Karl Steinle: Good afternoon, everyone, and welcome to our earnings call on our Financial Results for the Full Year 2024. Today's speakers will be our CEO, Jean-Jacques Henchoz and Clemens Jungsthöfel, our CFO. For the Q&A, we will be joined by Claude Chèvre and Sven Althoff. And with that, and for the last time as CEO at Hannover Re, I hand over to you, Jean-Jacques, to summarize the business development of another successful year of our company. Jean-

Jacques Henchoz: Thank you very much, Karl, and good afternoon on my side.

I'm very satisfied with Hannover Re's performance in the 2024 financial year with the Group net income slightly above EUR2.3 billion. We have delivered on the increased target of around EUR2.3 billion compared to the initial target of around EUR2.1 billion. The outperformance is driven by favorable investment income as well as a higher-than-expected reinsurance service result in both business groups. In other words, the operating performance was strong across all areas. Based on this positive development and very healthy capitalization, we will propose an increase in the ordinary dividend to EUR7 per share, complemented by a special dividend of EUR2.

This brings the total dividend to EUR9, an increase of 25% compared to the previous year. In P&C, we have successfully expanded our portfolio in an attractive market environment, resulting in a currency-adjusted growth rate in reinsurance revenue of 11%. The combined ratio of 86.6% sits very well within our target range below 89%, reflecting the very good underlying profitability of our P&C portfolio. Furthermore, the impact of large losses was about EUR200 million below budget, providing us with an opportunity to take a more cautious view on specific claims from older underwriting years, including the Russia-Ukraine loss complex and also to grow our resiliency in reserving, at least in line with the overall growth of our book of business. In life and health, reinsurance revenue was rather stable year-on-year.

Increasing volumes in morbidity and longevity were mainly offset by an accelerated runoff of our U.S. mortality business following the last recaptures connected to our in-force management actions in 2018. Looking at the new business generation of EUR624 million, we have been successful in seizing attractive business opportunities and a reduction, compared to the previous year, was mainly attributable to the extension of an individual large treaty in the prior year, but also reflects our selective underwriting approach in longevity and the impact of regulatory changes on the financial solutions business in China. The profitability of our life and health business is very satisfactory. Experience variance was overall positive within all reporting categories and mitigated the reserve strengthening for pockets of our morbidity book of business, mainly in China.

With the reinsurance service results of EUR883 million, we have exceeded our target of more than EUR850 million for the business. The return on investments of 3.2% was also very satisfying. The strong ordinary income is mainly driven by a combination of higher interest rates and a strong operating cash flow of EUR5.7 billion. Additionally, the moderate impact of impairments on real estate of EUR37 million compared favorably with our expectations. Change in ECL, as well as the change in fair value, recorded in the P&L had a minor impact on the results.

Cost efficiency, as you know, is another very important metric for Hannover Re. And with a Group cost ratio of 3.2%, we can confirm our continued success in maintaining our competitive edge in this respect. Altogether, the return on equity of 21.2% highlights the company's very strong earnings power and the solvency ratio of about 261% reflects our company's very healthy capitalization. Our strong capitalization is also the starting point for our dividend proposal for the 2024 financial year. It gives us the necessary flexibility to act on future growth opportunities in an attractive market environment, while at the same time, paying a growing dividend to shareholders.

The increased ordinary dividend of EUR7 per share reflects the favorable business development in 2024 and our strong confidence in future earnings growth as the EUR7 figure will be the new baseline for our targeted progressive growth in ordinary dividend. In combination with the proposed EUR2 special dividend, the total dividend of EUR9 results in a payout ratio of 47%, which is broadly in line with historical levels. The proportion of retained earnings expresses our confidence in growing our book of business profitably at double-digit return on equity also going forward. Shareholders' equity is up by 16.5%. The increase is driven primarily by the Group net income for the period, although the overall impact from interest rates and currency movements was also quite positive.

The CSM increased by about 6%, mainly reflecting the new business value generated by both business Groups. We're very pleased with this development as it clearly exceeds our strategic growth target of more than 2% for the CSM. The risk adjustment increased by 7.4%, mostly due to new business in P&C and assumption changes in life and health. Altogether, the growth in shareholders' equity, CSM and risk adjustment highlights an attractive value creation in 2024 and gives us a strong foundation for our earnings outlook. Our long-term ROE performance highlights the fact that we're continuously providing our shareholders with attractive double-digit returns above the cost of capital, no matter whether we look at the 5, 10 or 15 year average.

Our ROE performance also screens favorably compared to peers. As you know, we aspire to achieve not only a high ROE, but also a less volatile ROE. As you can see in the chart on the right hand side of the slide, comparing the 10 year ROE performance with the market, we continue to deliver on this ambition. And in the top left quadrant, Hannover Re is well placed with clearly above-average ROE and below-average volatility. On that note, I'll give the floor to Clemens for some more details on the financials.

Clemens Jungsthöfel: Thank you, Jean-Jacques and good afternoon, everyone. Starting with the development in P&C reinsurance, we have successfully expanded our portfolio, resulting in an increase in reinsurance revenue of 11%, adjusted for currency effects. The increase in net revenue was even slightly more pronounced as our ILS business came in very strong and the volume of our retrocession program has been reduced. As the reinsurance market environment continues to be favorable in most regions and lines of business, the growth has been well diversified. In APAC, the favorable underlying growth was mitigated by our portfolio pruning in 2023.

The impact of large losses was EUR1.63 billion for the full year. The largest event in 2024, and in the fourth quarter, was Hurricane Milton with a net impact of EUR230 million for Hannover Re. Apart from this, the large loss experience in Q4 was benign. Altogether, net large losses were around EUR200 million below our full year budget, providing us with the opportunity, as Jean-Jacques said, to take a more cautious view on specific claims from older underwriting years, including the Russia-Ukraine loss complex. Furthermore, the strong underlying profitability provided the flexibility to grow our resiliency level.

In relation to the total reserves, which have grown in 2024 of course, we expect the resiliency to be at least stable. The analysis of Willis Towers Watson is not fully concluded yet, but is expected to confirm our internal view. The actual outcome of the third-party assessment will be disclosed as usual in May. Overall, our reserve resiliency, and I want to stress this, should be measured including the risk adjustment. And the risk adjustment has increased now by another EUR143 million to around EUR1 billion at yearend 2024.

Last not least, the combined ratio includes a discount effect of around 7.5%. This is still higher than the interest accretion in the reinsurance finance results, but our prudent initial reserving should offset, as in previous year, that difference. The increase in the discount effect in the fourth quarter can be explained by the increase in reserve resiliency at yearend, which largely happened in long tail lines and by some true-up effects in the yearend calculations versus prior quarters. Altogether, the combined ratio of 86.6% is slightly better than our target, and reflects the very healthy underlying profitability and our continued prudent reserving approach for both new business and older underwriting years. The strong investment result in P&C primarily stems from the improved ordinary income.

The increase is mainly driven by higher interest rates supported by higher volumes from a strong operating cash flow. The amortization of our inflation-linked bonds added EUR149 million. Impairments on real estate, I spoke about this in Q3, they are at EUR37 million now, so moderate also compared to our initially planned number for the year. The currency result as part of the other result was mainly impacted by the strengthening of the U.S. dollar in fourth quarter and amounted to minus EUR143 million.

So this is really a swing by almost EUR250 million compared to the previous year. Altogether, the EBIT more than doubled to EUR2.4 billion. On the next slide, the main contributors to the P&C service result that's clearly the CSM release, reflecting the 2023 and 2024 renewals in a very attractive market environment. The rather high release in the second half of the CSM includes some catch-up effects due to a more prudent release in previous quarters. Importantly, I really want to note that this does not have any impact on the overall level of profits because the higher CSM release is offset by a quite conservative reserving approach for the current year.

Hence, a negative experience variance, as you can see here. Apart from this, the negative experience variance also includes the offset of the tailwind from higher discounting versus IFIE. As mentioned earlier, in our P&C runoff result reflects a positive development in most lines of business, but also some individual negative developments, including large losses like the Italy hail events from 2023, and also provisions for the Russia-Ukraine loss complex. Furthermore, the increase in resiliency is having an impact on the runoff result, and particularly in the fourth quarter, which would be higher without this balance sheet strengthening. The loss component from new business, as you can see, is quite low, confirming the attractive rate environment in P&C reinsurance.

The moderate decrease in the CSM in 2024 is connected to the previously mentioned catch-up effect. On a normalized basis, the CSM would have increased in 2024. So let's move on to life and health. Reinsurance revenue remained rather stable as expected. Underlying growth in morbidity and longevity has largely been offset by the runoff of our U.S.

mortality book, which accelerated following the recaptures connected to our in-force management actions in 2018. The reinsurance service result fully in line with our expectation with favorable contributions from mortality, longevity and financial solutions. In morbidity, the result has mainly been impacted by further strengthening of the reserves for critical illness business in China. Furthermore, a client insolvency in the third quarter resulted in a negative one-off impact of EUR37 million connected to a financing treaty with this client. The investment result mainly reflects the good ordinary income.

As mentioned earlier, the change in fair value of financial instruments had a positive impact of EUR57 million, partly offset by a negative EUR36 million impact from the valuation of an at equity participation. Both effects should be seen as nonrecurring. Altogether, our life and health Business Group reported EBIT of EUR934 million, an increase of 7%. Looking at the drivers for the reinsurance result, both the CSM release and the risk adjustment release are within the expected range. The experience variances of plus EUR204 million is driven by favorable claims experience across different lines of business and also by in-force management actions for our critical illness business in China.

This partly mitigates the negative impact from the loss component of EUR439 million. The new business loss component was a minor EUR6 million. The main driver for the change in loss component was the reserve strengthening in morbidity and the aforementioned client insolvency affecting the financing treaty. Altogether, the reinsurance service result, as Jean-Jacques mentioned, sits comfortably within the target range above EUR850 million. The new business CSM and extensions on existing contracts together amounted to EUR624 million based on diversified contributions from financial solutions, mortality and morbidity.

Changes in estimates had a positive impact of EUR415 million. The main driver here for the positive changes in estimates -- in estimations was our UK longevity business and to a smaller extent, recaptures in U.S. mortality. Adding positive currency effects and the interest accretion, the total CSM increased by almost 10% after recognizing the regular CSM release. Altogether, I would like to point out that from an economic perspective, assumption changes were rather neutral for Hannover Re.

This is because changes in estimates within the CSM offset changes in estimates resulting in a loss component affecting the P&L for the current period. You know this, the imperative [ph] principle embedded in the standard here. This highlights the benefit of having a diversified portfolio in life and health. On the next slide, the development of our investments. I think it's fair to say it was again very satisfactory.

Ordinary investment income is strong. Several factors played a role here. The asset volume increased based on a strong operating cash flow. In addition, the reinvestment yields are still nicely above our average portfolio yield with a continued positive impact on our returns from fixed income securities. The contribution from inflation-linked bonds was at EUR149 million.

And finally, the contribution from alternative investments, so our real estate, private equity infrastructure investments, increased as well. The impact from ECL and the overall valuation at fair value through P&L had only a minor impact. For our real estate investments, we recorded moderate impairments of EUR37 million, driven by decreasing valuations for some objects. You may remember that we had taken a cautionary view, as mentioned earlier already in the third quarter. So based on the yearend information, the actual impairments were actually slightly lower and overall lower than expected in our guidance.

So all-in-all, the return on investment of 3.2% is well above our 2.8% target. So to conclude my remarks, the result for the financial year 2024 reflects a very healthy underlying profitability. 2024 also marks the first year of our current strategy cycle and all targets according to our strategic financial ambitions have been met. Top and bottom line are growing nicely, providing a strong basis for the coming years. And on that note, I'll hand back to you, Jean-Jacques, for the comments on the outlook.

Jean-

Jacques Henchoz: Thank you very much, Clemens. I can be relatively brief on the outlook because I already commented on it about a month ago when Sven and I were presenting the successful outcome of our January renewals. The positive development fully supports our planning for 2025 financial year. Hence, I can confirm our guidance again today without any changes. For the Group net income, we aim to deliver around EUR2.4 billion.

We have already provided our initial view on the L.A. wildfires last time, and they are not triggering any review of our targets for the full year. So I can also confirm this today. Hannover Re is well positioned for 2025 and beyond. 2024 was another successful year for the company, and our balance sheet strength has further improved from an already high level.

The market environment remains supportive and our earnings continue to grow. So, against this backdrop, I feel very comfortable handing over to Clemens in April. And I have no doubt that he, together with the Executive Board, will lead the company to further success and sustainable value creation for our shareholders. This concludes my remarks, and we would be happy to answer your questions. Thank you very much.

Operator: Ladies and gentlemen, we will now begin the question-and-answer session [Operator Instructions]. And we have the first question coming from the line of Michael Huttner from Berenberg. Please go ahead.

Michael Huttner: Well, another good results and thank you so much for another set of amazing results. I only had two questions.

One is kind of nosy and the other one is, I don't quite understand. The nosy one is you're one of the few reinsurers which actually participate directly, I think, on a quota share basis in German Motor. So I just wondered if you can provide the latest in terms of pricing and outlook there? Particularly, I think you're the main reinsurer, the market leader. And the second is on pricing from memory, and my memory always fails me, so apologies if I get it wrong. Renewal pricing was down 2.7%.

The wildfires are -- give or take, I mean, if they're in the middle of the target range, around a third of your full year budget, and you're still guiding to profits being up. I know there's a lot of conservatism built in the 2024 results. So if you strip that out, of course, you would have some buffers. But maybe you can explain why you remain so confident despite these two negatives? Thank you.

Karl Steinle: Michael, could you repeat the first question because we did not -- just audible was bad.

Michael Huttner: Oh, I see. It's me. Sorry, sorry. I was muttering. So really, simply, German Motor, you're the one reinsurer who underwrites German Motor.

I just wonder if you can provide an update on how much uplift you will get if -- and how much the rate rise were and how much uplift it means for you? Thank you.

Karl Steinle: Very good, thank you. Jean-

Jacques Henchoz: Definitely. On the German Motor side, both insurers, but also reinsurers for the loss business have further increased the rates coming from '24. You know that the performance of the business had challenges with the levels of inflation that we could observe in the market, particularly on the physical damage side of things.

So with the additional rate increases that could now be achieved during the 2025 renewals, we fully expect that the business is back into profitable territory and meeting our hurdle rates for this line of business. When it comes to the questions on guidance, I mean it's early in the year. We have clearly exceeded the budget for the first quarter of 2025, which is EUR435 million. On the other hand, the range we gave on the California wildfires and -- the range is still valid. I mean there's still a long way to go to utilize our full year budget, which is EUR2.1 billion.

So from that point of view, we just feel it's too early in the year to make a full review of our assumptions as there is still quite a bit of budget ahead. And then as we explained also in the past, we, of course, are also looking at this from a balance sheet strength point of view that if required, we would try to get to the guided numbers, if that makes sense, at the time, also drawing, for example, from risk adjustment or resiliency.

Michael Huttner: Very good. Thank you.

Operator: The next question coming from the line of Kamran Hossain from JPMorgan.

Please go ahead.

Kamran Hossain: Hi, good afternoon. Two for me. And I guess just before I ask them, Jean-Jacques, I know we kind of mentioned a while ago, but just wishing you all the best in the next chapter from everyone at JP. We've really enjoyed our interactions with you kind of going back to when you kind of took over back in 2019.

So thanks so much. Based on what we can see, you're definitely leaving the business in good health and excellent hands. So thank you and looking forward to the next chapter for both you and for Hannover Re. The first question that I have is just on the reserve resilience. Just really interested in kind of where you see the resilience overall thinking about -- including the risk adjustment relative to historical levels and how you expect it to develop from this point forward? Just thinking this through in my head, there should be some growth every year.

You're booking the current year really prudently, just looking at your comments on the experience variance in P&C. So kind of how do you expect that to develop from this point forward? And should that grow from here on? And at any point, if I look back over history, 2015, '16, you kind of pointed to like a topping out on reserves and probably had shown a bit more of the profit. So interested in kind of where you think that's going? The second question is just around, there's been a bit of press discussion about Viridium. I'm sure you don't want to comment on it specifically. But if there was a theoretical exit of something that you owned, what do you think you do with proceeds, return or reinvest? Or how would you think about that? Thank you.

Clemens Jungsthöfel: Kamran, it's Clemens I'll take it -- I'll start with the reserve question, and it's perfectly right. I think in contrast to the previous accounting regime, we now have on top of it risk adjustment. And clearly, not only we, but also most of the rating agencies, and I can confirm that for some of them is that they see the risk adjustment really as the future profits, so as part of the hard capital, which I think is a proof point for the robustness of the risk adjustment on top of what we've -- in the [indiscernible]. So if we just look at 2023 numbers, just as a reminder for the benefit of everyone that we were at the resiliency level with Towers Watson of roughly EUR2.1 billion. If you add the risk adjustment at yearend 2023 to it, that would bring you to an absolute level of around EUR3 billion.

That compares to a nominal reserve level end of 2023, of roughly EUR42 billion. I would guess that would bring you to a number slightly above 7% of relative reserve resiliency level. And if you compare it to the resiliency that we have carried clearly with a much smaller book years [ph] ago, where we probably were at a peak level of 8%. This is, on the one hand, a very strong really strong resiliency level in our reserves. That's for sure.

At the same time, we still believe that there is still room for growing that both nominally, but also in relative terms. We do feel very comfortable with the actual reserve level. Again, the risk adjustment have now increased to EUR1 billion. And you would expect the nominal level of our resiliency as per Willis Towers Watson, again disclosed in May, also in absolute terms, of course, to have increased at least in line with our book. And as you've seen and also heard from my comments, we do believe that we have also clearly prudency in the most current underwriting years that haven't found their way into our resiliency, both our internal estimates as well as for Willis Towers Watson.

So we do believe that those numbers will materialize over time. As always, Kamran, we will always have a look at yearend at this. But again, the relative level should be at least be stable. And then as Sven mentioned, if there is a given year, as we've also shown in the past, we are willing, but also able to utilize some of that reserve resiliency to meet our long-term targets. On Viridium, yes, there is no doubt about it.

There's a sales process going on. The sales process is led by the major shareholder. And clearly, I can't comment on this, what we are going to do about our share. I do want to clarify, though, Kamran, that in any case, for our IFRS group financial statements, we have taken from a valuation standpoint, the fair value through OCI approach for this stake in Viridium. So in any case, this will not have any impact on our P&L, so on our IFRS group earnings.

This is just for clarification.

Kamran Hossain: Thank you.

Operator: The next question comes from the line of James Shuck from Citi. Please go ahead.

James Shuck: Thank you and good afternoon.

Jean-Jacques, same for me. Best of luck for the future. You still feel like the new CEO from my perspective. I don't know where the time has gone by so quickly, but thank you for your help. I had three questions, please.

So the first one, just looking at the increase in SCR from P&C underwriting risk that was up EUR0.8 billion year-on-year. That's quite a large increase. And I presume part of that is because you've taken on lower retro than in the past. But I'm kind of getting mixed signals from other parts of the business that the structured premium in '24 was up 58% and it's a big number. But the PMLs are up significantly, too.

I just look at the -- for example, the U.S. windstorm, I think the PML is up 30% year-on-year. So I'm just kind of keen to understand what drove that increase in SCR, where it's coming from? And really if you're able to provide any indication of the kind of expected profit from allocating that increase in SCR, that would be very helpful. I don't know whether you want to express that in relation to the new business CSM for '25 outlook or some other metric, but any insight there would be helpful. Secondly, on the discrete Q4 combined ratio in P&C Re, 82.5%.

Just struggling to understand this a little bit because you mentioned that there's kind of negative runoff result in Q4. We can see that through the experience variance. It looks like kind of over EUR200 million or so in Q4 discrete. You've added a little bit to the buffer perhaps. So where is that -- I don't know -- I mean, one quarter is obviously volatile.

But if I start kind of making adjustments to that 82.5%, I start to get a very low number indeed. So what's wrong with doing that sort of calculation? Where do you kind of view the normalized level of combined ratio in Q4, please? And then finally, just on the nominal -- sorry, the nominal runoff, reserve runoff, before risk adjustments. I'm looking at the claims triangles on a net basis. It's unusual, but there's EUR95 million adverse development across all years. You may have alluded to this in some of your opening comments, and obviously, it's not a big number in the context of EUR14 billion of reserves.

But you are seeing adverse development in 2018 than 2023. I presume that's connected to Russia and Italian hail. But if you could just clarify what's happening there, please? Thank you very much.

Clemens Jungsthöfel: James, good afternoon. It's Clemens.

So starting with the SCR. I don't have the numbers in front of me, but really just top of my head. So the increase in overall SCR in 2024 of roughly EUR1 billion stems in equal part from an increase in P&C underwriting risk, as you mentioned, but also there's a strong increase, I just want to mention it, also on the market risk side. the increase in P&C underwriting risk and just looking sort of at the technical numbers, and then I'll give some background and Sven can also step in. So increase in P&C underwriting risk is driven clearly by an increase in nat-cat capacity related also to our overall business growth and by an increase in reserve risk.

The latter will be driven by both business growth and loss development, of course. And just for the sake of completeness, the increase in market risk driven by higher volumes in real estate, private equity and also fixed income. The stronger U.S. dollar will also have contributed to the increase in these numbers and also in the P&C underwriting risk. And as the dominant risk categories, P&C and market growth further in comparison to life and health, I think the diversification benefit is slightly reduced compared to year-end 2023.

So that's really just from a technical sort of number-driven standpoint. I think the message here is clearly the underlying business growth on the property cat side has been strong. And well, this is both top line, so gross, as well as on the retro side, you know that we had already decreased our session rate in the year 2024, but also the substantial decrease in -- on the renewal 1/1/2025 will have had an impact here in the SCR because that is the plan, what we have baked into the plan also goes into the SCR calculation here. Sven, I don't know if you want to add anything probably on the growth on property cat side...

Sven Althoff: Yes, not too much.

I mean, I think you covered that well. We have used the hot market and the rating environment that was available since underwriting year 2023 to grow the incoming cat portfolio quicker than the general portfolio, which was also growing. And as you said, in combination with us adjusting our retro buying for the 1/1/25 renewal, which was baked into the planning for the SCR is the main driver here.

Clemens Jungsthöfel: Perfect. And on the combined ratio, just a couple of general comments.

Clearly, this is always at yearend. We overall look, of course, at the reserve position. And as mentioned earlier, we came in with the large loss budget around EUR200 million below the budget. This really, James, provided us with the opportunity to take a more cautious view on specific claims from older underwriting years, including Russia and Ukraine. Some of that happened -- that reserve strengthening, on Russia/Ukraine, it happened over the course of the year, yes, but also we took a bit more prudent view also in Q4.

And again, the growth in the resiliency level, clearly, some of that has taken place in Q4. Considering all this, clearly, the underlying combined ratio should not be too far from the published number for the whole year, maybe a bit better clearly for Q4. Again, given all these impacts, etc., that leads to the number. We should not forget that when we look at the overall combined ratio for the year that we've disclosed, we have continued to manage the tailwind from interest rates. So this delta between discounting and IFIE adds another 1.5-ish percentage points on the combined ratio.

A general statement, that we see historically that we have not changed our combined ratio target as dynamically probably as others over the course of the reinsurance cycle, and this continues to be our approach going forward. That being said, I do feel very comfortable with our lower than 80% combined ratio target, not only for 2025, but really also for the medium term and also in scenarios, as mentioned earlier, with decreasing interest rates and the lower discount effect. On the claims triangles, so again, on the runoff result, the P&C runoff results, again, as mentioned earlier, they do reflect a positive development in most lines of business. We have, in some individual cases had negative developments. You mentioned it, James, Italy hail is one driver.

Russia/Ukraine is a large driver. And then, as always, we will have done some reserve strengthening here and there also in some long tail lines and casualty lines, etc. And happy to share any further details really when we look at the reserve study in May. It's a bit too early really to look at certain lines of business, but we will disclose this then in May when we release the full study.

James Shuck: Okay, thank you very much.

Clemens Jungsthöfel: You're welcome.

Operator: The next question comes from the line of Shanti Kang from Bank of America. Please go ahead.

Shanti Kang: Hi, thanks for taking my question. So you highlighted additional reserve prudence across 2024 and your reinsurance service was still a pretty solid beat.

So just trying to understand the sentiment behind that, if the reserve actions reflect a shift in your risk perception or if they're more about proactive strengthening going into 2025? And then perhaps a follow-on from that is just how should we think about prior year development across 2025 and beyond given the reserve additions made today? Could we assume that there will be better PYD as a result? And then the last question is just on your affirmed net income guidance. What do you think are the biggest execution risks that could shift that either higher or lower as the year continues? Thank you.

Clemens Jungsthöfel: Shanti, I'll start probably with the runoff result. As mentioned earlier, it's driven by a couple of factors. Clearly, the runoff result usually is a positive, I would say, a mid-triple-digit positive number that we would expect.

I would say the movements here are really attributable to a couple of larger losses that we've seen. We mentioned Italy as one example. There are a few other examples where we have done some reserve strengthening. The biggest movement clearly here is the Ukraine-Russia loss complex, where we have added substantial reserves in 2024. That has found its way here into the runoff result.

Clearly, we do expect, again, normally a mid-triple-digit normalized runoff result also as we go into 2025, of course, subject to any further movement. And then anything else is really about reserve strengthening, which we will then fully disclose also going forward when we look at our reserve study. So this is really -- these are really the ingredients when we look at the runoff result and the resiliency result. On the net income question, I'm not sure if I really fully understood or fully caught the question. Would you mind reminding -- just reminding us of the second question?

Shanti Kang: Yes.

So I was just thinking, I know you guys guided to that, for example, on the basis that large losses would be within your budget. So I'm just curious to know what the execution risks are to that net income guidance either being higher or lower across the year?

Clemens Jungsthöfel: Yes. I mean, as Sven said, there's still the expectation is -- our guidance is always under the subject of that we don't have any material deviations from the budget. We have clearly increased this large loss budget to now EUR2.1 billion. So that reflects both our growth on the gross and net side.

This is a net large loss budget and there is clearly, as also Sven mentioned, which always comes into the equation, is our balance sheet strength, as mentioned earlier. So we are always willing and able to utilize some of the reserves. So at this time, therefore, Jean-Jacques clearly stated it, there's no reason for us at this time of the year to think about our guidance at all. So we are fully committed and think we will be able to meet all our targets.

Shanti Kang: Okay, thank you.

Operator: The next question comes from the line of Vinit Malhotra from Mediobanca. Please go ahead.

Vinit Malhotra: Good afternoon, Jean-Jacques and Clemens. And again, my wishes, Jean-Jacques, I still remember when you joined, we discussed reserves. And I think we should maybe start with that question again from my side.

So the first question is just again, just the -- and maybe more for Clemens maybe the reserve resilience. So the 7%, which is reserves plus RA, so resilience plus RA divided by reserves, that number, is it likely that it can go up? What do other stakeholders think about this? So I'm thinking of auditors or other taxmen, other people -- other stakeholders in this because it's obviously, just again a little bit more that when you say you added to Ukraine, is it because you saw -- you thought something about aviation or anything? Or is it just the opportunistic let's add because we had low large losses. So just a little more would help us understand your rationale. Second thing is just I noticed the real estate write down was much lower than you feared. And again, back to the topic of how are you looking at the private market world? Are there still some concerns about write-downs? Or you think situation is getting better on that front? Thank you.

Clemens Jungsthöfel: Yes, Vinit, on the resiliency level in general, I'll add and then Sven probably add to the specific Ukraine and Russia, probably also on aviation to comment on that, what was our thinking around those strengthening. And to be clear, that contract has not been part of the resiliency in the past and is also not part of our resiliency. So we are talking about mainly IBNR here when it comes to Ukraine, Russia. So on the resiliency level, look, I just wanted to -- that's why I always stress this that we see the resiliency of the P&C really as a conjunction of the Willis Towers Watson report, which technically is referring to our reserving compared to a view of Willis Towers Watson on our mainly liability for incurred claims. So for the part, and I always stress that we should also take the risk adjustment into the equation.

Which is more, I would say, a technical calculated number and very much reflects our business loss. So that's now EUR1 billion on the risk adjustment. We started with the Willis Towers Watson report last year, EUR2.1 billion, and that number will go up based on the initial discussions that we had with Willis Towers Watson. So if we think along the lines of, let's say, we end at the range of 7% to 7.5% of relative resiliency level, I think there's still room to grow that number in a given year, but we are not planning any extraordinary impacts here. So I'd say that is a resiliency level where we feel absolutely comfortable with in relative terms.

And again, if there is, in a given year, the earnings to provide for that, we would still be willing and able to increase that number even further again. On that level, we feel comfortable. On Russia-Ukraine, Sven, you might want to add, just give a bit more color on the overall thinking of our reserve strengthening over the course of the year as well as here [ph].

Sven Althoff: Yes, happy to do that. I mean the situation is largely unchanged.

When we look at this complex, we have the aviation and the non-aviation part. All the lines of business on the non-aviation side are behaving according to our original expectations. And we are certainly well within our original reserves when it comes to that side. On the aviation side, we still have the situation that we can only work on a loss scenario based assumption because we don't really have anything from our ceding companies on that side. On the other hand, we could see in the trade press and then, of course, also talking to our clients and checking where they are, that there was activity over the last couple of months when it came to commercial solutions between insurance companies and leasing companies.

And so in that situation and given that we had underutilized our loss budget for the year, we decided to increase the level of prudency in our scenario-based work we are doing on this claim. It's not driven by paid claims. It's not driven by reserves received through ceded accounts. I mean all of this is still well within our original reserve position from three years ago. But given that we sense that there is more going on, on the settlement side, we wanted to be in a position to be as prepared as possible to not have an impact on our 2025 earnings.

Clemens Jungsthöfel: So Vinit, you see this is more a prudent approach at yearend to address this specific loss complex. And overall, you mentioned how other stakeholders view our resiliency level. I think this is a volatile business as we've just seen in the first quarter, as we are seeing now. So we always argue we are still -- this is best estimate. We are just consistently at the upper range of possible best estimate, which suits our business model, particularly our Hannover Re model, how we look at the combined ratio over the cycle, as mentioned earlier very much.

On real estate or generally on our alternative investments, yes, I think we -- both 2023 and 2024, we had anticipated more volatility of our investment results due to the fact that particularly these funds, so real estate and private equities that are imbedded in funds are valued through the P&L. And we did expect fair values coming down. That has not really happened on the private equity side. And in those instances where it has, it has been mostly compensated by stronger returns. So the overall impact was clearly a reduced income, but not to the extent we had expected it.

Same is true for the real estate side. We would have expected a higher number. Having said this, on the direct real estate portfolio, we had EUR37 million of write-downs, as mentioned earlier, on the indirect side, it's probably another EUR35 million. So we landed at EUR70-ish million, but we would have actually expected more. So we have a cautious view when it comes to new investments.

So I wouldn't -- we're always a bit prudent when we clearly look at our investment income for the next year, but I would consider our guidance to be realistic. There's some room, but rather realistic. But overall, I think it's a robust guidance for 2024 also for investment income. So as for looking at this market, we don't plan to reduce our exposure, both in private equity and real estate. On the contrary, we selectively, on the direct real estate side, look at opportunities.

Here and there, on private equity, you should really expect a steady growth of our private equity exposure with our assets.

Vinit Malhotra: Okay, thank you very much.

Operator: The next question comes from the line of Will Hardcastle from UBS. Please go ahead.

Will Hardcastle: Thank you.

And just to echo everyone else's comments, thanks, Jean-Jacques. You'll very much be missed here. The first one is, I'm sure investors are pleased to see the 25% year-on-year uplift in dividend distribution. I guess, can you just give a bit more color on how you determine that level? Maybe I'm being greedy here, but it suggests -- I might suggest that a less than 50% payout ratio is lagging some other larger European reinsurers. You've got a really confident outlook.

You've got a high stock of solvency. I guess what would make you consider raising that distribution payout further in the future? And the second one is just linking to the reserve resilience. You linked it there with the liability reserve growth. I think there's been times where you've tried to get us to look away from that in the past and think about it in absolute terms. I guess why are we now coming back to thinking about it as a percentage of liability reserves? And you mentioned they're about 8% in the past.

Am I right in thinking that's probably going back to about 2018. And I think before that, it was higher than that. Should we think that, that 8% sort of level is the upper end? Thank you. Jean-

Jacques Henchoz: Will, I'll take up the dividend question, particularly because I've been tweaking arms with them and so over the past few months -- but in short, there is an element of judgment, of course, on -- particularly on the earnings outlook, on the growth opportunities, and that's the starting point for us. And there, we are of the view that we have a favorable outlook, particularly in P&C, even though there is a little bit more rivalry among the main incumbents, we still see some good pockets of growth, very well priced.

And this is really the starting point for the discussion. And then we wanted to give a hike on the overall dividend to send a signal of confidence. So we were around the 45%, 48%. We ended up with 47% payout, which we believe is a good indicator. It's very much aligned with the past.

And then the rest is really getting to round numbers, I suppose. But I think it reflects the fact that we want to show that growing trajectory. And as long as we feel there is attractive, well-priced opportunities for growth, then we'll take that option first.

Clemens Jungsthöfel: Yes, Will, to complete that, probably that arm twisting was for a reason I can tell you because as Jean-Jacques mentioned, we spent a lot of time, a lot of time, with the clients and brokers over the last couple of years as part of our transition. Jean-Jacques and myself, we saw a lot of clients across the globe and brokers, and we've received consistently the message of that there is plenty of opportunities for us to grow the business further.

And in all seriousness, I think that the capital is well placed to support that growth and really continue that path of producing double-digit ROEs and return it by that way to our shareholders. That's very much the philosophy, and that's really the reason why we haven't changed the payout ratio going forward. On the resiliency level, I try to recall sort of the comments in the context of our absolute reserve numbers. I think particularly in the years sort of '19, '20, '21, etc., I mean, we've grown our business quite substantially. And when you look at the reserves, of course, they were driven by that growth of our underlying business, but also with a couple of large losses when I look at the COVID claims in 2020, etc., on the P&C side.

So that has probably inflated the reserve level on a nominal basis a bit stronger than the resiliency embedded in that reserves would find their way into the Willis Towers Watson, because that's only happening with a time lag of, let's say, 2 to 3 years probably. So the underwriting years, the most recent underwriting years, haven't even found their way into the reserve study. And I would take the comments to be cautious on comparing the nominal resiliency levels with the nominal reserve levels in that context. And I think as we've probably a bit more normalized view now, I think the peak we probably had, when I recall it correctly, around 2015, I'd say, where we were around 8%. Which again, was on a completely different book, and it was 8.5%.

So on a completely different book. Clearly, when we are approaching 7.5%, we will see what the outcome of the study is. Again it's not a fully academic exercise, but this is clearly a level where we feel very confident.

Will Hardcastle: That's great. Thank you for that.

And just to confirm, I always thought it was just the most recent underwriting year that sort of didn't filter into that resilience number. It sounds like it's two or three. Is that right?

Clemens Jungsthöfel: Yes. It's probably -- I don't know the exact number, but it's not only one underwriting year. It's actually more than that in long tail lines, you would actually wait probably even two -- probably in some instances, actually three underwriting years to really put this up as a resiliency.

We wanted really loss clients to stabilize and to have a firm view on the…

Will Hardcastle: That's great. Thank you.

Operator: The next question comes from the line of Chris Hartwell from Autonomous. Please go ahead.

Chris Hartwell: Hey, good morning, sorry good afternoon, in fact.

It's been a long one. Just wanted to some extent, come back to Will's question on the payout ratio on the dividend. I mean I get that you want to sort of redeploy that and some of the other comments that you made. But how do I square that with the growth outlook that you have? I mean 7% wouldn't absorb a huge amount of additional capital for your sort of top line growth targets. So just trying to sort of again square the payout ratio with the growth ambition.

And then secondly, also, over the last couple of years, the CSM growth has been pretty rapid, surprisingly rapid, yet you still guide to, I believe, 2%. So again, I'm trying -- if you can help me understand why the forward CSM growth is that low versus what we've seen before? What are you expecting or what are you not expect to recur? Thank you.

Clemens Jungsthöfel: Yes, Chris, I'll start with the payout ratio. And really, I think when we think about growth or investing some of those retained earnings, we think about P&C, of course, and we really want to have room for maneuver and take any advantage of market opportunities, as Sven said, still an attractive market environment. We also think about life and health.

There is plenty of growth opportunities in life and health in the pipeline. So clearly, that's another element. Also, I mean, you know we've positioned our investment portfolio a bit more on the prudent side, to really to position ourselves for any market volatility. So there might be opportunities actually to, let's say, to invest some of that, call it, dry powder in the credit space or even in listed equity more on an opportunistic basis, so really to support the growth in our assets under management. Again, as mentioned, we've seen another year of very, very strong operating cash flow, and that will be invested.

So it's really just to give us room for maneuver. And then also on the hybrid side, there's an opportunity not to replace the hybrid that is due at midyear. So this is really part of the equation, and then we will revisit that position at yearend 2025, of course. So on the CSM growth, yes, well, Chris, so I'd say the CSM growth that we put out as a strategic target. We said, well, at least 2% per year over the strategic cycle.

That was our strategic ambition that we put out. And this is really just a message. I mean, you see that clearly our business on the P&C side is growing, but that overall CSM growth is very much fueled also by life and health. And it's clearly a commitment that over the strategic cycle, we want to grow our life and health business going forward. And that is a way of -- because as we always said, the revenue under IFRS 17 is a very useful KPI for capturing the growth in P&C, but still not for life and health.

And this is particularly true, I believe, for our portfolio where we have a very pronounced financial solutions business where mainly the margin is only captured in the revenue. So another good indicator for the growth of our business. So that was the rationale behind it when we put out the 2%. I think when we look at the -- both the new business, CSM over the most recent years, which has been very healthy, but that business is, as we all know, very transactional. I think the huge contributor to the CSM growth that we've seen over the recent period is that when we do assumption updates, we had rather seen that our reserving has been more on the prudent side in life and health, which we would have expected.

And overall, we see more positive assumption updates that are fueling the CSM than vice versa. Which is, I think, a good message in terms of how we view our assumptions. But I would say both on the CSM for new business, which is transactional, can be lumpy as well as the CSM that stems from assumption updates. I wouldn't expect that in any given year. And then we have seen a very strong development in 2023 and in 2024, we've been a bit more cautious on a given financial year guidance for 2025, and that's why we put out a bit more cautious guidance for 2025.

But we will see how it goes, again, particularly after a very strong CSM development in 2024. I hope that answers the question, Chris.

Operator: The next question comes from the line of Henry Heathfield from Morningstar. Please go ahead.

Henry Heathfield: Good morning -- good afternoon, sorry.

Thank you for taking my questions. I was just wondering if you could talk a little bit more about the top line growth in property and casualty within the Americas and the EMEA region, what in particular was driving that? And then in the life and health, could you just kind of remind me or confirm whether the U.S. mortality -- U.S. mortality portfolio that's been in runoff, is that now finished? That's sort of closed? And perhaps talk a little bit about whether there was any experience variance within U.S. mortality business in life and health.

Thank you.

Sven Althoff: Just starting with the top line growth on P&C, I mean, in 2024, we certainly still saw prices increase. Underlying volumes, i.e., the business with our ceding companies also increased because we were at the tail end of the inflationary environment. So underlying portfolios were increasing from a sum insured point of view, plus companies also decided both in the Americas and in EMEA to ask for more limits on their reinsurance structure. That was certainly still a feature in 2024.

So those were the main drivers for the EMEAs and Americas. If you look at the 11% for the entire business group, of course, we should not forget the particularly strong growth we had in our structured and ILS unit, where particularly on the structured side, we have seen strong demand, not only for the traditional surplus release kind of quota share structures, but also more excess of loss demand for string-rated business or multiyear multi-class business dealing with the traditional increased retention levels. So that was part of the growth story. And then on the ILS side, we had a very successful year in our catastrophe bond activities when it comes to transformation and the like. So those are the main ingredients of growth in our 2024 year.

Clemens Jungsthöfel: Yes. And many thanks for your question on life and health. Very happy that I got the question on life and health. So U.S. mortality, I can confirm that the issues that we had in the past are resolved.

And you were mentioning also the experience variances. And you see in our presentation that we had positive experience variances this year of EUR204 million, and they're mainly coming from all the lines of business, including, by the way, U.S. mortality. So we see experience variances, but positive experience variances on that side.

Henry Heathfield: Right, thank you very much.

Operator: We have a follow-up question coming from the line of Michael Huttner from Berenberg. Please go ahead.

Michael Huttner: I'm very lucky. So one is indeed a follow-up on the life because if I look at your guidance, EUR875 million and I take the EUR889 million figure and I add the EUR37 million kind of insolvency number, which presumably is not repeated. I get already to -- this is just 2024, to above, well above the EUR875 million.

So I just wondered if you can give us a little bit more on how you -- I know the question has been asked in terms of CSM, but maybe you can ask it in terms of this number as well. And the other question is also on growth, on P&C growth, of 7%. The 7% feels low given the way you're commenting about how you want to keep powder dry and stuff. Can you talk about -- a little bit about how much you would expect from the renewals still to come up relative to the 7.2%, I think you had, in January?

Clemens Jungsthöfel: Maybe your first question on the guidance of our reinsurance services, if I got it right, it was the RNR [ph], right? And your question was where it comes from compared to the reinsurance result of right now, correct?

Michael Huttner: Yes.

Clemens Jungsthöfel: Yes.

One thing is that you need to see is that we cannot plan -- we don't plan for positive experience variances. The experience variances that we're showing here in our plan are maybe zero. So if you place them out, then you end up with a lower figure automatically. So that's the reason why you cannot expect positive experience variances and then hence, a much more positive result from one year to the next.

Michael Huttner: Okay.

But I was going to say that your Hannover RE, I think you dream -- you live positive experience variances. And that's why I'm just -- it's almost like the answer you've given me would be -- I would understand if it came from a weaker, maybe French, competitor. But from you, it's almost like you're speaking from a different company. That's why -- but anyway, I take the comment.

Clemens Jungsthöfel: Yes, we are the Germans, as you know, it's in our blood.

Michael Huttner: Yes. But -- well, maybe let me have another go then, please, if I may. On U.S. mortality, what are you seeing at the moment? Is there -- have we bottomed? Because I see the change in estimates is longevity in your CSM. So that's the opposite of mortality.

So that looks -- feels like mortality is actually getting worse, but I don't know. But is there a change in the U.S., are people starting to live longer again?

Clemens Jungsthöfel: So the change in estimates that you're seeing on the mortality and longevity side was -- that's something that were communicated on the UK. So in the UK, we have seen a change in the mortality, let's say, mortality improvement. So we have less strong mortality improvements in the UK than what we thought, which led then to positive assumption changes on the longevity business in the UK and obviously to negative assumption changes on the mortality business in the UK. We don't see anything similar right now in the U.S.

Michael Huttner: Thank you.

Sven Althoff: Well, on the revenue guidance for P&C, I mean, the year has started well. I mean, as we reported during -- for the January renewals, which is 60% of our traditional treaty business, we managed to grow by 7.6%. We also had a good 1/1 for the structured activities, which is not part of the temporary reporting we are doing. So I mean, let's wait and see.

It's early in the year. Let's particularly wait what the April renewals bring. So as we sit here today, I would say that the likelihood of us achieving the 7% has certainly increased after the January renewal. And let's revisit that once we have a few more renewal dates behind us, but there could potentially be a chance of going over and above the 7% for the full year.

Michael Huttner: Thank you.

Operator: The next question comes from the line of Roland Pfander from ODDO BHF. Please go ahead.

Roland Pfänder: Good afternoon. First of all, Jean-Jacques, all the best for your future, and thanks for the good discussions for the last few years, much appreciated. Now coming to the questions on life and health, please.

You were quite positive for the growth outlook of the segment. Looking at 2024, new business was down by around 15%. You also mentioned there are some problems, regulatory problems, for financial solutions in China. Maybe you could comment how this is going on. And also longevity business might be quite competitive out there.

So where is your positive stance on future growth coming? Maybe that would be my question. Jean-

Jacques Henchoz: Yes. Thank you very much. So maybe just quickly on these figures on the new business CSM figures. I mean, as Clemens, by the way, said already, our business is very transactional.

So one or two more deals changed this new business CSM dramatically. So that's something that you need to see. So whether we do a deal in December or January is going to change these figures completely because we're looking into one year after the other. So very transactional, so a lot of changes there. So I wouldn't interpret too much into the absolute figure that we have there.

Still, if you take the new business and the renewed business and the addition and the prolongations that we have been doing, we're still at a very healthy EUR600-plus million, which is positive. You were mentioning the China FX situation. You're right, there is a regulatory change in China, something that we know for a few months now, which leads -- which means for us finally, that we need to change our financial solutions that we're providing our clients with. While previously, we have been providing solutions which were increasing the available capital for our clients, we now need to provide solutions which decrease the required capital for our clients. And this is a totally different cup of tea, and we're working on this.

So that's why our view on the absolute amount of profits that we can generate out of the financial solutions side in China are, let's say, more conservative at this stage, but we're working on a solution there. And last but not least, you were mentioning the longevity situation. One thing which led, by the way, to a little bit less CSM new business this year was the lack of a big, big longevity transaction, typically in the UK. This is due, as you said, to the competition that we're seeing. And we feel that the margins that we were able to do with some of these large transactions were just not reaching the hurdle rate for us.

So we decided not to write them than to write them. And that's also one of the reasons that we have. So on the longevity side, I think we're getting back. But also there, and that's maybe also the answer to the previous question, we're pretty, let's say, prudent in terms of how much new business we're going to be able to write out of these lines of business.

Roland Pfänder: Okay, thank you.

Operator: [Operator Instructions] The next question comes from the line of Ivan Bokhmat from Barclays. Please go ahead.

Ivan Bokhmat: Hi, good afternoon. Thank you very much. So one question from me would be quite general.

I mean we're observing some fairly tectonic shifts, I think, in the European competitiveness, in the fiscal rules in Germany. So I'm just wondering if you could get your general thoughts on what underwriting opportunities that investment super cycle may present for you? Or maybe what changes to the investment portfolio you would anticipate in that respect? And second question, a lot less general. In your guidance for 2025 for investment results, do you anticipate some specific impairments on real assets? Thank you.

Clemens Jungsthöfel: I mean I'll start probably with the last one on alternative assets or real estate private equity. We have -- I'd say, overall, we have been realistic in our assumptions.

Again, we've created a bit more prudency in 2023 and 2024. I wouldn't say that, that is the case for 2025. So no specific impairments or write-downs or dramatic fair value changes in our real asset portfolio in 2025. Jean-

Jacques Henchoz: Maybe generally, Jean-Jacques speaking, I'm not sure you were referring only to the investment side or the underwriting side on the general shift, as a general response, I would say on both sides, we're quite agile. And if we see opportunities, we go for it.

So that's specificity of the reinsurance business model to be really able to track changes, shifting trends and then capture these opportunities. So that's what we're going to do. I think in spite of the different views on climate change at the current stage in the international political arena, I still believe that the energy transition is going to take place. And that's a good example where we can capture opportunities both in terms of investment contribution, but also in terms of underwriting development. But again, that agility to react to trends is really a key success factor.

And subject to terms, of course, we'll capture these opportunities.

Clemens Jungsthöfel: Does this answer your question, Ivan?

Ivan Bokhmat: Well, it was a very general question. So I suppose I'll work at better formulating it next time. Jean-

Jacques Henchoz: Clemens looks forward to it.

Clemens Jungsthöfel: I don't -- I mean just on the investment side, I don't expect any dramatic change in our investment strategy.

As Jean-Jacques said, I think we have flexibility in the investment portfolio to take advantage of any opportunities, react to any changes in, let's say, how we view credits or [indiscernible] or whatever. Again, there's a lot of flexibility. But clearly, our investment philosophy, you know this, is no bets on interest rates, no bets on currency. So this is all going to happen in the context of asset liability management.

Ivan Bokhmat: Thank you very much, both.

Operator: There are no more questions at this time. I would now like to turn the conference back over to Jean-Jacques Henchoz for any closing remarks. However, with the last minute registration for Vinit Malhotra, I'm sorry, from Mediobanca. Please go ahead.

Vinit Malhotra: Yes.

Thank you. Sorry to jump in. I just thought that if there is more time. Just one thing -- so two things there, please. One is, Clemens, I mean, knowing you for the last few years as well, is it a fair assumption that the agenda would remain one of continuity? Or do you plan to review more and then maybe come to the market with some more plans later in the year in October, November with the new leadership from your side? So that's a very quick -- looking for a quick comment there.

And next is just in the past, I've asked a few times, and it's entirely my fault to not pick it up yet. But when the U.S. dollar strengthens, why does Hannover Re have a negative effect? If you don't mind just, if it's simply possible to explain that. Thank you.

Clemens Jungsthöfel: Just on the latter to get this sort of probably we've seen and I've alluded to it with the strengthening of the U.S.

dollar, we've seen P&L impact. On the P&C side that swing was quite dramatic year-on-year. It's probably a low triple-digit number for a given financial year. But I will see this again in our -- in -- as we are very [indiscernible] on currency matching, we do this on an economic basis. So we really try to do ALM and currency matching based on our Solvency II numbers.

So one of the impacts that you then see in the accounting is that you still have an accounting mismatch. And that is still true in a discounting regime under IFRS 17 because there are still assets that are treated as monetary. These are mainly fixed income, but there are also many assets that are treated in non-monetary items, and they are not revalued through the P&L. And that is very much true for our private equity, for our real estate portfolio, etc., where any changes in currency are not coming through the P&L. And that's why you have an imbalance, which makes it a bit difficult.

I should say this with my CFO glasses to see the results, of course, but it provides a bit of volatility as we have seen in our 2024 numbers. But it's really not something that we see as an economic currency change. On the strategy, look, I've got to talk about looking at Jean-Jacques right now. Look, I mean, we've been working for five years now, Jean-Jacques and myself with this Executive Board team. But we are just behind one year of our strategy, which we've all worked on together, which we've developed together.

So we are all very happy with the strategy. We're happy with the targets that we achieved in this financial year. So for us as an executive team and for me personally, clearly, I'm very grateful for the trust. But I clearly -- I see this as a privilege personally, but it's clearly a mandate to continue on this trajectory of outperformance on the ROE, and this is all about being absolutely stringent on executing our strategy and continuing the path that we've done in the past. So don't expect any revolution, a bit of acceleration here and there, clearly, as we are faced with market challenges, but that's really just the somewhat different Hannover Re, is clearly something that is top of mind.

Vinit Malhotra: Thank you.

Operator: So there are no more questions at this time. Now I would like to turn the conference back over to Jean-Jacques Henchoz for any closing remarks. Jean-

Jacques Henchoz: Well, thank you very much once again for covering the ground very well. Thank you also for the kind words.

It has been a big journey and part of the real pleasure I've had over the years was the dialogue with all of you, your challenging question, but this helps us to validate our thinking, and it has been really our acid test and something very, very useful to our thinking, to our strategy. I leave Hannover Re with an excellent feeling, again, satisfactory results in '24, increasing resilience. There is a fortress balance sheet here to create optionality to capture our growth opportunities, but also to make sure that we can deliver on targets. I always speak like a shareholder as we go. But I'm very confident personally about the outlook in my current role, but also for the future.

The team has a good blend of fresh perspective, but also a strong DNA in this somewhat different philosophy, which we are going to nurture in the future. So all the best. Thank you very much for all your support and for the dialogue. And I wish all the best to the team as well. I'll be an active listener going forward for the next meetings.

Clemens Jungsthöfel: Thank you, Jean-Jacques. I will take you up on the long-term shareholder view. So let's see. Jean-

Jacques Henchoz: With that, we close the call. Thank you, everyone.