German reinsurer Hannover Re has posted a fall in third-quarter profits, but remains “on track” to hit its full-year target.

Net income for the period was €205.5 million ($291.58 million), down 22.6% on the corresponding period last year.

Gross written premium was €3.31 billion ($4.7 billion), down 2.8%, and net investment income was €364.2 million ($516.76 million), a drop of 27.1%.

The combined ratio for the non-life sector was 96.3%, compared with 95.8%.

However, CEO Ulrich Wallin says net income of €613.2 million ($870.1 million) in the first nine months puts the group “well on track” for its year target of €800 million ($1.14 billion).

This is despite “challenging market conditions… particularly in view of the low interest rate level”.

Non-life reinsurance treaties came up for renewal in Australia and New Zealand in the third quarter, with “satisfactory prices” achieved.

Large losses and natural disasters were recorded in the period, with the biggest single event being Hailstorm Andreas in Germany, which brought net losses to Hannover Re of €64 million ($90.81 million).

The reinsurer says the “intensely competitive climate” in non-life insurance is likely to be sustained, “with corresponding implications for prices and conditions”.

However, it sees growth opportunities linked to the rising concentration of values in urban areas and the adoption of risk-based solvency systems in Europe and Asia.