Gjensidige Forsikring (GJF) Q2 2024 earnings summary

Executive summary

• Q2 2024 profit before tax reached NOK 1,830.5 million, up from NOK 1,333.9 million year-over-year, driven by 9.7% insurance revenue growth but offset by high claims in Norway, especially in motor and property lines.

• Insurance service result was NOK 1,434 million, including a NOK 402 million positive impact from a change in risk adjustment under IFRS 17.

• Profitability was challenged by increased claims frequency and inflation in Norway, particularly for property (fires) and motor, prompting significant pricing and deductible measures.

• Strong organic growth and high customer retention continued in Denmark, Sweden, and the Baltics, with improved profitability and new agency partnerships.

• The group maintains a solid capital position and high solvency ratio, supporting ongoing dividend payouts and growth initiatives.

Financial highlights

• Insurance revenue grew 9.7% year-over-year to NOK 9,832 million in Q2 2024, with strong growth in Norway and Denmark.

• Pre-tax profit increased to NOK 1,830 million from NOK 1,334 million in Q2 2023, aided by a NOK 402 million positive risk adjustment.

• Investment returns totaled NOK 540 million; return on equity annualized at 20.2%.

• Combined ratio for Q2 was 85.4% (83.2% last year); cost ratio improved to 13.2% (13.6%).

• Solvency ratio stood at 170% at quarter-end, down from Q1, mainly due to higher underwriting risk and dividend payment.

Outlook and guidance

• Combined ratio target for 2024 (<84%) is challenged by high claims in H1, but all financial targets for 2025 and 2026 are maintained.

• Ongoing pricing and cost control measures, including price increases up to 17.5% for motor and 15.5% for property, are expected to gradually improve profitability.

• Claims inflation expected to remain in the 5%-7% range for property and around 7% for motor in Norway for the next 12-18 months.