Munich Re has a projected net profit of €1.8 billion ($A2.9 billion) last year – a big turnaround from its first-ever net loss of €434 million ($A701 million) in 2003.

The group says its improved results were “largely due to further very satisfactory results in the reinsurance sector”. But it wasn’t all roses. Last year’s Florida hurricanes heavily impacted the group’s US operations, lowering profits to $US103 million ($A130 million).

Munich Re board member Torsten Jeworrek says the group will “stick by our business line of profitability and added value”.

“Despite some early Cassandra-like prophecies regarding the general state of the reinsurance market, Munich Re is starting 2005 with a portfolio which again promises a good level of profitability given normal claims experience.”

He says three years characterised by significantly increased risks and liabilities have resulted in “a swift adjustment of prices and conditions”, with the market seeming to have stabilised.