Munich Re's 'positive outlook' for 2002

MUNICH - Munich Re, one of the world's largest reinsurers, said that its outlook for 2002 was extremely positive as prices rose sharply. In 2001, it would still record a profit, despite a Euro2.1bn net hit (Euro3.2bn gross) from the World Trade Center disaster, chief executive Dr Hans-J�rgen Schinzler said. The profit would be down sharply, but the company still planned to pay an unchanged Euro1.25 dividend. The company also said that it had developed its own scheme for insuring terrorism-related risks, which included a cancellation period of two weeks for reinsurance cover and one week for the underlying primary cover. But it reiterated the call for a government-backed terrorism pool. Dr Schinzler said that Munich Re was certain to benefit from the flight to quality. There would be a major consolidation process in the industry. Dr Schinzler did not rule out acquisitions in both the primary and the reinsurance sectors. Munich Re saw premium income of Euro25.8bn in the first three quarters from both primary and reinsurance, a rise of 14.7%.