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Hello, everyone. Welcome to Swiss Re's Rendez-Vous de Septembre 2026 Media Conference. I'm Charlotte Nelson, and I'm responsible for P&C Re Media Relations at Swiss Re. Joining me here today is Urs Baertschi, our CEO, P&C Reinsurance; and Gianfranco Lot, our Chief Underwriting Officer, P&C Reinsurance.

In the next hour, we want to share our perspective on the forces impacting the reinsurance market, what it means for demand for underwriting and for reinsurance. And we will do so by Urs and Gianfranco will walk through our presentation first, and then we will open the floor for your questions.

And I think with that short introduction, Urs, the floor is yours.

Thank you, Charlotte, and good afternoon, everybody. Welcome, and thank you for being with us here today. I will start at a fairly high level, and we'll zoom in progressively here, and then Gianfranco is going to get into the real details when he takes over.

I want to start with the factors that are impacting the reinsurance and insurance industry globally. When we just look at the reinsurance industry and we think about the capital base here, there's a strong capital base of about $660 billion out there. I'll show you more details about that in a bit. The main message here is it's important for the reinsurance industry to have a strong capitalization, strong balance sheet. And I'll tell you more about that in a second.

We're also seeing that the cost of building, the cost of repairing, the cost of claims keeps going up due to inflation in general, due to claims inflation and a lot of that also has to do with supply chain bottlenecks. So we'll explore that in a bit. When we look into society, there's more unrest in the world. And there's more discontent with established structures, with companies and people are going to the street. We'll look at that.

On weather, for those of you who are in Europe, it was a hot and dry summer. I don't have to tell you that. The phenomenon of extreme weather is something that we're faced with in society as well as in our industry, more and more so. It translated into $220 billion of economic losses last year. Only $120 billion were insured, which means the protection gap of $100 billion from nat cat alone was the case last year. And then there's a lot of investments.

Some of you were present on Saturday when Gianfranco, our Chief Economist, Jerome presented our latest Sigma study, which focused on the enormous CapEx investments that are coming to back these infrastructure investments in data centers, in energy transition and infrastructure more broadly. This is also a massive opportunity for the insurance industry to step up and enable those projects as part of our effort to provide resilience to societies and economies.

So this is all around us. Let's go a little bit deeper. And we're going to talk about supply chains. And the way to think about this, there's a number of different factors that impact the inputs into the insurance industry. And the way that they manifest themselves are also various dimensions. So we can think about geopolitics. We can think about technological innovation. We can think about peak risks. All of that could have an impact on growth, on inflation, on investment dollars and how fragmented the global economy is.

Some of these developments, the arrows up might be good or bad. Some of these, the arrows downs might be good or bad, generally speaking. So it's a complex equation. But the main message is all these factors contribute to the supply chain bottlenecks and disruptions that drive up cost. And so there's inflation and it just costs more to build and to repair when there is a claim.

And it's a lot more volatile. It's not as predictable as before, and you could actually have some serious supply chain disruption that provide a lot of short-term disruption. It's structural where it's a bit more volatile overall. And then the economies are much more local, and that also contributes to that interruption.

Now let's go back to the capital piece, right? It's important that the reinsurance industry has a strong capital base growing demand, right? So demand is rising from insurance companies. Demand is rising from the public sector. There's more exposures, there's more values. There's new risks.

And as a reinsurance industry, we need to take out the volatility so that the insurance companies can provide their product at a cost-efficient way to the end customers, right? That only happens if we are resilient in our capital base. About a little bit over 80% comes in the form of traditional reinsurance capital. The rest we think of as alternative capital as well.

Alternative capital is an important part of the capital stack and the opportunities that insurance companies and buyers of this kind of protection have. And it also very importantly supports the traditional reinsurance capacity. So you've seen the rise over the last few years. This is a good thing because the demand and the risks and the exposures are going up.

I talked before about social tension in society. And if you look at the number of demonstrations and compared to just a few years ago, they're up significantly. There's some populist movements out there. There's a general disconsent with companies, with establishment. There's just a higher sense of grievance in society out there. And when we look through then, there's multiple dimensions around this topic, but one of them is, of course, when this happens, there's also losses.

And this is human-induced losses where, for example, if you look at the riots in South Africa, in the U.S., in France, these are billion-dollar loss events, right? So they're not small. And so we need to actually think in our industry through of what are the societal dynamics around the world, meaning for our business and how in the aftermath as well as before, provide resilience because ultimately, the insurance industry is a force for good because we are here to invest in society when people need us the most.

This is not a new topic. I said it last year. I said it the year before. I'm going to predict, I'm going to say it next year. We're very concerned about what's happening in the legal system in the U.S., in particular. Some of that is also spreading to other parts of the world, but not to the same extent. Fundamentally, in the U.S. on the legal system there and aided by the influx of third-party litigation funding, the verdicts that are being given by juries against ultimately the deep pocket, which oftentimes are the insurance companies go up at a rate and to amounts that were not anticipated at the time when their business was written.

It's much, much more costly at a much, much faster rate. And in the aggregate, if you just think about the commercial liability insured losses last year of $174 billion, that's U.S. commercial liability. Compare that to global nat cat insured losses, global of $120 billion. That gives you sort of an order of magnitude idea of what this is. And these record verdicts, they just keep coming up more frequently and they keep getting higher.

Ultimately, this is a cost to society. And there are studies out there that would indicate that on average for the U.S. household, the cost of this is over $4,000 per U.S. household per year. And you see this when you go to the grocery store or to the home improvement store. That's where you see this cost come through. And it's a big driver of why those prices are going up as well.

I'm going to end before I turn it over to Gianfranco to talk a little bit about AI. This is a big topic for us in the industry as it is around the world for other industries and for society more broadly speaking. But it's a technology that fundamentally allows us to do certain things more efficiently to make better decisions and to ultimately use the resources that we have and grow more and to innovate more. Now that's the exciting part. But when it comes to AI, there's also an element of defense that comes with it.

On the one hand, all the exciting stuff also means that the bad actors actually get a lot better. And so we have to play defense against that. There's critical infrastructure that's involved here from energy to data centers and so on. And there's a concentration and accumulation risk because if all of these data centers are in the same place and you have a tornado go through, there's a lot of losses that can come with that because they're really expensive.

And then ultimately, when we think about this world of more and more interconnected and faster-moving risks, technology is certainly a big factor and in the center of many of these discussions, both in terms of risks today, but this permeates then to the supply chains to liability and things like that. So it's a big factor of that, and we're paying attention to it as well.

I'm going to turn it over to Gianfranco to take you even deeper into some of these topics, and I'll be back for Q&A.

Thank you, Urs. Thank you, and welcome also from my side, and thank you for your interest today. So natural catastrophes is also not a new topic in Monte Carlo. But what got forgotten a bit is that we had benign nat cat years on the reinsurance side, but the underlying continues to preoccupy us. If you look at this chart here, you see the light green bars continue to be over $100 billion insured loss per year. And that's without having a big nat cat event.

I remind us all that in 2011, we had 2 earthquakes, in Christchurch in New Zealand and one in Tohoku in Japan, and that's the dark green bar there in 2011, right? Those spikes are they recur from time to time. So these are nat cat events that are on top of the normalized insured losses that you see on the light green bars here.

So I just want us to remind ourselves that there are earthquakes and there are hurricanes in the Northeast of the United States and in fact, also in the Caribbean. And so we've taken a look at what would happen if we had a big event in addition to the annualized insured losses that you see here. So that velvet bar there, and we attached the probability to it.

There's a sigma study that actually illustrates that quite in detail, but it would mean a $320 billion market loss from ground-up insured loss. That's a significant number. Why is it so much bigger than the Tohoku earthquake or the bars that you see there because there's some inflationary aspects to it that we can't deny.

Clearly, the losses, as Urs was mentioning before, are just more expensive. The reconstruction costs are more expensive. The concentration values have increased quite a bit. The urbanization has increased and therefore, also the insured values. And that brings us to this $320 billion.

It's clear we, as reinsurers are here to protect our insurance companies from these types of disasters, and we provide significant capacity to the marketplace that does just that. If you look at Hurricane Andrew in 1992 and you indexed it to today, it will be threefold in terms of impact, in terms of insured losses. By the way, the $36 billion is at today's prices. So if you go back at the prices of 1992, it will be $16 billion. So you index all.

But there's also positives that I want to highlight here after Hurricane Katrina, there were significant investments done in upgrading the infrastructure. And therefore, if the same storm would happen again, it would largely be the same insured loss. And that's a positive into learning from these kinds of events and invest in preventative measures.

If we dig deeper into the nat cat space, you can see here that the composition of these events or these years has shifted dramatically from peak perils, you see that velvet sort of area and the green area. The green area has just become larger. And I remind us all, we're talking about the same $100 billion. So the composition of the nature of the losses, the underlying has changed quite a bit. There's much more convective storms. There's many more wildfires, and there's clearly also more floods that contribute to that $100 billion, whereas there were hardly any earthquakes and hardly any hurricanes.

We've all witnessed that in Europe. For those of you who have been in Europe, the wildfires have been catastrophic, some of which have been insured and are being insured and reinsurance and some of which not so much, which is -- which points to the protection gap that still exists in many, many markets and countries.

So the secondary -- what we call secondary perils, this green shaded bars is 92% of the global insured losses in 2025. Clearly, we had, if you remember, the California wildfire losses, which was sort of a perfect storm with a lot of fire in the western part of the U.S. as an example.

If we then look at the wildfire risk, in particular, wildfire risk according to our study that was complemented with the European Commission study, 96% of the European wildfires are man-made. There's somebody that lighted a fire and then it just spread out. Of course, the conditions have to be met in order to -- for it to be spreading significantly and fast, the drought, the heat and the conditions that we saw in 2026 are a perfect context for wildfires to spread fast. But 96% are driven by human activity. So we consider this as a man-made loss as opposed to a natural catastrophe, even though the conditions that promote this fire have to be -- in terms of natural environment.

So the wildfire piece is inherently difficult to model. We have partnered up with Bellwether with a company that specifically is modeling wildfires. We have our own proprietary models. This is one of many models that we entertain and we invest in. But clearly, it's not a slam dunk in terms of determining how wildfires are propagated and how wildfires are modeled.

We then move over to an interesting aspect of our extreme weather patterns. And as Urs said before, we've all witnessed extreme heat in Europe. And clearly, extreme heat has been noticed all over the world. This is a product that we developed to link the payout of insurance to building resilience at town or a communal level.

So in the city in Arizona, we developed a parametric product that pays out if a number of days is above a certain heat -- certain degrees. And this payout is then linked to investments into sprinkles into adaptation. And this was a nice example of how insurance contributes to the local resilience of the different cities, different towns and the communes.

This is the first public-private partnership that we've done so far, but there's numerous requests to replicate this type of product because we see, right, and we all acknowledge that the temperatures are rising and with that, also the problems with -- that comes with it, whether it's critical infrastructure or whether it's actually people taking care of elderly in elderly homes, cooling down schools and making sure that people actually can cope with the heat that is so extraordinarily high. So there's product development innovation going on in the nat cat space as well, which we're quite excited about.

Now there's a lot of investments that go into modeling capabilities. You can see here the primary nat cat perils is 7% investments that go into the modeling of these nat cat risks, 15% in what we call secondary perils, so the floods, the wildfires, trying to understand how these nat cat or these perils are driving insured losses and are driving some of these extreme heat events is something that the industry seem to take really seriously.

Certainly, Swiss Re is taking it seriously, and we're investing significantly in new modeling capabilities, as I mentioned before. And also man-made perils as the wildfire bit I was mentioning before is also the significant investments that go into that as well. So we've seen over the past years that there's a shift really from investments into underwriting capabilities into modeling capabilities that we feel is very, very important.

We've established risk data solutions a number of years ago, which does exactly that and provides that -- those capabilities to our clients, which they're using it. There are 2 examples here I want to cite real quick. One is the wildfire accumulation tool that helped a client to diversify their underwriting and to essentially write the same amount of business but with less risk. And just having that insight, that modeling insight help them to redirect their underwriting into areas which are less correlated with the existing book.

And the second one is really about flood modeling. We've acquired a company called Fathom about 3 years ago. The granularity of these hazard maps is significant. It's down to 5 meters. And therefore, the ability to really understand where the flood areas are is so granular that it allows single risk underwriting in a much more efficient manner.

Well, Urs has said a lot about it already. These are the number of verdicts, excess $10 million. It just doesn't stop. It continues to preoccupy us and concern us. And frankly, it's quite frustrating to see this continue to evolve in the way we see it evolve. And therefore, our underwriting appetite for new liability business is almost 0. We keep what we underwrite, but we don't want to enlarge our footprint in newest liability classes. As we see here, we don't see it stop or reverse. The trend is there to stay.

There's also notable trends in terms of litigation funding and how the attractiveness of this, call it, subsector is really drawing in new capital. The latest is that these litigation funds are securitizing their funds and therefore, accessing the retail markets and therefore, attracting more investment into their funds, which is quite remarkable.

A final word on data centers. We've done a specific Sigma on this and also Sigma launch on Saturday and just reiterating what I said before, it's an ecosystem of lines of businesses and insurance needs that is really rising as opposed to construction and property. The workers that work there need insurance. There's marine insurance for the gas or the power plants that are being built, there's liability insurance. There's a number of insurance classes that go with infrastructure investments, and that's where this makes it very, very exciting. We're obviously really well positioned because we're in all of these classes, very active and take leading roles, particularly in property and construction.

The $91 billion opportunity that you see here is on the back of a 6.6 trillion investment by 2030. So these investments that are being done in data centers, but also in bridges, tunnels, in airports in the different infrastructure that are being developed in all over the world, not only in the U.S., elements this drive for insurance. And we think the capital that we showed before will all be necessary to cover all these risks going forward.

So with that, I conclude my session, and we open up for Q&A.

Yes. So we would like to open up the floor for your questions. [Operator Instructions] So let's start here in the room. Any questions in the room? Yes, please, here at the front. Just a moment when microphone is coming.

It's Gavin Souter from Business Insurance. You illustrated the increase in the number of like convective storms and secondary perils. Are you seeing a demand for coverages to address those like aggregate coverages or frequency coverages? And if so, what's your response to those demands?

Yes, I'll take that, if that's okay. So yes, there is continued interest, I'd say, to address some of the frequency of scenarios that we've seen in the secondary perils, some of which are covered through the traditional Cat XL space or the traditional reinsurance. In terms of aggregate covers, there are some in place, which we also underwrite. So we're not absent of it, but our risk appetite remains the same, which means we continue to write what we have as opposed to add new ones. But it's a bespoke client-by-client and treaty-by-treaty consideration. If it's well structured and it addresses the issues of our clients, then we certainly have a look at.

Why are you [indiscernible]?

Because the modeling of these secondary perils are more challenging than the peak perils and our intervention is typically at a level which is more a capital-driven level as opposed to an earnings-driven level.

Okay. Thank you. Any more questions in the room? Yes, at the back, please.

[indiscernible]. Just wondered whether you could share whether Swiss Re has any plans to further grow its alternative capital Partners division in 2027?

Yes. Look, I showed a little bit earlier that alternative capital is an important part of the capital alternatives that insurance companies in the public sector have. We've been a very strong player in this field for over 25 years. We were one of the pioneers in the ILS space. We continue to be offering those services to our clients as well, and we expect to continue to be a meaningful participant in that market.

Okay. Next question, at the back, please.

[ Philip Thomas ] for [indiscernible]. You mentioned that most of those wildfires are caused by human intervention. That could be arson, it could be negligence, cigarette butts throwing away. Has any thought been given on how to survey the further surveillance could be drones or whatever patrolling just to catch people who are responsible, prosecute them, create some examples and hence, improve human behavior?

So with human behavior, we don't mean malicious behavior necessarily. Of course, there's also malicious behavior there as well, but it's not -- sometimes it's not intentional that lightning -- a fire is not extinct after you grilled your steak. So there's that, too. But clearly, it's a concern for us in terms of how we get to the source of the fire, the wildfire because it's not always clear and how to monitor it adequately is a challenge for us. So we continue to think through how we can better identify the sources of these wildfires so that we can add to the prevention measures.

I'll add one element to this. There is a preventative component also when you think about either brush management around certain areas like a transformer that has the possibility of issuing a spark as well as transformer maintenance, for example, in the context of utilities, where some of that actually then could prevent the outbreak of a fire in the first place. So the creation of the awareness about what causes these wildfires, which are called a natural catastrophe, but really are triggered by human activity mostly is an important element around this.

So I think we'll take one more question here, Martin, and then we can look if there is anything online.

[indiscernible] from Insurance. I wanted to ask about the litigation environment. You've said it's bad. Where is it the worst? So which sector in the U.S. are you seeing the most worrying trends? I mean we've heard about AI litigation. We've heard about social media litigation. Where do you see it rising the fastest? And Swiss Re previously warned about this litigation environment also spreading to Europe. Do you see any signs of this happening?

I'll take the first part, and then you can cover the spreading. So where is it the worst? It's in the U.S., right? The liability in the U.S. is the topic that we're talking about here. It started in large commercial. And so the idea behind this is you have a certain event that's happening and the plaintiff bar going about the deepest pocket, which are the insurance policies of these large commercial companies. There's an element of societal sentiment in there as well, jury behavior and so on, but that was the trigger, and it is certainly spreading from there on as well.

It's going smaller. It's going across different classes. You have the traditional ones like commercial motor or trucking that are there, but it's also umbrella policies at a personal level. And so it's the liability in the U.S. given the legal system environment and what's happening there that's triggering these payouts, which are not connected with the original underwriting assumptions and the causation in many cases of the event that's triggering that loss. It's across everything.

On the second question, yes, it is spreading outside the United States. We see certain developments in the U.K., also litigation funds being established there and more aggressive claims behavior being displayed. It's still -- we observe this quite carefully so that our business that we do with our European cedents is well considered when it comes to this U.S. liability or liability trends as such. But yes, it is spreading elsewhere geographically.

Okay. But I think we'll move on to our guests online. I see that Blake has a question. Blake, please go ahead.

This is [indiscernible]. I work for Re in Asia. So I wonder if I could ask a quick APAC-focused question related to capital deployment. And I'm just interested with all this capital, abundant capital sloshing around and reinsurance increasingly having to think about where they want to deploy this capital. I'm just wondering if Asian cedents are used in the current environment to find protection for risks that were previously difficult to insure or retain. Is there any APAC flavor you can give on this?

Yes. Look, fundamentally, as a starting point, reinsurance is a global model, and you need the global diversification in order to provide the support to the more regional or local societies and companies and governments. So it's always a global competition, or a global capital allocation question. It is a competitive environment. And so from that perspective, there's different views of risk. Different reinsurers will want to deploy their capital in different regions, different lines of business.

And to your question of are there risks that are being covered today that weren't before. There is a little bit of a market dynamic certainly here throughout various market conditions. Sometimes wordings are a little bit broader, a little bit more narrow, same thing with structures. What you usually see are the headline prices, right? But generally speaking, I would say there's a reasonable amount of discipline in the reinsurance market around the structures and the wordings, and we would expect that to continue.

Okay. Thank you. And then we can go on to [ Maximilian Folz ], please.

It's part one. Can you say what impact the negotiations in Monte Carlo will have on reinsurance prices in Europe and in Germany in particular? And do you expect the situation in Baden-Baden to change again?

No, I cannot say. Look, the market is the market, and we're still too early anyways to get a sense of what's going to happen out there. This is the start of the conference season and some of the listening of the various parties that are meeting here in Monte Carlo. You mentioned Baden-Baden, in particular, it's a little bit further down the road. And in that conference, more specific negotiations are starting to happen. But the market will be the market, and that's not for us to say at this point.

Good. Then I think we'll go back to the room. Yes, please.

Tim Adler, Intelligent Insurer. Could we just drill down a bit deeper again into what you're saying about your appetite for new U.S. casualty liability being practically 0. Casualty is a broad word. There must be some classes that are attractive? Or is it just you thought this is a no-go area for us now?

So we define casualty -- thank you for the question, and I clarify. We define casualty as liability, motor, financial lines and workers' compensation or accident and health. And we have appetite for motor, personal motor. We have appetite for different classes, including workers' comp, if it's well structured and it meets our sort of appetite there. We have little to no appetite on the umbrella product and on the U.S. liability classes. So that's where we -- if I -- if we drill down to that level, then that will be the class that is toughest for us to underwrite.

Okay. Yes, next question?

I'm [ Sudhanshu ] from India. I've got an overall basic question is that the global capital insurance capital, reinsurance capital is growing. Also, the protection gap is also widening. So where is the disconnect happening here?

Yes. The -- look, we're very passionate about actually this topic of seeking to close the protection gap. I think as an industry overall, this is something that we should strive for. Some of it is structural in the sense that values keep going up, exposures keep going up. People like living in areas that are more exposed from a weather or a water perspective. They're nice, but they're also going to represent just a higher risk of there being some kind of a natural catastrophe event. And then there's insurance maybe sometimes chosen not to be actually taken up even though it's available.

So there's a number of different factors that go into it. It's mainly a question of the way that we think about this is we want to raise awareness because the more that people know about the risk, the more they can take action about it. Then we want to help in the discussion about prevention, risk prevention. This has to do when you think about natural catastrophes with zoning laws, building code and where do people live that makes a big difference.

If you're living in a flood zone, it will flood probably at some point, right? And so these are the kind of things that we're working on the prevention. And only then we're talking about really risk transfer, which is where we can protect those where we can. So the ambition is there clearly to close the protection gap, but there clearly remains challenges of achieving that in the industry.

Good. Any more questions in the room? Yes, please?

[indiscernible]. On the wildfires, it strikes me that there are two distinct types here, what we could easily say forest fires in natural areas where we are just moving into and what we might call wildfires in processed areas, grass fires, something like that, where it would be a lot more business, where there will be a lot more inhabitants. Are insurers and reinsurers treating these 2 different types of wildfires differently in terms of liability, in terms of pricing?

And also, is there not a case to be made that we have had forest fires and wildfires since there have been trees before there have been humans. It could be called part of nature. Might it not be better to take a strategy saying we need forest fires, you just shouldn't live there.

Yes. So there's certainly an element of people live very close to forests and the forest fires. But clearly, the insured values and the concentration of values in areas where people want to live, which are close to the forest are more exposed. And we do make that distinction in terms of where people live and what the insured values are at risk, right? So that's where you see the growth of wildfire losses come through from an insurance perspective.

The surface that is being burned down has also been growing quite dramatically. If you look at France, this is one of the biggest wildfires that we've ever seen since we recorded it. So it's a phenomenon that continues to challenge us in terms of how we think about modeling it and how we think about the insured losses that come through it.

And again, most of it is man-made. And when we do underwriting of houses, for example, in the western part of the U.S., which we've seen impacted by wildfires, then we do consider the liability part of utility companies, for example, where obviously, this will be correlated since the liability of the utility company would get the subrogation from the property insurer. So at the point of underwriting, we do consider the different factors that drive these insured losses.

Very good. I see we have another question online. So [indiscernible].

I have two more questions of more basic nature. First, I gather from what I'm reading in the news that you are expecting a decreasing prices for the sort of risks that you are offering to cover. Maybe you can elaborate a little bit of this -- on this, maybe you did. I was, for technical reasons, 10 minutes late on your conference. I'm sorry for that.

Second question is, again, you're stressing the man-made aspect of the wildfires. I expect -- I understand from this -- from your -- implicitly from your speeches that such wildfires as long as they are not precisely -- cannot precisely be modeled as long as there is this factor of man-made aspect in it, you need to ask higher prices for protection like some sort of a man-made premium. Is that correct? Is my understanding correct as more -- the more you can model the risk, the deeper go the prices and vice versa. Maybe you can also explain a little bit on this.

I'll start on the topic of price. So as we sort of elaborated a little bit earlier already, so we do not have a view or expressing any view at this point. The market will ultimately make the price. It's too early. There's a lot of time left in the year. A lot of things can happen still. So we'll just have to see what happens, but we do not predict the market at this point.

On the second part, we try our best, right, to determine the expected loss of any peril of any insurance or reinsurance, and this includes the modeling of wildfires. If there's greater uncertainty, we try our best to pin that down into a view that allows us to have a fair view of risk, and that's part of the construct of a premium. So we try our best to model it and to see all different perils that go into a treaty or into an insurance contract that are fairly reflected in terms of expected loss.

But you would agree that the uncertainty you cannot like get away with increases the price and the necessity of asking for a premium. Is that correct?

That is not correct. It is -- it depends on the underlying data and on the transparency we get on the underlying data, sometimes more data and more visibility actually increase the prices.

And in terms of wildfires?

As I said before, we stick to our view of risk. We have quite a few data points on wildfires. The modeling is -- we do have a wildfire model, and we try our best to determine the expected loss there.

Thank you. So let's see maybe we go back to the room. Any more questions in the room for Urs and Gianfranco? Yes, please.

Maybe you can talk a little bit more about the parametrics, particularly the example you had with Arizona. How long have that contract been in place before we had? I'm just trying to get a sense of whether it was -- you did it and then suddenly, you had to pay out everything in that same year or whether it had a longer term to it. And then maybe just talk a little bit more about the role of parametrics now. Are they still kind of like very much at the periphery? Or are they really making some inroads into the market?

So parametric products are interesting because they offer an objective view on the trigger point and also an immediate cash payout, which can be used to, as I said before, to fund some of the adaptation measures that are so needed to cope with heat in this case. We've had -- we have also precipitation. We have different types of weather phenomena that we can model and that we offer a parametric product to.

Some have been in place over many, many years and have not been triggered and some have been in place since very recently and have been triggered. So this is -- this depends a bit on the product that has been applied. But there is payouts. And clearly, we see the benefits of the towns and the cities to use those funds to -- for the benefit of the communities, which is sort of the point of that example to link insurance to the resilience of infrastructure and the cities.

Very good. I don't see any questions more online. Any one last question in the room? If not, I say thank you very much for joining today. You can find the press release from today as well as our presentation on our website. And in case of any follow-up questions, please reach out to [email protected]. Thank you very much for coming.

Good morning or good afternoon. Welcome to Swiss Re's Half Year Results Publication Conference Call and Live Webcast. Please note that today's conference call is being recorded.

At this time, I would like to turn the conference over to Andreas Berger, Group CEO. Please go ahead.

Thank you very much, and good morning and also good afternoon for everybody who's dialing in. I appreciate you taking the time to join us today. Before Anders Malmstrom, our Group CFO, walks you through the details of our H1 results, I'd like to start with some brief remarks.

Today, we're pleased to report a strong net income of USD 2.8 billion for the first half of 2026. This represents more than 60% of our full year net income target of USD 4.5 billion, which positions us well for the remainder of the year. We're proud to operate 3 core businesses. They are our passion. Each one is a leading value creator in its respective market. Together, Life & Health Re, P&C Re and Corporate Solutions provide significant diversification, both from a capital efficiency and an earnings perspective. The strength of this diversified business model is reflected in our first half year results with excellent underwriting results driving the group's 23% return on equity.

Life & Health Re delivered a strong result in the first half of the year, marking 2 consecutive quarters of clean earnings. The result was driven by strong in-force margins and favorable experience, particularly in U.S. mortality. This reinforces our confidence in the actions taken last year and in achieving our USD 1.7 billion net income target for 2026.

Our P&C businesses continued to deliver strong underwriting results, supported by a low level of large natural catastrophe losses and the high quality of the portfolios we have built over the years. This allowed us to post strong results while also strengthening the balance sheet. You hear us talking about cycle management. Let me expand on that and what this really means for us, namely preserving the quality of our underwriting portfolio, maintaining prudence on loss picks, expanding cycle de-correlated business lines, improving cost efficiency and elevating capital management. All of these we are delivering.

The midyear renewals were broadly consistent with what we had already seen at the January and April renewals. Competition remains most pronounced in nonproportional property, where nominal pricing is down by high single digits year-to-date with similar trends observed at the midyear renewals. Casualty and Specialty continued to present a more balanced pricing environment. Within casualty, liability experienced notable rate increases, while motor also saw positive rate developments. Overall, we achieved a mid-single-digit nominal price increase across our casualty portfolio year-to-date.

In Specialty, competition has picked up. However, nominal rates rose across the majority of sublines in specialty. Our approach in this environment remains unchanged, maintaining underwriting discipline while defending our portfolio quality and margins. Being in a constant active dialogue with our clients and brokers is absolutely key in this market. This proximity and relevance to clients means that even if we reduce exposures in some cases, where expected returns no longer meet our requirements, we can often expand our role in other areas. This has helped us not only defend our market position and share of wallet, but also to selectively grow through tailored solutions based on our leading risk knowledge while remaining disciplined where returns are inadequate.

Overall to date, we have maintained our market position. We achieved volume growth of 11% at the midyear renewals compared to our business up for renewal, driven by new business wins in proportional property and selected specialty lines while maintaining broadly stable terms and conditions. Combined with the January and April renewals, year-to-date premium volume increased by 0.5% compared with the business up for renewal. Overall, the nominal pricing across our diversified portfolio remained broadly flat year-to-date. And we consider all of this a good outcome, reflective of successful cycle management so far.

The second important element of cycle management is to maintain prudence on loss picks. Year-to-date, we increased our loss assumptions by 4.4%, almost entirely explaining the risk-adjusted price decline of 4.6%. In addition, new business continues to include our uncertainty load. If experience develops more favorably than assumed at inception, both the prudent loss assumptions and the uncertainty load would emerge as positive experience variance. This is exactly the resilience we aim to build into the portfolio and what we are now seeing come through.

Corporate Solutions is navigating a similar market environment. Risk-adjusted commercial rates were down by around 6% across the portfolio during the first half of the year. Despite this, the business unit continues to grow in its strategic focus areas, namely in cycle de-correlated lines and differentiated propositions such as international programs. Over the years, we have built a market-leading AI-enabled technology platform that allows us to seamlessly manage the insurance needs of our multinational clients across more than 150 jurisdictions. This makes us a trusted global partner with a truly differentiated value proposition.

The exclusive strategic partnerships announced to date in Mexico and India are a good example of how we continue to strengthen this proposition while selectively expanding our presence in attractive growth markets by leveraging our underwriting expertise and global capabilities. This, too, is an important element of how we manage the cycle. Alongside our underwriting actions, improving efficiency remains a key priority. To date, we announced an increase in our operating cost reduction target to USD 500 million by 2028. The increase reflects strong progress towards our initial reduction target of USD 300 million by 2027 as well as further opportunities to simplify how the group operates, focusing on non-client-facing teams. We continue to measure this cost reduction on a run rate basis. That means the lower cost run rate of USD 500 million by year-end 2028 will be fully reflected in the full year 2029.

I also mentioned capital management as a key component of our cycle management strategy. Anders will update you where we stand on this. Looking ahead, our priorities remain unchanged. We remain focused on delivering our financial targets and the group's overall resilience. Although the market environment remains competitive, and we are entering the peak of the hurricane season, we are -- sorry, I just got a mix up here. We are confident in the quality of our portfolios, our disciplined underwriting approach and our diversified earnings profile.

Now with that, now I can hand over to Anders and not before, and he will provide you a bit more details on the first half year results.

Thank you, Andreas, and good morning or good afternoon to everyone on the call. Andreas has taken you through the highlights of our strong first half year performance. Let me add a few further details before we move to the Q&A. P&C Reinsurance reported an insurance service result of USD 1.8 billion in the first half of 2026, well above the prior year level. The increase was mainly attributable to favorable experience variance related to both current and past services. The positive experience related to current services of around USD 350 million primarily reflects large nat cat losses, coming in USD 676 million below expectations, of which USD 391 million in Q2. Positive experience related to past services of around USD 350 million in the first half of 2026 reflects reserve releases across short-tail lines of more than USD 1 billion.

Given the benign large nat cat experience in the first half, we retained a significant portion of these releases by adding around USD 500 million to IBNR reserves for long-tail lines in the second quarter. This is in addition to the IBNR reserves established earlier in the year for potential inflationary impacts of the ongoing Middle East conflict. Together, these actions further strengthen the resilience of our balance sheet. On the back of these elements, P&C Re reported an excellent combined ratio of 76.7% for the first half, comfortably within its full year target of below 85%.

Let me also briefly touch on new business CSM before moving to Corporate Solutions. P&C Re generated new business CSM of USD 1.6 billion compared with USD 2.2 billion in the prior year period. The year-on-year reduction in new business CSM and increase in new business loss component is consistent with the approximately 4 percentage point increase in the nominal combined ratio on the between 6 billion and 7 billion of treaty business renewed through the end of June. In addition, there is also a modest impact from our facultative book. It was important to point out that the new business CSM reduction is driven by our higher loss picks, not by an overall decline in nominal pricing. That is a good sign.

Turning to Corporate Solutions. The business continued its strong performance, delivering a combined ratio of 86.1%. The insurance service result amounted to USD 578 million, supported by a CSM release of around USD 400 million. Experience earned and other was positive at USD 193 million, primarily driven by a favorable experience related to past service across lines of business. In addition, Corporate Solutions benefited from lower-than-expected large nat cat losses, more than offset by the usual allowance for potential claim seasonality due to late reporting. New business CSM amounted to USD 201 million compared with USD 262 million in the prior year period, reflecting the more challenging market environment in some lines, partially offset by the inclusion of P&C Re's credit and surety business.

Turning to Life & Health Re, where we continue to see the benefit of the actions taken in 2025 coming through. Net income for the first half amounted to just over USD 1 billion. The insurance service result increased to USD 1.2 billion and includes a CSM release of USD 758 million, corresponding to an annualized release rate of around 9%, in line with our full year guidance. The result was again supported by positive experience variance, particularly from U.S. mortality. New business CSM amounted to USD 338 million compared with USD 569 million in the prior year period, primarily reflecting lower transaction activity. On our investment portfolio, again, it delivered a robust contribution in the first 6 months with an ROI of 4.0% and a recurring income of USD 2 billion.

Let me also add a few words on Group Items. The result includes a reserve increase taken in the second quarter related to business in runoff that was formerly part of our dissolved Life Capital unit, which included ReAssure, iptiQ and elipsLife activities. Over the past years, we have successfully exited almost all of the former Life Capital businesses. In this particular case, to facilitate the exit, we provided a supporting reinsurance arrangement as part of the transaction. Following the decision to place this reinsurance contract into runoff and manage it separately from our core reinsurance business, we reallocated it from Life & Health Re to Group Items, where we manage our other runoff activities. The comparative information has been updated accordingly.

Finally, on capital, Swiss Re continues to maintain a very strong capital position with an estimated Group SST ratio of 264%, comfortably above our target range. The increase of 14 percentage points since 1st of January 2026 primarily reflects underwriting and investment contributions as well as a temporary benefit of around 5 percentage points from the issuance of subordinated debt to partially refinance debt maturing in 2027. We're also making good progress on the USD 1.5 billion share buyback we commenced in March, having executed approximately 60% by the end of July.

With that, I will leave it here and hand over to Thomas to open the Q&A.

Thank you, Andreas. Thank you, Anders, and hello to you from my side as well. As usual, before we start, I'd just like to remind you to please limit yourself to two questions. And should you have any follow-up questions, please rejoin the queue. Operator, with that, can we please have the first question?

The first question comes from Andrew Baker from Goldman Sachs.

First one, could you just help me on the reserving side, please? I think you said that you released USD 1 billion in short tail reserves in the first half. I appreciate you recycled a lot of that into long tails. But USD 1 billion over 20% of your earnings target for this year at least. So how structural should we see these short-tail reserve releases as we think about sort of earnings 2027 and beyond? And then I guess on the long-tail additions, is this just prudence? Or have you seen any deterioration in underlying trends in any of these lines?

And then secondly, I appreciate these are relatively small numbers. But if I look at your midyear renewals, your higher loss assumptions is plus 4.2% within your pricing. This is down from plus 4.4% in April year-to-date and plus 4.6% in January. So just curious what has sort of led to this sequential decline? Has anything changed in your view here? Is it mix? Or am I just sort of missing something?

Okay. So maybe just on the reserve releases, I mean, what we have seen now, and I think I highlighted it now also in the prepared remarks is, obviously, in the current period, you see it's mostly coming from the nat cat side, so the low nat cat clearly. But then in the previous period, it's really coming from the prudent reserving and the prudent loss picks in a way that we've done mostly on the short-tail lines. And so that's, in a way, now a testament that the reserving philosophy that we changed is really coming through now, and we see positive reserve developments. And this altogether, I think, allowed us then to just strengthen resilience and also put some of that into IBNRs into long-tail lines, which is not a trend, and this basically answers your second question here. This is not about seeing a trend. This is in a way, just having the opportunity to do that in a very strong environment to strengthen the resilience of these lines, but not because we see any worsening here at all.

And then your question about the intermediate renewals here about the loss picks. This is not a change in loss picks. This is the business mix that we have now seen in basically the January and April and now also in the June, July renewals. Overall, very consistent. And I always say this is a continuation. This is not a change here. It's all the differences you see is because of the different business mixes we have. But individually by business line, it's pretty much the same now since the beginning of the year.

The next question comes from Shanti Kang, Bank of America.

I just have two. So first one is on P&C and thinking about the direction of the earnings into '27. Could you just help us think about that? So given the decline in new business CSM today, how should we think about the direction of the P&C earnings into 2027? Sort of at what point does lower new business profitability start to sort of outweigh any benefits from a very profitable in-force trying to gauge that balance.

And then the second thing is just on casualty. I was listening to the U.S. earnings calls over the last few weeks, and one of the larger peers is super cautious on general liability in the U.S. And I know you guys have cut back your book in the last year or so, but it would just be good to get your thoughts on conditions there given you're saying rates are increasing, but it seems like loss cost trends are still pretty buoyant there. So just getting your thoughts on that would be helpful.

Okay. Excellent. Look, I think, I mean, I'm not in a position to give the guidance now going forward for 2027. But what you clearly see, I think the reduction in new business CSM gives you some idea here. But at the same time, also what we now see coming through is really the reserving benefit from being at the upper end of the best estimate range. And just to give you a bit kind of details for what we see now just for 2026 because you see in the slides that the renewal impact is roughly 4 percentage points in nominal combined ratio, which is for the renewed business. So this has not fully come through in 2026. And we are very comfortable to stay with below the 85 combined ratio points. That, kind of, gives you the indication that we can expect a mid-triple-digit reserve release that's baked into this expectation. And we're not really guiding here to anything in 2027. But I think if you just take that trend going forward, I think it gives you an estimate and then in the fall, we give you the full outlook for next year.

Maybe on casualty very briefly. We are very happy with the position we're in with the market share and also the subsegments, sublines that we're operating in. The nominal price changes that came through are actually reflected also in the growth that you can see in the casualty line, particularly in the U.S. But also, you have to see that the loss assumptions that we have put up is actually bigger than the nominal price changes that we see. So we still have a prudent approach to casualty and we're consistent with what we have seen before and done before. And that's sort of the way you should interpret our statements. I don't know what the markets then say, but that's definitely our approach here.

The next question comes from Kamran Hossain from JPMorgan.

Two questions from me. The first one is just intrigued about the motivation behind the increased cost cut. Definitely kind of a welcome thing, increased efficiency. Clearly, you're well on the way to kind of hitting your number that you set out previously. Is it market conditions, revenue may be a little bit softer? Just understanding kind of why today, it feels like it's a kind of full year issue to kind of talk about. The second question is just back on the long-tail reserving additions. Anders, I think your explanation around kind of the amount you've -- where it's come from, where you've recycled it makes sense, kind of adding more into prudence, et cetera, the kind of lemon tree.

What -- I think when you did the -- took the actions in Q3 '24, you talked about being at 90th percentile kind of reserving confidence across the entire book. And I think talking to a predecessor, he suggested that in the kind of casualty book, it would be higher than that. Could you maybe give kind of some qualitative comments around kind of whether those numbers are a little bit higher these days or whether actually just everything is running to plan?

Very good. Okay. Maybe just starting with costs. Look, I think cost is something that every company has to maintain and manage constantly. And that's not different for us. And we announced this program now 2 years ago, it's a USD 300 million. We're very well on track with it. Remember, I always said it's important that it's not just a hockey stick. It's a constant every year. Basically, we make progress towards that. That's going according to plan. And so with that in mind, we basically say, look now, let's extend that because it is going to plan, extend it by a year, but also to increase it. The benefits should then really come through that there's a better support ultimately for the clients and for the businesses. That's why we focus on the nonclient areas within the group, focusing on processes, focusing on simplifying the group, which then frees up resources that will help to grow the business.

Timing just because we're well underway here, we're in the middle of it now 2 years after it. So we thought it's a good time now to update that and give you that guidance here. On the long-tail reserve additions percentile, I mean, when we announced it, we said clearly, we want to be -- we are at the 90th percentile going forward. We will not give an exact number, but we are at the upper end of the best estimate range. And we continue to be at this upper end of the best estimate range. And you also see that now coming through the positive reserve development that we now see now basically quarter after quarter, which shows you that we are above the midpoint. So without giving you a number, I mean, I think it's really going according to plan.

The next question comes from Iain Pearce from BNP Paribas.

Just a follow-up on the sort of mid-triple-digit reserve release number that you're sort of saying we should expect in a normal year. Does that include the uncertainty? I'm just sort of back of the envelope here. If I say we could expect a 250 normalized reserve release and adjust the experience variance for that, that would be a 6-point headwind on the combined ratio for H1, which gets you to sort of roughly 83% level and then I add 4 points for the renewals, and I'm at 87% for next year. Could you just sort of -- or 87% for the business you're writing. Could you just sort of point where I'm going wrong there or sort of what's leaving that confidence on the 85% versus that math?

And the second one is just on the competitive positioning in the Life & Health business. I understand that this business can be lumpy. But even if we look sort of over the last 4 quarters versus the previous 4 quarters, new business CSM is down in the mid-teens FX adjusted. So just trying to see how you're viewing your competitive positioning, how you're viewing the competitive environment in Life & Health and sort of what the pipeline looks like for new business in Life & Health from here?

Yes. So let me start on the first one. I think what I tried to basically explain to you here with the mid-triple digit, that's what we -- when we put the target together, that was exactly how we assess and said, okay, we feel comfortable to go below the 85% target. Obviously, now going forward, that will be -- yes, will be adjusted. But this is how you should think. We knew that we see the pricing pressures, and we saw that increase. At the same time, we're very comfortable that we will see these releases coming through. Part of it from the UCL, part of it from the prudent loss picks. So that's -- I would say that's that. And then also, it obviously depends. You always see the benefits or headwinds coming from the nat cat side. That was baked into this view.

So Life & Health. On Life & Health, clearly, we have the long-term objective to be new business CSM 100% sustainable, which means we generate a new business CSM that is equal or higher than the CSM release that we see. That's the stated objective. Now because it's also heavily dependent on transactions, this can be quite lumpy. And you're absolutely right now that we've seen a couple of quarters or maybe even a bit more where we were below that, but we've also seen quarters where we were above that. I mean last year, we were CSM sustainable above 100%. I think this year, we will not be at 100%. We're very comfortable that for the second half of the year, we will be back on, call it, a normal run rate. but I don't think we're going to get back to 100% on the CSM sustainability. But this is a clear objective in the long run, which we've also had in the past. So it just can be lumpy periods.

The next question comes from Will Hardcastle from UBS.

Are you trying to tell us essentially that the 30% new business CSM reduction? So I think if we annualize that, it would be close to USD 0.75 billion or something is almost entirely extra prudency and therefore, there's almost zero underlying earnings pressure from the renewals. That feels too generous to me. But I guess, can you perhaps bridge that 30% reduction between prudency volume and margin?

And I seem to remember the new reserving philosophy that came in a couple of years ago was putting on around USD 600 million extra reserves pretax. So this would take time to ever get released to that extent in any given year, but you've released USD 1 billion of short-tail property year-to-date. And I guess, presumably, you're not encouraging us to extrapolate that USD 1 billion. And is this unwind sort of extra prudency as well that you've added in the last 2 years from benign cat, which will ultimately be depleted?

Okay. So let me start. And in a way, it goes a bit together, these questions. So the reduction in CSM, we're not saying that this is all prudent, but we're also saying this is not all just lower business. I think what we're saying is think clearly -- what we're saying is our reduction is pretty much in line with what we see on the renewals front with the different views that we have on the renewals. What we're saying is nominal premiums are pretty much flat. Nominal pricing is pretty much flat. And then you obviously have the assumptions on loss increases. I think we're prudent there, and you've seen that now over the last few years. But we're not saying this is 0. I'm not guiding you towards that this is 0, but I think it's also -- you can make your judgment how much of that is, I would say, directly related to claims inflation and how much you would say there is some room there.

And we will give you the '27 guidance then later in the year based on that. But I think that's an important point. And we want to make sure that we are reserved at this upper end of the best estimate range and then we see positive development, which now is clearly coming through.

The next question comes from Vinit Malhotra from Mediobanca.

So many of my topics have been addressed, but 2 topics, if I can raise, please. One is just on the P&C Re revenue growth, which ex FX shows quite a bit of improvement versus 1Q and 2Q. Is there -- I mean, I remember the cedent updates is a topic, but probably been mentioned again. Is there anything that you would like us to think about the coming quarters in terms of what could drive revenues? And I know it's not a guidance from your side, but -- or in other words, what could be won in the -- I mean, 1Q and 2Q. So that's on P&C revenues.

Second thing is just on the life reinsurance. There's -- I mean, obviously, you're running above target. So I'm just curious whether maintaining the target is driven by some expectations of some normalization or it's just you wanted to be conservative about the target?

Yes, sure. Let me just start with the second one. Just -- look, I think we are running above target, but it's also driven by better-than-expected experience variances. And if you normalize for that, and I think you should normalize for that, at least at that point in time, we will be exactly on target here. You can't -- I mean, mortality can be -- can have some volatility over the year, and we've seen that before. And so basically, assuming that and having a normalized assumption here brings you exactly in line with our target.

And then the other question was really on the revenue. I think you're absolutely right. I mean there's an FX component here. We don't really guide here. But what you know is that Q3 is usually higher given seasonality of the expected claim just because of the nat cat. You have the nat cat seasonality that usually is much higher in Q3. That's why also you will see a higher revenue coming through there from the expected claims. Other than that, I think it's just a very straightforward roll forward from what you've seen now over the first 2 quarters.

The next question comes from Chris Hartwell from Autonomous Research.

First question, if I may, is just on the investment book. The reinvestment yield, I think you pointed to a 90 basis point quarter-on-quarter improvement. That seems a little high versus what we've seen sort of prevailing in, I guess, in rates markets. So I wonder if you could give a little bit more color on that and maybe if there's any underlying asset allocation shift within that?

And second question, just on the P&C Re side. The expense ratio has been trending upwards a fair amount actually, I guess, over the last couple of years and quite a bit higher in H1 versus the prior year. So I was wondering if you could also give a little bit of color on how we should view the expense ratio development through 2026. And I guess also whether there will be any benefit coming through to that on the cost side or whether this is obviously pure underwriting expense?

Okay. So let me start on the investment side, in particular, the reinvestment yield. And particularly in Q2, we saw a significant -- I would say, materially higher reinvestment yield. This is not the result of any kind of changes in SAA. It's just that in this quarter, we had a higher allocation from the new investments into spread products. This is public and private credit, which now accounted for the majority of the purchases during the quarter. That's not because we wanted to change anything within the in the asset allocation. That was just because in Q2, in particular, we had higher reinvestments into this particular asset class. I think that's important.

And then on the expense ratio for P&C Re, I mean, this is really -- I mean, there's an FX component in here. And I think you should see then some of the expense reduction coming through. But the expense reduction throughout the firm. So this is only a part of that actually gets allocated to P&C Re. So I don't think this will have a material impact on the expense ratio. And then the other one is just we saw lower revenues coming through, which obviously naturally just increases the expense ratio here.

Can we have the next question, if there is one?

We actually don't have any questions right now from the phone.

Maybe on the expense ratio, just to add, we are here very well in competitive benchmark level. So it's not something to worry.

And in the future, we will also provide a breakdown of the USD 500 million cost savings, exactly which line item it goes to and how we're doing against that.

With that, thank you all for your questions, for attending this call. Should you have any follow-up questions, please don't hesitate to contact any member of the Investor Relations team. Thanks again, and have a good rest of the day.

Good morning or good afternoon. Welcome to Swiss Re's Q1 2026 Results Conference Call and Live Webcast. Please note that today's conference call is being recorded. At this time, I would like to turn the conference over to Andreas Berger, Group CEO. Please go ahead.

Thank you very much, and good morning or good afternoon to all of you. I appreciate you taking the time to join us today. Before our Group CFO, Anders Malmstrom, walks you through the details of our first quarter results, as usual, I would like to start with some brief remarks. We've made a strong start to 2026, delivering a net income of USD 1.5 billion in the first quarter. This represents 1/3 of our full year net income target of USD 4.5 billion and positions us well for the remainder of the year. The annualized ROE for the quarter amounted to 24%. All business units contributed to this result, also helped by a good investment contribution.

Both P&C businesses delivered strong underwriting results, supported by a low level of large losses in the quarter and excellent underlying profitability. This allowed us to post a strong overall result while also strengthening the balance sheet. Turning to the market environment and P&C reinsurance renewals. The April renewals confirmed the continuation of the trends observed in January. Our focus on prioritizing portfolio quality over volume remain unchanged. This is what is required by cycle management. Competition has intensified, especially in nonproportional nat cat. Here, the nominal price is down high single digits for our overall nat cat portfolio through the year-to-date renewals.

Casualty and specialty lines show a more balanced overall price development picture. Within casualty, liability experienced notable rate increases, though we remain cautious with motor also seeing rate improvements. Overall, we have achieved a nominal price increase in the mid-single-digit range for our casualty portfolio year-to-date. Within specialty, competition has picked up. However, nominal rates rose across the majority of sublines. As a result, the nominal price is slightly up for our overall specialty portfolio. Through the January and April renewals, we have successfully defended our market position and relevance and importantly, remained underwriting -- maintained underwriting discipline and terms and conditions.

That's key for us. Our client franchise continues to be in an excellent position. Specifically in the April renewals, we saw stable demand in panels in Japan. In the U.S., nationwide clients increased demand and we participated. In certain markets, an influx of new capacity led to materially lower adequacy, and we decided to reduce exposures. India agriculture is an example where such actions can have a disproportionate impact on volumes. Some new aggregate covers were placed. Here, we maintain our cautious stance.

What does that mean in terms of the overall renewal outcome? The April renewals represent a relatively modest portion of our overall business at 12%. Combined with the January renewals, overall nominal prices -- pricing has been flat despite the noted pressures in property nat cat. When taking into account prudent increases in loss assumptions, the net price change stands at a negative 4.4%. Overall volume is down slightly at minus 2%, primarily driven by the nominal property rate declines and by the stated reduction in agriculture business. Overall, the portfolio quality and outcome of the renewals remain supportive of our 2026 financial targets. This also means that our renewals at renewals have progressed broadly as we expected when we set the targets at the end of last year and communicated it also to you.

We expected a more challenging 2026, and this is clearly what is happening. This is simply the nature of our industry, and therefore, you will continue to see us applying discipline and cycle management. Subject to loss event development, we expect similar trends into June and July. This means higher demand but continued pricing pressure. Accordingly, at this point, you should not expect us to write higher volumes. We will remain focused on defending the overall price adequacy and quality of our portfolio. Now turning to Life & Health Re. The first quarter has provided encouraging signs that the actions taken in 2025 are delivering the intended outcome. The business is now on a very strong footing, let's say, on a stronger footing as evidenced by clean earnings delivery in the quarter, supported by a positive experience variance for the first time, by the way, since our IFRS transition. This supports our confidence in achieving the USD 1.5 billion and USD 1.7 billion net income target for 2026.

Let me also touch on new business generation across the group. The main driver of the year-on-year decline is the impact of the January renewals in P&C Re. In addition, the contribution from Life & Health Re in the first quarter was more muted, which reflects the inherent variability of underlying transaction activity throughout the year. By contrast, new business CSM in Corporate Solutions remained broadly stable year-on-year, which is a very solid outcome in the current environment.

CorSo benefited from more favorable reinsurance conditions in the external market as well as the inclusion of the P&C Re's credit and surety business. This partially offset the risk-adjusted rate decrease that we saw in Q1 and which amounted to around minus 5% for our overall portfolio. While CSA is clearly also having to manage downward price pressure, in particular in property, we continue to see underlying growth in our strategic assets that we call them and focus areas, including international insurance programs and alternative risk transfer solutions.

Looking ahead, our goals remain delivering on our financial targets and the group's overall resilience. Against the backdrop of geopolitical turbulence and an increasingly challenging market environment, our P&C businesses will remain focused on disciplined underwriting. In this context, we expect Life & Health Reinsurance to make a growing contribution going forward. At the same time, we remain focused on cost efficiency. Now with that, I'll hand over to Anders for a closer look at the financial details of our financial first quarter results. Anders, over to you.

Thank you, Andreas, and good morning or good afternoon to everyone on the call. Andreas has taken you through the highlights of our overall positive first quarter. Let me add a few further details before we move to the Q&A. P&C Reinsurance reported an insurance service result of almost USD 800 million, well above the prior year level. The increase was mainly attributable to favorable experience variance, which captures deviations from initial reserving assumptions. In the quarter, we saw positive experience variance related to both current and past services.

Just as a reminder, under IFRS, this broadly corresponds to what we previously referred to as current year and prior year development. The positive experience related to current services was around USD 100 million, primarily reflecting large nat cat losses coming in USD 276 million below expectations partially offset by reserve additions of slightly more than USD 100 million in IBNR form to cover potential late attritional losses.

Andreas mentioned that we strengthened the resilience of the balance sheet. In the quarter, we achieved a positive experience of around USD 130 million related to past services. This includes around USD 450 million of positive reserve developments. In light of geopolitical uncertainties associated with the ongoing Middle East conflict, we decided to retain most of these benefits and established around USD 400 million of IBNR reserves to address potential inflationary impact, of which USD 350 million in P&C Re.

On the back of these elements, P&C Re reported a strong combined ratio of 79.5% in the first quarter, comfortably within its target of below than 85% for the year. Let me also briefly touch on new business CSM before moving to Corporate Solutions. New business CSM amounted to USD 1 billion compared with $1.4 billion in the prior year period. As we indicated with our full year results in February, we expected the January renewals to translate into a roughly 3 percentage point increase in the nominal combined ratio compared to the up for renewal portfolio.

The year-on-year reduction in new business CSM of around USD 350 million is largely consistent with that expectation. Turning to Corporate Solutions. The business unit delivered a strong combined ratio of 85.1%. The related insurance service result was $286 million, supported by a CSM release of $192 million, broadly in line with last year. Experience variance and other was positive at $146 million, primarily driven by a favorable experience related to past services across all lines of business. In addition, Corporate Solutions benefited from lower-than-expected large nat cat and man-made losses, largely offset by the usual IBNR allowance for potential claims seasonality due to late reporting.

New business CSM remained broadly stable, supported by resilient new business generation and the inclusion of about USD 40 million from P&C Re's credit and surety business, partly offset by a more challenging property pricing environment. As a reminder, net new business CSM is subject to seasonality with the majority of the reinsurance program incepting in the first quarter, while assumed business is written more evenly throughout the year. Turning to Life & Health Re, where we see the impact of the actions taken in 2025 coming through. The net income of USD 491 million reflects underwriting margins from the large in-force book, favorable experience and a solid investment contribution. The insurance service result increased to $547 million and includes a CSM release of $379 million, corresponding to an annualized release rate of around 9%, in line with our full year guidance. The result was also supported by a positive experience variance of USD 60 million, primarily from the U.S. mortality portfolio.

A few words on the top line. Group insurance revenue is down $371 million versus last year, primarily due to P&C Re, where the overall renewals outcome and reduced cedent volume updates represent the main drivers of P&C Re's 8.5% decline. On a net basis, P&C Re's revenues are down by a more modest 5.7% as we lowered our external retrocession in nat cat. Further, iptiQ revenues contained in group items have reduced by $192 million due to our withdrawal progress on that business.

Life & Health Re revenues are up by $240 million, mainly due to FX tailwinds, while Corporate Solutions revenues are down $77 million. Excluding the impact of the discontinued Irish Medex business, CorSo's revenues are up by around $100 million, which includes an FX tailwind. We also benefited from strong investment results with an ROI of 4.6%, supported by disposal gains of USD 159 million, primarily from real estate sales, while recurring income remained healthy at USD 1 billion.

Lastly, on capital, we continue to maintain a strong capital position with the group SST ratio estimated at 252% as of 1st of April, above our target range.

With that, I will leave it here and hand over to Thomas to open the Q&A.

Thank you, Anders. Thank you, Andreas, and hello to all of you from my side as well. As usual, we have the first question, please?

The first question comes from Kamran Hossain from JPMorgan.

I've got one topic with a couple of questions. Really kind of intrigued about kind of your attitude towards that building prudence at Swiss Re. I know we talked about this at the IR Day and not wanting to push too hard. But what was behind the decision to post such a strong Q1 combined ratio kind of discount in your favor, like, you've done some stuff anyway. But could you have done more given you're probably a little bit earlier on your kind of reserve build journey than some peers. So kind of to do that more.

The second question is just on reserve releases in the quarter. In the commentary, you mentioned -- I think it's USD 450 million of reserve releases in the quarter that you offset with the kind of inflation-related Middle East sorry, the inflation as a result of the Middle East-related charge.

The USD 450 million, was that substantially higher than you had expected? Because for me, that does sound very high for a quarter. I just wanted to understand whether this is just positive development or something else happening in the background that means this could be a higher number going forward?

Yes. Maybe we come and these 2 questions in a way are the same question. They hang very much together overall. So maybe just to step back, when we talk about reserving, when we talk about prudent approaches, I think we were very clear that we're always going to reserve at the higher end of the best estimate range. And that's the philosophy, how we reserve, how we set also loss picks, and you also see that now in the renewals. The loss picks that we said are prudent. They reflect the basically exactly to be at the upper end of the best estimate range.

So that should then also in a normal quarter, this should then also come through to the reserve releases. And that's exactly what you now saw in Q1. The USD 450 million is a solid number. We don't really give hard guidance, but we show evidence, and we see that every quarter how this reserve is now developing. And that's on purpose. That's absolutely on purpose. Now to your point about then also more technical questions like discounting and other things. These are more consequences of that. So the discounting is not higher per se this quarter. It's only higher because of the additional reserve that we put up for the Middle East because you basically allocate it to all the different lines, including liabilities.

We just put it everywhere. And then because you have a long-term liability business, that's where the discounting is higher. So it's a consequence of the reserving. It's not the reason for the good result. So I think overall, we're very happy with that. It actually shows that the whole framework is now working and is coming through. So it's a good outcome.

The next question comes from Will Hardcastle from UBS.

Just thinking about the P&C renew business CSM, clearly, that was materially low. And you said it aligned with your expectations when setting those full year targets in December. And then you link that with about 3 points of combined ratio deterioration. I guess the question is if the June and July renewals, if we see this continued trend, and let's say that pushes us beyond the 3 percentage points combined ratio guidance, is that then starting to say it's a bit worse than we anticipated for '26 and beyond?

Because of course, a lot of this -- I guess the other part of that is how much of that USD 1 billion new business CSM flows into the current year earnings versus what goes into future, thinking about extrapolation of that.

The second one, I just wanted to quickly come back to Cameron's question there on the USD 450 million of experience variance. It's a really large number. Is there any, I guess, one-offs within there? I mean I presume you're not trying to make a that's a run rate from here. I guess any color of sort of abnormality within that USD 450 million would be very helpful.

Okay. So let me start on the new business CSM. I think -- look, I think we -- as you rightly state, I mean, the 3 percentage point combined ratio impact is exactly in line with what we see now on the new business CSM -- and look, our view is that we -- everything else equal, we will probably see a continuation of what we have seen at 1/1 and 1/4. So we have no indication one way or the other. But the other point I want to make here, I mean, this really reflects also a very prudent loss pick that we put in. So the 4.4% that you see here, I would say, I mean, that goes back to the discussion we had before. That's a very prudent assumption. That's obviously reflected in the new business CSM. So we don't try to manage new business CSM. We let it go through.

And then once we see the reserve development, you should then see it come through in the form of reserve releases, which leads me directly to your second question, the USD 450 million, there is no one-off in it. This is just the reserve development. But it also allowed us now to say, okay, I think we see the uncertainty in the world. We see the Middle East conflict that creates volatility. Let's take a prudent approach and put some of that money to the site for inflation that we will see somehow.

You will see an inflation impact coming from the higher energy prices coming from the disruption on the supply chain. We don't know exactly how much. We don't know for how long this is going to last, but this allowed us now to take that approach as well to then continue that prudent approach.

The next question comes from Shanti Kang from Bank of America.

I was just reading the U.S. primary results over the last few weeks, and I noticed a number of the primaries are increasing their limits and being able to negotiate more favorable terms on their reinsurance programs. And then this morning on one of the London market names, we heard for the first time that there's been a bit of modest slippage in Ts and Cs. So I was just curious to get your take on that. And if there is any slippage, where is that focused? Is that on attachment points? Is that on wordings? Or you mentioned a bit earlier the return of ag covers in specifics. But any color on that would be really helpful.

Yes. Let me take maybe that question. I think we have been very clear. So terms and conditions, structures remain stable. We have also heard of maybe individual cases where aggregates suddenly were a topic again. But I think we will apply discipline, and that's what I said also in my initial remarks, we stay very cautious here.

We don't see a reason why this should be supported. We also have heard also from primaries, certain individuals who are referring to rates shooting down in certain markets, in particular, E&S. And here, I can assure you, we're observing the whole situation. We're reinsuring some of it. That's why we're very attentive here. And I can assure you on the CorSo side, it's a very, very limited activity and exposure that we have there mainly or almost exclusively in property with a very low volume of around USD 200 million to USD 250 million revenues coming from that area. So we're observing it, obviously, as a leading reinsurance market, but we're very cautious.

The next question comes from Andrew Baker from Goldman Sachs.

First one, just on the P&C Reinsurance revenue.

So you mentioned the sort of renewals were broadly in line with what you're expecting coming into the year. It sounds like -- or it looks like the results today is lower than what it sounded like you were expecting at the December management dialogue event last year. So can you just help me understand sort of where that delta is. So what the decline was versus what it sounds like you were previously expecting?

And also how we should think about insurance revenue developing for the rest of the year? And then on the Life & Health Re side, so it's obviously good to see the positive experience variances come through today. I can see that's driven by U.S. mortality experience. Are you able to give us an update on the experience variances related to the previously underperforming portfolio, so Australia, Israel, South Korea, -- were they positive, neutral or negative? Any color there would be helpful.

Yes, sure. I can do that. So maybe just back to your revenue question.

And also, I think I mentioned that in the opening remarks. So it's really 2 drivers for the -- on the P&C reset. One is the renewals outcome. And the renewal outcome is pretty clear. I think we -- as Andreas also said, is on expectations. And then the second one is the cedent update. And you can maybe say the cedent update came in a bit lower than what we expected. And that's something you don't really know until you actually get the underlying data. So that's really the 2 drivers and nothing else there.

On the Life & Health Re, absolutely, we have very positive experience now in the U.S. mortality front. All the other portfolios are absolutely in line with expectations. So there's nothing else there, which is exactly what we expect and which is a good outcome.

And maybe for the outlook there, you were referring to it. Look, we're going to go through the next renewals, and we told you we expect that the trend holds. But I would also highlight that there are opportunities in the market. So it's not all glooming. It's mainly a property and Cat topic. And we see increasing demand, in particular, also through the crisis in various parts of the world. There's not only a downside, there's also an upside. So we see heightened activities around infrastructure investments, increased resilience of nations of critical infrastructures, and that's where we're definitely going to participate.

And this will land up in obviously the treaties. -- if the primaries are participating on a single risk basis, we participate through the FA business that definitely will then grow with the investments, but also with CorSo. And I think one should focus on the areas where there's healthy opportunities while we keep the resilience of the group.

The next question comes from Ivan Bokmat from Barclays.

I've got 2 questions, please. One is on the investment results. Maybe you could talk a little bit about the investment disposals that you've seen this quarter and how does the pipeline looks for those type of gains or perhaps some other form of true-ups later in the year, how should we think about it? And another question is just about the USD 400 million of Middle East reserve that you have established. Maybe you can give a little bit of color of how much of that related to pure inflation impact and how much of that could be the direct impact from the conflict?

Yes. So let me start on the investment results. So maybe just to step back, the overall investment result at 4.6% is obviously higher than what you would usually expect. Recurring investment is 4.1 and reinvestment -- new investments of USD 4.3 billion was really driven by the disposals on the real estate. This is a one-off. You should not expect that to come in the future quarters. So -- and also, we don't have anything that we would guide you to for additional investment gains.

Importantly, I think we have a very strong recurring investment results of 4.1%, and this will continue to be that. And that's higher than what we had in previous years due to the repositioning of the portfolio. On the USD 400 million reserve, this is an inflation. It's an IBNR, first of all, it's an IBNR for impact that might come as a second order impact from the Middle East war. -- we have very negligible first order impact. So we're not really exposed to any claims coming directly from the war. It's all about the second order impact, which really be the inflation, driven by higher energy prices and also disruptions in the supply chain.

And maybe the driver of realized gains was real estate.

The -- sorry, I forgot that. Yes, the driver of the realized gains was real estate and disposals in Switzerland.

The next question comes from Chris Haswell from Autonomous.

First question is just wanted to come back to the P&C Re combined ratio. I understand the deterioration that you're expecting from rate. But if I look at the year-to-date premium and also the renewal data from both January and April, I mean, there does appear to be -- I assume there would be some duration lengthening through that book and casualty is either flat or growing versus particularly property and nat cat shrinking.

So wondering if -- or what we should be thinking about combined ratio development just because of the sort of duration impacts there? And second question, the expense ratio in P&C, obviously ticking up. And with volumes coming down, I was wondering beyond what you've already said about cost initiatives, is there anything more that you could be thinking about to try to protect the combined ratio from an expense side?

Okay. So maybe your first question about the combined ratio on the P&C Re side and the lengthening of the book. We don't really see a lengthening of the book, not at all. So also from the renewals side, there's no reason why the book should lengthen. And the only reason maybe that's why the discounting is a bit higher are these additional reserves that we also attributed some of them to the liability book. But other than that, from the pure renewal and development of the portfolio, there's no lengthening of the book. On the expense ratio for the P&C, it increased mainly for 2 reasons.

One is just the decline in revenues, clearly and then the other impact is FX. So this is no underlying development there from an expense perspective. So it's purely driven by -- basically by the denominator of the ratio.

The next question comes from James Shuck from Citi.

Sorry, but I just wanted to return to the P&C insurance revenues again. So the gross revenues are down 8.5%. But still, I hear what you're saying about the -- some of the contributing factors towards that. But the premium, the renewals year-to-date down 2%. This time last year, you were up kind of 5% or so. I'm just struggling to kind of square that with the gross revenues being down 8.5% at this point, even with the changes to the notifications. And then secondly, can you just unpick the P&C new business CSM for me?

So it's down 30% year-on-year. presumably there was some positive FX in that. So what's the constant FX number? And is there any contribution from changing to discounting rates in that? I guess what I'm getting at is if you're saying kind of 3-point increase in the combined ratio at least 30% decline, is that a good rule of thumb going forward? So every point is about 10 points of that new business?

Okay. So maybe on the first one, maybe one thing I should just clarify, I wasn't maybe that specific before. When I talk about renewals, we obviously always talk about the 1/1 renewals. But what we also need to reflect here are the renewals that happened still during the second half of 2025. Obviously, we never had a renewals update explicitly, but this also goes into that calculation has mostly happens during the later part of the second half of the year. That's also reflected in the revenue.

There are some transactions there that have very low margin, but have a higher revenue. And we had some reductions there, but it has very little bottom line impact. So that should also be reflected in the revenue development here. Now on the P&C re the CSM calculation. So for you, I think that the way to think about it, if we have this new business coming in with a lower premium or lower margin, we said it's about 3 percentage points on combined ratio. And that translates with the revenue, we have about USD 350 million.

So I don't think just in percentages, you think in dollars. And then you reduce that from the CSM new business and that we have the year before. The premiums overall are the same, pretty much the same. You have USD 350 million less. That brings you exactly to the number that we disclosed now in Q1.

And James, just on the other renewals on the revenue development, Anders already mentioned the season updates, which are, of course, a true-up of the renewal information from last year, where the underlying volumes are lower than initially expected, particularly on quota shares.

The next question comes from Vinit Malhotra from Mediobanca.

So for me, the first one is just on the retrocession changes. I've seen the nat cat YTD is down 11% growth, but only 4% net. It looks like a pretty big shift happening there. Could you just comment a bit about what was done and what are the implications of that? Is it really more risk taken -- or is it margin management? So a little bit of on that looking like a big shift. Second thing is just on the Corporate Solutions. This new business loss component of 77 minus 77 is quite big, and you commented it because of MH business.

But I'm surprised, I thought it could be a generic issue with maybe pricing or is there any other drivers there? Or was the MH material enough to bring such a loss component charge? So just curious on that, please as well.

Okay. So maybe I'll start on the impact from the retro. And we talked about that in previous meetings also at the management dialogue that we reduced the retro just because we believe it's good business and we can keep it on ourselves. That's why the premium decline actually netting the lower retro is a decline by 4%, whereas if you take the gross number, it's 11%. That's really the -- I think that's the answer.

We just kept more of that business on our books, whereas in the previous period, we retroed it out again to the market. Maybe on CorSo, this is the Accident & Health business. Maybe, Andreas, if you want to give.

Yes. I can confirm Accident and Health remains a strategic priority. It provides still the diversification benefits. That's the reason why we have it. It reduces the overall average expense ratio. So what you see here is that in the U.S., in particular, we had some claims developments. And this reflects also the actions that we took here, and you saw large claim activity in this book, which we haven't seen before. And we don't see it as a trend, but we have seen it in 2025. And this is something that we then address and you should also know that the short-tail nature of this book can actually help us to correct and to introduce corrective actions and then bring the recovery very, very quickly. So that's happening as we speak here in the book. So I wouldn't look at it as a continuum or a trend.

The next question comes from Ben Cohen from RBC.

I had 2 on the Life & Health business. Could you give us a bit more color in terms of the pipeline that you see that gives you the confidence that kind of Q1 was just a bit of volatility in terms of CSM. And I guess related, because of the outlook that you have, do you think that you will actually be able to keep new business CSM at least flat this year? And indeed, do you think that the stock of CSM in Life & Health will actually grow over the course of the year?

Yes. So look, I mean, I think, first, I mean, it's clear that on the Life & Health side, the new business is always a bit lumpy. And obviously, you have the flow business, which is steady, which we have, which is good, but then you have transactions and transactions can be quite volatile. And that's exactly what happened here. We had very good transactions in the first quarter last year. I think now it's a bit less.

I think we will see over the next -- we are very convinced actually that over the next 3 quarters, we're going to catch up there. We have a good pipeline that's coming through. We target and we mentioned that before, CSM sustainability, absent any large transactions, that's very important, absent any large transaction, CSM sustainability.

That's our main objective here. I mean, I can't go into details, obviously, but I think that the pipeline, I mean, is pretty good. Maybe also to mention here, the longevity transactions that we published talked about in was in March is not yet reflected in these numbers. This is an April 1 transaction that will then come in Q2.

Maybe the last point to mention here is also, and you might have seen the announcement yesterday that we now hired a Head of transactions for Life and Health reinsurance. We combined all of that. So that's an important development now that we put more emphasis going forward now also new business on growing the business and also through transactions, which now that the business is on good footage, I think, is the right next step.

I have a follow-up question?

We now have a follow-up from James Shuck from Citi.

With the balance sheet kind of in a strong place and the core earnings now on a much firmer footing, you haven't really done any M&A in recent history. Just kind of what are you thinking about in terms of the pipeline here? And I know you want to grow the Life and Health Re business proportionately. Is there potential for kind of M&A? Would you look to do transactions or something on the open book?

Yes. I mean we can repeat what we always said. We are well established with the 3 business units.

We have a very nice diversification.

We see opportunities in the market. So despite the cyclicality or the cycle management aspect of it, there's still lines of businesses where we can see opportunities. And also geographically, definitely, we can see opportunities. Now having said that, we're always very clear -- we have analyzed the areas through our target liability portfolio approach and have looked at where would we focus on growth, attractive growth and profitable growth organically.

And should there be an opportunity to do bolt-on acquisitions like we have done with the QBE credit and surety portfolio that we took over, then we will do so. It adds nicely to the current portfolio to the credit and surety book because it's straight credit, where we were underweight and it diversified nicely. So if at all, you would -- you should expect something like that. But nothing -- we don't need an M&A. We're not a distressed buyer. We have actually a very solid portfolio, and we can weather the storm in the markets.

Thank you, James. Are there any more questions?

There are no more questions from the phone.

We'd like to thank you for your interest and for your questions. Should you have any follow-up questions, please, of course, do not hesitate to contact any member of the IR team. Thank you again for joining the call, and have a good rest of the week.

Thank you all for your participation. You may now disconnect.

Ladies and gentlemen, welcome to Swiss Re Q1 Results Conference Call. I am Valentina, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions]The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Elena Logutenkova, Head of Media Relations. Please go ahead.

Thank you, and good morning from my side as well to everyone. I am joined today here by our Group CFO, Anders Malmstrom, and Andres will give you a brief overview of our first quarter 2026 results, and then we'll be very happy to take your questions. Anders, over to you.

Thank you, Elena, and good morning, everyone. Swiss Re delivered a net income of $1.5 billion in the first quarter. All business units posted increased earnings, which were also supported by a low natural catastrophe experience and a strong investment result. Property and Casualty Reinsurance delivered a 43% increase in net income to $754 million and a combined ratio of 79.5% for the first quarter against a target of below 85% for the full year.

Large natural catastrophe losses for P&C Re amounted to $133 million, driven by Storm Kristin, which made landfall in Portugal in January. April renewals in P&C Re saw a continuation of the trends we observed in the January renewals broadly in line with what we had expected when we set our targets at the end of 2025. The April renewals are driven by markets in Japan, India and parts of Asia Pacific, representing a modest portion of our overall business at 12%. Our focus on prioritizing portfolio quality over volume remains unchanged as we continue to actively manage the cycle.

Competition intensified with different pictures in different lines. We generally defended our market position and importantly, maintained underwriting discipline on terms and conditions. If you take the January and the April renewals together for a more complete picture, overall nominal pricing has been flat in total. We also made some prudent increases to our loss assumptions. And once those are taken into account, the net price change stands at a negative 4.4%. Overall, volume is down slightly with a 2% reduction.

We expected a more challenging 2026, and this is clearly what we are seeing in practice as the year plays out. This is simply the nature of our industry, and therefore, you will continue to see us applying discipline and cycle management. Corporate Solutions achieved a 26% increase in net income to $262 million with a combined ratio of 85.1% against a full year target of below 91%. While Corporate Solutions is clearly also having to manage downward price pressure in property, we continue to see underlying growth in our strategic areas of focus, including international programs and alternative risk solutions.

Life & Health Reinsurance delivered a 12% increase in net income to $491 million in the first quarter. Following last year's portfolio review, this business is on a stronger footing and has made good progress towards its full year net income target of $1.7 billion. As we announced yesterday, we have strengthened the Life & Health Re team with the hire of Dean Galligan as Head of Transactions, Life & Health Re. This is a new role, which brings together all of our Life & Health transactions expertise and will drive Life & Health Re's transaction-led growth areas, such as our longevity business.

Life & Health Re also launched Magnum XP and Promise XP. These are a collection of AI-enhanced tools to support primary insurers with underwriting and claims management. We have already seen this suite of products adopted in all regions, the Americas, EMEA and APAC. The client benefits are clear. These tools speed up the key processes needed to get people into the insurance safety net or make better, more consistent decisions earlier in the claims journey.

Turning to the outlook. Our goals are unchanged, deliver on our financial targets and maintain the group's overall resilience. Against the backdrop of geopolitical turbulence, we set aside around $400 million in additional reserves in the first quarter for potential inflationary impacts of the ongoing Middle East conflict. We delivered strong earnings in the first quarter, putting us on a good path towards our 2026 financial targets. With an increasingly challenging market environment, our P&C businesses will continue to focus on disciplined underwriting and cycle management. At the same time, we expect Life & Health Re to make a growing contribution to balance the group's overall performance going forward.

With that, I would like to hand back to Elena.

Thank you, Anders. We would be ready to take your questions. Now operator, could you open the line for questions, please?

[Operator Instructions]

The first question comes from [ Tyson Dem ] from S&P Global Market Intelligence.

Got a couple if I may. Just one on the Middle East reserve you set aside $400 million. I think I'm right in thinking that's $350 million for P&C Re and $50 million for Corporate Solutions. I just wonder if you could say you mentioned it was to do with inflation or potential effects of inflation. I was just wondering if that's all that the reserve is for if it's for other things or how you're thinking about potential claims from the war? And then the second question really was just around life and health reinsurance. The first quarter performance suggests that you actually beat your $1.7 billion target. So I'm just wondering if there's things that you're expecting later in the year that will sort of bring that down to EUR 1.7 billion at year-end.

Okay. Very good. Thank you for the question. So maybe if we start on the Middle East. before I go into directly answer your question, so overall, we did not have any direct claims coming from the war. So [ Swiss Re ], because we have all the war exclusion. So no direct exposure, but that's really the secondary risk that we see coming from the Middle East. And when you think about all the disruption in the supply chain and then in particular, the higher energy prices, I think that's where we strongly believe that we're going to see inflation picking up over the next time.

In certain areas, we've already seen that. And that's why inflation is probably the biggest impact that comes from the Middle East war. And so that's why the $400 million is, as you rightly state, $350 million for P&C Re and $50 million for CorSo. On the Life & Health side, we obviously have a really good result. We're very happy with that. It's a consequence of all the repositioning and the strengthening that we've done.

It's also, of course, then supported by positive claims development in the U.S. on U.S. mortality, in particular, we had lower large claims and large claims is subject to volatility. So we can't expect that we see every quarter the same positive large loss on a large impact from large claims. So that's why I think we're well on track to that. But I wouldn't say that this is a trend in mortality. This is just normal volatility that we expect.

The next question comes from Nathalie Olof-Ors from AFP.

I will have 2 questions. One is on France on the floodings. In France, if you've seen an impact or if you could give us an indication of what you've seen with these floodings. And then on the reserves, I think I missed the number. You said $400 million and provided the details for CorSo and P&C. Can you give us an indication as to how the Middle East is going to have an impact? Why do you think it is important to put money aside? And what can the effect be?

Okay. Very good. So on the France flooding, this is probably too early to say what this means a Q2 event to my knowledge. So we don't have data. We don't see right now there's going to be a big reinsurance event. Obviously, always -- first, it goes to the primary insurers and then if it hits the triggers, then it would go back to the reinsurers. So that's too early to know that, but we don't expect that to be a material impact for reinsurance.

So back to the Middle East. So the reserve overall for the group that we set up here is about USD 400 million, USD 350 million for P&C Re and $50 million for Corporate Solutions. And as I stated before, when we look at the exposure coming from the Middle East conflict from the war itself, we have war exclusions in our programs, which means the direct exposure is very limited. We do in the specialty lines, sometimes have more inclusions, but that's separate, and we did not have any claims so far that were material note.

Now the impact of the war is really the second order impact. When you think about the significant increase in energy prices, that will drive inflation. Also the disruption in supply chain will drive inflation. And so that's why we thought it's prudent to put money aside for higher inflation. This is for business that has already been written because -- not claims that happen, but claims will come, can be property prices, can be construction, can be whatever. And I think that's where we believe that higher inflation will have an impact. And that's the main reason we put that money aside.

You mean that the claims are going to -- that inflation is going to inflate the cost of...

Of the claims.

Claims.

Correct. Yes.

Can you give us a few examples from what I remember, there was -- after the COVID, there was an inflation in the price of auto parts versus the scarcity of parts. Can you remind us what you saw with the COVID and in '22 after the war in Ukraine?

Yes. So I don't have the data in front of me for COVID and for the war. But maybe I just can give a bit -- without going too much into details, I mean, higher energy prices increases the production of products, increases the transport of products and throughout the value chain, you can have an impact that drives prices up. And that's really what we want to reflect here with this additional reserves. We have not allocated it to specific claims. We just believe -- strongly believe that it will have an inflationary impact.

Perfect.

The next question comes from Daniel [Pula] from [indiscernible].

Good morning. Can I ask you 2 questions. The first is about the Life & Health business. Could you please explain a little bit the rationale -- the business rationale of your longevity business and its importance? And the second question is about about your investment results, they were apparently very good in the quarter. The stock markets are back on record price levels and the financial markets seem to be in a quite optimistic positive mood in general, although if you look around us, things do not really support this optimism. I was wondering what the projections are in terms of your investment policy.

Okay. So let me start on the Life and Health side. So longevity transaction has become a bigger demand in the industry as you see much more pension risk transfers where companies take -- primary insurers take over pension liabilities from the industry, people. And one of the risks that the primary insurers face is longevity risk, meaning that people live longer than was originally expected. And so that's an area where reinsurance and risk in particular here, can support the primary insurers to take that risk off their balance sheet. And I think for us, this is a good opportunity also to then balance within our portfolio, the mortality exposure that we already have on our books.

Reinsurers are traditionally very strong on the mortality side. Longevity goes exactly in the other direction. And so it's a good way on one hand, to support our clients for risk they would like to reduce and on our side to then use the diversification benefits of having risks that go in opposite directions, meaning that if you have a mortality improvement, it helps on the mortality side and it then impacts the longevity side. So a very natural way to manage biometric risk as an insurance company and as a reinsurance company. So that's really the business rationale, and that's also why we were very keen to also now do the first transaction in the U.S. where we have most of our mortality exposure.

So your question -- second question about investment results. Maybe 2 things to say. Our strategic asset allocation has very -- is a very conservative one. They have very little equity exposure. We have some private equity but very, very minor. It's mostly fixed income, but it also has a real estate book. And in the real estate book, that's where we do -- I call that normal maintenance of the real estate portfolio, we realized some gains through the sale of some real estate. And that's why we see a higher investment result in Q1.

So the overall investment result was 4.6% what we call the recurring one is 4.1% and the reinvestment, so how can you reinvest money right now it's about 4.3%. So that should give you a bit the overall composition of our results.

The next question comes from Rachel Dalton from Insurance Insider.

I noticed in your disclosure about the P&C reinsurance service results that there was a note about additional reserves for attritional losses. Could you give us any further information about that, please?

Yes, sure. So it's always when you go through the quarter, this is a normal process. You obviously, at some point, you have to cut off the date where data comes in. And then you look through the process and say, okay, is there anything else that happened? In the meantime that you don't have all the data yet, but you know that there's something coming that where you put up an IBNR reserves, which means it's reserves for claims that have already occurred, but not yet been reported, and that's what we've done at the amount of around USD 100 million.

The next question comes from Thomas Pohl from AWP.

I just wanted to ask again, I'm a bit astonished that you have absolutely no impact from [ Middle ] East conflict. You have a war exclusion you say, but does this also cover this turbulences or disruptions at transport, aviation and the kind of problems that occur now with the closing of the strait of and all the problems around it. Could you say a little bit more about that, please?

Yes. So maybe the first point here is that, yes, it is an escalation of -- it's a war right now, but it's an escalation of a conflict that's there since a long time. So we always took a cautious approach to that area specifically. So it's not a new conflict, something new that came up and was not there before. It's just an escalation of that one.

As I mentioned before, we have the war exclusions, which means the direct impact is extremely limited here. And so that's why you don't see more impact coming from that event, even though it is obviously a problematic event and an event that we continue to monitor here.

But you don't see -- like I said, in like aviation, insurances or transport that the goods don't arrive at time. Is that not a thing that will hit back to you also?

No, no. That will not hit back to us. Because as I mentioned, I mean, this is an area where we already have a cautious approach.

The next question comes from Francis Churchill from Insurance Day.

How you think about the mid-year renewals? How are you feeling about what ratings doing? And are there any opportunities you see coming up in the mid-year?

Yes. Look, I think we don't speculate and we don't give any kind of forward-looking statements about what we see -- what we can expect for midyear. I think you saw the January 1 renewals. You saw the April 1 renewals, which will only be reflected in the Q2 numbers. They're not reflected in the Q1 numbers. They all looked very similar. So the same impact on those. But we don't really know exactly what's going to happen, and we also don't give forward guidance on the renews.

The next question comes from Jonathan Progin from Finanz und Wirtschaft.

I'm wondering about your cycle management. I mean we are seeing prices going down broadly. I mean, not in every business segment, the same amount of the price reduction, but still. And I remember Chubb's Evan Greenberg called the softening kind of like dump. -- what's your view on prices in more general sense? Is this like a -- still reasonable prices? Or do we see a lot of capital -- do you still see a lot of alternative capital flowing in and make it hard for you as a traditional reinsurer to reinsure business and provide your services to reasonable prices.

So I mean, just what's your take on it? How does it have to change in your view very, very -- in the next few quarters? Or what's your take on it, not going like too much forward guidance, that's still like describing the current situation and how it's hard for you to do business? And then maybe two additional questions to your strategy going forward in M&A.

Where do you see potential additions to your current company structure more like on the P&C Re side or more on the CorSo side, Corporate Solutions? And maybe are you looking for a Lloyd's syndicate? And also, what can we read into the moving the credit maturity new business from P&C Re to CorSo in 2026? Is that like do you want to have it in the CorSo business because you are maybe looking for what sort of potential deals? If you can give some light on that.

Okay. Very good. Let's start on the cycle management. Maybe a few comments here. So first of all, when we talk about cycle management for us, it's important that we keep relevance, which means we keep the market share. And that's what we have done. But at the same time, also keep discipline on the underwriting. So I think terms and conditions are a key part here, and we were able to keep the terms on conditions. We haven't written any aggregates that could change the risk profile.

So that's that's for us what it means about cycle management. Simply to your question about price adequacy, in our view, prices are adequate. So otherwise, we wouldn't write it. If prices become inadequate, we obviously have to take actions. We don't want to write inadequate business within adequate prices. So for us, still adequate. We kept market share. But when you see the decline, this is really just the pricing cycle that impacts that.

To your second question about M&A, we were very clear that M&A, if we want to do M&A, has to support the core businesses. And we would never do M&A just to do M&A. It has to have a strong business rationale. And then if you basically go through the business units, quite naturally, we would pass on P&C Re. Because P&C Re, there's no benefit in doing acquisitions because there's more capacity and the question, how much capacity you want to deploy and you get to a natural market share and you would lose that new business fairly, fairly quickly. So no interest there.

It's very similar on the Life and Health side, we don't really see there a strong rationale to do M&A. So that leads you then to CorSo. And on the CorSo side, we always said we would like to strengthen the business if it helps diversify the business. We have a few areas like credit and surety, where we say this is a good business. Also that's non-correlated to the, call it traditional property insurance business. And that's also one of the rationales why we said, okay, let's centralize the credit and surety business in CorSo have one center of expertise. And also, that's why we did the small acquisition with QBE that we announced earlier in the year, which strengthened the credit and surety business here.

So you should always see that if we do M&A, then it has to support the business rationale. We've done the small transactions. We don't have to do anything else if we don't find the right opportunity, and it has to be at a reasonable price. Otherwise, we would not be. So that should give you a bit of the rationale around how we think about M&A. We really have to have strong business support. And you cant -- you shouldn't expect anything big here anyway.

All right. Can I just pose an additional question, not maybe very related to your business activities, but it affects you as a big Swiss company. In June, we will vote on the popular initiative to cap the population in Switzerland to 10 million. What's Swiss Re's take on it? Surely, you will have a position there because it will affect you as a multinational company with a lot of expats working in Swiss Re and you want the best talent to be able to come to Zurich or to Switzerland to work for you.

Do you expect anything that will affect your business negatively if the initiative will be accepted by the population? Or I mean, how do you prepare internally for one or other outcomes of the initiatives? Can you maybe give us some answer here?

Yes. I mean, look, first of all, we don't make any statements to popular votes. To political processes. That's not our job to do. That's the political process in Switzerland. I think you stated it well. For us, what is important is that we have access to the best people. Zurich is a key location for us. It's the main location. It's the headquarter. And we have access here to the best people, people come here as well. And then we have about, I think about 70 nationalities working for Swiss Re just here in Zurich. And so for us, this is crucial. I think we made that very clear. Other than that, I think it's now up to the political process to go through and then we see where this goes.

The next question comes from Anna Sagar from InsuranceERM.

I was just intrigued as to Swiss Re's appetite for longevity reinsurance given the 2 billion transaction with the team in the U.S. I was wondering if the U.S. was the primary geography that Swiss Re was focused on or if there are other areas -- other geographies or other regions that it would look to expand into? And also if you could talk a bit about your current capital management strategy and any plans for capital returns to shareholders, that would be greatly appreciated.

Yes, sure. So on longevity reinsurance, when you look at where is the market, where are the opportunities -- there's clearly the U.K. that stands out. You've seen the most transactions in the U.K. We've also seen now a lot of transactions happening in the Netherlands due to the pension reform. You haven't really seen a lot of transactions in the U.S. The main reason is that in the U.S. -- in the U.S. capital framework, there is no charge for longevity risk, which means there's very little incentives for a U.S. primary insurer to reinsure longevity because it doesn't really reduce their capital needs.

This has changed since many U.S. companies go through the reinsurance through Bermuda to have a more economic model. Bermuda framework is much more economic than the U.S. framework. Bermuda has a capital charge. And then it becomes interesting also for the primaries to say, okay, I can now capital manage through longevity transactions. But I would say going forward, I would still see this is a slow start now with U.S. liabilities. It's much more -- you will see much more transactions. And I'm not talking about Swiss, I'm talking about the market transactions in the U.K. and also Netherlands going forward.

And then your second question about capital management strategy. I mean, I can reiterate what we said. Obviously, first and foremost, we want to maintain and increase the dividend payout and then we supplement that dividend payout with what we call a sustainable share buyback program when we achieve our full year targets. And then I think for the remainder, if there's opportunities to deploy the capital in the business at the right returns, we obviously do that. If not, and we have excess capital above our target range, we would then give that back to shareholders. So that's clearly the strategy. That's also what we have done now at the end of last year, beginning of this year.

The next question comes from Noele Illien from Bloomberg.

You mentioned the sale of some real estate boosting the investment results. Is that a strategy -- is that -- was that a one-off? Or is that -- are you continuing to sell off some real estate in the coming quarters? And I think most of my other questions have been asked.

Okay. Yes, sure, quickly on the real estate, yes, this was a one-off. I mean this is not a strategy to -- I mean, to reduce the real estate exposure, not at all. We like real estate. It is a big part of our asset allocation. It's just normal maintenance, I call it, normal management of the real estate portfolio that we have that from time to time, you realize gains. Yes. But you should not expect that to repeat in the next quarters.

Okay. And was the sales in any particular region?

It was Switzerland.

The next question comes from Glenn Turpa from Intelligent Insurer.

I would like to better understand underlying growth in Corporate Solutions. You've mentioned a couple of one-offs that presumably are skewing the numbers, the non-renewal of MedEx and the shift to credit and surety. Maybe by line and by revenue versus new business CSM that you may have into the portfolio? Is there a better view we can have? And once I do have a better view of underlying revenues, and if we were to compare it to the decline in the P&C reinsurance book, I'd be curious to know if that is representative of your appetite of your outlook. Corporate Solutions seems more stable. And is it your preferred flavor for 2026?

Yes, sure. I can give a bit background. And maybe I'll start just the revenue decline that you actually saw in P&C Re is really just related to the pricing cycle that we have seen. That's the main driver here. Now if we then go to Corporate Solutions as you rightly state, I think we had a decline mainly driven by the non-repeat or the non-renewal of the Irish MedX, which we talked about already last year. So that's now fully non-renewed in a way. So if you actually take that out, it's pretty much a flat revenue development.

Now we had some support also from FX. So if you take FX out, maybe it would have been a slight decrease. But the key point here is the underlying business where we actually see growth in CorSo is really coming from the international programs. That's an area we had really good success. It's also an edge where CorSo can play, and we have good progress there. And then also on alternative risk transfers. These are the 2 areas where CorSo really was able to grow the business throughout the period now.

Yes. And then I would say the accident and health, I would say that's more a -- I call that more business volatility, still an area that we like, that we want to maintain that we might want to grow further. So that are the areas where you should continue to see CorSo perform.

And the relative appetite then to P&C considering you're calling it your following prices and maintaining market share?

Yes. I mean on the P&C Re, clearly, we want to keep the relevance. We want to keep the market share. We're not want to shrink them, not at all. We just manage the factor here. Prices are adequate, as I said. But revenue is just following the pricing cycle.

We now have a follow-up question from Daniel [Pula] from [indiscernible].

Yes, quickly. Just quickly, the $400 million provision, what is the underlying inflation projection you have to that number? And one other observation I just made, which I made me a bit curious. In the past, you didn't -- that's at least my perception, talk so much about market share and keeping market share. It was like almost a little bit considered given that the largest reinsurers would stick to more or less their market shares over the cycle, and it wasn't really an issue that was publicly -- at least publicly debated. Now you stress the importance of keeping that market share has something changed in that market? Are you being challenged more than in the past?

Yes. Maybe I'll just start with your second one. This has not really changed in a way. I think it's just the way we want to explain the development of the premiums and prices that you see because you've seen then the decline in property and cat that you see an increase in casualty. And both of them are not driven by the change in risk we are taking. They're really driven by how the prices develop. That was really the main reason that we wanted to highlight the market share discussion.

On the inflation question, we don't disclose our underlying inflation assumptions. But I mean, they're based on the public available inflation data that you see disclosed in the market. And here, we just took the -- obviously, you have to go in and it's judgmental. You don't know exactly where the energy prices will end up for the year, but we have the assumption that we will see significant -- we see a continuation of increased energy prices, and that's how we then calculated the impact here.

That was the last question. I would now like to turn the conference back over to you, Elena Logutenkova, for any closing remarks.

All right. Thank you, everyone, for joining our call this morning. If there are any further questions, please feel free to reach out to Media Relations. And otherwise, we wish you a lovely day. Bye-bye.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Ladies and gentlemen, dear shareholders, good morning, and welcome to the 2026 Annual General Meeting of Swiss Re. Thank you very much for joining us today. We are pleased to welcome you to a new venue here in Dubendorf. I'm joined on stage by Andreas Berger, our Group Chief Executive Officer; Anders Malmstrom, our Group Chief Financial Officer, and Marisa Walker, our Group Company Secretary.

I would like to extend a warm welcome to our Board of Directors and to Jean-Jacques Henchoz, who has been nominated for election as a new member of the Board of Directors.

A special welcome also goes to our Honorary Chairman, Walter Kielholz. Additionally, I would like to welcome the members of the Group Executive Committee. It is also my pleasure to welcome Christof Helbling and Gian Andri Tondury, representing Proxy Voting Services GmbH Zurich, our independent proxy; Frank Pfaffenzeller and Matthias Schiessl, who are representing our auditor, KPMG Zurich; and Markus Muller-Smit from the Zurich Altstadt notary office. He will certify the resolution on the conversion of shares capital currency under agenda Item 6 and on the amendments to the Articles of Association under agenda Item 7. I would also like to welcome our scrutineers and thank them for volunteering their time to perform this task.

Shareholders who wish to ask questions about individual agenda items are kindly requested to sign up at the speakers' registration desk as early as possible. The desk is located at the front of this hall on your left and registration is now open. We kindly ask all speakers to limit their time to a few minutes to allow all shareholders to express themselves and make sure we address all questions efficiently.

Simultaneous translation will be provided during the entire AGM. Headphones are available in the entrance of the area. I hope you got this. Please select channel 1 for German and Channel 2 for English. The meeting minutes are being recorded by our Company Secretary, Marisa Walker. The AGM is also being recorded in both audio and video, and broadcast live online.

By attending the Annual General Meeting, each participant consents to Swiss Re recording the meeting, including any statements they make and to publishing and using such recording. The invitation to the AGM was published in the Swiss Official Gazette of Commerce on March 12, '26. The annual report 2025, including the compensation report and the sustainability report were published on Swiss Re website on the same day. The Annual General Meeting was duly convened and can validly pass the resolution according to today's agenda.

Ladies and gentlemen, dear shareholders, I will now take you through Swiss Re major milestone and successes of 2025. We had 2 key priorities for the year: achieving our group net income target and strengthening the resilience of the company. I'm pleased to say that we delivered on both. Swiss Re achieved a group net income of $4.8 billion against a target of more than $4.4 billion. This is the highest net income in Swiss Re's history, underpinned by a strong underwriting performance in our Property & Casualty businesses and strong investment returns. In the Life & Health Reinsurance, we conducted a comprehensive review of underperforming segments and took decisive action to enhance the quality of our portfolio. This positions all 3 businesses, P&C Re, Corporate Solutions and Life & Health Re to deliver strong, consistent results. The strong performance provides the foundation for attractive capital returns to our shareholders.

The Board of Directors is proposing a dividend of USD 8 per share, an increase of 9% compared to last year and in line with our growth aspiration of at least 7% per year for the period 2025 to 2027. In addition to the increased dividend, we have initiated a share buyback program of up to $1.5 billion. This includes $500 million as part of the sustainable annual share buyback program we announced last December. The share buyback reflects both the strength of our operating performance and our robust capital position. Our group solvency as measured by the Swiss Solvency Test ratio is estimated to remain at 250% even after taking into account the impact of the proposed capital repatriation actions. This is at the top end of target range of 200% to 250%. With these capital actions, we are returning 80% of our full year 2025 earnings to our shareholders.

Ladies and gentlemen, let me now turn to our strategic direction. Last December, we introduced our strategy Built to Lead. At its core is a clear ambition to deliver consistent and sustainable performance. This means sharpening our focus on our core insurance and reinsurance businesses, driven by technical excellence and by close relationship with clients and brokers. At the same time, we are intensifying the use of data and technology.

By leveraging our risk expertise and expanding our AI capabilities, we are enforcing our technical excellence, enhancing execution and ensuring we remain adaptable in a rapidly changing risk landscape. This ensures that we remain well positioned to fulfill our core whole building resilience as a shock absorber against peak risk while providing critical data-driven insights. At the heart of everything we do is our purpose, making the world more resilient.

This brings me to sustainability, which is an integral part of our refreshed group strategy Built to Lead. I'm pleased to say that we achieved all our externally communicated sustainability targets in 2025. And our sustainability efforts continue to be recognized with MSCI once again rating Swiss Re AAA, its highest rating under its ESG rating methodology. Our 2 sustainability ambitions were reaffirmed as part of the 2026, 2028 Group Sustainability Strategy update, which was guided by the updated Group Materiality Assessment 2025.

The first ambition, building societal resilience is anchored in our focus on enhancing disaster resilience as well as improving access to Life & Health Insurance protection. This is strongly aligned with the priorities in our core businesses. By developing innovative insurance solution with our clients, partnering with governments and leveraging data and supporting adaptation to evolving risk, we aim to expand the pool of people, businesses and countries that have access to insurance protection.

The second ambition reflects our long-term commitment to achieving group-wide net zero greenhouse gas emissions by 2050, in line with Swiss legal requirements. We presented our climate transition plan last year and continue working towards our interim climate targets. We follow a transition approach that seeks to jointly transition with our clients, investees and vendors in all sectors. We encourage and support them in the transition to net zero. Swiss Re's action in the net zero transition and the prioritization over time depends on various external factors such as availability of robust methodologies and reliable data.

In addition, we are dependent on supportive public policies at the pace at which the real economy makes this transition. This is critical as we cannot do this alone. We recognize that some stakeholders would prefer us to move faster, while others advocate for a more gradual transition. Such differing expectation are natural in a transition of this scale. We remain confident in our climate transition plan and are committed to its execution.

Before concluding, let me briefly touch on developments at the Board level. We are pleased to propose the election of Jean-Jacques Hencho to the Board of Directors. Jean-Jacques brings outstanding reinsurance expertise, strategic thinking and proven leadership skills, having served as CEO of Hannover Re and previously holding senior positions at Swiss Re. Jean-Jacques will briefly introduce himself when we get to the point of the elections. I would also like to thank Larry Zimpleman, who is not standing for reelection to the Board of Directors for his 8 outstanding years of dedication and valuable contributions to the group.

Let me conclude with a brief outlook. As we look at developments around the world, it is clear that risk remains elevated. The ongoing war in the Middle East has introduced significant new uncertainties and as a reminder of how quickly the risk landscape can evolve. Risks today are Intrinsically interconnected and can have consequences in areas where we might not initially expect them. We are monitoring these developments closely and remain vigilant. Against this backdrop, Swiss Re remains committed to supporting our clients and partners across business, government and society in understanding and mitigating emerging risk and in enabling swift recovery when they materialize. Your continued trust and support are essential as we pursue our purpose, making the world more resilient. For that, I thank you sincerely.

I will now hand over to Andreas Berger, who will provide a more detailed review of our business unit performance in 2025. Before that, I invite you to watch a short video highlighting Swiss Re's strategic approach and how we aim to shape the future of our industry. Thank you for your attention, [Foreign Language]

[Presentation]

[Foreign Language]

Thank you, Andreas. Our Company Secretary will now address some formality and administrative matters.

[Foreign Language]

Thank you, Marisa. It's time now to proceed with the first item on the agenda, the approval of the financial and nonfinancial reporting for 2025. This item is divided in 3 subitems. Each subitem requires a vote.

Agenda Item 1.1 is the approval of the annual report 2025 and the annual and the consolidated financial statements for the year 2025. The group CEO has commented on the financial year 2025. The annual financial statements and the consolidated financial statements for 2025 have been audited by our auditor, KPMG. The audit report contain no qualification or reservation. The auditor has not had any additional remarks and recommends approval by this Annual General Meeting. The Board of Directors recommends that the annual report 2025, the annual and the consolidated financial statements for the financial year 2025 be approved.

Under agenda item 1.2, the Board of Directors is presenting the compensation report 2025 for a nonbinding consultative vote. The compensation report 2025 and the KPMG audit report can be found in the annual report 2025. The Board of Directors also recommend that the compensation report 2025 be accepted.

Under agenda Item 1.3, the Board of Directors is submitting Swiss Re Sustainability Report 2025 for a nonbinding consultative vote. These reports provide comprehensive information about Swiss Re's Group Sustainability Strategy accomplishments and targets. It includes a climate transition plan, meets all Swiss legal requirements and has been independently reviewed by KPMG for the limited assurance conclusion. The Sustainability Report 2025 and the KPMG report review can be found in the Annual Report 2025. The Board of Directors recommends that the Sustainability Report 2025 be accepted.

Before I open for questions, I would like to remind anyone who would like to ask a question to register at the registration desk. And please keep your question short and concise. We will first hear all of the speakers and then address the question afterwards. Does anyone have a question about the agenda items 1.1 to 1.3?

[Foreign Language]

If you wish, I tell you in English. It's too early young man.

[Foreign Language]

Thank you, [ Mr. Grobe ]. I call now Mr. Fritz Peter from Actares.

[Foreign Language]

You will respond at the end or...?

We will respond after we receive all the questions. Thank you very much.

I'm now calling Nora Scheel from Campax, please.

The Tragedy on Swiss Re's Horizon. Here, Mr. Berger. I'm speaking as a representative of the NGO Campax as well as a member of the Insure Our Future network. You recently spoke publicly with NBIM CEO, Nicolai Tangen. When asked about rising insurer losses due to extreme weather catastrophes, you made some remarks about global warming that really worried us. I quote, "People refer always to climate. That's one aspect that complicates things, but the main aspect is population growth." However, research suggests that more than 1/3 of insured weather losses in the last decade were attributable to climate change.

Mr. Berger, it seems that you were promoted to help stabilize profits. But if your industry's profit boosting measures involve drastic actions to reduce exposure to the persistent economic losses, insurance was created to help society absorb, we must ask, what will you do in 5 or 15 years' time? What business will Swiss Re have left in a burning underwater world? Swiss Re warned in its annual reporting fine print that climate change may render certain properties exposed to extreme weather events uninsurable as storms like the wildfires in Los Angeles and the deadly floods in Texas make the costs unviable for many.

The tragedy here, Mr. Berger, is that when faced with our overwhelming evidence you state Swiss Re has known about for so long, you seem to evoke the same tactic that Mark Carney once opted for. Facing the foreseen tragedy on our fast-approaching horizon, instead of leveraging your deep understanding to advocate for an effective necessary changing, of course, you opt instead for short-term optimization of your own risk underwriting.

Speaking not to investors, but to the public, you said it yourself. The data shows clearly that the frequency and severity, not only of extreme heat, but also natural catastrophes in general is increasing. We need to all come together. It's not one party alone that can solve the problem. What are you doing, Mr. Berger, not only to get these losses of your balance sheet, but to protect the planetary viability your successor will need for Swiss Re to survive?

I'm now calling Mr. Peter Bosshard also from Campax.

As an international climate campaigner, I have followed the climate policies of Swiss Re since the 1990s. And I have generally had a good impression of your company. In 2018, Swiss Re was the first reinsurer to stop insuring new coal projects. In 2022, Swiss Re was the second reinsurer to stop or to limit underwriting new oil and gas fields just after Jean-Jacques Hencho's Hannover Re. And in all the climate rankings, which we have published, Swiss Re ranked among the top contenders. So congratulations.

Now the latest frontier of the fossil fuel transition is liquefied gas or LNG. If we continue to build, finance and insure lots of new LNG terminals, we will lock the world into decades more of gas dependency. Swiss Re was Built to Lead. And so my question is, when will Swiss Re end underwriting new LNG terminals? You have at least 4 good reasons to do so. First, climate change. Gas produces less emissions than coal when it's burned. But if we also consider the leakage from extracting, transporting and liquefying gas, LNG has even more serious climate impact than coal.

Second, economics. Last year, the average cost of solar power with battery storage was $25 per megawatt hour. The average cost of gas from -- of electricity from gas power plants was $38, about half as much more. And while the cost of solar power and batteries continues to drop, the cost of gas is holding steady or even spiking.

Third, energy security. The main sources of LNG are Russia, the United States and the Middle East. And gas supply from any of these regions can be stopped at the moment's notice. This is not resilient, and it is not the case for wind and solar energy.

And finally, shareholder value. Many financial analysts look at climate leadership as an indicator of farsighted management. In 2020, for example, Societe Generale increased their target price for Swiss Re shares by 5% because your company had done so well in our climate ranking. That was a $1 billion bonus for climate leadership. In spite of this, Swiss Re has so far not shown any leadership when it comes to LNG. For the first time, Munich Re was the first reinsurer to limit their support for new LNG terminals under their new CEOs in January. We are still waiting for a response from Swiss Re.

Ladies and gentlemen, Swiss Re was Built to Lead. And this includes ending support for new LNG terminals, which are not a responsible option in today's environment. So again, my question, when will Swiss Re stop underwriting new LNG terminals? Thank you for your attention.

Thank you, Mr. Bosshard for your question. I'm now calling [ Ines Zangger ] on the podium.

[Foreign Language]

Thank you very much. I'm now calling on stage [ Mr. Christian Alther ].

[Foreign Language]

It seems that Mr. [ Grobe ] wants to ask a second question.

[Foreign Language]

Thank you very much for your question. Are there any more questions? Good. We'll now proceed with the answers to the question, and we will take it in the same order. I will put -- we'll start with [ Mr. Grobe ]. Timing early morning, 9:30, we take your remark into consideration. There are practical reasons starting early allows everybody to get back on time in the afternoon. So I think we will never find the right -- the timing, which is fine for everybody. We choose it for a lot of practical consideration, among which we have other meetings the same day. The location, I hope you like the location. I find it very good. We are not changing every year. We have been for many years in the previous location. And if everything is happening well today, this is clearly a place which we believe is modern, well suited for the requirements of an AGM of this size. And therefore, we feel that -- we hope also that you feel that it's a very good place. You had also a question on dividend and my proposal is to have our CFO responding on that part.

[Foreign Language]

Thank you. Thank you, Anders, sorry. We come back to you, Andreas now with the questions from Mr. Peter and there are questions and sub-questions. First question is on the investment in emission-intensive activities, then we have deforestation and geopolitics. So could you address these 3 parts, please?

[Foreign Language]

Thank you. Andreas, could you also comment on the question on geopolitics and war?

Yes. [Foreign Language]

Thank you very much, Andreas. I propose we move to the next question, the one of Nora Scheel which was directly addressed to you, I think.

Yes. [Foreign Language]

Thank you. Thank you very much. We come to the next question from Mr. Bosshard about underwriting new LNG terminals.

So [Foreign Language]

Thank you very much. The next question was the impact on human rights and the health of local people.

Yes.

For you also Andreas.

[Foreign Language]

Thank you. The next was from Mr. [ Alther ] on biodiversity.

Yes. [Foreign Language]

Thank you, Andreas. I think that we have provided an answer to all questions about agenda Items 11, 12 and 13. Thank you very much for the questions again. And we will now proceed with the vote on these 3 agenda items.

[Foreign Language]

[Voting]

[Foreign Language]

Thank you very much. We can now proceed to agenda Item #2, appropriation of available earnings. The figures and the proposed appropriation of available earnings for 2025 can be found in the invitation to today's Annual General Meeting on Page 3. This is about the available earnings of Swiss Re Limited, the holding company of the Swiss Re Group. According to the statutory accounts, the available earnings of Swiss Re Limited amount to CHF 1.698 billion. The Board of Directors proposed allocating these available earnings to the voluntary profit reserves. Following this allocation, the voluntary profit reserve will amount to CHF 16.992 billion. The proposed dividend payment will be paid out of the voluntary profit reserves.

The Board of Directors recommends a gross ordinary dividend of USD 8 per share distributed to shareholders. The dividend will be paid in Swiss franc, converted at the applicable U.S. dollar exchange rate as of April 13. The exchange rate will be published on the Swiss Re website on the ex-dividend date, which is April 14. In its report to shareholders, the auditor confirmed that the Board of Directors motion regarding the appropriation of available earnings compliance with the statutory regulation and the Articles of Association. Let's open the Q&A. Does anyone have a question about Item 2? I don't see anybody moving. It means that we can now proceed with the vote.

[Foreign Language]

[Voting]

[Foreign Language]

Thank you, ladies and gentlemen. The dividend will be paid from the 16th of April onwards after deduction of 35% for Swiss Federal withholding tax. It will be distributed to all shareholders who hold shares on the 13th of April 2026. Shares will be traded ex dividend starting on the 14th of April 2026. We'll now move on to agenda Item 3, discharge of the members of the Board of Directors. The Board of Directors recommend that all members of the Board of Directors who were in office during the 2025 financial year be discharged for the financial year 2025. Does anyone have a question about this agenda item? I don't see anybody. There are no speakers registered for this item. It allows us to move immediately to the vote.

[Foreign Language]

[Voting]

[Foreign Language]

Ladies and gentlemen, on behalf of the entire Board of Directors, I thank you for the trust you have placed in us. We will now move on to agenda item 4 is about the election of the Board of Directors, the independent proxy and the auditor. The General Meeting of Shareholders is responsible for electing each member of the Board of Directors, the Chairman of the Board of Directors, the members of the Compensation Committee, the independent proxy and the auditor. We will begin with the elections of the member of the Board of Directors and the Chairman of the Board of Directors. As I previously mentioned, Larry Zimpleman is not standing for reelection.

The Board of Directors recommend the individual reelection of 11 current members as well as the election of 1 new member of the Board of Directors, each of them for 1 term of office until the completion of the next AGM. I am also standing for reelection as Chairman of the Board. You can find all our biographies on the Swiss Re website. On behalf of the Board of Directors, I am pleased to propose the election of Jean-Jacques Henchoz as new Board member. I already mentioned his extensive experience and deep expertise at the beginning of this meeting. Before the vote, I would like to give Jean-Jacques Henchoz the opportunity to introduce himself. Jean-Jacques, the floor is yours.

[Foreign Language]

Thank you, Jean-Jacques. Ladies and gentlemen, let's start the Q&A. There are no speakers registered, but does anybody in the room want to take the floor? I don't see anybody. So let's then proceed now with the election.

[Foreign Language]

[Voting]

[Foreign Language]

Thank you, and congratulations to all my colleagues of the Board of Directors on the election and especially our new Board member, Jean-Jacques Henchoz. Gentlemen, it's an honor to have the opportunity to continue serving as Chairman of the Board of Directors. I appreciate your support and trust. This concludes the election to the Board of Directors under agenda Item 4.1. We can now proceed with agenda Item 4.2, which covers the election of members to the Compensation Committee. The Board of Directors recommends the individual reelection of the 4 current members of the Compensation Committee, each for 1 term of office until the completion of the next AGM. You can find the biographies of these candidates on the Swiss Re website and the Board of Directors recommends that you vote in favor of the 4 candidates. I don't see any questions. There are no questions registered. This is allowing us to proceed to vote on the candidates.

[Foreign Language]

[Voting]

[Foreign Language]

Ladies and gentlemen, thank you also, and congratulations to my 4 colleagues on the election to the Compensation Committee. This concludes our Board-related election. We'll now proceed to the next item on the agenda, which is the reelection of the independent proxy. The Board of Directors recommends that proxy voting service, GmbH be reelected as the independent proxy for a 1-year term of office until completion of the next AGM. Proxy voting service has served as independent proxy for many years and has performed this task competently and to the satisfaction of our shareholders. I don't think that there is any question about this agenda item. This allows us to proceed to the voting.

[Foreign Language]

[Voting]

[Foreign Language]

Congratulations to proxy voting service on this reelection. Let's move to agenda Item 4.4, the reelection of the auditor. The Board of Directors recommends that KPMG be reelected for another 1-year term of office as auditor for the financial year 2027. KPMG has confirmed to the Audit Committee that it complies with the relevant independent criteria and is available for reelection. Let's open for questions. But here again, I think that there are no questions, nobody did register. Perfect. Thank you very much. Let's proceed to the voting.

[Foreign Language]

[Voting]

[Foreign Language]

Congratulations to KPMG on its reelection. Now that we have concluded on all elections, we'll move to agenda Item 5 for the approval of compensation. Details about our compensation system and compensation paid can be found in the compensation report 2025, which is an integral part of the annual report. We will be holding 3 votes under this agenda item. The first vote concerns the maximum aggregate amount of compensation for the members of the Board of Directors for the 1-year term of office starting after this AGM. The second vote concerns the aggregate amount of variable short-term compensation for the members of the Group Executive Committee for the past financial year 2025. And the third vote concerns the maximum aggregate amount of fixed compensation and variable long-term compensation for the members of the Group Executive Committee for the financial year 2027. I will now briefly explain the 3 motions.

Members of the Board of Directors received only fixed compensation. The Board of Directors recommends that shareholders approve a maximum aggregate amount of CHF 8.6 million for the members of the Board of Directors for the next term of office until the next AGM. Under item -- agenda Item 5.2, the Board of Directors recommends the approval of an aggregate amount of variable short-term compensation for the member of the Group Executive Committee for the past financial year 2025, amounting to CHF 11,936,254. The proposed aggregate variable short-term compensation amount reflects Swiss Re Group IFRS performance. The proposed aggregate amount include a total annual performance incentive for 13 members of the Group Executive Committee who were in office in 2025 pro rata where applicable. Under agenda Item 5.3, the Board of Directors recommends the approval of a maximum aggregate amount of fixed compensation and variable long-term compensation of CHF 31 million for the members of the Group Executive Committee for the financial year 2027.

The fixed compensation for the members of the group EC consists of a base salary allowance, regular employee pension contribution, any matching shares granted under the company's global share participation plan and additional benefits. The variable long-term compensation for the members of the group EC, if any, will be granted in the first half of the financial year 2027. The maximum aggregate amount considers the value of the award at grant. The effective amount to be paid or granted to the member of the Group Executive Committee for the financial year 2027 will be disclosed in the compensation report 2027. More details on all these 3 compensation motions can be found in the invitation to the AGM. The Board of Directors recommends approving all 3 motions. Let's open for questions. Here also, we don't have any speaker who has presented itself. This is allowing us to proceed with the voting.

[Foreign Language]

[Voting]

[Foreign Language]

Thank you, ladies and gentlemen. This brings us to the next item on our agenda, which is Item 6, conversion of share capital currency and amendments to the Articles of Association. The revised Swiss corporate law which entered into force on January 1, 2023, allows the company share capital to be maintained in selected foreign currencies. The Board of Directors proposed to convert the share capital currency from Swiss franc to U.S. dollar. This aligns the share capital with the currency that is material to the company's business activities and reduces operational complexity. This conversion will take place in 2 steps. First, under agenda Item 6.1, the Board of Directors proposed to slightly reduce the share capital in Swiss franc so that we have a own nominal value per share of USD 0.12 after the conversion.

These steps is purely for practical reasons and is intended to make the second step under agenda Item 6.2 easier. The reduction amount will be allocated to the legal capital reserve. This will leave the total equity completely unchanged. Second, under agenda Item 6.2, the Board of Directors proposed to convert the share capital currency into U.S. dollar with a nominal value per share of USD 0.12. Please note that this will not affect the share capital reported under IFRS, and it will not affect the total number of registered shares in both the consolidated and stand-alone financial statements. Agenda Items 6.1 and 6.2 are conditional on one another and will only be implemented if both are approved by the shareholders and concurrently implemented by the Board of Directors.

Before I open the discussion on agenda Item 6.1, the ordinary reduction of the share capital by reducing the nominal value per share, I would like to note that on March 2, 2026, the call to creditors was published in the Swiss Official Gazette of Commerce. No creditors have come forward. KPMG Limited Zurich has prepared a special audit report dated from the 7th of April 2026, confirming that all claims of Swiss Re Limited creditors are covered despite the share capital reduction. Thank you to Mr. Frank Pfaffenzeller and Schiessl who are here today for KPMG for their work in this regard. We are now open for questions on agenda Item 6.1. No speakers have registered, I think. Yes, nobody is showing. Thank you very much for that. So let's vote on this agenda item or we will vote on the 2 other...

[Foreign Language]

The Board recommendation. -- apologies. The Board of Directors, let me read the recommendation. The Board of Directors proposed to reduce the share capital of Swiss Re Limited as set out in the invitation to today's meeting and to allocate the reduction amount to the legal capital reserve. The implementation of this resolution is contingent upon the concurrent implementation of the share capital currency conversion proposed under agenda Item 62. Marisa?

[Foreign Language]

[Voting]

[Foreign Language]

Thank you very much. I ask the notary, Mr. Muller-Smit, to certify the results of agenda -- of the vote on agenda Item 6.1. We now move to agenda Item 6.2, the change of the share capital currency. As explained, the Board of Directors proposed to convert the share capital currency from Swiss franc to U.S. dollar to align it with the currency that is material to the company's business activities. For accounting and reporting purpose, the conversion will have retroactive effect from January 1, 2026, and will be based on the ICA Data Services London closing spot rate as of December 31, 2025.

The total share capital reported in the consolidated and stand-alone financial statements of Swiss Re Limited will remain unchanged. Because Article 3, Paragraph 1 and Article 3A Paragraph 1 of the Articles of Association currently refer to nominal values denominated in Swiss franc, those reference will be amended accordingly.

If approved, the Board of Directors will implement the currency conversion and amend the Articles of Association accordingly. This will be done at the same time as the capital reduction under agenda Item 6.1. I now open the floor for questions. I don't see anybody moving. This allows us to move on to the vote. The Board of Directors propose first to convert Swiss Re limited share capital currency from Swiss franc to U.S. dollars. Second, to authorize the Board of Directors to implement this change with effect from January 1, 2026, and to apply the conversion exchange rate as of December 31, 2025. And third, to authorize the Board of Directors to amend the reference to the currency in the Articles of Association as set out in the invitation to today's meeting. The implementation of this resolution is contingent upon the concurrent execution of the capital reduction approved under agenda Item 6.1. Marisa, please.

[Foreign Language]

[Voting]

[Foreign Language]

[Audio Gap]

of this resolution 6.1. Since we have approved the agenda Items 6.1 and 6.2, we can now proceed to a final agenda item, which is agenda Item 7, the renewal and the extension of the capital band. Under Swiss law, the authorization for a capital band expires if the General Meeting of Shareholders resolved to reduce the share capital or to change the share capital currency during its term. As both the reduction of the share capital and the conversion of the share capital currency have just been approved today, Swiss Re Limited's existing capital band has automatically expired. The Board of Directors wishes to keep the capital band to maintain financial flexibility and believes this is in the best interest of the company.

The Board, therefore, proposed to renew it for 2 years. The conversion from Swiss franc to U.S. dollar will be made on a one-to-one basis and the parameters of the capital band will remain the same as under the capital band that just expired. Shareholders will, therefore, grant the same authorization as in the past. The new capital band will be valid until April 10 of the year 2028. We are now open for questions on this agenda item 7. No speakers have registered. Let's move then on the vote. The Board of Directors proposed first, to renew Swiss Re Limited capital band as reflected in the invitation today's meeting; and second, to amend and supplement Article 3C of the Article of Association as reflected in the invitation. Marisa, please.

[Foreign Language]

[Voting]

[Foreign Language]

Thank you. Ask the notary, Mr. Muller-Smit to certify the results of agenda Item 7. Ladies and gentlemen, thank you for your very strong support. We have now addressed all the agenda items of this year's Annual General Meeting. The next AGM of Swiss Re Limited is scheduled for Wednesday, April 14, 2027. The minutes of today's meeting will be available shortly on our Swiss Re website. This concludes our 2026 Annual General Meeting. Thank you for being here. Thank you for your support. Thank you for your voting. If you wish, take some of the pastry that are still left after the breakfast of this morning. And please don't leave with your voting device, leave them and the headphones, leave them on your chairs. I wish you a very pleasant day, and thank you again.

Good morning or good afternoon. Welcome to Swiss Re's Annual Results 2025 Conference Call. Please note that today's conference call is being recorded.

At this time, I would like to turn the conference over to Andreas Berger, Group CEO. Please go ahead.

Thank you very much, and good morning or good afternoon to all of you. I appreciate you taking the time to join us today. Before our Group CFO, Anders Malmstrom, will walk you through the detailed numbers, I'd like to start with some brief remarks as usual.

It was a good day. 2025 has been a successful year for Swiss Re, but also for all key stakeholders, our clients and partners, our investors, but also our employees. We have two priorities: first, delivering on our group net income; and second, increasing the resilience of Swiss Re to improve the consistency of earnings delivery over time.

In 2025, we delivered against both priorities, also allowing us to increase our capital repatriation to shareholders. We achieved a record group net income of USD 4.8 billion against our target of more than USD 4.4 billion and an ROE of 20%. This result reflects disciplined underwriting, strong recurring investment income and low burden of large losses outside of the first quarter last year.

At the same time, and this is equally important, we further strengthened the resilience of the group. We completed the Life & Health Re portfolio review, added to the current and prior year reserves in P&C Re, continued to increase initial loss assumptions well in excess of economic inflation and applied the uncertainty load on new business across the Swiss Re Group.

In addition, we achieved more than USD 100 million of cost savings in 2025. Therefore, we're well on track to deliver our targeted USD 300 million reduction in the operating cost run rate by 2027. P&C Re and Corporate Solutions achieved an excellent result, supported by strong underwriting performance and lower-than-expected large claims. P&C Re achieved a combined ratio of 79.4%, well within its target of below 85%, while Corporate Solutions delivered a combined ratio of 86.5% comfortably meeting its target of below 91%.

Just as a reminder, the 86.5% combined ratio for Corporate Solutions is calculated on a different basis than that of P&C Re, reflecting a gross revenue view and including all expenses. On a like-for-like basis, Corporate Solutions combined ratio would have been 80%. These outcomes reflect the actions we have taken in recent years to build the highest quality portfolio we've ever had in both P&C businesses.

And against this backdrop, we entered the renewal for January 2026. The outcome was in line with expectations with no real surprises. We executed on our priorities: first, to lead with confidence in segments where we have differentiating value propositions; secondly, to actively manage our sub-portfolios to respond to the more competitive market, including prioritizing sustainable structures; and third, to grow together with our clients by offering solutions that address challenging concentration risks.

Overall, while demand increased competition intensified, especially in nat cat. Although clients selectively increased retentions, Swiss Re selectively or successfully, I should say, preserved our share of wallet.

Casualty prices were up, but we remain cautious even as our repositioning actions are complete. We expect similar conditions in the upcoming renewals, always obviously subject to loss activity.

What does that mean in terms of numbers? On volume, we renewed treaty contracts representing USD 12.4 billion of gross premium in line with the business up for renewal. Overall, nominal pricing was broadly flat, with mid-single-digit improvements in casualty, offset by similar declines in property, particularly for nat cat covers.

The gross premium volume developments mirror this divergence. At the same time, based on a prudent view on inflation and updated loss models, we increased loss assumptions by 4.6%, resulting in a net price decrease of 4.3%.

Importantly, and I repeat importantly, terms and conditions remain stable. In addition, we reduced our external retro for nat cat at the 1/1 renewals, as flagged already at the management dialogue in December, thereby increasing our nat cat exposures.

Now turning to Life & Health Re. In 2025, we completed the review of underperforming portfolios and took targeted actions to address related sources of volatility. The assumptions updates booked in the fourth quarter that impacted the insurance service results and CSM balance are in line with our guidance provided at the management dialogue.

Despite all these actions, Life & Health Re delivered a net income of USD 1.3 billion for the full year. As a consequence, Life & Health Re is on a much stronger footing with clearer visibility on earnings delivery. This gives us confidence in achieving the increased net income target of USD 1.7 billion for 2026. And in Life Health Re's ability to be the stable earnings provider to the group, covering the majority of our ordinary dividend.

Our earnings were underpinned by a strong investments contribution, with a return on investments of 4% and the recurring income yield of 4.2%, providing an important and stable contribution to our earnings. We've also made substantial progress on our decision to withdraw from iptiQ with all remaining parts now being either sold or to be placed into runoff in due course.

Looking ahead, we confirm the financial targets we communicated at our management dialogue in December. For 2026, we are targeting a group net income of USD 4.5 billion, reflecting our confidence in the resilience of our business units, disciplined underwriting and active cycle management.

In closing, I would really like to thank our employees for their strong commitment and hard work throughout the year 2025. I'd like to thank our clients and partners for their continued trust. And you, I'd like to thank you, our investors and analysts for your engagement and support.

Now with that, I'll hand over to Anders to you for a closer look at the financial details of the 2025 results.

Thank you, Andreas, and good morning or good afternoon to everyone on the call. I will make a few remarks on the results we released this morning before we move to the Q&A.

Let me start with the insurance service results of our businesses. P&C Re reported an insurance service result of USD 3.6 billion for 2025, significantly above the prior year level. The increase was driven by favorable experience variance, partly offset by lower CSM release, reflecting the earn-through of prudent initial loss picks, including the impact of the uncertainty allowance on new business as well as slightly lower margins.

Experience, variance and other which captures deviations from initial reserving assumptions contributed a positive $698 million in 2025. This was primarily driven by large nat cat losses that came in USD 1.2 billion below expectations. Against this highly favorable backdrop, we further strengthened P&C Re's resilience by selectively adding to both current and prior year reserves.

For the full year, we added about USD 200 million to current year reserves and around USD 100 million to prior year reserves in nominal terms. These prior year reserve additions are net of releases. We have substantial reserve redundancies on short tail lines close to USD 1 billion, which we recycled into longer tail lines in the form of IBNR reserves. This obviously benefits overall resilience. On the back of these actions, P&C Re reported a very strong combined ratio of 79.4% for the year, comfortably achieving its full year target of below 85%.

Turning to Corporate Solutions. The business unit delivered another strong year, achieving a full year combined ratio of 86.5%, comfortably meeting its target of less than 91%. The insurance service result increased to $1.2 billion in 2025, up approximately $200 million year-on-year, primarily driven by higher CSM release, reflecting stronger in-force margins.

Experience, variance and other was positive at USD 217 million, reflecting favorable large loss experience and a positive prior year reserving result, partially offset by reserve additions for the current year. Large nat cat claims of USD 148 million were below full year expectations, while large man-made claims of $351 million, were slightly above, partially offsetting the favorable nat cat experience.

Finally, in Life & Health Reinsurance, the insurance service result was USD 1.2 billion in 2025 compared with $1.5 billion for 2024, reflecting the impact of detailed reviews of underperforming portfolios concluding in 2025. For the full year, the negative assumption updates related to these reviews impacted the P&L by around USD 650 million, of which approximately USD 250 million in the fourth quarter. This is in line with the guidance provided at the management dialogue. Both the full year and fourth quarter assumption update, we're focused on three markets: Australia, Israel and South Korea.

In addition, adverse experience impacted the insurance service result by approximately USD 300 million for the full year with close to $200 million of the impact attributable to the market mentioned before. Despite these actions, Life & Health Re delivered a net income of USD 1.3 billion for 2025. While the assumption reviews also impacted the CSM balance, in addition to the P&L, the CSM remains robust at USD 17 billion, supported by prudently priced new business and favorable FX movements.

On revenues, the group's insurance revenue amounted to USD 43.1 billion compared with $45.6 billion in the prior year, reflecting several key drivers that were already flagged throughout the year. As we have said repeatedly, we do not manage for top line. Earnings are what matter and the quality and resilience of earnings continue to improve in 2025.

Moving on to investments. Asset Management delivered another year of strong returns with an ROI of 4.0%, in line with last year, reflecting a recurring investment income of USD 4 billion. In 2025, we benefited from the sale of Definity, offset by targeted losses within the fixed income portfolio.

So let me conclude with capital. Swiss Re's Board of Directors will propose a dividend of USD 8 per share, representing a 9% increase, thereby delivering against our stated objective of growing the ordinary dividend paid between 2025 and 2027 by at least 7% per year.

On the announced buyback, last December we added important changes to our regular long-term capital distribution policy, which focuses on growing the ordinary dividend and complementing this with a sustainable buyback that is linked to the achievement of our annual group net income target. Beyond this, we have been clear that we do not rule out the possibility of additional excess capital repatriation in the form of extraordinary buybacks.

Today's announcement of USD 1 billion extraordinary buyback on top of the dividend and the $500 million sustainable buyback should be seen in that context. The $500 million sustainable buyback is here because we have achieved our group net income target. The additional USD 1 billion extraordinary buyback reflects all the key drivers.

Firstly, we generated USD 4.7 billion of SST capital in 2025 despite the various actions we took to increase the resilience of the group, in particular on the Life & Health Re side.

Secondly, the extraordinary buyback is consistent with our focus on managing this important phase of the P&C Re pricing cycle.

And thirdly, the extraordinary buyback reflects our confidence in the overall resilience of the group, having successfully completed a host of actions across our businesses in the last 2 years.

We expect to launch the buyback in early March with completion targeted by the end of 2026. Our announced capital actions today imply total payout of USD 3.9 billion or approximately 80% of our full year 2025 earnings. The group's SST ratio, including all of the announced capital actions remains at a strong 250%.

That's where I will leave it for now, and I'm happy to hand over to Thomas to kick off the Q&A.

Thank you, Andreas. Thank you, Anders. As usual, before we start the questions, if I could just remind you to limit yourself to two questions. Should you have additional questions, please rejoin the line.

With that, could we have the first question, please?

Sure. The first question comes from Will Hardcastle from UBS.

Will Hardcastle from UBS. First one is just trying to really triangulate and work out where the starting point to think of the '26 combined ratio is. I wonder if you can try and help with some of that working out to the underlying, so we can compare it to that better than 85% bridging with the 3 points worse combined ratio from January renewal, that would be helpful.

And then secondly, can you talk me through the rationale of buying less retro year-on-year and therefore, adding greater volatility? I guess it comes slightly in conflict to your added resiliency. So just trying to understand why that happened. I'm trying to think that presumably return on capital, I guess, the belly of the risk as well or is it just on the tail?

Okay. Maybe I'll start here. And I think your first question is the starting point of the combined ratio. And basically, I think what we've tried to figure out is what's the normalized combined ratio after the renewals, in a way and then where do you get that.

And look, I think if we do that, I think we obviously have to normalize for seasonality, we have to normalize for the smaller FX and then incorporate the new information we have with the renewals, which I think we stated as being around 3% nominal. So in our view, this would bring us somewhere between 84% and 84.5%, somewhere there for the year.

But I think this already incorporates all the prudent assumptions that we took. When you look at the -- our assumption that we increased the loss picks by 4.6%. That's significantly higher than inflation. So I think there's some, call it, prudency in. I think we have the uncertainty load. And then at the same time, we bring the -- we have all the expense actions. So I think this brings us well in line with the target also for 2026 to be below the 85% target that we have. I hope that helps.

On the retro?

On retro, yes.

Yes. I mean, I can maybe start there. I think we're not known to depend on retro. We have a strong balance sheet, and we believe and trust our underwriting. We were using retro historically, yes. But when we believe that the margins remain with us and that we can deploy the capacity that we have allocated to nat cat in particular, that situation occurred. And then we said, why not benefiting from it in-house. And I think this is something -- that is a strong statement actually for the underwriting that we have in the underlying quality of the book supports it. So we'll take decisions in future and weigh up whether or not it makes sense.

On the other hand, it's also important from a capacity deployment perspective, not to add to the fire, fuel -- oil into the fire, because if you add more capacity in a rate declining an environment, you will actually obviously intensify the competition. And this would be counterintuitive for the stability of rate adequacy that we would like to achieve. So that's the context for this decision, and then we'll revisit it. But at the moment, we feel very comfortable with this decision.

Could we have the next question, please?

Next question comes from Kamran Hossain from JPMorgan.

I've got two questions. The first one is on the buyback. If I think back to December in the IR Day, I think, Andreas, you made quite a few references to the term, kind of the lemon tree, and I think you talked about sustainability, consistency and not wanting to squeeze the lemon tree too hard. How should we -- how should I interpret those messages that you were trying to give in December and the extraordinary buyback today?

Was it just 2025 was extraordinary and therefore, don't think about it that don't plug that in or an additional buyback into later years because it simply is just an extraordinary set of circumstances? Or are you planning to squeeze things a little bit more?

The second question is on Life & Health. So in the fourth quarter, obviously, you had the assumption changes, which were in line with your expectations. You then have some other kind of negative experience, variance in the fourth quarter. How comfortable are you that the kind of negative experience rate from kind of Q1 '26 just goes away completely? Should we -- is that what you assume and that's what we should assume?

Yes. Okay. Let me take the first one and second one. I can pass on to Anders on the Life & Health side.

2025 should not be seen as a new normal in the nat cat activities. We had a Q1 where we exceeded our budget, nat cat budget, but then we had a very benign rest of the year in nat cat. That's not the new normal. Exposures exposure can happen any time. And that is reflected also in the budget that we set up. We've got a budget of $2.1 billion for nat cat. And let's see. So this can happen any time.

So what we wanted to do is really bring in that professional underwriting view from a technical perspective that we are managing cycles. Cycle management is what we do. And then we look at our portfolio and see what lines of business are correlating with each other, in particular, when we assume certain cycle developments. We see a decline in property in particular in cat. And as I said before, we don't want to fuel the fire by adding more capacity to a declining market. So the quality of the rates and the rate adequacy is really important.

So in that context, you should see the comments that we did in December at our management dialogue. And if you now look forward into '26 and maybe even beyond, we will see maybe similar behavior in the '26 renewals. So let's see. But it just requires one big event, loss event and then the whole dynamics will change. And that's the message I wanted to get across. And that's why we said don't take this as a new normal. We don't want to squeeze the lemon now. We're managing expectations in the sense of what does the market say and what do the cycles tell us.

So we want to create a lemon tree here, and that's what we did and starting and continuing to do, because we need to manage the cycles and the volatility. We've got a diversification benefit through Life & Health, which is helping. But I think within the P&C businesses, that cycle management is key, in particular, at the moment, applying disciplined underwriting.

Yes. Maybe just to reiterate back on Life & Health, what I already just said on the call. I think we really finished now all the reviews. I think we strengthened the reserves significantly during that review. And then we actually look where the volatility that we had, the negative experience where it's really coming from out of the USD 300 million that we had, USD 200 million came from these underperforming markets that we just strengthened. So I feel very comfortable now that after all that work that you will not see this adverse experience in the future years.

And look, I think now we're going to continue to just do -- every year, we do the updates and go through the portfolios, and you will not see large movements because you do it on a regular basis. And of course, we can always have some volatility, but we feel very comfortable now that all the assumptions are set to what we have experienced and what we expect in the future years.

Can we have the next question, please?

The next question comes from Shanti Kang from Bank of America.

So just on the prudence that you've added today, you mentioned the skew between shorter and long-tail lines. And I was just wondering if you could give us some color on what particular lines you address more heavily or if that was more evenly spread across risk lines?

And then just on the renewals, I noticed that you offset some of the volume decline in property and nat cat with some gains in specialty and casualty. Can you just characterize the specialty lines that you felt were most attractive to grow? And also on casualty, which areas feature interest there?

Okay. So maybe I'll start with the first one and Andreas will take the prudence. And I think very clear that we had on the short-term business, we had releases of basically close to USD 1 billion, and we moved them over to the long term. And I think we evenly spread that. It's not that one particular line had a problem because we are not talking about problems here. We're talking about strengthening resilience. So this is not one particular line that got that. And I think it's important, this is all IBNR. This is all IBNR that we use to strengthen the resilience.

Maybe on the renewals, in particular, you said we were offsetting casualty by property by growth in casualty and some specialty lines. On the casualty, I can specifically say it was rate developments, positive rate developments. We are not -- we're still very conservative because we think it's still a market or a line of business where you have to apply prudence, not only in U.S. liability, but also in EMEA and Europe, where you don't want to pick up through the back door the U.S. casualty or U.S. liability exposures through European treaties.

In Europe, particularly, the growth came from motor portfolios in particular on the casualty side. On the specialty side, I think overall, I think we were very happy with the lines of businesses. We're a bit cautious in the marine and energy space. We see very healthy situations in engineering, although competition is increasing in this line of business as well, so something to watch. And then the aviation market, we've seen positive price changes on a nominal basis on the adjusted risk-adjusted basis, it was almost flat. So that's the picture we can see at the moment.

On the cyber side, I can say risk-adjusted, we don't see a very positive picture. So we've got slight decline. So we're very prudent there in the underwriting. And you see it in the market also that some of the players were also pulling back some capacity because we need to watch the rate adequacy.

Could we have the next question, please?

The next question comes from Andrew Baker from Goldman Sachs.

The first one, probably a little bit of a follow-up on Will's question. But can you help me try and reconcile the 5% year-on-year increase in cat budget with your P&L losses to weather events have sort of increased 20% to 30% or so. Does this just mean that you're writing a lot of the incremental cat exposure in the higher layers? Or is there something else going on here?

And then secondly, on insurance revenue. So I appreciate what you're saying on the focus on the bottom line, but it has been a pretty volatile top line in '25 and been quite difficult for us to forecast. I think you made the comment in December and correct me if I'm wrong, that you expect the group number in '26 to be broadly flat versus '25. Is this still the case? And I guess, is there any variation divisionally we should take into account?

I think the first question was more about the cat budget. So I think the nat cat budget increased, as you say, by 5% from USD 2 billion to USD 2.1 billion. I think the reduction in retro doesn't really impact the expected nat cat. So this is much more in the tail. So this is a capacity that we increased, but that's in the tail. So the expected nat cat should not really be impacted by that decision. So that's why I think it's, say, a natural increase of 5% of the nat cat budget to USD 2.1 billion.

And second question?

The insurance revenue. I mean, look, there's a mixed items here. So we've got the earn-through of the casualty, U.S. casualty pruning. We had some individual items, smaller items, also on CorSo, for instance, the medex book, the medical expense book on the A&H side that went to AXA from the Irish MGA that we were underwriting. So those were smaller items, and they added up, obviously, to that number.

And in terms of guidance...

Yes. I mean, we don't really give guidance in terms of revenues. But I think we mentioned many times that we don't manage to revenues, but you could probably see that the market generally grows with GDP or slightly above that.

Could we have the next question, please?

The next question comes from Ivan Bokhmat from Barclays.

My first question will be fully also going back to one of the earlier questions on the combined ratio development. I'm just trying to understand, as we look into 2026 and perhaps in outer years, so if 84.5% at the starting point, we can assume delivery on cost savings, but -- which is 1.5 to 2 percentage points, this still leaves a little bit of a balance that would push combined ratio higher unless we assume some sustainable reserve releases.

And of course, given the buffers you create, this is not unreasonable. But maybe you could talk a little bit about that progression and how the balance sheet could be deployed at what time frame?

And the second question, I wanted to ask you about renewals and the new business CSM and P&C Re. So we've had this year in '25, the growth was negative 5%. I'm just wondering maybe you could try to separate the FX impact within that and also perhaps suggest some view into 2026 of how should that be affected by the renewals?

Yes. Maybe let me just do here the intro, and then I'll hand over to Anders. Just on the cycle management piece. So you've got two elements, the cost obviously and then the loss ratios to look at.

And cycle management, as far as the exposure is concerned, that's our day-to-day business. And we set the strong foundation now, the underlying portfolios are strong. And that's why we think we can manage those cycles very effectively. So with the bottom line view.

Now expense management is becoming part of day-to-day business. We have introduced a philosophy here that we actively obviously optimize the setup of the group. That's what we did with the organizational effectiveness measures and also faster decision-making that translated automatically into expense savings, and we're going to continue there.

I'm not going to talk about the productivity gains that we're going to get through AI because that is a new area, and we haven't factored that into our plans yet. So that's a general view. And then again, we are in an extremely volatile market. That's our business.

So one big event can change the dynamics completely, and that would then lead automatically to a hardening of the market again. So I wouldn't rule out dynamics like that. Because the alternative capital that's coming into the industry also has to then experience the losses that are coming through. And we are a long-term player with strong balance sheets, and that's what we need to manage.

Yes. So maybe just back to your question a bit on the numerical side, on the quantitative side. So I think as we mentioned before, I think you're going to get a normalized combined ratio of below 85%. This reflects the prudence. So I think you can expect if everything else as expected that we're going to see reserve releases.

And then on top of that, the expense actions, that will continue. This is not over in 2025. We took the first 100 this year, we're going to have another 100 -- and another 200 over the next 2 years. So that will help.

And then, yes, I mean, prices will not always go down. So I think we feel very confident and comfortable that I think we will stay below the 85% obviously, upset any huge nat cat events that clear when we budget. But I think it's really the combination of prudent reserving, expense actions and then disciplined underwriting.

And then on the new business CSM, I mean, the new business CSM will come out in Q1. I think that's when we come with the exact number. I mean you've got now all in for how much the renewals impact the combined ratio. So that's a good proxy. But the exact number we're going to provide in Q1.

Could we have the next question, please.

The next question comes from James Shuck from Citi.

I just have to begin with just a couple of questions on some of the moving pieces in the combined ratio. So I appreciate the new business loss component is seasonal. However, the full year number is still a very large number. I think from memory, you were kind of guiding to around 1.5 to 2 percentage points as being the loss component and it's been 2.5% in '24 and around 3% in '25. So what's driving that? $500 million negative loss component is quite a large number in the context of the overall insurance service results. So just keen to get some insight into the outlook for that number.

And also if you're able to just comment a little bit on the expense ratio, which went up from 4.8% to 5.4%. I presume that's just your ending front-loaded costs ahead of the reduction and efficiency program.

And then finally, just on the group items, iptiQ now largely disposed or fully in runoff. I know you guided to sort of a $50 million reduction in the loss at iptiQ on an annual basis. But has that been accelerated in the period? The Q4 loss in group items was bigger than anticipated. So what was the iptiQ loss booked in Q4 and the outlook there, please?

Okay. Maybe I'll start on the first one. Again, I think your question about the new business loss component. And I mean, look, I think the way I think about this is, this is really driven by the prudent loss picks and you should then see that coming through positive variance going forward. That's really how I look at because we write profitable business. It's not that we don't write profitability. It's just the way you reserve for, it becomes onerous day 1, and then it releases over the -- to positive experience.

Maybe just on iptiQ, no, there's no acceleration. Just to remind us, we have first sold the P&C iptiQ Europe business to Allianz. And then we sold the U.S. Solutions -- the Health Solutions business that was, call it, a lead management company that we had. And then we were busy looking at the individual portfolios. So we had a remaining EMEA Life & Health book, but also the U.S. book, and we could successfully then conclude on the U.S. book. So that's also sold.

And we have the remaining piece, the EMEA Life book. And here, we decided to send this EMEA Life & Health book into runoff. So that's going now into the normal runoff activities and manage runoff as we always do and see what opportunities occur in the runoff process.

And so there's no change on iptiQ guidance, which we said should be at around minus $50 million in 2027. And to the question, in Q4, there is an amount of around minus $100 million related to the sales of iptiQ.

Next question comes from Chris Hartwell from Autonomous.

A couple of questions, please. First of all, just going back to the Life side, and I think it builds an extension from Kamran's question earlier. If I look at the start point of 2025 and add back the experience variance, that gets me to a much higher number than what you are implying in your 2026 target. So I was wondering if you could just help me understand maybe some of the moving parts between, I guess, what we saw last year and that 2026 target?

And the second question just really reflecting back on the renewals. Obviously, we've seen quite a significant reduction in price. You and I think many of your peers have confirmed that terms and conditions have remained stable. I'm just wondering what your feelings are about how much room there is or willingness there is for T&Cs to soften as we go through this year. And obviously, notwithstanding the fact that you have mentioned that the market is fairly balanced. But I just wondering really on your sort of the outlook for terms as we go through the year.

Yes. So maybe I'll start on the Life & Health side. And I think you're absolutely right. If I just take the experience out and add it back in, I think I get higher. Now I think when we discussed about that before, I think the CSM release was higher than what we expected, and that's what we were guiding for. And I think that's something we discussed. I think we clearly understand this is really driven by the assumption changes themselves, but also just management actions, BAU management actions like recaptures and so basically drove the CSM release up.

And so if I normalize for that, I get back to a CSM release of in the range of 8% to 9%. And if I then back that -- to take that together with the non-repeat of the experience variance, I get back to the targets that we basically put out for Life & Health. That's really how to triangulate.

Just quickly on the renewals. Again, I can repeat myself. By the way, there's some good news. The broker reports all predicted a steeper decline of rates, and I think that didn't materialize. So that's the good news. So the market was still broadly constructive or professional actually because there's still demand, but in the negotiations, the reinsurers stayed pretty disciplined. And the rest will be seen for this year. I expect a very competitive market still, nevertheless. The next renewals are the 1st of April renewals and mainly Japan renewals. And again, Japan is a different market and different dynamics in the market.

We had a good renewal last year, and we'll see what the renewal brings this year. And then we will have obviously the 1st of June, 1st of July renewals in the U.S. Those are the important data points to look at.

First, I see still a constructive market. We'll have to see how the buyers' behavior is. The fact is that the buyers all need strong lead reinsurers. And you could see that the market share didn't reduce. So we didn't reduce our market share even though the absolute -- I mean, the pie was shrinking that people were taking more risk on their own balance sheet. That created another opportunity for us to go into software solutions, et cetera. But overall, we were not signed down. So they need still strong lead capacity, lead underwriters with the expertise that gives me comfort for the next renewals.

Could we have the next question, please?

The next question comes from Iain Pearce from BNP Paribas.

So just on net operating capital generation. So the 21 points net capital generation this year, do you view that as a relatively clean number or a good starting point to use going forward? Obviously, there's a lot going on this year in terms of Clean Care, Life & Health review. But is that a good number going forward? And also, does that new business strain, the 0.5 in the increase in total capital include the changes in the retro very long, because it's the 1st of January '26, I think. If you could just clarify those two points, that would be great.

Yes. So look, I think this is a good proxy for the capital generation. So I think in general, that was, I think, the year think really showed more or less in certain areas, we obviously have the assumption changes. But other than that, I think it's -- you can expect -- I always guide to around 25 percentage points of net capital generation -- gross capital generation before repatriation. So that's a good proxy.

And then the target capital that already includes the reduction in retro, capital requirement.

I missed that. Yes, that's already -- that's all reflected. Correct, yes.

Could we have the next question, please?

The next question comes from Vinit Malhotra from Mediobanca.

I hope you can hear me. So my first question is just -- and apologies, a bit repetitive, but I want to be clearer from my side. The extraordinary buyback, if you could just please elaborate what conditions we should look at as triggers or a possible trigger for another such extraordinary buyback in the future? So that's my first question on extraordinary buyback.

Second question is actually on the nat cat increased exposure. So just to be very clear, the fact that you have increased your net nat cat exposure probably had a favorable impact on the 3 percentage points of the nominal combined ratio. Is that a correct understanding? Are you able to give some idea of how much benefit that was from this strategy?

Okay. I maybe start again with the extraordinary buyback and maybe I just kind of emphasize what I said before. I mean you have the main part of the -- call it, on our capital return policy is dividend and sustainable buyback. That's the -- I would say that's the core. And then if we're in a situation where we have excess capital, and we don't believe that we want to and have the opportunity to deploy it with the right return, that's when we consider ordinary -- an extraordinary buyback. So you can't bake that in. So you should -- it's quantitative and qualitative, but that's really the way we think about it. And this was this year very clear, that is qualified.

Just quickly on nat cats question. Just to clarify, the renewals are growth. That's before retro.

So the information on the slide is our growth, and we show you the impact just based on that. So any changes in retro are not accounted for in that estimate of...

The next question comes from Ben Cohen from RBC.

I had two questions, please. Firstly, just on M&A. Could you just sort of reiterate kind of what your priorities are there? And with regards to the deal that you announced last week, should we assume that, that will achieve the targets that you have for CorSo as a whole? Or is there anything that you want to call out there?

And the second question was just on the return on investments going forward. Do you expect that, that yield will rise going into 2026? I just asked because I think there have been periods in the past, say, at the end of 2024 when you had a very high reinvestment yield and actually the sort of the ROI hasn't or didn't go up last year.

Let me take the M&A question. So our M&A priorities didn't change. We always were very clear to say we don't see at this stage any transformational M&A opportunities. But what we would look at is additions to the portfolios, and particularly in Corporate Solutions, we said that we are happy to add in the areas, we call them focused growth areas that are decorrelated to the property and cat cycles. And that, in particular, was credit and surety, and we were very open about this.

Now we only do these bolt-on acquisitions when they really make sense. Here, we have the opportunity to add the portfolio that QBE wanted to discontinue or divest. And that, in particular, is a trade credit and surety portfolio, their global portfolio with a strong presence in Australia.

Why is it so interesting? Within the trade credit -- within the credit and surety book that we have in Swiss Re, it added another nice diversification. So all-in-all, very positive. And we will continue to look into those bolt-on acquisitions if they make sense and if they are in the areas that help us to further strengthen the resilience of our liability portfolio, target liability portfolio.

And just on the investments, so just to reiterate what we have said. So the ROI itself was 4%. The recurring investment yield is 4.2% right now. And the reinvestment yield was 4.4%. So all pretty close to each other. And obviously, when you then calculate how -- over time, how this develops, yes, you bring 4.4% in, but the question is always how much actually goes out. And you can expect that this has very little impact. It should have a slight positive impact, but it depends what actually matures over time. So I would expect that to remain pretty stable.

Could we have the next question, please?

We now have a follow-up from James Shuck from Citi.

I just had a couple more things, please. CorSo's revenues in the fourth quarter were very weak, with down 10% year-on-year. Just keen to understand that development, please. I also wanted to ask a question on the expense ratio again, which I think was answered last time. I just keen to know it went from 4.8% to 5.4%. Is that just a temporary jump? Does it go back to 4.8% in '26?

And then just on your new CTO, I thought it was interesting what are the first priorities for this Chief Technology Officer?

Yes. Maybe I'll take the CorSo one and the CTO and then maybe you can elaborate on the expense ratio.

Just on CorSo revenues, it's very simple. This is the portfolio of the Irish medex book, that was taken over by AXA. And this is -- to be concrete, it's $200 million. So that is sort of the decline. Otherwise, CorSo had some healthy new business opportunities, in particular in the differentiating propositions in international programs and alternative risk transfer. Those were the most attractive ones.

On the CTO, it's not the Chief Technology Officer, because we already have a Chief Data and Technology Officer. It is a Chief Transformation Officer.

What is this? We are in a transformation process. The company went not only on a cultural transformation, but also we were streamlining processes, increasing proximity to markets by delayering the organization. And we do have ambitions and concrete use cases also around Agentic AI. This needs to be embedded into the organization, cascade through the organizations from top to bottom.

And I think here, we need specific focus, in particular, on execution rigor and delivery here so that we don't increase again, the complexity of the organization, which will end up in increased costs again. So this is the idea of this new role that we created. AI, but not only AI is really changing the way we organize our business and the way we process our business.

Okay. And then on the expense ratio in CorSo, I think we saw that increase in P&C Re.

The question was on P&C Re.

I thought it was on CorSo.

So in P&C Re, we have some one-off effects from year-end accruals, and it's always better to look at the full year number. Also last year, we had an impact under the first year of IFRS or some out-of-period adjustment. So we would suggest just to look at the full year '25 number as the basis.

Yes. We have seasonality in the cost, project costs, et cetera, that are then coming in late in the year. So that's the effect.

Could we have the next question, please. We have time for one more.

The next question comes from Roland Pfaender from ODDO BHF.

Two questions, please. First one on Life & Health. Could you speak about your CSM new business growth ambitions, let's say, if you strip out large deals, what would be the underlying growth target you have for '26, '27? Just to understand it a little bit better. I think it was flat year-over-year for the year.

Second question on CorSo. Rates are coming down. Do you need to execute cycle management here? Or do you still see some growth pockets like specialty or other things, which might keep growing? That would be also interesting.

So on the growth ambition, for Life & Health, maybe before I talk about the ambition itself, I think we have a very strong in-force business here. And the in-force itself brings us sustainable kind of new business. And I think you saw that kind of without any large transactions, we were actually able to sustain the new CSM just through new business CSM. And that's really the core here. That's important. And that's what we want to maintain that make sure that the in-force produces the new business itself. And then on top of that, we're always looking at transactions. If they make sense, they have to make financially sense. Otherwise, we pull back, but that's in a way, the upside, but the in-force itself allows us to keep the CSM flat.

Yes. So on the CorSo side, in addition to rigorous and disciplined underwriting and cycle management, there are obviously business opportunities, in particular, when you look at geographical opportunities. And we try to optimize -- continue to optimize the setup. We partner where partnerships make sense. We have a very well-run joint venture in Brazil and in those kind of emerging markets, you could expect maybe also some partnership models that we would do rather than planting the flag and have from scratch organic growth opportunities.

So this is something that the team is looking at. But in particular, we're looking for expansions in the differentiation that we have in international programs and alternative risk transfer.

Alternative risk transfer, why? Because like we discussed it for the large cedents, the primary insurance companies who take our premium from the market, that same phenomenon happens with large corporates. They take on more risk on their balance sheets and they create their captives. And with the captives, we have a leading position in managing helping captives at the fronting before the captive and within the captive and behind the captive with capacity, reinsurance capacity. So it's a unique one-stop shop proposition, which is very successful.

Thank you, Roland. With that, I would like to thank you all for your interest, for your questions. Should you have any follow-up questions, please do not hesitate to contact any member of the IR team. Thank you again. We wish you a nice weekend.

Thank you all for your participation. You may now disconnect.

Good morning, everyone, and welcome to Swiss Re's 2025 Full Year Results Media Conference. My name is Elena Logutenkova, I'm Head of Media Relations here, and I'm joined today by our Group CEO, Andreas Berger; and our Group CFO, Anders Malmstrom. They will give you a very quick overview of our results, and then we will be happy to take your questions.

With that, Andreas, over to you.

So thank you, Elena, and good morning, maybe good afternoon to all of you. It's great to have you, also in the room. What should I say? It's a good day for Swiss Re stakeholders, for our clients, for our investors, but also for Swiss Re and its employees 2025 was a very successful year.

Again, I repeat it, we had 2 priorities. Priority #1 was to deliver on our group net income target. Priority #2, the second priority was to increase the resilience of the group, the Swiss Re Group. And in order to improve the consistency of our earnings delivery over time.

Now it's -- I'm happy to say we achieved both. We delivered a record group net income of USD 4.8 billion in 2025, against a target of more than USD 4.4 billion in '25. So at the same time, we took decisive steps to further strengthen Swiss Re's resilience for future delivery. That's the second priority I mentioned.

To give you some examples, we completed the assumption review in our Life & Health Reinsurance business, considerably strengthening our assumptions on underperforming portfolios. In practice, that means we examine how we expect our portfolios to perform. And remember that some of these contracts will last for decades and take a critical look at the assumptions, which underpin those expectations. Where necessary, we revise those assumptions to ensure that they reflect our current experience and insights. This assumption strengthening puts Life and Health Re on a very strong footing now with clearer visibility on earnings delivery in the future.

For Property & Casualty Reinsurance, we added to current and prior year reserves, the money set aside to pay future claims and continued -- we continued to also increase our initial loss assumptions, well in excess of the economic inflation. And on top of that, we continue to apply an uncertainty load on new business across all business units. Effectively, this means that we add an extra margin for prudence when we bring new risks onto our books. The actions we have taken in recent years mean that we have built the highest quality portfolio we have ever had at Swiss Re.

We also made good progress on our objective of reducing our operating costs. Remember, run rate by 2027 is to USD 300 million against the best baseline of year-end 2024. We achieved more than USD 100 million of savings in 2025, meaning we're well on track to deliver on that target. As a rule looking back on 2025, we can clearly say that we did what we said we would do. And in doing so, we helped our clients. We have to make our clients and the communities we work with more resilient too. Swiss Re paid out USD 39 billion in claims in 2025. These payments covered the breadth of our businesses, from Life and Health to Property & Casualty as well as large corporates in the large corporate risk space. This is the reason we do what we do to support clients and communities through peak risks and in doing so, to help make the world more resilient.

In terms of natural catastrophes, the biggest loss event in 2025 for us came from the devastating wildfires that hit Los Angeles in January. One other event I'd like to mention here is the hurricane Melissa, which made landfall in Jamaica in October. Combined, those 2 events led to $813 million and large natural catastrophe claims for our Property Casualty reinsurance business. Hurricane Melissa made the headlines for another reason. You might be aware that the government of Jamaica had issued a $150 million catastrophe bond via the World Bank's catastrophe bond program. Swiss Re was a lead arranger and structurer of this bond. That bond was triggered, meaning that Jamaica quickly could access the USD 150 million and used that to provide fast relief to affected communities. Those cat bonds are paid out very, very quickly. This is separate to the claims we paid via P&C Re, but it shows the breadth of our business and how we can help communities through peak events not just through reinsurance in a classical form, but also other forms of risk transfer.

That takes me to our refreshed strategy, which we announced at our management dialogue in December last year, Build to Lead. Our ambition is to make the world more resilient, that didn't change. To be ready not only to advance our industry but also to play a leading role in shaping its future and create lasting value. And we will do so through 3 guiding principles that build on each other, which you can find or see behind me.

First, we will amplify our core by focusing on a leading market position for each of our 3 core businesses. You saw last week that we announced the acquisition of QBE's Global Trade Credit and Surety business. This is an example of that expansion and in action basically for Corporate Solutions and its portfolio, diversifying our portfolio and capturing new growth opportunities in particular, in lines of businesses, which are not correlated to the broader reinsurance cycle. We will use the full strength of the group including our transversal value propositions such as alternative capital partners and also the public sector solutions team to create real leverage across the portfolio and deepen our relevance with clients and brokers.

Second, we will advance the reinsurance and insurance industry, because amplifying our core is not enough on its own. We also need to reimagine the value chain overall. We will use AI to enhance and support decisions, simplify processes and scale expertise. We will also seek to leverage our proprietary data and research turning it into sharper insights and more targeted solutions for clients, brokers, but also for ourselves.

And third, we will achieve more together because none of this happens without the right people and the right culture. We will attract and develop future-ready talent with the Intellect execution and vision to deliver on our technical and AI ambitions, and we will foster a culture that drives commercial results substantially and sustainably but importantly, also responsibly.

Looking ahead, we confirm the financial targets for 2026 we communicated in December. We are targeting a higher group net income of USD 4.5 billion, reflecting our confidence in the resilience of the business units of the Swiss Re Group, disciplined underwriting and active cycle management. Decisive actions we have taken over the past 2 years allow us to launch a USD 1.5 billion share buyback program, further supporting shareholder returns. Anders, our Group CFO, will give you more details on this later.

We remain focused on executing with discipline, delivering distinctive value to our clients and reinforcing a leading position in key markets. Our aim is to provide stability and security in uncertain times, and that means taking a long-term approach. The metaphor I used when we first announced our 2026 targets is this. We're not here to squeeze the lemon for short-term gains. Instead, we're growing a lemon tree. So it delivers a consistent harvest year and year after year after year. This is our commitment, and we will deliver on it.

With this, I would like to hand over now to Anders and he will run you through more details of the 2025 results. Thank you, Anders.

Thank you, Andreas. Also good morning from my side. So let's start with the P&C Re results. Swiss Re achieved its combined ratio target by a considerable margin coming in at 79.4% for the year against a target of below 85%. We have been writing good business and the performance has been helped by a low level of large natural catastrophe claims outside of the first quarter.

Corporate Solutions also continued its strong track record with net income reaching almost $1 billion. The combined ratio for the year was 86.5% meeting its target of below 91% for the full year, very comfortably.

Moving on to Life & Health Reinsurance. Despite the negative impact of the assumption strengthening, which amounted to $0.65 billion, the business unit delivered a net income of $1.3 billion against a target of $1.6 billion. So let's look at the property and casualty reinsurance renewals. More than half of P&C Re's Property and casualty treaty business is renewed each January. And through the renewals, we executed on our priority. Firstly, to lead with confidence in segments where we have a differentiating value proposition. And secondly, to actively manage our sub portfolios to respond to the more competitive market, including prioritizing sustainable structures. And thirdly, to grow together with our clients by offering solutions that address challenging concentration risks. Demand for cover increased, but competition also intensified. Also clients selectively increased the risk they retained, we successfully preserved our share of wallet.

We renewed 3 key contracts, representing $12.4 billion of premium volume, in line with the business of renewal. Nominal pricing remained stable overall. Mid-single-digit improvements in casualty were offset by similar declines in property, particularly for natural catastrophe covers. At the same time, based on a prudent view on inflation and updated loss models, we increased loss assumptions by 4.6%, resulting in a net price decrease of 4.3%. Importantly, terms and conditions remain stable. We expect similar conditions in the upcoming renewals always subject to loss activity.

In Asset Management, we generated $4 billion in recurring income in 2025, supported by a high-quality investment portfolio. We achieved a return on investment of 4.0% and the recurring income yield of 4.2%, providing an important and stable contribution to our earnings.

And here, we also took steps to increase the resilience of our portfolio. We realized a gain from the sale of a minority equity position in the first quarter. We decided to use the opportunity to sell lower yielding fixed income instruments, locking in a loss in the current period but reinvesting in higher-yielding instruments, which increased potential recurring income in the future.

Taken together, the strong group result allows us to increase our payout to investors. We will propose a 9% dividend increase delivering against our objective of growing the ordinary dividend between 2025 and 2027 by 7% or more per year.

In December, we also announced the launch of a sustainable annual share buyback program to complement that dividend subject to achieving the annual group net income target. Today, we also announced the launch of a $1 billion extraordinary share buyback, taking the total share buyback for 2025 or 2026 to $1.5 billion. To put this into context, the $500 million sustainable buyback reflects the fact that we achieved our group net income target. The additional $1 billion extraordinary buyback reflects all the key drivers. Firstly, we generated significant additional SST capital in 2025 despite the various actions we took to increase the resilience of the group in particular on the Life & Health Re side.

Secondly, as pricing conditions in property and casualty are becoming more competitive, we are managing capital carefully through this phase of the cycle.

And thirdly, the extraordinary buyback reflect our confidence in the overall resilience of the group. Having successfully completed a host of actions across our businesses in the last 2 years. We expect to launch the buyback in early March with completion targeted by the end of this year. The capital actions that we announced today imply a total payout of $3.9 billion or approximately 80% of our full year 2025 earnings. The group SST ratio including all of the announced capital actions, remains at a strong 250%.

That's where I will leave it for now, and I'm happy to hand back to Elena to start the Q&A.

Thank you, Andres. We're going to start our Q&A session now. [Operator Instructions] Perhaps we start with the question in the room, if there is one. Danny? Just wait a second for the microphone.

Could you please elaborate on the new assumptions in your Life & Health business. what are these assumptions you have changed these assumptions and have set free a lot of capital apparently as a result of it. What are these assumptions now?

Yes. So in Life & Health, we have always said that this is the third and the last business unit that we were analyzing. We started with Corporate Solutions then with P&C reinsurance, where we introduced the new reserving philosophy. But in Health Re, we analyzed the reserves in 3 steps. The first step, we looked at the very large portfolios, in particular, critical illness, and we took already action then to address the assumptions. Then we look at the medium-sized portfolios. And then finally, last year, we looked at the last tranche. And here in particular, we can single out the countries, Australia, Israel and South Korea. So these were the remaining smaller portfolios that we analyzed and we can now say we have completed the assumption review in Life & Health Re. And that's why we are in a much stronger position now in Life & Health Re than we were before.

So we can now say each business unit has completed their fundamental work and now each business unit can play its role that it's supposed to play in the context of the group in order to see the diversification benefits that we have because they are not correlated life and health reinsurance portfolios with the P&C portfolios. This is the strength of the group, and we are very happy that our teams have done the heavy lifting, the work last year. And this resulted to an increased resilience. And hence, what Anders was just saying, put us in a position to address also some capital management actions.

And maybe just to add in all these 3 markets, we're not just updated assumptions and increased reserves. We also took business actions. So in Australia, we basically paused new business. We post the new business in Australia. That was a significant action that actually got quite some feedback in the market, very positive feedback actually from our clients because they were pleased to see that somebody is taking actions because in Australia, it's really an environment that's just not supportive of the -- for the private insurance. It's mostly disability. And it's really related to the increase in health claims have issues that are driven by the state insurance. In Israel, we took action that we put these businesses in runoff. And in Korea, we took action that we stopped the particular product completely and adjusted the products for new business. So in all 3, it's not just assumptions, but it's also business actions. And to your point, this did not free up capital, the actions. I think I heard you asking that the actions themselves did not free up capital.

This particular treaties are just not sustainable from the environment, and so we put these particular treaties. Besides making the assumption changes also, we just put that in...

All right. I see we have a question from Ben Dyson online. Can we cut to that?

A couple of questions, if I may. Firstly, I was wondering if you could tell me what the Hurricane Melissa claim was in isolation. I know you gave them earlier in combination with the LA wildfire claims earlier, so I just wondering if you could separate that out?

And then the second question I had was just on the profit target for 2026, that's lower than the actual result you achieved in '25 although it's higher than the target. And so I was just wondering there if you could tell you why you set that level where it is, given how you perform in '25 and whether if that's an acknowledgment that '25 was an exceptional year. And if you could say why that was and if it was driven by the lower level of natural catastrophes in the year.

And then the third one I had was just around the renewals, the renewal outcomes. It kind of looks like you've not done as much pruning as some of your competitors have and because the overall outcome was relatively flat on a volume basis. So I was just interested there, if you could say a little bit more about whether -- when taking into effect the prices and the volume changes that you saw, whether you're actually growing or shrinking effectively.

Maybe I'll start with the Melissa question. So you said the quantum of the Melissa question. It was a cat bond, and I said it's $150 million. This is outside of the P&C claims that we paid out. I was referring to the $39 billion. In the U.S., in total, we have been paying out around USD 17 billion for the U.S. alone. And the biggest nat cat event was obviously the LA wild fires, which amounted around $600 million for Swiss Re. It was basically the biggest nat cat event in the U.S. in 2025. And maybe I should link that also to the question around the renewals now.

You were asking about the volumes. First of all, you have seen on the slide that the volumes were pretty flat, nominal price increases were also roughly flat that we use the opportunity also to address inflation, model updates and also initial loss assumption updates which then impacted obviously the risk-adjusted price adjustment or price outcome. And that's the minus 4.3% that you saw on the slide. So this is an additional -- you can see it as an additional resilience for the company. So it's not just reserves that you increase. There are many other aspects that you can do. And this is important because you need to have a very robust resilient portfolio when you enter into a cycle management phase now.

I think that gives us the comfort that we're ready for a cycle management. And again, we never steered people or I mentioned growth targets. We always look at the quality of the business, the disciplined underwriting. And for us, it matters that you have a bottom line growth. Obviously, bottom line growth implicitly also means you need to grow the top line, but you only grow it in desired areas where we have risk adequate pricing, and we feel very comfortable with this.

On the nat cat side and you might take this question also around the targets. But one thing I would like to do as an intro, don't consider the 2025 nat cat experiences and events as a new normal exposure as exposure. It can happen anytime and there is exposure out there. That's why the demand for such covers is actually increasing, but competition is also increasing. And that's why you have to be very prudent also in engaging so that you don't fuel another softening of the market. We look for rate adequacy. We put price to risk. That's what we do. And that's why you always have to expect normal nat cat events in 2026 because that's why we have budgets for this.

Yes. Maybe just to add to that, if you -- and usually you normalize results exactly to Andreas' point, you take the positive experience out that was, yes, in this case, because of nat cat. And in that context, we believe that the USD 4.5 billion target for 2026 is an ambitious but an achievable target. And I think we're very confident that we will get there, but this is a good target that we believe and reflects the true underlying earnings power that we can deliver.

So just quickly, could you tell me what you think -- what you're using as a normal assumption for nat cat in a year?

So for nat cat, we have a budget of USD 2 billion in the P&C Re side. And as we mentioned before, I think we used -- we had claims up to the amount of $800 million. So we had $1.2 billion positive. Now not all of that went to the bottom line. I think we use that also to strengthen resilience as we talked about before. I think you see it's about $700 million that went to the ultimate result and $500 million, we use them to strengthen the overall reserves.

Thanks, Ben. Let's take a question from Jonathan in the room.

I have some on the share buyback. How should we think about the $1.5 billion share buyback in terms of like sustainability? I mean, how sustainable is this level of additional share buyback? I mean, you guided for $0.5 billion as base? And then if I look at other players in the industry, your peers or also other large insurers they are not returning as much capital, but are retaining it more to -- and look for further M&A opportunities. You also has stressed that you would like to engage in more M&A activity during the current consolidation phase, if I can use this term, but what do your current capital management actions, say about your M&A strategy?

And then last question, I'm just thinking about why exactly now are you buying back shares on this level of the share with CHF 130 more or less. How could you maybe plan this more ahead in terms of buyback shares when the shares are in your view, lower and lower level, like maybe CHF 90, CHF 100. I'm just thinking about last 5 years and next 5 years in terms of why not just wait for the shares to fall and then maybe try to buy them back? Yes, that's it.

Maybe I'll start with the sustainability of -- your question about sustainability. I think we have very clear at the management dialogue and we introduced a new capital framework that the number one priority is to keep dividends stable or increase the dividend. And we have a clear commitment that we want to grow the dividends by 7% at least for 3 consecutive years. So in addition, we said if we achieve targets, we can add to that dividend amount also a sustainable buyback. We call it a sustainable buyback, and we start with around $500 million. This brings you then to a payout ratio of about 60%. And insurance business or reinsurance business is quite volatile. So you should think that as the sustainable part of the business. Then we obviously want to use the capital to grow the business if you see opportunities.

But if we have sustainable excess capital that we don't see that we can deploy it at the right level, and we are well capitalized, then we would give it back in the form of a buyback. And you should really see this $1 billion in that context. We have a very strong solvency ratio that even after these actions is at 250%, which is the upper end of our band, we are going now in a cycle where that you have to manage. So you don't want to deploy capital below the target ratio. And so that's the -- I would say that's the rationale. And that's very much in line with what we talked about in December. So don't think that, that additional $1 billion is sustainable. That really depends on the situation where we are in the business where we are from an earnings generation and where we are on the capital front. So that's how you have to think about.

To the question about when to buy back, I mean we don't have discretion that I can just go out and say, now I should buy so you start the program and that program needs to be structured and then you give it out, and then it runs. And look, in my view, this is not because the stock is weak. It is because we don't have -- we see better use for the capital to give it back to shareholders than to keep it.

So on the M&A question, I can say that, but this action you can read it as we don't believe in really transformational M&A. But what we believe in is adding to our portfolios where we see a need or where we see a strengthening of our resilience or diversification even of our portfolios. So we have always said, for instance, that in Corporate Solutions, we see opportunities in the market to add lines of businesses that are not correlated with the property or cat pricing cycle. So if the rates are going down in property, they're definitely not going down because it's not correlated on the credit and surety space.

And we always said we like this line of business not only because it's de-correlated to the property cycle, but also because it adds nicely to our capabilities that we have and if opportunities present themselves, then we will go for them. And that's exactly what we did in Australia with the QBEs, global trade credit and surety portfolio that we took over from them and we will look further for opportunities like that. We call them the bolt-on opportunities, and we feel much more comfortable with this approach.

I have a question also concerning the dividend payment. When you look on Swiss investors because of the change to the dollar. They are really now under -- its [ 6.19% ] I calculated this morning. So they're getting less dividend payment in Swiss francs. Is this a point why you put the share buyback to give something additional on this? Or what do you think -- why you didn't increase more the dividend proposal? This was the first question.

Maybe, again, I think maybe to reiterate, I mean, we said clearly in our capital allocation policy or deployment policy that we want to keep the dividend stable or grow it. Our business is predominantly in U.S. dollars. So 50% of the business is U.S. dollars, then we have all the other currencies. We don't have any Swiss franc exposures about 1% of the business. So it would be impossible for us to give a Swiss franc dividend policy. So with the policy we give has to be in dollars because that reflects the overall business. And I think that's a strong message also, and we were able to increase the dividend by 9% in U.S. dollars. I understand that in Swiss francs and we all are Swiss people but that this reduces that's not the 9% increase in Swiss francs, but I think it's -- that's how the business is managed. We cannot just go up and do the Swiss franc dividend increases and then the exchange rate moves around, and we cannot commit to that. We really want to commit to our policy, and that's a consistent framework that we have here. And the buyback to your question has nothing to do with the Swiss franc situation.

It's just 154 years, it was okay to have a Swiss dividend and Swiss franc dividend. And then you recently changed before the weakening of the U.S. dollar started you changed to U.S. dollar. So you always had a big portion of U.S. business and never -- it was never a topic. But recently, you changed and now the Swiss investors are getting less in Swiss franc due to this change. Otherwise, you would have with the same strategy would have to pay more dividend.

Look, the way I look at it is I'm coming from the other side. I think we're generating earnings, and we're paying out about 50% in dividends. And then I think you see another 10% now in the sustainable buyback, and you see another 20% in the extraordinary buyback. This brings you to 80%. So the overall amount that we give back to shareholders is significant. And that doesn't make a difference if that is in dollars or in Swiss francs. So I think that's how I look at it. So we want to give the earnings back to shareholders in these various forms. But I want to have a stable dividend going forward.

And the second question I have is concerning the strategy. Again, the EUR 4.5 billion target seems to be very low compared to Munich Re, for instance, which has EUR 6.1 billion in earnings just in euro announced yesterday. If you just said that the nat cat risk is there. You had a good year because there were less claims, but isn't -- shouldn't be the target higher if -- or the payout higher if nothing happens really dramatic?

Yes. I mean I can just repeat what I said before that year 2025 had call it luck or not, but had a very -- it was a benign nat cat year. So I think that's factual. So -- and that's why, I mean, we have a budget of $2 billion, and there's a reason for that. We are market leaders in the nat cat space. On a global basis, we have around 10% market share. So if you want to manage volatility, and that's what we are there for, manage market cycles. So then you have to factor for that. That's exactly what we do. No we're not ignoring what's happening out there in the market and what could happen. What we try to do is to manage consistently to deliver consistently on our targets. We don't want to go too aggressively into a target space where the probability not to meet the target is very high. That would not help us with the credibility that we built on.

And the last question I have, 43% of your investment portfolio of the bond portfolios are in U.S. government bonds. Do you feel comfortable with this high level of U.S. government bonds?

Yes. So look, I think the way we manage the business and also the investment businesses, we basically match the investment with the liability in its currency in its market. So we want to be matched in each market. And because almost 50% of the business is in the U.S. you would also expect that 50% of the investments are in the U.S. And because I think that's the most efficient and effective way because when something moves then it moves on both sides.

It's not too high in government bonds you're saying.

No, no. It's matched. It's linked to the liabilities, yes.

Let's take a question online from [indiscernible]. We can't hear you. You're muted.

Can you hear me now?

Thank you.

Yes? No? Okay. Sorry. My first question is about P&C reinsurance. I have noticed more selective underwriting and slightly decreasing price in the branch. And by Swiss Re, yet climate change should increase loss exposure and this demand, which should increase the prices. Can you please explain this to me? Will this trend continue? And how does it affect your 2026 target?

And the next question is a CEO question. What is more likely that you will catch up with Munich Re or that Hannover Re will catch up with you?

Yes. Let me take the first one. I mean, Swiss Re Institute published a number. So you can really go into the details there. The nat cat exposures obviously increased. The loss has increased. 5% to 7% annually, and we have exceeded the $100 billion losses, U.S. dollar losses in 6 consecutive years now. So it is real. But then you have a distinction between the primary and the secondary perils. And what reinsurance is, therefore, we take the peak risk. We the shock absorber take the peak risk. But we're not there for the frequency risks because that is better managed by the prime insurance companies. So if you look at the structures of the contracts, and look at the attachment points when reinsurance is triggered, it is too high for the frequency risks. And the perils, the secondary perils, in particular, when you look at floods, for instance, that's a secondary peril wildfires. A lot of it is actually managed in the net retentions of the insurance companies, the primary insurance companies. So what we then provide is data analytics and solutions for them to better understand those risks and better manage those risks.

This is nothing for severity protection. So that's why we are modeling it obviously, and we're well positioned. We help our clients, but this is a discussion that the prime insurance companies need to have with the end customer. And if this is a systemic and too big to be solved by one party, then we join in a public-private partnership model. We have various programs in place. I mean I was just mentioning Melissa, for instance, that is another program, the cat bond program that we set up. But we do also have government programs for floods, flood protection in the U.K., for instance, where we bring in our expertise and our claims paying ability the government brings in protection, prevention, by building dams for instance, to protect against floods. So these kind of instruments are there, and we are one of the market leaders in those instruments as well. The second question?

Second question was about Munich Re [indiscernible].

CEO question. You said you probably referred to transformation program when we said we need to close the gap to #1. It's not about any of names of our competitors. It's about a mindset. So obviously, we look at benchmarks. We look at how do we do in comparison, everybody does this as good practice. But then we look at root causes. Why are we lagging behind in certain KPIs and then we address this. So this is the mindset because we are a leading reinsurer in the world. We are built to lead, as I said it. Historically, we are built on a lot of data analytics and risk insights. And we are part of the Tier 1 reinsurer. So naturally, you would want to lead, and that's exactly what we do. And closing the gap to number one, Yes, if you look at numbers, but we leave this judgment to yourselves. You just have to look at the numbers and see how we were doing. We believe that we were -- we had built up a good track record in building and closing the gap to #1 in critical KPIs, yes.

Let's take the next question from Nathalie Olof-Ors.

I'd like to see if you could give us a bit of color on the first 2 months of 2026. There's been quite a few weather events between the cold snap in the U.S., the Blizzard in New York, the floodings in France. And I assume at this point, you're probably going to tell me that you don't have an estimate yet, the water level or just started to receive in France, for instance. But could you give us a bit of an idea of what you know so far, how significant are these losses. And since the Sigma report always point out the increasing pressure of the secondary perils like flooding. How do these cold snaps and floodings in France compared to what you've seen so far in the last few years?

For 2026 in the first months as far as the activities, nat cat activities are concerned, we can say it's not higher than first quarter so far, I mean, the first couple of months in 2025. So we don't see this as an extraordinary start of the year. It's still early days, yes. So Q1 still some time to go, and things can happen any time. As far as the secondary powers that you mentioned are concerned, we can say that these don't hit our budgets yet. So we allocated the budgets, obviously, and we are still in the territory within our expectations. We do have models that have probably the most -- one of the most advanced flood modeling through the acquisition of a company called Fathom, that's included now into our models. And this we provide, obviously, we give clients the opportunity obviously to access this and to help prevent or mitigate so prime insurance, but also in the corporate sector.

And I say that I assume you don't have an estimate yet, but do you actually. Do you have some idea of how much all this is going to cost. The cold snap, the avalanche in Switzerland, the flooding is in France.

It's too early to say because you can obviously speculate, but I think it's much too early to say the large implications of losses are not even coming in at this stage, maybe in certain individual cases. So I would say it's still too early to say.

There's a question from [indiscernible] in the room.

Also, CEO question. When you started in 2024, there was a lot of talk about you doing the same thing in the group that you did at CorSo this turnaround. So I was wondering how far do you think have you come on this path? And what are your priorities from here?

Yes. So of CorSo was a specific situation, which is not 100% comparable with group. So I would separate the 2 events. The group was not a burning platform. CorSo was a burning platform. We had certain areas where we were underperforming at group level and those ones we addressed. There was one commonality maybe between CorSo and all the other reinsurance business units. This was the introduction of the new reserving philosophy. This was done across the group, and that's something that everybody had in common. And there are other very good positive examples where we also found synergies between the business units in CorSo, CorSo started with the analytical data model where we manage our business completely differently to traditional ways using software.

So that's something we had started at CorSo and we deployed it across the group, not only in the business units, but also in all group functions. So that's a positive, for instance. But as far as the transformation, the cultural transformation is concerned. This is really a group topic. That's not a CorSo cultural transformation that was for the whole group across all functions, all territories and all business units.

I just wanted to ask a bit on the renewals. Again, you explained it a little bit, but can you maybe elaborate a little bit what kind of the software market is due to the benign environment of 2025 and how much is the competition? And are there more nontraditional competitors? Can you a little bit say something about that?

Yes. First of all, let me state, there is not 1 cycle. So it's very important to say because each line of business is in a different market cycle. There might be a few lines that are correlated to each other but not in general. That's what I said around the lines of business like credit and surety, which I mentioned before, which is not correlated to the traditional property and casualty lines of businesses. So for the renewals, we have seen demand, but we have seen also higher competition on the supply side. So there's capital -- abundant capital in the market, and that is reflected in a more intense pricing competition. The good news is that the structure states broadly intact, the terms and conditions and attachment points. And that's something we need to observe, and we need to keep that discipline in the market. We have seen the sophisticated and very large reinsurance buyers. They have taken more risk so meaning taking premium out of the market.

But again, the good news is they need lead reinsurance partners. So our share of wallet in the market didn't reduce. Yes, we see trends of alternative capital coming into the reinsurance space. We have seen so far individual transactions. They're all in their nature were very bespoke, something we're observing. Swiss Re is always known to be very active in the intersection between the liability and the asset side, but also capital market side. So again, we were one of the founders of -- or maybe the founder of the ILS market. So this is normal cycle management. The parts of the cycle when rates go up and then parts of the cycle when due to the high rates, investors think that's an attractive market. So capital will come in and it puts more pressure on pricing, competition goes up. But here, technical excellence, technical underwriting, how do you assess the risk. How do you price risk is very important. And you always have to look at rate adequacy and about composition of your portfolios and protecting your balance sheet. That's the professional answer that I would give you on this.

I have 2 additional questions. The first, I understand that from what you said earlier on Life & Health, the release of capital is not due to this third step that you have explained, but rather to the first 2 steps, I would appreciate to learn more about what these first 2 steps were specifically in terms of new assumptions? And the second question is also about nat cat. You mentioned this interesting figure about your market share 10%. I have the impression, could be completely wrong, but I have the impression that in the earlier years, the role of reinsurance companies in these nat cat field was more pronounced in terms of market share, et cetera, and the exposure but I could be wrong, but that was my impression.

Maybe I'll start with the -- on the Life & Health side. Maybe just to step back, what we said and what we did is when we go in and say we strengthen assumptions means you go in, you check are your assumptions adequate for what you see in the market for the experience and also what your insights have about the future. So when you strengthen that, you actually increase your reserves, increasing reserves per se uses capital, doesn't free up. It actually uses capital. And so that's what happened. And just for this year. Yes. We did not lose assumptions. We strengthened the assumption, right? So that uses capital and the capital generation. What we said is despite all this strengthening, we still generated significant SST capital that put us in the strong position here. Yes. [indiscernible]

What assumptions -- what are the most important assumptions that you have strengthened? Are we talking about life expectancy, these kind of things or what is it?

Yes. So I mean, when we started 3, 4 years ago with the strengthening and Andreas said, we had the large portfolios, that was U.S. mortality and critical illness mostly China and some other countries. So on mortality, this is life expectancy, clearly. On critical illness, this is the probability of getting sick. So this is kind of a disability probability. Then you have lapse assumptions. That's quite important here. And I think those are the 3 main assumptions, disability -- in all instances, I mean, there's multiple ways that you can assess that it's really mortality, disability and then lapse assumption.

And life expectancy in the United States, your assumption is a decrease of life expectancy over the last few years, right?

I mean we haven't updated these assumptions in this year. This was not the focus. Previously, yes. Yes, we basically how to strengthen the mortality. And this was driven by COVID. COVID really changed the life expectancy. It's coming back. So that's reflected. But COVID clearly increased mortality and so that had an impact on life expectancy. But you see a release of that. You see how that kind of fades back to pre-COVID.

And then on the second question is nat cat related and market share related. In general, if you look at the bigger picture, you've got the top 3 or call it 4, we actually look at the top 3, and they have the majority of the market share still as a top 3 group. Then you have the second-tier reinsurance companies, and you have third-tier reinsurance companies. So over the years, you could see that the market share of the top 3 didn't really reduce. I think that's an important message why because the insurance companies and reinsurance buyers, they need strong long-term partners. And that's why even now, we said our share of wallet didn't reduce in this renewal, even though some of the large insurance companies took out premium.

So they must have reduced somewhere else. The second tier ones and Tier 1 means those were the best rating also. And then the second tier ones are the ones that over the years could actually also increase our shares, but also then to the expense of the Tier 3 ones. The Tier 3 ones are very small reinsurance companies. And if you look at the panel that 1 given insurance company has, there are plenty, plenty of reinsurance companies on 1 panel. And some are starting to optimize a little bit to reduce the number of reinsurance companies on that panel, but they still need the lead reinsurance companies.

I think we have a question from [indiscernible] online.

I have a question about the L&H outlook for 2026. So you've projected it to be at $1.7 billion, which is almost 30% more than what you achieved this year. So I mean, the pressor does mentioned about strengthening the portfolio, but could you just shed a little more light on it. Specifically with regards to any regional pockets that you see that might deliver this or help sustain this because you did take action in South Korea, Australia and New Zealand. So in that sense, I just wanted to...

Yes. Look, I think, I mean, this year, we had a target of USD 1.6 billion. We took significant actions this year in the sense that we took a charge of USD 650 million so we believe now that we're in a good position that we don't have negative assumption changes in 2026, and that brings you back to the target or actually above the target. And that's why we feel comfortable that we can actually increase the target for 2026 relative to 2025.

We have to wrap up. There is a question online from Glenn [indiscernible]. This would be the last question that we take.

I should like to know a little bit about appetite, especially in casualty lines and P&C reinsurance, in part because of the growth in casualty at the 1/1 renewals. If that can be explained in greater detail. But also I'd like to understand the revenue progression. When you discuss full year IFRS 17 revenues by segment. And if I back out the 9-month results, I see that suddenly fourth quarter P&C Re casualty seems flat year-on-year after having been down double digit throughout each of the first 3 quarters. I know that's an earned-in measure, and there's a lot of give and take on prior periods. But I'd like to understand how that turnaround came about so quickly. If you'll have extra time, I would do the same thing on properties since you backed out of property at the renewal and I'd like to know if that's an omen for Cedents who are lining up for the midyears.

Yes. Just quickly on casualty, starting with casualty. You know where we came from. At the peak, we had 17% -- roughly 17% market share in the U.S. -- on U.S. casualty. And we corrected that. So we are now around 5-ish, maybe between 5% -- call it, 5%. So we are where we want to be. Not everything in casualty is highly exposed and not rate adequate or risk adequate. So there are areas where we are obviously operating in. The growth usually, I would say, would come from the rate increases. Now if you look at the territories where we are also active, that is also EMEA, Europe, in particular. And there, you could see that we had significant growth also on the motor book. So that is one driver also on the casualty side.

On capability as far as the trends are concerned, we're very careful and conservative because -- and here you need to dig deeper into the sub lines of businesses and where they exposed in Europe, you got to be careful, for instance, with casualty portfolios with U.S. exposure. So you get basically the U.S. exposure that we addressed in the pruning of the U.S. casualty or the U.S. liability book, you don't want to get it through the back door in European treaty. So that's something we're watching.

On the property side, look, I can't give you -- I don't have the crystal ball, but we expect the market to be similar as -- and from the dynamics as we had in the January renewals, yes. So why would it be over so quickly? Obviously, if there's a huge loss event that changed the dynamics again. And that's something we observe all the time. We're going now into the April renewals. They're mainly Asia or Japan driven again, the Japanese market is a very different market to the U.S. market or European markets. And then you go into the July renewals, June, July renewals in the U.S., everybody is waiting for that, obviously. So let's see. I think it's higher demand that's always a good sign. So there's demand for the product, and we just need to have discipline in keeping the rates adequate and keeping the structures disciplined.

All right. Then thank you, everyone, for joining. If you have any follow-up questions, we'd be happy to receive in Media Relations and clarify anything.

Thank you very much.

Thank you.

Thank you. Bye-bye.

Good morning from the Swiss Re offices here in London, at the Gherkin. My name is Thomas Bohun. I'm the Head of Investor Relations, and I would like to welcome you to our management dialogue event this year.

We will kick it off right away. You will hear from our CEO, Andreas Berger; followed by our CFO, Anders Malmstrom. That session will take around an hour and 15 minutes. We'll then show you a short video on AI, 2 minutes, before we head for a short coffee break and then reconvene for the Q&A, where we will take questions here in the room.

So with that, Andreas, over to you.

So, a warm welcome for the people here in the room. It looks very cozy and intimate, so -- and a lot of familiar faces, but also a warm welcome for everybody who's dialing in. The sun is shining. The markets are tough, but there's a positive outlook. And it's about strength and resilience. That's my key message.

Remember, when I stood here last year, I was talking about closing the gap to #1. But before I go there, I wanted to say there are so many temptations, temptations around in the market and huge expectations, obviously, because there are temptations.

What is the temptation? Temptation is growth at the moment. Everybody thinks we have to grow. There are so many opportunities. There's so much demand in the market. So let's go and grow. In our business -- sorry to say, it's a recipe for disaster. I have lived through many, many cycles. We could actually make a vote here in the room, at least how many cycles you have lived through.

The characteristics are always the same. People go into markets, grow at the wrong time. I've seen this movie before. And we are also guilty because in the past, we have grown in certain areas at the right time. No, actually, not at the right time. It was the wrong time. You see -- so we have to be very conscious about this.

For me, when I ask about what is closing the gap #1 actually mean? First of all, it means we have to come to the party with humility. We have to admit that we were not #1 in the past. That's what we said internally. We recognized there are some things that we need to change. Why? Because we're market leaders. We're market leaders and people are looking at us. So, the right behavior from market leaders also contributes to the stability in the market.

So number one, people ask me what is #1? I said, you define what #1 is. By the way, you in the room define what #1 is. And the outcome is actually determining what #1 means. But I said to our colleagues, #1 is actually a mindset. Closing the gap to #1 or wanting to be #1 is a mindset. And it's not just growth. At the end of the day, we are in a volatile cyclical business, and it's about managing volatility. It's the fine art of good underwriting, good claims management and good cycle management, and we call it the Smart Circle, where all functions play their role, work together and come to the right conclusions, except the actuals in the market, but then adjust the expectations if they're not aligned, if the gap is widening.

This is something. That's a muscle that we were working on for now quite some time, and you see certainly things coming through. And you see me here very confident also, because we see it coming through. We see it in the numbers. We see it in the behaviors of our colleagues in the market, in particular. Maybe we're going to talk about this as we go into the renewals.

So, I'm not here to squeeze the lemon. I came here to build a lemon tree, let's call it the lemon tree. It's not about squeezing the lemon. It's about long-term stability, resilience. It's about delivering year-by-year-by-year-by-year, consistency. And you won't achieve that if one gets too excited, if people think there's an opportunity that we need to chase. But on the other hand, I'm also not intimidated by what people say about markets and rate developments. That is cycle management. That's normal. So, we have to grow up and behave in the right way in each and every part of the cycle. That's our job.

Now let me quickly start with -- I think we did have here the key messages that I wanted to send to you today. So we were too fast with the slide here. So, we want to grow the Swiss Re franchise. So, listen to my introduction, the sentiment that I wanted to send, we want to grow the Swiss Re franchise at the right time when the right opportunity is there. And we need to be ready for every part of the cycle. And I'm very positive about the market, because there are areas where you can still grow today. But again, you have to adjust your portfolio. And near term, we're focusing on cycle management and on margins. That's very important.

Second takeaway, we're going to talk a bit more today about the data foundation that we built over years now. There's over 8 years where we have built a solid data foundation and tech foundation, where we believe we are AI-ready with a now state-of-the-art leading AI platform that we can deploy into the business.

Remember, I said Life & Health is the last business unit that we are going to address. In 2019, we started with Corporate Solutions with a fundamental turnaround, introducing a new reserving philosophy, solidify the business. And you've seen over, I think it's 21 consecutive quarters beating consensus, really delivering on what people were promising to deliver. And then obviously, we went to the P&C Re business. And the same applied to the P&C Re business. And you can see suddenly the underlying quality of the portfolio is really coming through now very nice.

Finally, we said this year, we're going to address Life & Health Re as a business unit. And remember, there were three phases, two large portfolios at the beginning when we introduced the IFRS balance sheet, critical illness and U.S. mortality in particular. Then we went to the midsized portfolios, and now we have addressed the smaller portfolio. So now, we have looked at all portfolios. And we can say it's materially completed now.

Last year, when we talked about Life & Health -- sorry, liability reserve increases, you asked me and I said, I can sleep easier now. Now, I can say it for Life & Health, too. So, we set all three business units now at a level where we say it's a successful foundation now for the next phase. And then, this also will justify the increased targets for the Life & Health business unit for 2026, as you can see later.

We have also achieved an excellent portfolio quality across the P&C businesses. We've said that. You can see that in the results that were coming through the quarters last year -- or this year, sorry, we're still in '25. And I'm very happy with the performance of both business units as we speak. There was a bit of luck also, obviously, in the P&C Re business with a pretty benign cat season, in particular in Q1, we felt we had a very heavy Q1, wildfires in Los Angeles. We always know about this. But Q2, Q3 were actually quite favorable for our book. So, it didn't reach our budgets.

Expenses, I put out a USD 300 million or more cost reduction target by 2027. This is a net run rate number. So, inflation and investments are being taken out. So, that's a real saving, and we are very well on track this year alone, USD 100 million we will definitely achieve.

We expect to deliver on our 225 (sic) [ 2025 ] net income targets of greater than USD 4.4 billion. At Q3, I already said we are very well on track. We were 90% there. So, I would expect us to be confident about this target. The aim for 2026 will be at USD 4.5 billion net income target. You might say it's underwhelming. Again, I repeat, the market is not easy out there. USD 4.5 billion is an attractive outcome for us. It's more than this year, but also you can translate that into roughly a 20% ROE. So this is a pretty good outcome.

Could we do more? Maybe. But again, remember, I don't want to squeeze the lemon. We need some dry powder for further strengthening our position in the market.

And finally, we will announce now today that we will have a sustainable annual share buyback program. It will be a starting point of USD 500 million, and we will start in 2026, obviously subject to us making the target for 2025 and obviously also subject to Board approval in February.

This, again, you might say, underwhelming. But if you look at the market, there's not just rate down decline, et cetera. There's also opportunities. It's a very dynamic market at the moment. There's not 1 week where we are not being approached about potential inorganic opportunities, but also organic opportunities. We're open for that. There are international opportunities that present themselves that are not baked into yet. Those are new ideas, new platforms, regional platforms that are being created.

Swiss Re as a leading reinsurance group is always at the forefront. We've always been invited to the party. So, expect something more to come at this front. So I'd like to keep some powder dry. There are great opportunities out there, and we want to be there to capture on those. So that's -- those are the key messages I'm going to send.

And we will separate our presentations today in the more strategic part. And then Anders, our Group CFO, will come with the finance part of the presentation. And then obviously, we're going to engage in the Q&A.

We're coming from a strong foundation. We have addressed the areas where we looked -- we found drag, drag, negative distraction. And now we could uncover the quality of Swiss Re with a great leading brand reputation with more than 160 years of history. We've got fantastic access to clients and brokers, actually privileged access. This is reflected in very, very good feedback that we measure on a regular basis.

We have top-tier market positions in all three business units in the addressable target market that we're operating in, we have leading positions, if not the leading position, #1. And this obviously is underpinned by a very, very strong continuously performing asset management unit that we're very proud of.

We have a strong balance sheet, strong capital position with a fantastic diversification. I'm going to come to that point in a bit.

Risk knowledge. I think, when people talk about Swiss Re, that's what comes to mind. It's reflected in Sigma, the publication, where we channel our knowledge into our stakeholder groups, not at least the customers.

And again, state-of-the-art data foundation and technology, that's something that we want to be known for as well going forward. This all makes the world more resilient. That's sort of the frame that we set as a foundation.

And if you look deeper now, you can see that Swiss Re is actually very well positioned with a strong capital position, of course. But the diversification of the book is going across the business units, Life & Health, not correlated to the P&C businesses. I think the clean setup of the businesses, the business units is helping. So, we have a clear mandate for each and every business unit to deliver upon. I think that clean setup is not -- it's almost unique in the industry.

At the same time, we've got a clear diversification when it comes to lines of business, that we look at lines that are not correlated to the negative pricing cycles that we want to focus on when we talk about growth and then manage, obviously, the cycle in the areas where the rates are going down. And then the territorial mix, I'm very happy with. We have reduced the share of the U.S. business, for instance, to the benefit of, for instance, EMEA or Europe. So, I think I feel much better with the mix that we have. The capital strength, solvency ratio, 268% as of October 1 in this year. The rating is very strong, AA-. We've got the risk expertise that I just mentioned, 200 -- around 200 proprietary cat models that we have with 50 scientists feeding those models every day with data points that are coming in as the events are happening and other models are being created. So, all this is fed into our models and being deployed into our underwriting, but also into the market.

Client feedback and NPS of 50, I was told is really excellent. And you can see here, and this is the latest feedback that we get from our customers, we are increasing year-by-year-by-year in the Net Promoter Scores or in reinsurance, you have the NMG scores. This is very, very promising. People see the change coming through and also the positive attributes like speed of decision-making. That's what our clients want. They want the risk expertise and insights, but they also want speed and clarity, clarity and consistency of risk appetite.

You want, obviously, also consistency, consistency in delivering our targets and not producing surprises all the time. And by the way, the public sector is also a big client group of ours. They're also looking for stability for stable partners with a strong resilient balance sheet. They deserve to have a resilient Swiss Re in order to increase their resiliency. We see this with governments that we engage when we talk about catastrophic events and how to help governments also protect their people. We do that also with parametric solutions, for instance, and the Caribbean is a discussion point as we speak. How can we help prevent situations like that or at least when it happens, have a payout mechanism so that governments quickly can help their populations.

Our priorities for 2025 are very clear. I always said there are two priorities. One is, hit the targets, meet the targets. The group net income is the overarching objective that we want to pursue. Secondly, increase resilience of the group. Those two priorities you should always have in mind when you look at our actions and when you look at our communication when we put our actions out there.

Increased resilience is one topic. And by the way, they're not mutually exclusive, those two priorities. So, meeting the targets is for me is always important. But should we have wiggle room to increase resilience, we would use that and still make the target. And that philosophy, you have seen in Q3, and you will see it also as we go into Q4.

Now Life & Health portfolio reviews, and I spoke about it. I'm really very happy and proud that the teams really pulled up their socks, went through all portfolios and came to a landing not only for Q3, but now also for Q4. Anders will talk about this in a moment.

We have reserves for current year attritional losses in P&C Re. We have seen certain claims activities or seasonalities. That's something that we addressed. We could also afford it, obviously, funded through a very good Q2, Q3, where the nat cat losses really not were hitting the budget. I think that's something that we do now on a continuous basis when things are affordable, when we can strengthen resilience and still make the targets, think about that. That's how we manage cycles also.

The allowance for claims reporting, I mentioned that, but important is the initial loss pick. We have a prudent initial loss pick across the P&C units. And we introduced, obviously, also the uncertainty allowance for new business. You have heard that before. But I think it's important that we have that discipline that the costing gets right. The costing is determining at the end of the day whether the actuals versus expected gap is widening or not. And I think we've done a very good job in the meantime since we introduced the new reserving philosophy for the P&C businesses. And now, this is now also being introduced in the Life & Health business.

USD 100 million cost savings in 2025. I spoke about this already, contributing to the USD 300 million cost savings by 2027. And again, this is a net run rate -- cost run rate reduction for Swiss Re. You will see that we have had significant investments also into AI capabilities and use cases. That's all factored in. So, this is really net of inflation and obviously, the investments.

Now that's a recap only because I wanted to set the stage. Everything I was talking about now was about getting ready and setting a successful foundation now for the next phase so that we then can see the benefits coming through of having three clean business units, each and everyone playing its role in the group and not having all these distractions that always keep us busy and keep us away from the core of what we are about.

I'm very happy and very proud that in this period where we call this program NEXT, close the gap to #1. This period, and it's not a long time. We started with a transition phase when it was announced that I will become the group CEO, my predecessor and I already took a tough decision on ETQ, the B2B2C business that we would exit this business. That triggered then obviously a whole series of other events. That was the transition phase. And then, when I started in July, we went into the immediate actions. We reset our solutions business. We're cleaning the whole portfolio, focusing really on the portfolios where we have the right to win and then expanding from there.

Secondly, and you know the U.S. liability reserve increase was the decisive moment, and this was a moment and remember last year, I said, after this action, the world was a different one. It was a different one for you. It was a different one for our customers, but in particular, for our employees, our colleagues who have to go out and in this very difficult market, go and fight for their rates. There can leave the drag behind. It's very important to just see that this was now something that changed the world.

So, you can see in the bottom, we say we were addressing all the areas and key improvements -- improvement areas to set the foundation now for the future, and that's where you see where we are today. And now, we can say with this foundation, we can look into a refreshed strategy, which we call "built to lead".

But in order to do that, just quickly, let's recap. Because everything we did under NEXT is not going to stop. It's going to be part of business as usual. And I'll start with technical excellence. This is so fundamental. Remember, I always said technical excellence, we're an underwriting company, and we have to be proud to be an underwriting company. We introduced -- reintroduced the Group Chief Underwriting Officer. Regulators around the world love this move. Because now they're sure that underwriting is really the core of our activity, underwriting claims, risk expertise, that's -- risk insights. That's what we have, and that's what we're proud of. So, we need to invest into it and solidify it.

The A versus E is the central focus KPI for us. It goes through the whole company up to the Board, the risk committee, everybody is looking at that KPI. That's why I'm confident that we can manage the cycle, because the whole company now is looking at this. Should we have a too broad deviation or widening of the gap actuals versus expected, there will be discussions in the group. That would trigger discussions even with the risk committee if this widening of the gap is not going to be addressed.

The reserving philosophy I was talking about it. And then we've got the data platform and then also the AI readiness that I'm going to talk about this a bit in a moment. I think it's very important. It's fundamental. It's not about AI for AI or tech for tech. It's really for business, where we come from, we embrace data and technology for many, many years. And I think now you can see it's harvest time, and we're very happy about this.

The people and talent aspect is very important. We invested into the capability models of the future. The gaps that we identified, we set up a strategic workforce planning, it's approach and tool. It's a strategy where we can simulate developments into the future and address where should we invest, where do we have the gaps that we need to close in order to be successful in the future. It's a tough labor market out there and talent market. Everybody is fishing in the same pond, in the same pool. But here, I think it's important to have the attractiveness as an employer where the young people also with the new capabilities feel that this is an attractive industry to work in.

And finally, the culture aspect, I'm really proud of how the adoption ratio was. And you will see a few stats later about the engagement of our people, the understanding of the culture and embracing it. And this is something that I haven't seen in the industry personally so far. But remember, it's not a sprint. It's a marathon.

As a CEO, I realize that after 12 to 18 months almost, there can be fatigue, because the changes are so fundamental, and we do it at speed. So you continuously have to reenergize our people, and this comes with very successful milestones that we could produce that we could report on.

For instance, the iptiQ exit strategy that we are implementing, when you see the engagement service coming through from the iptiQ people, it's something that surprised me how positive it was because it's clear, clarity is important. The journey is clear, the trajectory is important that everybody understands it. And then you celebrate the individual successes coming through like selling a portfolio to a credible party where it's a better home for the people. So they acknowledge this.

Everything like that needs a team. It's the first time that I'm showing the team in this form, and I've got a lot of people sitting here based in London, I guess, or in the U.K. at least. So just imagine a Premier League team. And I'd like to use that analogy, because it's really about who's playing what role and why do we think this could be really the winning team.

We've got a combined 250 years of experience in this team. And we've got a healthy mix of people who came through the ranks, long-serving Swiss Re colleagues. But we also have colleagues from external that really strengthened the team. So, you see -- take the analogy from a Premier League, you see the manager and the right-hand man of the manager on the left, so that's the group CEO and the CFO. And then, if you go then to the team, and I hope it's the team that scores a lot of goals. So, the first line is the offense, I would call it there, they are the interface to the customers and to the brokers. And that's where the market decisions are being taken. Those are the business units and asset management, yes. We cover the liability and the asset side. That's for me the first line and call it the offense, if you want, because they are there to score the goals.

And then you've got the mid-field. So, you've got the business units that are working very closely with the Group Chief Underwriting Officer. That's where we steer the business. And the Chief Underwriting Officer also works very closely with the Chief Investment Officer because here, we optimize gross and net. We look at how do we want to position ourselves. We have the hedging strategies that come together with the Group Chief Underwriting Officer. And then the execution of it when we go into the retrocession markets or capital markets, it's done executed by the team underneath the Chief Investment Officer, the Alternative Capital Partners team.

So I think this is a fine combination. We've got on the right -- in the mid-field, you've got the Chief Data, the group Data and Technology Officer. That's the enablement. And remember, that's part of business. AI is not run by the tech people. It's run by business. But tech is critical here.

And in the middle, you see, we call it now the Group Chief People Officer, because it's not about HR functions alone. It's really about HR for the business, for the people. It's broader. We need to bring the people to the next level. And as I said, capability gaps need to be closed. We will see with AI that will be a transformation of how teams are being composed in the future.

You see here a new name, Nicole Pieterse. She will join us as of 1st of January. Sad news, Cathy Desquesses, she decided to leave because she needs to look after her health. It's very sad. But we, as a company, stand behind her and really thank her for everything. So, that was announced yesterday, by the way. And Nicole Pieterse, that's why we put her name there already, is part of the future team, an internal that came through the ranks. I'm very proud of our succession plan in this case.

And then you've got the defense. So you only see two people. There are some teams who have more people at defense, but they are very critical, there's the Chief Risk Officer. He joined us 1st of October. And we have Hermann Geiger, our Legal and Compliance Officer and General Counsel. These guys are keeping our goal clean. I always say, keep us out of prison too, but keeping the goal clean is probably the right thing.

Everybody has a role, a responsibility and accountability. It's very important. Single accountability is important. Healthy challenge, great team spirit, collaborative team spirit. And this will help us to unlock the power of Swiss Re. We have changed the company. We have set the foundation to be successful. We eliminated the drags. There's always continuous improvement, obviously, but the big positions we have addressed.

And now, you can come back to what Swiss Re really stands for. Swiss Re also in the eyes of the industry is a leader. And Swiss Re is built to lead. That's it. That's the center piece. It's built to lead. That's what we have to recognize all the time. But we need to earn that right every day. So that's the challenge for ourselves. But in order to give credit for the Swiss Re brand and everything we have, we say Swiss Re is built to lead. Our team is built to lead. That's what we have to say with all humility.

This is now fostered by three principles. You always heard me saying the core is important. Maybe we were neglecting the core in the past a bit. We will amplify the core, which means we will make it stronger, even stronger. We will invest into the core. Investing into the core means the three business units that we have will be strengthened.

If you think about inorganic growth or so, yes, that's part of it. It's not innovation. It's strengthening the core along the liability portfolio, the target liability portfolio approach. We invest in strengthening where we think it makes sense for the group. And once we have strengthened the core, we also need to think about experiments, innovation.

Swiss Re is known for innovation. It's a very strong intellect in the company, but we said we need to apply the intellect -- apply the intellect to an outcome. And the outcome is obviously also financials, in particular.

So, when we talk about advancing the core, advancing reinsurance and insurance, it's always coming from the core, same customer base, cedents, insurance companies, corporates, public entities. This is core.

And the risk transfer offers that we have for the core customer base is the core of us deploying the capacity, bringing the balance sheet, the strong balance sheet to the customers. But then also innovate -- innovate, and that's where we have Swiss Re Institute, the knowledge base, risk insights that we have to translate into solutions for customers. But it's also AI. And it's not only Gen AI-driven new products. It's also how we do, how we run our business. It's mostly where we see the biggest impact at the moment in Agentic AI, and I'll come to that.

And thirdly, achieve more together. That's our people. That's our people, and we're very proud of that. Because, we have designed a new architecture, leadership and also learning and development architecture that helps to support the core, that we have healthy creative pipelines, solid pipelines in our company for the next generation, that we have the pipeline that also is, for instance, M&A ready. Should we go into an inorganic action, we need to be M&A ready. So what are the principles that we have? What gaps do we have in departments that matter? That's everything we're working on as well as we speak.

And then obviously, it has to support the advancing the core. We need to have the right capabilities on board to also complement the new AI use cases, and we're going to see what that really means. So, our ambition is to make them more resilient. Our purpose has not changed. Strong purpose resonates with the external world, but also internal world. Graduates like this. They come to Swiss Re because of that. We'll be -- to be ready to advance our industry by shaping its future and creating lasting value. That's the entry point of the refreshed strategy.

Let's quickly go through each and every component. We're well positioned to generate value. We've got clear defined customer groups. There's no confusion there. We're not going into B2B2C spaces, hunting for customers that are not part of our DNA. Cedents, corporates, public sector -- combined, it's an addressable target market of USD 750 billion. That's big.

And in those addressable target markets, it's not the full market, it's the addressable target market. We have a leading market position in all three business units. So, we've got the scale. We've got the position. We've got the offerings. And then, this will be complemented by transversal capabilities.

I mentioned already Alternative Capital Partners expect more to come. We have a leading position in the ILS market. It's good. We're working on future ideas here, not to be disclosed yet, but we're busy.

Public Sector solutions, I think we were pioneers in this field. We're market leading in this field, more than 1,800 transactions since 2011. And then we've got now this reset solutions unit that we call Risk Data Solutions, where we consolidate all digital assets that the Swiss Re Group has where Swiss IP -- Swiss Re IP sits on, and that we deploy in particular to our customers, but also internally.

We have a strong foundation. The improved portfolio quality positions us well. This is so important. That was NEXT. So you can see in P&C Re, we shifted the portfolio away from the long tail towards the shorter tail, mainly driven, as you can see here, U.S. liability and casualty in general. We're still a big player in this field, as you can see. But it's much more risk-oriented and healthy in the whole overall composition. You see that property and nat cat, we extended, is good. It's a healthy market. Demand is high. Just watch the margins. We're still in a very healthy environment. And specialty, in particular, we're very happy also with the expansion of specialty.

In Corporate Solutions, a similar picture. Property heavy, we exited the U.S. casualty market completely. We have some international programs with some U.S. exposures on local policies. That's the design of the program. That's intentional. That's good, but it's managed.

We are now a very short tail Corporate Solutions, corporate commercial company. We now are managing the cycle, and we're investing in the growth of in de-correlated lines of businesses. De-correlated to the property cycle. That's very important. That's cycle management, and that's growth in areas where there are more attractive opportunities.

And then we have differentiation -- differentiated assets, where in a market with a lot of bespoke solutions for customers and with a hardening of the market that we experienced, the very professional corporates who buy insurance were taking out more premium out of the market, because they felt it was too expensive and brought it into captives. And here, we have alternative risk transfer where we are the market leaders in providing solutions also for captives as an example, parametric solutions as another example. But then also international insurance programs, we are probably the only late entrant into that oligopolistic market where you only have a handful of carriers who can provide those global solutions for corporates that span across the world, international or global corporates.

And as we were a late entrant, we were benefiting from little to no legacy, IT legacy and also process complication. We have a state-of-the-art platform that we were deploying internally, but are also offering to externals. So, I think that worked out very well as a strategy. Because with this focused strategy, you avoid to be drawn into the commoditized parts of the business where it's very price sensitive and we can't show the differentiation because it's just about capacity, providing capacity.

Last but not least, you see Life & Health reinsurance on the right-hand side. We came with a heavy U.S. mortality book. We're market leaders in U.S. mortality. You have seen the impact of COVID. And we -- and this was a very focused area, as I said, when we introduced the IFRS balance sheet to address U.S. mortality and then China critical illness, but U.S. mortality was the big topic where that was addressed then. We -- the in-force book, you have to know, it's basically 90% of our net income is influenced by the in-force book management. So that matters.

So that's where we're focusing all our action to relieve the balance sheet actions on the in-force book and the teams have done great in 2025, and that's obviously more to come in 2026.

When you look at the new business CSM, you then see suddenly that we're going -- diversifying away from the U.S. mortality side. I mean, it's a big book. It will take time until you build up the alternative options here. So, mortality in other parts of the world, health is pretty stable.

Longevity is an area that a lot of people are looking into. It's an area that need to be very careful. People always think it's low margin. So you got to be very selective, but that's another area that we're looking into. And this is all underpinned by very, very attractive and increased recurring investment income from a very, very strongly performing asset management team.

And again, cost discipline. We say it out loud now also in the reinsurance industry matters. So, that's the foundation. And this is obviously amidst a constructive market environment. And this is -- and very important to note, the Swiss Re Institute predicts an overall growth of the overall insurance market in Life & Health and P&C between 4% to 5%. So, at GDP or slightly above levels.

Now if you then talk to the markets, they obviously always talk about individual areas and they say, all the rates are going down and the market is shrinking. Actually, on a more mid- to long-term perspective, we don't believe in this narrative. People overemphasize a certain moment in a cycle, in particular, in property and cat, because we had cat events and people were getting nervous and were looking for capacity, and they suddenly realize there's a price tag to it. And so, the 4% to 5%, obviously, the flip side of the coin is the bottom part of the slide, where we say you see suddenly that after a prolonged period of hardening of the market, suddenly you see plateauing.

Now again, it's not in all lines of businesses. And even in property, in lines of businesses that are distressed or occupancies that are distressed that you still see rate increases. But overall, the whole market accepts that we are in a very comfortable margin space. And that's why, in particular, the more sophisticated buyers, obviously supported by the broking market are fighting for reduction of rates.

We are looking now into 1/1 renewals, as we speak. I know we're looking to your eyes now, you're all very curious. You see I'm not nervous. I'm not intimidated by the narrative. And I always -- personally, I always take the figures that brokers put out there. And then, I use this as a challenge to the reality when teams are going out.

In a lot of markets, I haven't seen this coming through, the negative view coming through. We see reductions, but still at a very healthy level. We're still in the midst of negotiations. Let's wait and see what's happening. So, our teams are working hard. And everybody, obviously, in the heat of the moment in negotiations is nervous and then you see that nervousness coming through in language. But when I look at numbers, we're still in a solid market, very constructive, as we always say.

As long as the attachment points are stable and as long as terms and conditions are stable, people need to know where their walk away line is on rates. And that can vary depending where you position in the market. So, the midterm trend depends who you ask. If you ask a very scary conservative person that is fighting now over the rates, we'll say actually, it's going further down. Structurally, we have invested a lot in governance.

I mentioned before, the KPIs are being monitored and tracked instantly and the reaction is quicker. So, when you saw in the past, the A versus E gaps widening, even though people were addressing the costing, well, it was not decisive enough. People were still thinking maybe it's going to be fine. That positive biases went through the market and the reactions were too late. This we need to stop. That's about the discipline. And that's what we want to stand for. Nobody gets an incentive to just grow for the sake of growing. That's very important also in the incentive structures in our company.

Now let's go to advancing reinsurance and insurance. And I'm going to give you three aspects. One is risk insights through Swiss Re Institute and data. The other one is obviously the role that solutions plays and then the role that AI plays.

Let's start here. Why am I showing you this slide? I'm going to show you the slides, because it's 160 years plus experience with data, dealing with data. That's what we're known for. And then, we have -- and I can say it to myself, I grew up in the industry with Sigma. When I speak to students at university, when I speak to analysts, by the way, when I speak to consultants to investment bankers or to clients, everybody always refers to Sigma. That's the channel. We channel the risk knowledge and the data in analytics and insights that we produce through Sigma. We reinforced that channel just recently.

Just to make clear, this is the flagship publication that we have. That's where risk insight and risk knowledge comes from and all major topics that trends in the industry, our people work on and put it through the Sigma channel. That's Swiss Re Institute. It's to the benefit of our clients to increase their resilience. It's for our underwriters and claims managers and risk engineers out there. By the way, they feed their knowledge also into the scientific teams to complement their research. And also, it strengthened the resilience of society. 17 million individuals reached out that we could reach through Sigma, and that's very good. This is the foundation that we call data ready.

And now we complement the data readiness now with tech. And that's what we've done 8 years ago. 8 years ago, we entered into a partnership with Palantir. I think we were the first ones in our industry sector. But we definitely are the ones who use it most extensively. As the foundation, we always call it powered by Palantir, because then the Swiss Re Analytics and Swiss IP is coming to fruition. So, that solid foundation to manage data to go from standard data interfaces from one program to the next one and having to leave native environments all the time, which is cumbersome. We have now one way of translating data through the foundry, creating the Swiss Re analytical data model and front to end, everybody is working on this analytical data model.

I haven't seen any example in the industry. I ask you, please send me the examples if you see them. That's why we said technology is very important to us. We embrace data, as I said, and technology. And you see the adoption rate. Out of 14,700 employees, we've got roughly 11,000 or more than 11,000 who are actually using this -- we call it Stargate, this analytical data model approach in our company, powered by the Palantir partnership.

And this is also unique. So on a daily basis, they use this. And we are rigorous and we have to be more rigorous to decommission all the other little tools that are still existing in the Excel sheet, might be loved little personal Excel sheet, et cetera. That's the way we operate and we use data now at scale. So, we have access to enormous amounts of data in our company, files in our company that before we couldn't extract value from this in a meaningful way. So, it improves actually the way we use data and technology for decision-making.

And here, this is the illustration what you should keep in mind when you think about AI. We said this data and technology approach makes us AI ready. Why? Because we used to always work with structured data. But now we complement it with a way to manage unstructured data. So, if you imagine you're an underwriter, and you do underwriting, you operate 90% of the data or information you use is based on unstructured data, e-mails, handwritten notes, Excel sheets, PDF or whatever. It's tough. And I feel for those underwriters, but they're used to it because they did it every day for many years.

So, we now have a seamless integration of those structured, unstructured data, and then we complement it. We use the common large language models, and that is now being powered by this Palantir AI platform. And this platform allows us to immediately integrate it into our data and tech foundation. It's a global integrated infrastructure. That's the beauty. Because we don't have this IT legacy with a very fragmented tech and data landscape, which makes difficult to gather data, to do data cleansing, to prepare data to make it usable for the AI use cases. This is the problem in our industry.

You've got the hype of AI, and you've got the problem to demonstrate concrete use cases. Because the hype gives you a use case, and it's a stand-alone use case. It's a very exciting little solution, but it's not integrated into your data and tech foundation. So, it adds complexity, which is cost.

And the underlying IT legacy and tech debt still needs to be paid. So, the benefits are not coming really through. And that's something we are working very hard on to demonstrate, to prove also that there's real benefit. Every use case goes through a proper governance process. There's no release of funds if there's no articulated and quantified benefits. And these are two buckets. And I'll come to them in a moment. But ultimately, this will all lead to robust cross-functional AI governance.

The human in the loop is very important. Humans always take decisions. It's not AI, it's not Agentic AI. The humans need to have oversight. That's important. And we have developed an approach towards code of conduct. We have an AI council with leading experts who feed us, who challenge us and who keep us informed about the latest trends. Obviously, we have to accept that there's also a risky part of AI, and that's why we need robust governance, and we are in regular interactions with regulators also to get that alignment also from a regulatory side.

So, what happened? In a summary, from 2017 to 2025, we were investing into this tech foundation. We have built the data and tech platform. You saw the users, the amount of users. We have already worked with scalable AI use cases. Admittedly, they were mostly generative AI use cases in claims and document management, et cetera. That was until today. In the past 2 years or so. So, we used the tech foundation, and then we worked already on Gen AI cases. But now this year, we embarked on a very large program called AI, Agentic AI. Because we see the biggest impact at the moment coming from this Agentic AI space.

And here, we have reimagined core processes in our company. We integrate the Agentic AI capabilities into our business. And this is the transformation program that we have that goes into the next phase now. Again, this is a real fundamental change. And I want to run you maybe quickly through examples.

This is an example for single risk underwriting. So, you would typically see it in facultative business and in Corporate Solutions. And here, we've got an example of construction engineering underwriting in Corporate Solutions. I'm not going to too much detail, because you're going to see the video later, which gives you a very clear illustration that it's real. It's not fantasy. It's not a consultant giving you a benefit aspiration. This is a real case, a pilot that we did. And it's about managing the unstructured data from submission, when the submission arrives to quoting.

You will see in the video how cumbersome it is today. We have identified 25 different process steps, with plenty of applications being used, and this ended up in, depending on complexity, 3 weeks of time from submission to quote, 3 weeks. And we could reduce it to maximum 1 day and even reduce the number of applications. I'm not going to go deeper into it. So just if you think about the impact and then apply this now to other similar use cases and lines of business with similar characteristics, you will then suddenly see how the impact will come through.

We've got two buckets that we always look at when we talk about benefits. One is the cost side, the productivity, freeing up underwriters' time. This is measurable, pretty good, pretty well measurable. And the second one is actually eliminating or avoiding leakage, which means what we do with Agentic AI will translate into maybe a better loss ratio. There, it's much more difficult to quantify.

And if you look at attribution, not everything is always 100% tech. It's a lot of process reengineering and tech AI helps. So at the moment, we see it's 80% process reengineering and process management and 20% roughly is really then the coding. But you see that's the weakness of our industry, because productivity gains were never possible really to demonstrate to that level. And here, it's an opportunity.

On the reinsurance side, the cases were frontrunners on P&C Re. So, we have looked at a life of an underwriter in treaty P&C underwriting. And the P&C underwriter typically focuses on one event. That's the renewal date when we're in the midst of it. So, everything is concentrated around this date.

Poor underwriters need to work with a lot of unstructured data. You could argue sometimes data accuracy could be questioned. But that's -- everybody is working towards that one day, let's say, 1st of January. It comes 1st of January, inception date, there's a bit of work behind that. But it's important also to note that the rest of the year is completely unstructured. So after renewal, each and every underwriter does something different. And we identified this as an opportunity, and we call it always on. The underwriter needs to be always on, not just until renewal, everything concentrated there and then everybody does something.

Now, there will be a structured process in between where you can even generate also ideas and more business, for instance, together with the Risk Data Solutions. And we have real cases where this is -- has been proven now, and that's something to look into, and I'm very, very happy to see that.

On the claims side, you see that in P&C Re, the claims are pretty automated up to a certain level. We defined the threshold. So it's a no touch. And the rest is very bespoke, very complex claims handling on the very large ones.

We have identified in our pilots that when this AI, Agentic AI does the matching with the policies, we have identified that the human beings were not as accurate as Agentic AI is. We have identified cases where we were paying out claims that we shouldn't have paid out. That's a huge future impact. That's our expectation. So, those are the cases that we're working on at the moment and call it as a one-stop shop for structured and unstructured data.

And we, in P&C, in particular, went from the first pilot, the sprints that we do. There's always an 11-week sprints. And then either it shows the results and then it goes into the MVP. And we're implementing this now in '26 now and testing it for the next renewals. So, that's going to be a real life experience away from the sprint and MVP.

Risk Data Solutions. I'm very happy that this team went through the reset. We discontinued the portfolios where we didn't have really any traction. So we concentrated on the products where we had a right to win. You can see it here, everything around physical assets, cat, property, et cetera. That's the starting point for us, now the Property Solutions. And we deploy this to our customers, all customer groups across. And RDS is the data platform that we use. Even here, we deploy the data and technology that we have, and make it available. So all the models, the cat models are available on this data platform and the clients ingest their information onto that platform, we call it the digital twin. And then, we stress test it with our models so that gives them insights. And then, we complement it with risk consulting and analytics teams that help prime insurance companies reposition themselves.

Here's one example. We had the Gherkin here. And we just took the Gherkin as one example and put it on the data platform as a digital twin. And then, we ran our cat models through it and ran the scenarios as well. So, likelihood of a natural hazard, you see it's pretty well positioned here. So don't worry. But we also do projections. This is the current view, but we do the projections up to, for instance, 2080, yes, so including financial impact, financial projections.

And you could see, okay, there's an extreme precipitation is going up. Drought is going up also in future. So this is a measurable, quantifiable impact that we see. And then, it gives you actionable insights to mitigate or prevent. So, it informs CapEx, et cetera. This is a tool that's live.

Corporates have this, public entities work with this in New Zealand, in Australia, in the U.K. and household corporate names in the U.K. are working with this. So that's deploying really data, risk insights to increase resilience before you think risk transfer. So, that's done on the corporate side, in particular, that we've started in public entities and now the scenes are being using as well.

All of this is underpinned by people. As I said, it's achieved more together, the third pillar, strategic workforce planning, learning development. Those are new things that we introduced to make scenarios quantifiable. So it informs our planning. It informs our talent actions. And the culture transformation obviously is underpinning all these changes.

I'm really happy to see that we have higher-than-industry employee engagement. So the employee engagement survey, we call it Pulse Survey that we do regularly came out just now. So, we have greater than 8% engagement. More than 70% of our people embrace the target culture, the culture change. I think that's good. That's massive.

And the last point I'm very, very proud of, and this is showing also the data and AI readiness. More than 85% of our employees integrate new data or new tech well, 30% more above industry benchmark. I think this is fantastic, and our Chief People Officer is central to bring this enablement into the company.

I'll close with what you are waiting for, obviously, and you have pre-informed what is to be expected for 2026, the financial targets. We will aim for USD 4.5 billion net income. I know, some people say it's underwhelming. I think it's very attractive. This translates into roughly 20% ROE. Yes? And again, don't squeeze the lemon. We're ready here for the long term.

The P&C businesses confirm the target that we had in 2025. This is a very ambitious, I think, achievable, but very ambitious target in the market environment that I was describing at length.

Life & Health Re, with all the actions that we took now finally in Q3 and Q4, this allows us to go to USD 1.7 billion. And in addition, we have an adjustment on the capital management ambitions. Remember, we have -- we are now in year 2, going into year 2 of our dividend policy, greater than 7% per annum growth. And this will be complemented by a sustainable annual share-backed program. We will start with USD 500 million. We will do this if we achieve our targets. We will start with this in 2026. The Board has to approve it in February.

So, if I say sustainable, then think of it as annual. You can choose the words you would like to choose, you can say, recurring. With sustainable, I think we want to underline that it's an important step, but also sustainable means we need to make a group target.

Why do I think this is a very attractive package? Because if you think about the payout, we're going to give back -- give you USD 10 per share. That's what that translates to. It's a USD 3 billion payout. I think it's very attractive, very attractive, which underlines the solidity that we created through the transformation in NEXT, set the foundation to be successful in the future.

The discipline that we have introduced into the business, in particular, in the core competencies of underwriting, claims management, risk expertise, underpinned by strong asset management. But this also gives us optionality, keeps the powder dry should there be an opportunity that we want to look into when we think about inorganic growth. That's why it's important for us to see it as a package.

And I close by saying I'm not here to squeeze the lemon. We're planting a lemon tree and looking for long-term sustainability and resilience for our customers. And ultimately, investors and you analysts will benefit from this, too.

So thank you very much. And I would like to hand over to our Group CFO. I went a bit longer, but I think it was important for me to make those points. Thank you very much.

Thank you, Andreas. So, good morning also from my side. I'm quite excited to be here. It's my first time with Swiss Re. And I was just thinking because this is now almost -- my first year is almost finished now. Because I started in January 1, I then took over in April. And so, we're closing the loop here.

And maybe just a bit of reflection. So what I did, I actually visited several markets. I went to the U.S., I went to Asia, I went to Australia. I talked to, obviously, a lot of employees. I talked to clients, talked to regulators. And you could really feel kind of the positive spirit that's really going through Swiss Re. So, this momentum that we have overall internally, but also externally was very visible and clear for me. And I'm actually -- I was even more energized after coming back from these trips than I was before, because I was always energized about being part of Swiss Re.

Now let's go a bit into the numbers. And this way. And I start, as Andreas did as well, I start with CorSo. I think CorSo has become a true reliable, sustainable contributor of earnings, of results. And what you just see on this slide is that when you look at the combined ratio since 2021, I think you just see now a constant result coming through. And this is clearly the result of the heavy restructuring that was happening before. The average combined ratio now since 2021 is 90.6%. So, and we see it very, very, very stable.

Also, it has really established to be a true core business unit. We have a reinsurance program. We place 80% of CorSo's reinsurance externally, 20% we keep internally. We also have on the reserving side, I mean, we introduced the uncertainty load. We have also an IBNR reserve that's quite supportive to make sure that I think we can continue this steady process and steady growth.

And also, I think Andreas mentioned that in the beginning, 5 years ago, about 50% of the business was -- 25% was de-correlated with the cycle. Now it's 50%. So also that, I think, a nice shift towards de-correlation from what we call the cycle, knowing that there's many cycles, but call it the big cycle. So, a strong performance here.

Moving to P&C Re. A similar story. A year ago, the U.S. casualty was obviously the key topic. And a big focus was reducing the dependency and the exposure to U.S. casualty. But also another aspect when you look at these numbers, the initial loss pick that was put into the reserves increased over the last few years annually by 10%. That's significant. That shows you the prudence that we are kind of putting into the number. It's really driven by the inflation model that we had the inflation assumptions, the model updates, but also then the uncertainty load that Andreas was mentioning.

And you see that it's throughout. It's 11% in casualty, it's 11% in property, it's 5% in specialty. But when you actually compare that with the, call it, the true inflation, it's much more. The true inflation or the CPI in the U.S. was about 3%. If you go into Construction, it was also 3%. Wage growth was about 4%. Healthcare, even less 2%. So, if you compare the 10% with the true inflation, this really shows you the strength that went into the reserves.

And if I look now at the reserves themselves, and you go on the left-hand side and you see the split of the total reserves between the case reserves and the IBNR, you see a nice development how this -- how the overall reserves actually increased to 48%. But you also see that this ratio stayed stable over the year, even though you would assume when you reduce long-term business, long-tail business, you should actually see a reduction in IBNR relative to the full reserves. And you didn't see that, which is a clear signal for the strong reserves we have.

On the right-hand side, what you see is the -- just the breakout of -- from a U.S. liability, ultimate loss, how much is IBNR, how much is case and how much has been paid out already. And you see the overall reserve is about USD 12 billion from '16 till '25, 81% of that is IBNR. That's a very strong number. That actually increased by 1% year-over-year.

So, I think to Andreas' point about, can we sleep well on this topic? Yes, we can sleep well on this topic.

Now moving over to Life & Health Re. We talked a lot about this. This portfolio review was really crucial that we get that fully done now. This is now fully done. We've reviewed 100% of the portfolios. Again, just repeating what you already heard, but we did it really in three phases.

First phase was when we transitioned to IFRS, the really large portfolios U.S. worse mortality, China critical illness, they're all performing in line with expectations. Then we went into the more midsized portfolios. And now the last step in 2025 was the remaining portfolios, which represent about 10% of the portfolios when I take the present value of claims. It's about 10%. All the other 90% were already kind of reviewed and were in line with expectations.

And on this 10%, you see on the box here, the impact that you saw in the first 3 months, which was about USD 400 million in on the P&L. Now for the remaining for Q4, I think I can confirm the number that we already gave you on the Q3 call. It's around USD 250 million on additional impact. And then on the CSM, it's also around USD 400 million.

And I think with that, we can really conclude that chapter as well and really look forward on a steady income, because Life & Health is a key pillar of the overall Swiss Re franchise. It's not correlated to the other cycles. So, it really contributes well to the overall results.

Maybe just last comment. I mean, as Andreas said, if we was -- if you have room at the end of the year and we are above the USD 4.4 billion net income, we could always think about strengthening IBNR reserves to the extent possible. Don't expect that to be big because, I mean, we've done it now, but that's always something where you can even increase the resilience of the book. But I'm very pleased now with this result. So, this is now fully reviewed and we go into what we call normal BAU.

Now going a bit deeper into the markets. That's why it was also so important for me to actually visit some of these markets and I actually talk to the people, because what you see, we not only took financial actions. Of course, we have to. We have to strengthen the results, but we also took business actions, which are critical.

And I take Australia. Australia, we strengthened the disability assumptions, because this was concerning. It's mostly coming from mental health claims and also work patterns. People not coming back to work. And we clearly said, look, this is not sustainable. The environment there is not sustainable. We're going to pause new business.

And we put out a press release. This sent a very strong signal to the market, because that's what people don't expect from Swiss Re to bail out in a way. But the feedback we already got from other market participants was very positive. And this goes in line with this built to lead. If we believe in a market, it's not sustainable, the environment is not sustainable, we have to show also business actions, not just financial actions.

Israel, a very similar story. It's more on the medical side, but also disability. Much higher-than-expected drug-related claims. We strengthened reserves and we placed these treaties in runoff, because they're just not sustainable.

And then last but not least, South Korea. Also on the health side, assumptions driven by higher expected utilization of new products, and we just stopped these products. So, I think it's important. Yes, there's a financial aspect, but there's an important business aspect where we just have to lead the pack in a way to say, look, we want to support here, but the environment needs to be sustainable and needs to be predictable. And if not, then we were just not part of the game.

Okay. So, this then led to the updated target for Life & Health Re. We increased the target from USD 1.6 billion to USD 1.7 billion. I think, that's a nice increase. It is also driven by a change one other change, I think we can confirm just the CSM release is now between 8% and 9%. And why it's coming down relative to what you've seen during the year is really because we reduced the shorter tail business in the CSM. So, the CSM of the shorter tail business got reduced. And by that, you should naturally then see a reduction in the CSM release.

The risk adjustment release stayed very stable. And also this business is obviously nicely supported by the recurring investment income that is performing very well. This leads me then also to the investment income. I think, what you see here is we have a well-positioned portfolio. It's conservative in the sense that this also allows us to take opportunities when they are in the market. I think right now, it's -- say, I think also when you look at credit cycle, I think it's an area where you have to be a bit conservative. But if you see opportunities, we actually have room to take these opportunities.

You look at the credit impairments over the last 10 years, very de minimis. And also, I think the high-yield credit bond portfolio is also de minimis. So, this is a very strong portfolio that allows us then also to deploy capital when there's opportunity.

On the yield, you see here the reinvestment yield that at Q3 was about 4.3% is approaching the recurring income yield, which was at Q3 4.1%, I think. And so this coming together, and we expect that this then stays pretty much at that level going forward.

The other aspect that is really critical when it comes to manage, the balance sheet is expensive. Andreas mentioned it. And we put out the USD 300 million cost target. We're well on track with achieving this target of USD 300 million over 3 years. We have the USD 100 million -- we're going to nicely achieve the USD 100 million for the first year. And this is really important for me. I really don't like hockey stick assumption. I like hockey, but I don't like hockey stick when it comes to these plans. And so, this is really important that we get every year, we get expenses down.

And yes, of course, in the beginning, I think we had some easier areas, easier in bracket. The iptiQ withdrawal obviously gets push, but also we took a lot on the group function simplifications. And this absorbs already, because this is a net number, so net of inflation, but also net of all the investment that Andreas was talking on AI, which are significant.

And that's something -- that's another important framework. When we talk about investments, we say, yes, we have a certain budget. And if we want to invest something new, we have to take something out. We're not just adding on the investment budgets. And then, you clearly see that it's nicely coming down. Now for the next years, we now go into areas like legacy systems. We still need to get all remaining legacy systems out of the infrastructure, and we're also going to rightsize some selected services and look at outsourcing, off shoring, near shoring. These are the areas.

Yes. And the benefit, obviously, then is this really benefits all business units. So, all business units are benefiting from the reduction in the core cost when it comes to their cost ratio. So that's going very well.

Moving over to Swiss Solvency Test. Swiss Solvency Test is at a very strong level, 268% at the end of Q3. What you see here is this is -- you see the net capital generation of about 20 points or in dollars is about USD 4.4 billion on SST capital or RBC as we call it. So this is in line with the USD 4 billion that you've seen on the IFRS net income.

All the other items are pretty neutral. And then, you see the capital repatriation assumption. That's the dividend only right now. So that just assumes the dividend as we announced it. That doesn't assume any buybacks. So, buybacks of about USD 500 million would represent roughly 3 SST points. That's not reflected in here. So this is -- I think it's a good solid SST. It's right above the range of 200% to 250%. I think that's where we want to be. So, that's working well.

Now moving over to how we manage capital. And also -- and I take the example here of the nat cat exposure, because it's a really good one when you then also see how you can manage gross versus net and how much capital we actually want to deploy and how much we want to and retro back to the market or hedge back to the market through third-party capital investors through ACP.

What you see here is that the gross exposure increased over the last 6 years from USD 1.7 billion. This is the expected loss or the expected claims from nat cat, increased from USD 1.7 billion to USD 2.9 billion over the 6 years.

The net after hedging and taking out the, call it, the small nat cat losses, the below USD 20 million nat cat losses, it increased from USD 1.3 billion to USD 2 billion. So quite significant increase. And this was really then supported by what I call the third-party investors, because that's where you have alignment. They're interested to take some of the risk through cat bonds and similar instruments. They have full alignment with us, and you can manage the actual capital exposure that's risk we have. And that's a strong asset that we have, a strong tool that we have.

And what you can expect now going into '26 is actually that we probably reduce a bit the external retro, because we can keep more risk on our balance sheet than in the past. And that's a good tool for us then to fine-tune the actual capital that we want to use, that we want to have on our balance sheet. So, that's a very nice development. At the same time, I think it's also good, we have a really strong relationship with this third-party capital investors, and they have also done very well over the last few years.

So now coming to my last slide. I think we talked a lot also in past investor meetings about how do you want to deploy capital. I think we replaced -- we updated the capital management priorities. Here, you see that in this slide, we replaced the opportunistic return of excess capital with a complement, the ordinary dividend with sustainable annual share buyback.

And I think for us, for me, this is quite an important change. Because what it tells you is that we think in totality. We think that we generate capital. We want to be well capitalized, but we generate a significant amount of capital every year. We obviously want to pay an ordinary dividend, and that is stable, that grows now with the 7% for the next 2 years. But in general, it just should grow with the underlying earnings.

Then when there is opportunity to invest capital into new business opportunities, is it organic or inorganic? Yes, let's do it this way. But then the rest should be part of -- should then be deployed through buybacks. And so, you have a package then of dividends and buyback that you always should see together where you have a stable part and the volatile part that then goes with the actual results. If you have a great year, you give more. If you have a big event, you give less, but you always give, always relative to the result and achieving the target. So, I think that's a really -- that's a fundamental structural change that we're going to introduce here.

This does not prevent us from -- if we are in a true excess position to give back buybacks in addition. That's not preventing us. This just gives us the framework how we should think about buybacks that before wasn't there. So that's an important change update that we want to give you. And of course, we still have the very attractive capital -- the dividend growth that we are now going into the second year with a 7% increase year-over-year.

So this concludes from a financial perspective, my presentation. Overall, I'm very excited about where we are. I think the results are -- the targets are strong targets. I think they will put us on a good foot going forward. I'm pretty confident that we can meet or exceed these targets. And with that, I hand back to Thomas. Thank you.

Thank you, Anders. Thank you, Andreas. So we'll -- just before we go for the break, we'll show a 2-minute video and then we just ask to reconvene here at 11.50 to start the Q&A session. So, if we could just have the video, please and then please feel free to have...

All right. Welcome to the Q&A session. I think we have time to do more than one round. So, if you could just limit yourself to one question at the beginning, and then we'll just come back. And also for the benefit of the people who are following the webcast, if you could quickly introduce yourself before asking the question, that would be great.

Ivan, do you want to start?

It's Ivan Bokhmat from Barclays. Andreas, my first question would be, I think, on the mentions of the inorganic growth that you made several during your presentation. So, I was just wondering whether you could talk a little bit more about the potential timing of it, what phase of the cycle do you think it will be appropriate? What type of expertise or particular gaps you want to address? And maybe what are you waiting for?

We're not rushed. We're not desperate. We're very well positioned as Swiss Re. Can you hear me well? Yes. Very well positioned as Swiss Re. Now we always said, once we have addressed all the areas during NEXT, it should set us in a situation and a position to benefit from a successful foundation. That's built on the technical view of our portfolio and of the market. The technical view can be summarized in the target liability portfolio approach, where we look at the current portfolio mix, then we look at all the trends that we see in the markets and see what's the future optimal portfolio. And we always have a 5-year forward-looking view.

So, the plan is always a 3-year period, but that is a bit longer, because we want to see how markets really behave. And then we say, when we see -- take an example, property or cat, when we see a rate decline, we don't want to wait. So we say, okay, what are the lines of business that can help us compensate? At group level, have a nice diversification of Life & Health and P&C businesses.

And if you looked at the stand-alone, let's take nat cat, natural catastrophes. If you look at the stand-alone capital return on cat, that's 8%. That increases to 40% when you look at it at group level. So that's the diversification benefit that I'm talking about. So, then go back into then the individual business units, because at group level, we look at what areas do we want to deploy capacity or capital. That's the group view.

And then we go into the BUs and say, what is the optimal BU mix? And we remember, we already said in the past, Corporate Solutions is an area that's quite obvious on the P&C reinsurance side and Life & Health reinsurance side, we didn't see so many opportunities. So CorSo, if you take that example, you say, look at the portfolio, what is de-correlated to the property price cycle. And certainly, you have a list of lines of business where you say, do I want to strengthen them. That's more a bolt-on acquisition approach. Because we didn't believe really in this transformational one, the lack of opportunities probably and attractive opportunities. So, that's the ingoing strategy that we have.

And what we have done internally, we have done an exercise at the Group Executive Committee and when we looked at the overall strategy. And then we said, okay, what is the option space that's out there. So, we look basically at the full option space, and then we narrowed it down to the attractive parts and we derived M&A principles from there and linked it to what we call the M&A readiness approach to strengthen the muscle also.

We haven't done M&As for sometimes, yes, smaller bolt-on acquisitions, yes. So get ready, get ready for what's happening out there in the market. It's a very dynamic market. Your colleagues on the investment banking side, I'm sure, are telling you how dynamic it is, but it needs to be for the right reasons. That's why there's no timing aspect to it. There's no distressed situation here. We're looking at the readiness, yes. It's not only the readiness to do a deal, to do the right deal. It's also the readiness for post-merger integration scenarios. So, all of this we're doing at the moment. We're well on track. And there are small opportunities that we actually as we speak, look into. So there's more to come. And if it's not happening, then it's for the good reasons.

It's Kamran Hossain from JPMorgan. Two questions. The first one is just coming back to the M&A point. What do you think your firepower is for M&A? And should we think -- also think about this as an ever-expanding part? If I look at this year, USD 4.4 billion of earnings, you probably beat that USD 3 billion of capital return. Same again next year-ish, you're adding USD 3 billion to a potential firepower. So, just interested in what you think the firepower is for M&A.

And then the second question, on the Life & Health side, I think, the thing I'm really interested in is that you said you want to -- you think you can draw a line underneath the Life & Health issue for Swiss Re. When we think about Q4 and next year, Q4 in particular, what -- you're saying now there will be no negative experience variance in Q4? Just trying to understand whether this is done and that we should expect experience variance to be kind of neutral or there is still potentially something in Q4 that could hurt a little bit. So just interested in any thoughts there.

I'll give it to Anders and I'll complement it afterwards, if necessary.

Okay. So, maybe I'll start on the firepower. So you should not think about that we -- because when we go back to the capital management philosophy that I laid out, I think it's clearly that you generate capital and then you deploy the capital. You can assume now with -- I just take the numbers in the targets. It's about USD 3 billion would be given back to shareholders. USD 1.5 billion we would keep. That doesn't have to be stable going forward. We would not build that up. So, because we have a capital target of being between USD 200 million, USD 250 million, we feel we're very comfortable at that upper end of that range, but we will not go to, call it, USD 300 million to basically have a buffer to then buy something. So, that's not how you should think about it.

So, we will deploy the capital either into the business, new business growth. It's also when I talked about the retro that consumes capital if I reduce that, and we will not keep firepower as capital. Because as Andreas said, you never know when things come, do they come at all? We don't know in what size. And so that's not. I think if the right opportunity comes, we will always find the right way to deploy and to pay for that.

I was just interested in whether you had like a number so that if we wake up on Monday morning, there's a deal that's $8 billion, we would be that surprised if it's $2 billion or bolt-on and whether you do have a kind of capacity number.

Yes, I don't think right now that we're in a position -- I think as Andreas said, I think right now, we're talking more about the smaller bolt-ons in -- particularly in Corporate Solutions. This is what we talk about it since a long time. It's about strengthening the core. It's about getting the de-correlation from cycles, reducing the exposure to the cycle by adding -- and that's more on the specialty side. We mentioned Credit & Surety and Accident & Health that de-correlates. You should say, I think, that's the -- and that really complements the core. That's really -- because we're not doing something out in space. It's about strengthening what we already have in the core. And you should not expect then particularly on the P&C Re side that we would do something that would evaporate quickly.

That's the exercise we did in the beginning, as I said, the option space. We really looked at everything, even also the transformational ones. But then we narrowed it down to really something where we said this can make sense. And that's then the outcome that Anders was describing.

Exactly. Then back to the Life & Health, your question was about the impact in Q4. I think, what I have here is the assumption update. We went through all the portfolios. The impact for the assumption update. I can't give an impact on experience variance, because the quarter is not over.

Not that I expect anything right now, but I don't know where experience comes when the quarter is closed. So I would be a magician if I would be able to tell what's happening for the future. But I think what you always should assume is that, if the result -- if the assumptions are set the right way, you only have normal volatility, which is normal in both ways. It should be neutral overall.

The problem -- and I could have mentioned that before, but what you see on the Life & Health and some of our peers have actually put that out. Usually, when you have positive experience, it goes into CSM. When you have negative experience, it goes into the P&L. That's IFRS 17. But we don't expect now a trend. So, we expect that the underwriting experience is going to be neutral over this portfolio. That's why we did all the assumption change.

Will Hardcastle, UBS. I'll ask a boring one first, if that's okay. Just on the combined ratio for P&C Re 85%, better than 85%, flat year-on-year. Can we just do a bit of a walk year-on-year on how you're thinking about it? Discounting is 1 to 2 points higher year-on-year. I guess, any PYD assumed and then thoughts on the underlying. And I know it's an extension to it. So obviously, it's within your net income guidance for P&C Re result is in there. Maybe a net insurance revenue discussion as well to help us get to that because we've linked it there with holding more retro.

Yes, maybe let me start and Anders, you can then chime in. You could, already in 2024, see the underlying quality of the book from an underwriting perspective. That's why we said we could afford to take the hit in Q3. This quality is coming through. It's a structural good underwriting portfolio. We had obviously good Q2, Q3 quarters on nat cat. And I think that was a driver also of a very good low combined ratio, by the way, not just with us. It was a good Q2, Q3 for the industry. But we always said, don't take this as the new normal. It is volatile. There is volatility. And that's why we feel it's prudent to confirm the targets.

The structure of the portfolio, you've seen it. I think in our rate expectations, we priced in, obviously, the difficult market. That has to do with, yes, the combined ratio outlook that we, from the planning perspective, from the bottom-up planning perspective could see.

We still see then there's some room, and that's why we added some positive basically, some expectation into the combined ratio when we thought about, okay, how to think about '26. We also have to think about earning patterns when is the premium earned and through. So, we still see some earning through from the previous renewal year. And all of it combined gives us comfort to say the 85% number is an ambitious one, but still achievable.

All things obviously being equal, if there's a major natural catastrophe year that will impact the whole industry. But even with the shape of the portfolio, I think we can absorb a lot. We still see that the portfolio is positive. The assumptions are sound. And that's why we believe that the portfolio overall can produce the nice outcome with the positive outcome. And that informs, obviously, our hedging strategy and the retrocession strategy. So, that's why we believe by reducing it and benefiting basically from the good underwriting and from the structure of the portfolio makes sense. Maybe I'll leave it here.

Maybe just to add on the revenue -- because you asked also about revenue. We don't give revenue guidance, because we really don't manage to the top line. I think we're pretty clear. I think you can still take probably then full year '25 as a starting point and then start from there. I think that's clearly what you then should do.

When you look at the PYD development, again, I don't give -- we don't give a numerical guidance there, but you should expect the positive development in a normal environment where you have kind of normal claims. You've seen that in the first two quarters -- you saw that in last quarter -- last year, you saw that in the first two quarters this year. In the third quarter, because we had room, and we were very explicit, we used -- because we had the risk adjustment and release, we used that to strengthen resilience. But other than that, you would have seen kind of a similar effect. And so that's -- without giving you a numerical guidance, I think that should give you kind of an expectation.

Darius Satkauskas, KBW. So two questions for me. The first question is just on the buyback. So you joined one of your large peers with the buyback program. Buybacks clearly create value when done right, but clearly, buying back shares at any price is not an ideal capital allocation policy.

So, could you share your thinking on why the buyback is the right tool to return capital going forward -- for Swiss Re? And do you have some sort of hurdle rates in mind that the buybacks ROI needs to clear? Or how are you measuring the value creation in doing the buyback?

My second question is just on the CorSo combined ratio stability. So you guided to the same target that you had last year and yet the rates came down mid-single digits. So, are you suggesting that you'll be baking in less prudence in open loss picks? Or is this based on you releasing more from the back book? How are you able to keep the guidance stable?

Okay. Maybe I'll start on the buybacks. So look, I think for me, it's important that the dividend and buyback for me go together. In the end, this is how I return capital. The majority comes back as dividend, stable with -- should grow with the underlying earnings development. And then, for the remaining part, you use buybacks. This gives you the flexibility because you don't want to -- I don't want to run -- jump around with the dividend.

You could do extraordinary dividend instead of a buyback. I prefer the buyback, because this allows exactly to your point, you can stretch that over a period of time and then see how -- you obviously give it -- you don't -- we don't do it ourselves, we give it to bank, but you can give guidance how they should execute over time. So that gives a positive impact overall. We're not that -- I would say, I'm not a big fan of gaming in the end the market. We just give a guidance out how they should execute that, that form of capital return.

So, I'm not sure if that fully answers your question, but -- and I'm definitely not giving you the hurdle rates, but yes.

I mean, in terms of hurdle rate, it's more about clearly you got different options in how to deploy capital organically, you can give a dividend that is neutral, you can buy something. So clearly, you set out [indiscernible] the buyback that you want to achieve.

The buyback is always -- the buyback is subordinated. That's how you should think about it. Buyback is subordinated. I have the dividend, if I have business opportunity that have a higher hurdle rate, so the mid-teen hurdle rate, that's what I would expect, then you do the business opportunity. And then the remaining part, if you don't have an opportunity, you give it back. That's the -- that's -- but I don't play the share price over time with the buyback. That's what I mean.

So quickly CorSo combined ratio. Again, when you look at the reserving positions, we are adequately comfortably reserved. Should there be the need to obviously release some of the reserves, then you look exactly, is there a need also to redeploy, because the situation allows it and actually demands it. Then you redeploy and that's obviously subject to also the auditors approving to this.

We see a continuous situation where we say, in particular, in the shorter tail lines, are the reserves, are they really still suiting the purpose? And if not, obviously, there is a release. And that's something that you will see then in the development, prior development. So that's as much as we can say, because a little bit of it is also a crystal ball, and it's also depending on also the accounting consideration, but the shape of the portfolio and the shape of the book gives us enough indication to have that optionality.

Back to that side, Hadley.

Hadley Cohen, Morgan Stanley. With the guidance for USD 4.5 billion versus the '25 initial guidance of USD 4.4 billion, the uplift is effectively driven from the increased guidance for the Life Re business of USD 100 million. Given you've got the combined ratio guidance is effectively unchanged. I mean, the moving parts within that are different, but the guidance is unchanged. All else equal, I think you should still have some FX tailwinds going into next year. Investment income should be better. And you've got cost savings coming through. You're retaining more on your own book. And presumably, there's a benefit from iptiQ coming through in '26 versus '25.

The only conclusion I can come to is that there's a decent reduction in the top line for P&C Re and CorSo as well. Can you just help me, sort of, square the circle there to help me understand what I might be missing in that context? And in that context, I think on Slide 14, I think Swiss Re Sigma is talking about the 5% annualized CAGR in the reinsurance premium base over the next 6 years, starting from 2024, your '25 revenues were lower. By implication, your '26 revenues could be even lower. So, how we think about your market positioning and your ambition to close the gap to #1 in that context?

Yes. So,, you can argue whether we closed the gap to #1 already. I believe there are a lot of indications that we did actually. And now, it's how do you behave in this market cycle. And that's the main narrative around this.

And remember, I said, could we have done more? Maybe, yes, to your point. But remember, we just came out of a phase where we were reestablishing the foundations and the stability and consistency in the company. I want to see some more track record. I don't want to oversell and destroy the good work that the teams have been doing. And that's what I stand for. Because we know exactly that there's a lot of uncertainty out there. And you were actually listing quite a long list of things that can or need to happen. But just two or three things out of your list when they turn negative in the market, then that will have an impact and you will have to deal with this. So, that's the ingoing, sort of, thought around this.

And I can repeat myself, USD 4.5 billion with the market environment is a good number. It's an attractive number. It's around 20% ROE. And I think this is what we want to say that we, through the cycle, want to generate more than 14% ROE, because there could be parts in the business, in the cycle that will not generate the 20%. That is -- the history is telling you this.

So, what we're trying to do is, to manage expectations also and also give us the optionality, the room to really deliver on what we said we would do on a consistent basis. So, USD 4.5 billion is good, in particular, when you take the P&C businesses that are under pressure as we have a pretty large part of the P&C in our book, and that needs to be managed. I'm not saying that I'm pessimistic about it. I'm not intimated, but we need to manage it actively. I said that would be my answer to this.

Maybe just to add, I actually agree. So what you listed are all the items that are in our control. And this is what we're going to deliver. They're in our control on the expenses. They're in our control on the retro. This is all in our control, but there's a lot not in our control. And what we want to make sure is that, even if that what's not in our control is not behaving as expected, we can meet the target.

I think that's how we think. Because the target is not just there when the sky is blue and the sun is shining. The target is there because it's the real target. And so make sure that what you -- what is in your control, you can actually meet and then be prepared for the volatile piece. That's always how I think because otherwise, I can always give you the blue sky target. That's easy. But a target that works in different environment and you meet it, that's what we really want to achieve.

Iain Pearce, BNP Paribas. Just on the growth outlook, you said you don't want to chase some of the opportunities that might be there and act rationally across all cycles. Well, with returns where they are, the 20% ROE that you're talking about, probably the outlook for pricing and returns in the market not getting any better in the short term is now not the right time to grow. So, just why would you not be more optimistic on growth in the near term?

And then secondly, on short term portfolio mix with the target liability structure that you have, how does the current structure compare to that?

So we repositioned already our portfolio. So, you should see that on the casualty side in P&C Re, for instance, we reduced the U.S. casualty market share from 17% at the peak to now 5%. We think we are where we should be. So, there's no need now to correct the shape of the portfolio. And that's going basically also into our plan going forward.

On your first part of the question, the growth opportunities. There are growth opportunities, and that's what we say with our TLP. But you have basically two effects. You reduce the share of the U.S. casualty and P&C Re. And if you look just stand-alone on the growth of property, specialty, but even cat also, lower but still there, it's there. It's healthy. And it was just eaten up by the reduction of the U.S. casualty piece.

Now that we are where casualty, we think, should be, we see now the downward cycle, but there are still growth opportunities. So what we're doing now is, we look at structural initiatives, actions to strengthen the company, in particular, at the interface of the markets. We increase the empowerment, the authority levels. We strengthened the teams in the market units, as we call, in both P&C businesses. We have various initiatives going on at geographic level, where we have discussions around partnering with market leaders, where we will benefit from their market position and they have a need to complement it, for instance, with the capabilities of CorSo in a market where we -- when we enter it and plant the flag stand-alone, would incur costs that's investments and would take time to piggyback with market leaders that they don't have this capability where we can add it.

We have very concretely three markets that we look into it. It's not the time to discuss it, because it's still under NDA. On the reinsurance side, we have a similar approach. Obviously, we already have scale and market-leading positions in most markets, but there are attractive markets that are in a built-up phase, where we have been selected as the partner to build up markets and platforms. Those are all ideas that will generate revenues for the future, but they also have to then scale. So, as it is already a pretty large portfolio with -- we've got USD 43 billion insurance revenue, IFRS insurance revenue. So, you need to start to create those -- I always call it bread crumbs that you lay out, and that will then obviously contribute to future insurance revenue growth.

Shanti from Bank of America. So, I just had a question on the P&C combined ratio target, which includes that discount rate of 9%, which is broadly, sort of, flat year-on-year where you're trending at the moment. And given that you cut back the casualty book, I think, 26% in the first half of this year and rates are expected to come down. I was just curious to know why that is expected to remain so high because naturally, I'd expect that to come down over time.

Yes. Look, I think -- I mean, that's our current expectation based on the modeling. I think it can -- if you would assume that rates are coming down significantly, this will come down as well. I think, we -- in our planning, we don't expect rates. I think we expect rates to stay pretty much where they are. If you know more, then that's different. We don't know.

I'm just curious on how the casualty pruning. I know, it should...

No, no. Yes. Exactly.

Today, but over time.

Look, it should come down over time. I don't think that quickly, because the casualty pruning on the new business has already happened. On the in-force, this will take some time until you will see that in the discount rate. And then, the other on rates, we just assume that rates -- in this forecast, we just assume that rates stay where they are. Interest rates.

Back here, Ben.

Ben Cohen at RBC. I just had questions on the Life & Health side. I just wondered if you could say more about where you see the opportunities in terms of new business in Life & Health. And maybe in the context of the charges that you highlighted on one of the slides, you could talk about whether you see any, sort of, structural issues across health markets globally? Are there sort of inflationary pressures or changes in society that you're not capturing and might lead more of the portfolio at risk?

So there's basically two questions. One is, do you see continuous issues? And the other one is where do you see opportunities. And I would say the first one about the -- I think we -- the reserving is fine. We're good. Now we have reviewed all the portfolios. Absent any material changes, I think that should now reduce the experience volatility drastically. So that's -- of course, you can always have a new pandemic or you can have a new other event, but that's different.

Look, I think Life & Health, and you saw that in Andreas' presentation, the market itself is expected to grow by about 4%. And so, we see over the next 5, 6 years. So we will see opportunities, and it's throughout the world. It's in all aspects. It's on the mortality side.

Now mortality, we don't want to grow much more in the U.S., but in the rest of the world, that's still an area that we see opportunity. Longevity is a market that is developing, quite developed here in the U.K., Netherlands is also, I would say, the second largest, but you also will see in U.S. -- I always say it's U.S./Bermuda because in the U.S. itself, companies have no benefit of offloading longevity because of the RBC charge. But many PRT players then retrocede that business through Bermuda.

And that's where then I think there's an opportunity for longevity transactions. Because the Bermuda regime has a longevity charge. Because what you ultimately want, what most players want, they want to have steady cash flows, and they want that someone takes out the optionality. And optionality is -- can be longevity, but it can also be mortality and can be other options that then we come in and provide a solution for particular PRT writers. So, that's a big, big opportunity that will play out over the next few years.

Maybe let me add to this. Again, 90% of our net income is determined by the in-force book. So there's a lot of work that needs to be done there. On the new business, I think we should also look at the transactions segment, the FinSol, Financial Solutions business. And immediately, people will then drift towards the asset-intensive part of the business. So, we see opportunities, yes, in the asset-intensive business part, where we help with the biometrical side -- the biometrical underwriting side. We are not going to be a big player in the asset-intensive business. We just are complementing it with the underwriting.

We have a regulatory regime in Switzerland that is not comparable to the Bermuda system. So, the SST charge that we would get if we would enter into similar kind of deals is significant. But where it makes sense, where there's also margin to be made on the biometrical side, that's what the expertise that the markets then need also. So, that I would see as an area, but don't expect miracles in this area, very margin-oriented, technical -- and then the other areas, Anders already mentioned.

Yes. And they come together these two areas. Yes.

Charles Graham from Bloomberg Intelligence. Two questions really. There have been some interesting discussions about extensions to flood insurance in Europe. In terms of the geographic mix, is it too early to think about that as a potential growth market for Swiss Re? And then just sort of more generally, has there been any or is there likely to be any change in Swiss Re's approach to cyber to AI data centers and the whole of that market?

Yes. First part, flood insurance, I mean, we bought a company called Fathom, attached to Bristol University. They're market-leading in -- with a flood model. So that is integrated now into the cat model, the perils in total in Swiss Re. So, that's an opportunity for us from a pure modeling point of view. We see developments, public-private partnership developments in Europe. There's an active discussion in Germany around nat cat floods also in particular. There's no final decision yet, but I would not be surprised if we would see a vehicle called Element Re being set up for -- we see it as an opportunity in the market.

We are an active party in the discussions at the association level, obviously, but also in the discussions in the Tripartite construct. The problem there is evident because the local, in particular, the regional and local insurance companies are exposed with their net as the reinsurance industry have increased the retention levels, where reinsurance then kicks in, then they actually are exposed on the net side.

This is predominantly also valid for the semi-private companies owned by the Sparkassen, who have a regional concentration and limitation also. So, they have regional limitations, so they can't diversify away from their net exposure in their region, which is causing a problem. That's why I think it's important that the industry comes together and tries to solve this problem, because diversification is key, and that's where we can help, where we can provide because our diversification works at global level, which is always superior to a stand-alone local or even regional in a country regional exposure.

So hopefully, more to come. I think the legislative procedures are ongoing. And I hope it will be a quick solution. That's what the market needs. And we're here, we're providing our data, our models, analytics and capacity also. So we are at the table and discussing with them. So that was the one in the cyber and data centers. So that was a list of distinct high exposure areas.

Cyber, we didn't change our view on cyber. We're very careful. Nevertheless, we are one of the top 5 capacity providers as a reinsurer in the cyber market. But we're very careful. We look at the overall deployment of capacity. We have capacity and risk limits that we need to watch. So that tells you that we, again, have a very technical view on it. We have invested a lot into capabilities, also in modeling capabilities, trying to understand that this is a big vast territory.

And you have seen just recently also primary insurance companies have reduced capacity and are careful because they see the number of claims, the frequency going up, but also the severity. And almost on a daily basis, you see downtimes of cloud, cloud providers, et cetera. So, this is a dangerous area. And I think it's, again, an area where one party alone is not enough to solve, and we are also supporting the public-private partnership models here, but there's still some way to go.

On data centers, that's different. Data centers is a new risk exposure coming into our industry. But again, here, that's a concentration question, in particular, about U.S. There are so many data centers planned and the accumulation topic has to be addressed and has to be managed. The demand, the need for extremely high limits is there. So, you would think it's a great market, because there's great demand. But from a technical exposure perspective, we need to understand where the exposures are, what's the worst-case scenario to think of. So, we're active in the discussion with data center providers, with the brokers, but also with cedents who have specialty and specialist know-how in this area that we complement with our know-how.

We need all the capacity available in the world. That's why this is an area where we need to be careful and have an alignment of interest. Europe is a bit behind, but that's why it's all concentrated in the U.S. the discussion, because that's real. So the number of data centers that are being not only planned but built, that's real. And that's why we need quick answers to it.

Vinit?

So just the Life, so I hear your confidence in it's been solved. I just wanted to follow up because last year, one of your slightly smaller peers had a big thing about Israel and long-term care. And today, when I hear Israel, I see other things being mentioned, disability, other medical things. And I think it's just, will be helpful to see what you think about whether these two things were the same, whether you addressed them a little later or whether there is something else that potentially is a risk. So, I'm just curious to your thoughts on what's happened there because it was a very, very big -- I mean, topic in our world last year. So just curious on that.

Yes. So look, I think, it in the end, I mean, it's the whole market. And so it's the same issue that has been addressed. Now by Swiss Re, I would say, to the extent that we have now also by the closure of the -- or the stopping of all the treaties. In my view, this is the same market environment that has created this issue. That's why this is not just a Swiss Re reserving issue. This is a market issue in Israel that ultimately then also impacts also consumers, because if reinsurers just withdraw from that market, insurers in the end don't have the capacity to then provide the service or the protection that you need. So it is -- in my view, this is the same. Yes, the same thing.

And to add, we're in active discussions. The regulator has to approve specifically in Israel. So, it's a complicated situation that needs a solution.

Just trying to -- maybe in the back, you haven't had your turn.

It's Andrew Baker, Goldman Sachs. Just hoping -- maybe I've misinterpreted what you're saying here, but can you help me reconcile a couple of points that you're making? So I guess, Andreas, from the opening remarks, I thought that you were relatively relaxed about the P&C Re pricing outlook. But then if I look at the plan, it looks like there is quite a bit built in to sort of protect from the downside risk there. So one, I guess, have I read those two statements correctly? And then secondly, are you able to just be a bit more explicit about where you're thinking 2026 risk-adjusted pricing declines will land versus 2025. So are you thinking they are in line? Or do you expect them to decline materially, I guess?

So when I sounded optimistic or positive, I was referring to the narrative that was out there in the market. that we hear and we have various meetings, I mean, amongst us even in Monte Carlo and afterwards, and it's dynamic. But to be quite fair, I don't see the dramatic decline that some market participants, I'm not saying peers even, were entertaining as a narrative. That is not the reality that I see, which means there's still some discipline in the market, which I see as a positive. Now we planned with some rate declines.

And again, why am I not so negative or intimidated? It's because we are within our expectations. Yes, we still operate in a space where there's margin. And as long as that's the case, I shouldn't be negative about this.

The second part of the question was?

It was about the risk-adjusted pricing.

Yes, that's basically -- that's what I just said, yes. So, we have a plan, and we're way within our expectations, yes. In comparison to the prior year, I don't want to give you a crystal ball number. We're within our expectations. I think that should be sufficient because we're still in the negotiations.

Chris?

It's Chris Hartwell from Autonomous. Just trying to sort of think about dividend policy. Obviously, the earnings growth -- the growth in net income obviously implied in the '26 and '25 plan is relatively modest versus dividend growing 7%. And if I extrapolate market conditions forward into 2027, again, we've got -- and that's going to be 15% growth in ordinary dividend plus buyback on top with a very modest presumably growth in net income. So, the payout ratio is going to widen quite a bit. So, I'm just, sort of, wondering if you can, sort of, talk a little bit about the, sort of, the broader payout philosophy as we go towards the end of this current plan.

Yes. Look, I think you highlight -- I think you summarized it well. So, we have the dividend, that is, call it, the main part of the payout. And we announced last year the 7% that we -- for 3 consecutive years. I mean that's clear. That's a commitment we're going to do.

On top of that, we now added the buybacks as a supplement that then basically closes that. But as a program, not as an opportunistic buyback, as a program going forward that you should expect that continues when result. And we start with USD 500 million, and you should see that as a good proxy. But going forward, if results go up, then you would see that going up as well.

Obviously, we talked about the priority. If there's an opportunity in the market, you would use that as well. But if I just look at the overall capital generation, I think there's ample space to continue that program. So it's -- I think with -- in the plan, it's about 60% payout ratio. With your view, it probably goes up a bit, which is fully in line with kind of the capacity that we have going forward.

So that's -- I think -- look at it as a starting point. And then going forward, I think we want to deploy the capital at the right level. But if there's no opportunity in the market, we give it back in the form of this program. That's why it's a program to keep then the capitalization at this USD 250 million range around where we want to be. So, I think that should give you clarity.

Anne-Chantal.

Anne-Chantal Risold from Octavian. I just have a question on the slide that you have in your appendix. We haven't talked about it. You say you make a proposal at the AGM 2026, you will move your share capital to USD. So not long ago, you moved your dividend to USD share capital. Will that have an impact going forward also on the currency you will be quoted in at the exchange?

So, the short answer is, no. But maybe I can give a bit background here. So, we manage this company on a USD basis because the vast majority of our exposure is in USD. We have 50% in the U.S. You saw it in Andreas' slides. We only generate about 1% of our revenues in Swiss franc. So that's why I think it's important. We manage and think that the company in USDs.

We changed the dividend policy to that because otherwise, we couldn't give a dividend guidance. And how do you give a dividend guidance if your currency moves around? Now, there was a change in the Swiss law that allows that we can also change the statutory accounts from Swiss francs to USD. And this is an opportunity because now -- and you will not see anything of that in the IFRS. And it's not an IFRS issue.

But I think it reduces a lot of complexity underneath, also reduces some hedging. So, there's a real cost benefit that we can reduce going forward. It simplifies it. The hedging is gone. And from statutory to IFRS to dividend policy, all of that is in line in U.S. dollars.

We're listed at the Swiss Stock Exchange. This is in Swiss francs, and this will remain in Swiss francs. So, I think these are two different things. But the important point is this simplifies a lot. This reduces cost. And so this is really in the interest of shareholders and ultimately, policyholders as well.

Just a second round.

It's Ivan Bokhmat, again. Just wanted to follow up a little bit on the things you were mentioning. One, on the plan to see a little bit less cat risk to external recession. I'm just wondering what's the rationale here? And wouldn't it be more logical to increase the session given the market becomes a little softer? So, you can collect fees from that.

And then the second question, I mean, I'm just trying to understand the dividend message a little bit better. But the way I understood it is that extra buyback beyond the USD 500 million that we should consider as recurring would come, a, towards the level of USD 250 million as the ceiling where you would pay down potentially? And secondly, should we think about it with the view of this 14% IRR, if you're unable to deploy capital organically above that level, this is when extra buyback comes in.

Okay. Maybe I'll start on the cat exposure. I mean, you saw -- I didn't mention it, but on cat, overall, we have a combined ratio of 68% over the last probably 10 years. So, this is a very profitable business. So even if prices are coming down, this is business you want.

And if we have risk capacity and capital capacity to take more on, this is beneficial. And this is exactly how you should think here. So, this we can reduce a bit the hedging, the retro, because we still believe this is a very profitable business that creates the right return.

To Andreas' point as well, I think also when you look at the capital intensity, I mean, it's about 40% return on capital just because of the diversification. So this business with this combined ratio is worth taking a bit more risk increase.

So, on the dividend, again, I think the 14% ROE target that we have, you should see that as a through-the-cycle target. So, through-the-cycle being above 14%, that's the objective. Right now, the target that we put out is about 20%, so way above the 14%. So the 14% is really the through-the-cycle view here.

The dividend itself -- so -- and then we have the capital band or the capital range where we say we want to be at this between USD 200 million and USD 250 million. Now in normal circumstances, you want to be at this upper end, because then you can absorb any big event without going out of the range. So that's -- but we feel comfortable in that area. We don't need to be way above that.

And now introducing the buyback allows us to maintain exactly that level in a normal year and complement the dividend with the buybacks. But on a recurring basis, on a sustainable basis, not on a one-off basis. And as I said, we start next year, start with the USD 500 million. But over time, we will see how this develops.

Time for one more. Maybe, Will, you were...

He was waiting.

Will Hardcastle from UBS. Just coming back to the Life & Health, I understand you've done the portfolio reviews and you guys are comfortable. I guess, as we sit here or as investors look at it, what data points can we sort of grab hold of that we can be comfortable? With the P&C stuff, historically been you've shown, we've seen -- we've seen a 10% hit to CSM effectively over the last 12 months or so. That's a big number. Some companies might do a third-party review. Is there any possibility of that? I guess, as investors or analysts, how do we get comfortable with that?

And I'll just be greedy just on one last point on the sustainability of the buyback comment. Am I right in thinking, therefore, that USD 500 million is the minimum, it would be. Would you ever reduce it year-on-year? I'm just trying to understand that. Is it a ratchet type thing?

Yes. So in a normal environment where nothing catastrophic happens, I think you can see that as a guidance that would not go below that. Obviously, if you would have a big earthquake like we had 12 years ago, 15 years ago in New Zealand, that's something you would have to then think about. But in a normal situation, this is -- you can see that as a guidance, absolutely. Yes.

On the -- look, I think on the Life & Health, I think the proof will be quarter-over-quarter, how we're going to see the experience variance go through. I think important for you is, we went through three phases. We took the big ones, and we already saw that the big ones are working, because U.S. mortality and China critical illness are in line with expectations. These are the big ones.

And you saw in Andreas' pages, U.S. mortality is about 50% of the in-force. So that's big. And that's critical. If this doesn't work, then we have to talk. But this is not -- this is in line. This is as expected. China critical illness is fine. So, all the big ones are fine. The small ones when we went through now, and you will see then in the experience variance going forward, we have to think about if peers do something like the triangles, because that would be the corresponding. I'm not aware of that. So -- but under IFRS, I think you will see them very detailed and how this develops.

And let me add also here, because you had a nice slide where you said, okay, there's a lot that has been done when we reviewed the portfolios, but there's also management actions.

And the same here, 90% of our net income comes from the in-force book. And there's a lot that can be done there. Think about recapture, for instance, and we had a very successful 2025 so far already. And if teams are focusing on optimizing, sort of, the in-force book, there's a lot to be done there and to be gained.

And now at the end, I'd like to bridge it again to AI because what the beautiful thing is on Life & Health is that I personally see the biggest impact, positive impact and benefit in AI, in Life & Health. It's extremely manual. All contracts are very bespoke. And we have around, I think, 11,500 treaties. And we were looking at sort of a subset of 4,500 treaties. And we were thinking about the rate reviewability clause in those contracts.

Today, it's humanly impossible with the team to go through each and every bespoke contract because the rates, the clauses are not even equal, identical in all type of contracts, very bespoke. It's almost impossible to go through and then to activate that clause. With AI, we now suddenly see that scraping the information of those treaties is done in no time.

And now, you can actually take management actions, do something that is your contractual right actually that you should do what prime insurance companies are also should do with their policyholders. That's the opportunity here, and that's why we're doubling down on it. And as we speak today, they are sitting in a sprint, the teams from the tech side, but in particular, from the underwriting and the claims side on the Life & Health Re. So, I've got big hopes there. I don't want to oversell it again, but this is clearly an opportunity.

With that, thank you very much for your questions, for joining us today. For those of you here, we still have a lunch snack waiting outside. So you're, of course, welcome to stay. Thank you again for joining the management dialogue event, and have a nice weekend.

Thank you.

Thank you.

Good morning or good afternoon. Welcome to Swiss Re's 9 Months 2025 Results Conference Call. Please note that today's conference call is being recorded. At this time, I would like to turn the conference over to Andreas Berger, Group CEO. Please go ahead.

Thank you very much, and good morning or good afternoon to all of you. I appreciate that you're taking the time today to listen to us and also to engage into a hopefully very vivid Q&A.

Before our Group CFO, Anders Malmstrom, walks you through the details of our 9 months results, I'd like to start with some brief remarks as usual. After another strong quarter with a profit of USD 1.4 billion, we're pleased to report a net income of USD 4 billion for the first 9 months of 2025, corresponding to an annualized return on equity of 22.5%. This puts us very well on track for our full year net income target of more than USD 4.4 billion.

We benefited from exceptionally strong P&C results in the third quarter, helped by a low burden of large claims. These amounted to around USD 200 million in the quarter, well below expectations across P&C Re and Corporate Solutions. The result of the second consecutive benign large-loss quarter is that both our P&C units are tracking well ahead of their respective targets. This is the principal reason why we're in such a good position at this point in the year.

You've heard me stress our two key priorities, and they are unchanged. Firstly, deliver on the more than USD 4.4 billion group net income targets; and secondly, increase the group's overall resilience to improve long-term delivery.

Now on resilience. This journey started with a complete turnaround of Corporate Solutions and the implementation of a new reserving philosophy, which we subsequently extended to P&C Re, 2 years ago. We also successfully addressed P&C Re's in-force U.S. liability reserves last year. This year, we've been focused on further improving the resilience of the third business unit, Life & Health Re.

After 3 quarters, Life & Health Re net income stands at USD 1.1 billion, which is actually a quite solid result and a very important contribution to the group's earnings. But Life & Health Res' result has been too noisy. As mentioned at our half year results, we continue to focus on reducing volatility in smaller portfolios, where experience has lagged expectations, thereby producing negative variances to our expected results. These negative variances are unacceptable, even as our largest portfolios, including U.S. mortality, performed in line with expectations. In the third quarter, we, therefore, decided to partially accelerate efforts to strengthen the resilience of the in-force book based on detailed reviews of underperforming portfolios. Some of these are still ongoing and will be completed at the end of this year.

We have full confidence in reaching the group's net income target of more than USD 4.4 billion over the year. But given where Life & Health Re stands after 3 quarters and given our focus on resilience, we feel it is prudent to flag that in a base case, we are likely to fall short of the USD 1.6 billion Life & Health Re full year target. We will do what's required to get this business to produce results closer to expectations. At this point, and I emphasize, we do not expect significantly outsized impacts from Life & Health Re in the fourth quarter relative to Q3. So you heard me emphasizing that. We will update you on this on December 5 at our Management Dialogue Event, and we're looking forward to that.

Let me also briefly touch on new business CSM generation across our segments. We remain focused on disciplined underwriting as profitability continues to be our priority. To reemphasize again, we don't have a top line target. New business generation remained resilient with a new business CSM of USD 3.9 billion for the first 9 months, slightly down from last year's USD 4.2 billion. The decline versus last year, partially reflects the more challenging pricing environment that we're facing in some lines of business in the P&C business, but also in Corporate Solutions. It also reflects our continued focus on portfolio quality, including the setting of prudent initial loss assumptions.

Overall, we're still satisfied with the margins we're able to generate across the businesses. Importantly, we continue to maintain discipline on terms and conditions and attachment points. I look forward to presenting further details on our group priorities at the upcoming Management Dialogue Event on December 5. On that date, we'll also announce our financial targets for 2026. I'll be joined by our Group CFO, Anders Malmstrom, to provide an update on key topics across our businesses followed by then an extended Q&A session.

I think with that, I'm happy to hand over to Anders to give you more flavor.

Thank you, Andreas. And again, good afternoon or good morning to everyone on the call. I will make a few remarks on the results we released this morning before we go to the Q&A session. Andreas has taken you through the highlights of our overall strong results for the first 9 months of the year. Let me add a few further details.

On revenues, the group's Insurance revenue amounted to USD 32 billion in the first 9 months, down from USD 33.7 billion last year. The USD 1.7 billion decline has a few major drivers, most of which were already highlighted in the first half of the year. At Q2 2025, we had indicated that group revenues in the second half would be around USD 1.5 billion higher than in the first half. In line with this guidance, Q3 revenues were around USD 600 million higher than the average quarterly revenue in the first half of the year, reflecting the increased claims seasonality.

While Q4 is also projected to be higher than Q1 and Q2, we now expect revenues in the second half to be slightly below the USD 1.5 billion previous estimate, primarily due to our continued focus on portfolio quality in P&C Re. As you have heard from us by now, we do not manage for top line. Let me move on to the Insurance Service result of our businesses.

In P&C Re, you will continue to notice a decline in the CSM release versus last year's period. The USD 2.1 billion release in the first 9 months is down from last year's $2.7 billion. This decrease is driven by the earn-through of prudent initial loss picks, including impact of new business uncertainty allowance and slightly lower margins. Experience variance and other, which captures all variances relative to initial reserving assumptions, contributed positively by USD 549 million in the first 9 months, including $447 million in the third quarter alone. This quarter's positive experience was mainly attributable to large nat cat losses that came in $678 million below expectations, bringing year-to-date favorable nat cat experience to USD 900 million.

In addition, P&C Re benefited from a one-off risk adjustment release in the third quarter in the amount of USD 170 million. Against this very favorable backdrop in the third quarter, we selectively added to both current and prior year reserves. Year-to-date, we have added around USD 300 million to our current year reserves in P&C Re. Nominal prior year reserve releases stand at around $150 million for 9 months, which means we added around USD 100 million in the third quarter. Please note that no further actions have been necessary on the U.S. liability portfolio we strengthened, a year ago.

On the back of all the pieces I just described, P&C Re reported a very strong combined ratio of 71.3% in the third quarter, resulting in 77.6% for the first 9 months, well below the 85% target we have for the year. Moving on to Corporate Solutions. The 9-month CSM release of USD 668 million is above last year's $628 million, driven by higher in-force margins. Experience, variance and other was positive at USD 111 million. This reflects favorable large loss experience and a positive prior year reserve result, partially offset by an allowance for potential late claims reporting. Large nat cat claims of USD 60 million came in below expectations for the first 9 months, while large man-made claims of $282 million were slightly above, partially offsetting the favorable nat cat experience.

Corporate Solutions continues its track record with a 9-month combined ratio of 87.1%, below our target of less than 91% for the full year.

Finally, on Life & Health Reinsurance, as Andreas mentioned, we decided to partially accelerate our efforts to strengthen the resilience of the in-force book, following detailed reviews of underperforming portfolios. This resulted in negative assumption updates hitting the P&L in the amount of around USD 400 million for the first 9-months, [ there ] was USD 250 million in the third quarter. The large majority of the third quarter's impact related to selected Health business in the EMEA and ANZ regions. The fact that this hits P&L mostly reflects the onerous nature of these portfolios under IFRS, and this makes it particularly important that we strengthen them sufficiently.

We have also seen negative claims and volume developments of approximately USD 250 million year-to-date, primarily in the third quarter. Q3 was mostly driven by the Americas region, which had a relatively poor quarter in terms of experience, driven by volatile large claims. Importantly, over year-to-date claims experience in our largest -- overall year-to-date claims experience in our largest portfolios, which includes the U.S. Mortality, which was strengthened before our transition to IFRS, continues to perform in line with expectations over the first 9-months.

Despite all of the actions and impact, Life & Health Re has produced a net income of USD 1.1 billion in the first 9 months with $280 million achieved in the third quarter. While some of these assumptions reviews also affected our CSM balance in addition to the P&L, our CSM overall remained unchanged at USD 17.4 billion compared to year-end 2024, supported by attractive and prudently priced new bases and favorable FX impact.

A few words on investments before concluding with SST. We benefited from a strong investment result, with a return on investment of 4.1% ahead of last year's 3.9%, supported by strong recurring income standing at USD 3.0 billion in the first 9-months. We estimate the group's SST ratio at 268% as of 1 of October 2025, 11 points higher from where we started the year. That's where I will leave it for now, and I'm happy to hand over to Thomas to kick off the Q&A.

Thanks, Andreas. Thank you, Andres. Hi to you from my side as well. [Operator Instructions]. With that, operator, could we start with the first question, please?

The first question comes from Kamran Hossain from JPMorgan.

A couple of questions. The first one was just on the Life side. I think the commentary you've given around like quantum in Q4 versus Q3 is helpful. I just wanted to clarify a few things.

So when you say it's not going to be a much larger quantum than Q3, I'm just trying to understand whether you mean the $250 million you flagged or the $450 million negative experience in Q3 stand-alone? Because there's quite a difference between the two numbers. So any kind of clarification on kind of what that comment kind of meant slightly more precisely?

And the second question is in terms of like portfolios left to review, can you maybe talk through kind of the proportion you've got left to review, like what proportion is of kind of Life reserves? How meaningful is this? I'm hoping you're going to say a low number, but I just kind of wanted to hear what you say on that.

Thanks, Kamran, maybe I should give Anders the first words on the size, and then I might jump in to give you a bit of background then.

So, Kamran just on the -- when we talk about outsized or not outsized impact in Q4, we basically mean the $250 million impact that we saw in Q3. That's what kind of puts it in a box. So it's not much left. There's a few portfolios that we have to go through. We need to finalize that. And yes, by the end of the year, we should be done.

Yes. And maybe just to give you the perspective, the bigger picture. So we have three phases that we looked at, and that's exactly why we come to that small number in comparison.

So Phase 1 was introduction of IFRS. That's where we addressed the large portfolios, in particular, critical illness in China and U.S. mortality. Then we had, as a second phase, midsized portfolios, that also have been digested. And now we were turning the attention to the remaining smaller portfolios that are distributed across the regions and also lines of businesses. So what we needed to do, is really to address the individual noise in those many small portfolios, they are actually quite modest, but we needed to address the accumulation of this noise. And that's exactly why we took this view now, and that's the background to the question that, or the answer that Anders gave you.

On the details of the regions, I think we will give you more details in the management update on the 5 of December.

The next question comes from Andrew Baker, Goldman Sachs.

First one, just on the Insurance revenues. So I hear what you're saying on you don't manage the top line. But are you able to give a bit more detail on which areas of the business has led for the, I guess, change -- slight change in view in the second half. Obviously, you previously said it was sort of $1.5 billion, you're expecting it to be higher than the first and now it seems like slightly below that. So just any more color there would be really helpful.

And then secondly, are you able just to confirm how much of the uncertainty allowance you've added so far this year and what you expect this to be by the end of the year?

Okay. Maybe I'll take the first one on the revenues. So maybe just to give you a bit of context again, and I think maybe it's a bit repetition from the first half.

But overall, when I talk about $1.7 billion year-over-year lower, $1.5 billion, I think we already told you. First of all, it's the pruning actions on the P&C Re side, which is about $0.5 billion. It's the termination of an external retro transaction on the Life & Health Re side, which is $400 million, it's a nonrenewal of the Irish MedEx business, which is about $400 million, and it's then the sale of the P&C EMEA IptiQ, which is about $200 million. So that explains basically the majority of that.

So overall, the remaining piece is then really coming from the P&C side, where we have this NDIC feature that we talked about, the netting of the commission with the -- that we didn't do before that and then just continued management of the business itself. So I think that explains it. I think that should be clear now.

On the uncertainty note, I think this is a prudency measure. We're not quantifying it.

The next question comes from Shanti Kang, Bank of America.

So it was just mainly on the Life & Health side. So I understand that the L&H miss today won't derail the group net result target. But I think it does raise a couple of questions about the run rate into 2026.

So I'm just curious whether or not the adjustments today will adjust the forward view on the run rate of the Life & Health book, i.e., if that's like a structural concern today that we should be thinking about?

And then just given the fact over last 6 quarters, we've had a number of assumption updates. I get that you're saying you'll complete that in the full year, this year. But do we need to take some more caution on our assumptions for those into the next year, i.e., can we get a bit more comfortable as you think about there being no more updates or repeats in the future?

Maybe let me do the intro and hand over then to Anders. Maybe just to clarify, we could have let the noise continue, that is another option. But -- and then we could have made our targets also in Life & Health. That's the one option.

But again, we want all our business units to look healthy across all portfolios. We want all business units to play their role that they play in the portfolio of Swiss Re Group. We'd like to see the diversification benefits come through over time and consistently. Life & Health is decorated to P&C. That's the strength of our portfolio. Within the P&C, CorSo is not so correlated to the P&C Re business because we buy external reinsurance. So we think we've got a pretty clean setup at group level with all 3 business units. That's why we want all units to play their role and also to have a healthy portfolio to play optimal role.

So maybe just to add to what Andreas said, I mean, I think it's really critical that we get that through. And that's the last phase of -- we started with large portfolios and now we're doing the small ones. But then this is done. We're going to give an update on the target and the expected run rate for the next year's -- at the management dialogue. And that's where you can also then expect a bit more details how this will perform going forward.

The next question comes from Ivan Bokhmat from Barclays.

My first question would be on Life & Health as well. Maybe you could talk in a bit more detail about the underlying reasons for deterioration in those Health portfolios. Maybe there are any common drivers in these markets that developed negatively and what would make them unique compared to the better performing ones? Just to see if there's some trends that we can monitor from our side.

And my second question, I mean, Anders, considering you suggested that the Q4 adjustment will be smaller than $250 million and your run rate is still quite comfortably getting you above $4.4 billion. I was just wondering if you consider taking any additional steps to add prudence in Q4 beyond the run rate that you have shown so far? And maybe if you could just highlight a bit more color on the movements in reserves that you have done year-to-date by portfolios.

Okay. So let me start on the Health side. And this is -- I mean, all the actions are really driven on Health portfolios in EMEA and then APAC. And I think one that I can actually highlight is Australia. You might have seen also the press release that we put out, that in Australia, we're actually pausing new business because the environment is just not sustainable, and this is a market issue. This is not a Swiss issue. This is a market issue. That's really driven by the environment that we have higher claims than what we expected, and that's why we paused that business. So that's -- I would say that's the core.

We give you more details then at the management dialogue also on the other portfolios, but that's a key element here. And we're not afraid of actually stopping or pausing a new business, if that's necessary because it's not sustainable in the market.

I think overall, when you look at the reserve development, I mean, I can reiterate what Andreas just said in the beginning, I think we have two main objectives. One is to meet our financial targets and the other one is to then strengthen the resilience. We've done that already, I think, year-to-date, you can see that clearly. P&C, we talked about. Life & Health, we also -- and P&C, we also used the benefit of having a risk adjustment release in Q3 of $170 million. We immediately kind of re-purposed in that because we also had a very positive development coming from the nat cat.

So all that together helped us to put more resilience in the balance sheet. It has nothing to do with the U.S. Casualty. It's completely different to that, but we took the opportunity now, very strong nat cat results, risk adjustment release to strengthen the balance sheet that I mentioned in my opening remarks.

The next question comes from Iain Pearce, BNP Paribas.

They're all on new business CSM. So when I look at the new business CSM for the non-Life divisions, if I just look at Q3 stand-alone, they're down by 30% to 35%. I'm just wondering if you could run through why there's been such a big move? I know it's not a massive quarter for P&C Re, but for CorSo, it seemingly is quite a big quarter on new business CSM. So why are they down so much in Q3 standalone?

And same for the Life business, where clearly, ex-MedEx, it still looked like the new business CSM would be down quite a lot. So just trying to understand that as well. Any comments would be really useful.

Just quickly before Anders answers this MedEx that was mentioned here, not Life & Health, that's actually the CorSo MedEx business in Ireland where the minus $400 million was stated.

Yes. So I think CorSo is clear. I think Andreas mentioned it. It's really the MedEx business. On the Life & Health, you -- I mean, it can be a bit lumpy here because Life & Health, obviously, it also depends on the transactions. We didn't have transaction in Q3. So year-over-year, we were slightly down.

Actually, compared to Q2, we're up. So I think overall, I think I'm actually pretty pleased with the Life & Health CSM despite having not had transactions. Obviously, when you have transactions, you have additional CSM. And then on the P&C side, I would say it's mainly driven by the property prices that are coming down that we see. I think other than that, we're pretty comfortable with the new business that's coming through.

Yes. And let me make a general statement again on this top line growth aspect versus profitability bottom line view, and the reason why we don't put out growth targets because and I repeat myself again, in our industry, there's no problem to grow. If you want to grow, you can grow.

And we learned our lessons, by the way, ourselves also in Swiss Re. The importance here to manage volatility and to manage cycles. And this is critical. Our customers, the [indiscernible], but also the corporates and the public entities, they rely on us being resilient even in stressful market cycles and market environments. And that's why we put the emphasis really on the healthy portfolio and also on growing the bottom line, which is that forces us also to find attractive growth pools where we can then go after. So that's the general statement I wanted to make.

The next question comes from James Shuck from Citi.

I'm probably going to go over a couple of areas again, if you don't mind. So on Life & Health Re, I think on the call last time, Anders, I was kind of asking you about the outlook for the experience, variances and loss components, which have been negative previously. And obviously, we've got the same thing coming through just now.

You previously indicated you expect those to trend to zero. I presume that the actions you're taking today means that, that trend should actually accelerate. So really kind of just getting an insight into that kind of glide path to getting to zero. So should we expect 2026 to be a clean slate in terms of the experience, variance?

And I kind of think linked to that, it's kind of the CSM amortization rate is much higher than the 8%, and I think when I asked previously, you suggested that it would come down. It wasn't clear to me why it would come down. And obviously, you've guided 8%, it's running around 10%. So just keen to get an outlook for the amortization, please.

And then secondly, it was also actually on the P&C new business CSM, which is obviously down very sharply in the third quarter, as Iain highlighted. I understand what you're saying about not having top line targets. And -- but on the other hand, margins are very good and should be able to deploy capital incrementally. So if I look at your target capital over time in recent years, you haven't actually managed to deploy any incremental capital over the last kind of 2 or 3 years, and I'm kind of wanting to get an insight, particularly on that P&C Re new business CSM, in terms of the outlook there? And I appreciate you might return to this at the Management Dialogues Day, but I think it's an important point to try and get this feel for, are you still able to grow your earnings through a soft cycle?

Yes, sure. So maybe, James, I'll start on the Life & Health side. I think you're absolutely right. I mean the whole objective of what we're doing here is to reduce the experience variance, and it should come to zero. I mean you will always see normal volatility. That's clear over the quarters, but the volatility for the full year should be close to zero, if not actually positive. That's where we're going to go in the long run. So that's why we took these actions.

The other reason also, I think when we looked at this portfolio, all assumption changes here went through the -- because it's onerous business. It's even more important that you take these actions upfront because you don't want to have that noise in the P&L. I think that's really the driver.

On the CSM release and the CSM amortization, I think we mentioned a couple of times now that we're running higher than the guidance we gave you. I think this is something that we will address at the Management Dialogue. We give you full guidance where we're going to expect that coming forward because we need to make sure that the guidance is what we see, and we saw a higher release than what we guided you to.

On the P&C new business CSM, that's down year-to-date. I mean maybe another -- just -- I think you mentioned this before, your colleague mentioned before, we obviously talked now about the smaller portion that was renewed in Q3. That -- because until Q2, the CSM was actually in line with the previous year. Now you see it coming down from a small portion that got renewed, mentioned, of course, it was driven by the prices, also driven by the casualty pruning that we still continue -- that we say continue on a relative basis. I think Casualty overall, I think we're fine now with the market positioning.

I mean, look, the outlook, I think we will see. We're very comfortable with the margins that we're writing. Andreas mentioned that before. We're still in a good position, but we manage to margin, and we just don't manage to volumes. And actually, in our view, that's why CSM is a good measure. That's why we're also explaining it to you that way because it talks about value. It doesn't talk about volume, it talks about value. But obviously, it reflects, if you have business mix changes in the business where you basically move to the more profitable ones, and that's exactly what we did. I don't know, Andreas?

Yes. And I mean I can maybe just report out quickly from the discussions I have on the renewal side. We're just in the midst of the negotiations. So I don't have any indication to panic. We're still in very healthy territory, and I'm very careful to say, to guide you here because we're in the midst of the discussions. But you can already sense that I'm not pessimistic here about the outcome of the renewal. It's very constructive. And in cases, even, I would say, for me, quite optimistic. So let's see. The teams are working hard.

The next question comes from Vinit Malhotra, Mediobanca.

I mean some of these topics have been addressed. So I will just have maybe one theoretical question really. The fact that we've had 2 good quarters on tax means obviously, the targets are achievable easier, a bit easier. So I would say, was that one of the reasons why this Life & Health review was initiated? Or actually you were -- you would have initiated that even if 2Q and 3Q were normal cat quarters? Because in that instance, it might have been that the targets would have been a bit more difficult to reach. So I'm just curious about that.

And also one question, if I can ask on Corporate Solutions, where the price cuts is a bit worse, minus 7% on just a quick check of 3Q. Could you comment on how the inflation or business mix or something else is changing to get good numbers on CorSo? Which obviously are helped by cat, but I understand even the underlying is good. So could you explain a little bit about the margin management at CorSo with minus 7% pricing?

Just maybe quickly on the first one. Yes, of course, I mean, we are doing quite well at group level. And that helped us to take the decision on the Life & Health actions, and this is very clear. And by the way, we're consistent with all the meetings that we had before the call, in the last quarters or months where we continuously were telling that resilience of the group is really one of our two priorities. And should we be in a position to do that and still make our group target, why wouldn't we do this?

So I'll bring this what you call theoretical question to a very concrete action now. On CorSo, I think CorSo, like all other companies in that sector have produced very good numbers. They're in a very healthy margin space. If you see slight reductions on rates, that's the same as in reinsurance, we're still very, very healthy in the longterm pricing adequacy as we call it. So I'm not nervous about this.

Now the -- what's the focus of CorSo? CorSo doesn't want to play in this very commoditized space where the pricing pressure is really increasing due to increased competition. CorSo wants to play their advantages in the differentiation, international programs and alternative risk transfer. And I think this is a sweet spot because some of the very large corporates take premium out of the market, and manage it via their captives. And there, they need support through alternative risk transfer tools and solutions. The same actually also you can see also in the reinsurance market. The very large players think of taking business, reinsurance premium out of the market and try to find structured solutions, maybe some access to alternative capital solutions, et cetera.

And again, here, we are best positioned to give not only advice but also solutions and those also generate revenues. So overall, for us, not a situation to be nervous in, but we're observing, obviously, and we're growing in areas predominantly where they're not correlated with the lines of business that have a stronger decline in rates.

The next question comes from Will Hardcastle from UBS.

The first one is just coming back to something we discussed a bit, but just trying to verify that $250 million of our outsized comment a bit relative to that. Are you saying there's not much chance that it could escalate further from this $250 million already done or another $250 million? And just to be clear on it, have you moved up on an actuarial margin basis? Or this is still best estimate still?

Coming back to the $1.5 billion higher revenue 2H on 1H. FX hasn't really changed too much, and I guess you knew the parameter deviation already. Of the reduced number that you're thinking about now, how much of that's been a bigger NDIC impact and therefore, maybe a combined ratio offset? Or is it purely organic growth driven?

Okay. So just to confirm on what we said -- what we meant is that for Q4 because we continue to clean up the Life & Health, the smaller Life & Health portfolios. You should not expect an impact that is bigger than the impact we saw in Q3.

So to your question, to be very precise, this would be on top of the $250 million that we see. It's not more than $250 million in Q4, that's in a way, what I would expect. Now we haven't done it. We're not fully done. So we're going to give you the final update at the Management Dialogue. That's where you should then see much more details, but that's kind of the direction of travel that we're telling you as a floor.

On the revenue side, yes, I think once we have the final run rate now, I think we're fully on this new -- with the full adoption of the NDIC methodology that we introduced last year. So you should then see based on that, a smaller revenue just for the same business on a relative basis, which has marginal impact on combined ratio. That's absolutely correct.

The next question comes from Ben Cohen from RBC.

I had two questions, please. Firstly, on the Life & Health side, could you talk a bit more about the areas in where you did see new business CSM growth? I think you flagged U.S. Mortality and Health and Longevity in EMEA. And specifically, I guess, the reasons why you feel confident to kind of grow those business lines, perhaps particularly with regards to Longevity?

And my second question was in CorSo and P&C, I think on a 9-month view, the expense ratios rose reasonably materially year-over-year. Were there some one-off features in there? Do you need to do more to address costs because of the top line pressures that you're seeing?

Okay. So maybe I start on the Life & Health side with the new business CSM growth areas. I think you will continue to see new business CSM growth on Mortality, the classical mortality that we write, that's still a big driver. We have a lot of contracts there and there's new business coming in there, which is good.

Longevity is, I would say, a new area that for us became quite important, and we saw some traction there during the year. It's something that will develop. I would love to be more in the U.S. on the Longevity side. I think the problem there is just I think people need to start to realize that they actually have an issue because the local RBC framework in the U.S. doesn't really reflect that and you don't have a longevity chart.

But I think the discussion we already have with clients is that this is a topic that will come over the next few years. And then still Asia is a growth driver where we will see CSM growth and particularly also on the Health side, after we have fixed all of the issues on the in-force.

So maybe on your expense ratio, the increase of expense ratio is not business driven, and the reason why in Q3, we've got 3% year-on-year increase, that's mainly due to restructuring costs. We have restructured parts of the businesses.

For instance, in CorSo, we have decided to exit the Aviation business and concentrate the underwriting on the Reinsurance side. So there were costs attached to that, the restructuring costs. Then we have a slight increase in volume-driven commissions. That's due to shift of some of the businesses, in particular, when you go into businesses that are more volume or facility-driven, those have -- and also specialty lines, those have elevated commission levels and then also slightly the lower insurance revenue. I think that I would look at it.

Now we don't look at a quarterly basis for the expense management side because overall, we see a very positive trajectory by reducing actually the expenses because the actions that we took now are coming through and we see it in earning [indiscernible] and also. So I actually applaud then CorSo to address these things in a situation where CorSo was really performing very, very well. So that's the moment when we need to address those things.

So you will expect the expense ratio going down. So remember, we put out the number bigger than $300 million cost savings target overall, and we are very, very well on track to achieve this. So even alone this year, we are exceeding the $100 million. So we're well on track to achieve this by 2027.

And we will provide details on that management...

Yes, absolutely.

There are no more questions from the phone.

There seems to be maybe one more.

We actually lost him. So he probably decided not to ask the question anymore.

Thank you very much for all the questions and your interest. Should there be any questions outstanding, as always, please do not hesitate to contact the IR team. With that, thank you for attending the call, and have a good weekend.

Thank you.

Thank you all for your participation. You may now disconnect.