requirements for Munich Re. He stated that the company had spent an estimated 300-400 million euros on implementation and around 50 million euros per year in running costs for financial reporting, and estimated that sustainability reporting would cost the group at least 100 million euros. Jurecka expressed concern about the extent of the requirements, uncertainty in interpreting standards, and the potential for limited comparability between companies. He suggested that the money spent on reporting could alternatively be used to implement real-world changes. Jurecka also called for a reduction in bureaucracy and a focus on global competitiveness in future EU policy.
During the COVID-19 pandemic in 2020, Jurecka said Munich Re was "very cautious" and had withdrawn its guidance for the year due to uncertainties. He reported that the company had posted 1.5 billion euros in COVID-related claims in the first half of 2020 but still achieved a half-year net profit of 800 million euros. Jurecka noted that claims from event cancellation were realized quickly, while credit insurance claims could be delayed due to their connection to global economic development. In a 2019 presentation on the 2018 balance sheet, Jurecka described the company's risk situation as being in a position where market and credit risks were smaller than insurance technical risks for the first time in many years.
Source: AI-verified profile updated from Christoph Jurecka's recent appearances.
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Transcript (8 segments)
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Host0:00
Now insurers have struggled to keep up with claims as the coronavirus crisis upends every aspect of our lives. German insurer and reinsurer Munich Re has withdrawn its guidance for 2020. It's the latest sign of the toll that the pandemic is taking on European insurers, and really despite the impressive job that Germany itself has done in dealing with this pandemic. We are going to talk to right now the Chief Financial Officer at Munich Re to try and get a little bit more detail. Christoph Jurecka joins us from Munich. Christoph, thanks so much for your time this morning. You've scrapped your guidance, but can I ask if you still at least expect to post a net profit for 2020?
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Christoph Jurecka0:51
Well, if we look at our Q2 figure, I can only say with a very pleasing Q2 result despite the challenging environment we are in. We posted 1.5 billion COVID-related claims in the first half of the year. This is significant, and given that, we are very happy that in Q2 we have a half-year result of 800 million euros still, so a very positive result despite our duty to cover all these claims. This is where we currently stand. We just didn't give an outlook because, as much as we in Germany are benefiting from the situation that currently the virus is not spreading around that much anymore, I can only remind you that on a global level we are still in the midst of the current wave. Cases are still going up, and we are a global firm; we have all the companies. So for us, Germany is one market, but there are many others, and so we continue to be very cautious.
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Amber Hordern1:54
Thanks so much. It's Amber Hordern in London. I just have to follow up a little bit there. Matt made a really good point. Yes, you withdrew your guidance, but will we see a profit for the year, a net profit? Can you confirm that?
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Christoph Jurecka2:08
Well, we started with the profit already after the first half of the year. Not giving guidance just means we don't talk about it; the uncertainties are just big. Therefore, we don't talk about year-end now. But as I said before, we have a very pleasing result after the first half of the year. We have a lot of support from the first half here. We are as always very prudent in the way we set up our reserves for the claims we have already. So in that sense, I'm fairly optimistic, as much as you can be in a difficult environment like we are currently in.
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Amber Hordern2:45
All right, so you had, I think you said, one and a half billion in COVID claims, COVID-related claims in the second quarter, Christoph. Is that right? And does that seem like the peak to you, or do you expect COVID claims then to continue to rise in Q3?
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Christoph Jurecka3:03
For the 1.5 billion, thank you for the question. The 1.5 billion is a half-year figure, so first six months covered by that. This figure pretty much covers everything which happened until the end of June. Who are we to really know how the COVID-19 pandemic is going to continue? We don't know. Therefore, I just can't give you the answer because I don't know if there will be a second wave in the countries where we are currently having a better environment, or if the acceleration we see in some markets, the acceleration of infections within some markets, if this is going to continue or is eventually — and that's everything we hope for, of course — it will reduce in spreading around and the pace will come down. We don't know that yet. And a big part of our claims is also coming from life insurance, and of course the number of fatalities is something very much driving also our claims. And then on the P&C side, it's event cancellation, it's contingency. So how long will there be public measures to fight the virus and to what effect on our business? We don't know that yet. So therefore we continue to be cautious. But as I said, so far we have a stable balance sheet, we are very well capitalized. So we have — it's our job to bear these risks and we're very happy to do that.
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Amber Hordern4:28
Absolutely, I understand, Christoph. You know, I wonder though, if we don't see a pickup, assuming there's no second wave pickup, do you expect claims to rise? Because what I'm trying to gauge is what's the lag time between damage and claim in these COVID-related issues.
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Christoph Jurecka4:47
Yeah, if there's not a second wave, let's assume the best possible scenario — at the global level the number of infections just goes down very quickly. Now that would be the best possible scenario, maybe with vaccination being available. In that case, we still expect some things to come, because as you said, this is the case until we see them realizing these claims. This varies very much line by line. In event cancellation it's pretty quick, we know it. By the way, if you look for example at credit insurance, credit insurance is very much globally connected to the global economic development, and there might be a delay and we might still have claims going forward.
