Owed to several waves of global natural disasters and exposure to sovereign debt of countries who have been bailed out or are near that point, the major European insurance companies have been able to show significant earnings in the last six months. The European multinationals posted joint profits of 10.172 billion euros, which compared to the same period last year reflects a 42.8% gain.
The evolution of these figures -which do not account for several European insurance titans such as Generali, Gropuama or Helvetia, among others- occurred during a difficult time for the sector. During the past year it was afflicted by global catastrophes (something that impacted the re-insurance agencies as well) and exposure to sovereign debt, particularly countries such as Greece, Ireland, Portugal and Spain.
The last point forced the major companies to remit significant provisions. Still, the majority of them were forced to keep positions open based on the argument that they are secure, according to recent explanations by the global president of Axa, Henri de Castries. That said, not all companies have posted earnings for the past two quarters, so this figure does not include them.
In Spain, Mapfre expects to have exposure to 100 million euros in sovereign debt, posting weaker profits than other financial companies on the Ibex 35 such as Santander and BBVA.
But also worth noting is the huge sovereign debt bet placed by the German insurer Allianz, who is holding a position of 4.9 billion euros. That said, Spain did not weigh down Allianz with 28% of sovereign debt last semester.
