(Keystone-ATS) The Zurich-based reinsurer Swiss Re has opted for continuity at the top. Andreas Berger, already a member of the executive board, was promoted to CEO on July 1.
He succeeds Christian Mumenthaler, who spent eight years as CEO and 25 years in the company. Mr. Berger, who is German, currently heads Corporate Solutions (CorSo), Swiss Re’s smallest division dedicated to businesses, and the search for his successor has already begun, according to a statement released on Wednesday.
In January, the executive emphasized that as the world becomes “more interconnected, more complicated, and in some respects more perilous,” the reinsurer and its clients could better “visualize and plan for more contingencies” by harnessing “the power of data and systems”. Mr. Berger highlighted that digital technology makes operations “more efficient,” with Swiss Re estimating that digitizing claims management could reduce claims settlement expenses by up to 25% and overhead costs by 20%.
At 57 years old, the future CEO joined Swiss Re in 2019 as a member of the executive board, following stints at Boston Consulting Group and German insurer Allianz, among others.
For Jacques de Vaucleroy, chairman of the Swiss Re board, “Andreas Berger is the right person to leverage the company’s current momentum and lead Swiss Re into its new phase of development,” citing his “convincing” track record of five years at the helm of CorSo.
At the same time, the supervisory body “wishes the best” to Christian Mumenthaler, who led the reinsurer through a period marked by a high level of natural disasters, an unprecedented low interest rate environment, and the Covid-19 pandemic. During his eight years at the helm, earned premiums and commission income increased from $30 billion in 2015 to $45 billion in 2023, while the group’s capitalization strengthened.
Profit surge in 2023
Andreas Berger will take over the reins of the world’s second largest reinsurer, behind Munich Re, which saw its net profit soar to $3.21 billion in 2023, up from $472 million in 2022. Corporate Solutions continued its growth, with net profit rising to $678 million, despite stagnant net premiums earned. However, Corporate Solutions’ combined ratio, the ratio of premiums earned to claims paid, fell to 91.7% from 93.1% in 2022.
Last year, Swiss Re saw the departure of Sergio Ermotti, who took over as chairman of the board in April 2021, before moving to UBS following the acquisition of Credit Suisse. Belgian Jacques de Vaucleroy, a board member since 2017, took over at Swiss Re. He will stand for re-election at the general assembly on April 12.
According to Vontobel, this change in leadership is not a big surprise, given that Swiss Re’s profitability has been lower than that of its peers in recent years, except in 2023. Andreas Berger has an impressive track record at CorSo, according to the analyst, for whom the key will be “execution.” The stock is recommended for purchase.
Conversely, Georg Marti and Michael Klien of the Zurich Cantonal Bank (ZKB) are surprised by the news, although it is probably time to refresh the company’s leadership to “write a new chapter.” They also commend Andreas Berger’s work at the helm of Corporate Solutions. Having been a board member for five years, he knows Swiss Re “very well.”
Investors seem less keen on change. At around 10:40 a.m., the reinsurer’s stock was down 2.1% at 112.95 Swiss francs, the worst performer in the Swiss Market Index (SMI), which was up 0.1%.
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