Paris-based insurer Axa has warned its bottom line will take a hit this year from costs aimed at shoring up earnings at Axa XL and announced it has appointed a new CEO to run the unit.

The subsidiary Axa XL business was hit by higher than normal levels of natural catastrophe charges in 2019.

The company says it has taken steps to reduce earnings volatility, spending €200 million ($301.56 million) to reduce exposure to catastrophes and increase reinsurance.

Management forecasts the XL unit, which posted a combined ratio of 101.5% last year, will achieve underlying earnings of €1.2 billion ($1.81 billion) this year, compared with €507 million ($764.45 million) in 2019.

Axa acquired Bermuda-based XL Group in September 2018 in a deal that shifted Axa’s business from predominantly life cover and savings to mainly property and casualty. Axa XL accounted for about a fifth of group revenue in 2019.

The new Axa XL CEO is Scott Gunter, who was previously a senior VP at Chubb. He replaces Greg Hendrick, who oversaw the integration of the unit. Axa, the second-largest European insurer after Allianz, reported a 4% rise in 2019 underlying earnings. Revenue rose to €103.5 billion ($156.06 billon).

Property & Casualty underlying earnings increased by 12% to €3.3 billion ($4.98 billion).

Axa’s property and casualty (P&C) combined ratio was 96.4%, an improvement of 0.6%, while its protection combined ratio improved by 0.7% to 93.2%. Health combined ratio widened by 0.1% to 94.1%.

At Axa XL, total revenues were up 10% at €18.7 billion ($28.2 billion).

Axa XL’s P&C revenue rose 18% to €9.1 billion ($13.72 billion) while specialty insurance revenues increased 6% to €4.9 billion ($7.39 billion). Reinsurance revenues were 2% higher at €4.5 billion ($6.79 billion).