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Investing.com -- Scor SE (EPA:SCOR) shares jumped over 4% on Tuesday, driven by the reinsurance company’s strong performance during the January 2025 renewals.
According to a company statement, Scor’s growth was largely fueled by its success in expanding its preferred lines, with significant contributions from Specialty lines and Alternative Solutions.
"The update today seems consistent with comments made at the Dec 2024 CMD. Volumes were healthy with margins flat. While it’s a positive development we think it’s largely as expected and hence we do not see anything incremental to sway the story on the back of this," said analysts at RBC Capital Markets in a note.
This comes in line with the company’s strategic plan, Forward 2026, which emphasizes strict underwriting discipline while capitalizing on emerging market opportunities.
During the January renewals, Scor reported an overall growth of 9.6% in its Expected Gross Premium Income, with particular strength in its Engineering, Marine, IDI, and International Casualty lines, which collectively saw an 8.1% increase.
Alternative Solutions, a high-growth segment, also contributed significantly with a 29.6% rise in EGPI. Despite a slightly more competitive market environment, Scor maintained its disciplined approach, ensuring the profitability of its reinsurance portfolio remained stable.
The company also took a conservative stance on business exposed to climate change and U.S. Casualty risks, reducing its exposure in the latter by 11%.
While natural catastrophe premiums held steady, Scor’s overall portfolio continued to benefit from careful management of its underwriting practices, with net technical profitability remaining strong.
Scor’s strong results are due to its focus on making profitable growth a priority and its active retrocession strategy.
This disciplined approach, along with good market conditions, let Scor optimize its risk and improve profitability in its renewed portfolio.
This performance signals to investors that Scor is well-positioned to continue its growth trajectory, offering reassurance amid a slightly softer reinsurance market.
The company’s disciplined underwriting and strategic focus on preferred lines have helped to maintain stability even in the face of increasing competition and market shifts.
"A better than feared outcome on the L&H assumption review and additional capital actions should secure the FY24 DPS of €1.80 which yields ~8%. In the medium-term, the revamped business is better positioned to deliver mid-teens ROEs from FY25 onwards and help re-rate the shares," RBC added.