Strong underwriting results in property and casualty and solid investment income have resulted in Hannover Re posting a full-year profit of €1.17 billion ($1.64 billion), marking a 1.8% increase on 2015 and its fifth consecutive record result.

The reinsurer’s strategy of generating profits rather than growing premium led to gross premiums contracting 4.2% on the prior year to €16.4 billion ($23.1 billion).

Its combined operating ratio improved from 94.4% in 2015 to 93.7% last year.

Despite continued low interest rates, Hannover says it is “very satisfied” with an investment income of €1.21 million ($1.7 million).

The rise in demand for reinsurance solutions offering solvency relief in Europe and Asia also contributed to the strong results.

However, this positive trend wasn’t enough to offset premium declines in other areas, with the result that the gross premium volume in property and casualty reinsurance fell slightly by 1.4% to €9.2 billion ($12.97 billion).

Hannover Re has set its profit target for 2017 at €1 billion ($1.41 billion).

Life and health reinsurance also generated solid profits in the year, and CEO Ulrich Wallin says he is pleased the company has comfortably surpassed its financial targets.

“Another strong underwriting result in property and casualty reinsurance combined with pleasing investment income laid the foundation,” he said.