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Investing.com -- S&P Global Ratings has revised its outlook on Vienna Insurance Group (VIE:VIG) and its core subsidiary VIG RE to positive from stable, while affirming their ’A+’ ratings.
The rating agency cited VIG’s strong progress in diversifying its business and expanding its scale and earnings, particularly in Central and Eastern Europe (CEE). This growth has broadened the group’s earnings base and reduced its dependence on traditional key markets like Austria and the Czech Republic.
In the first half of 2025, VIG reported an 8.1% increase in insurance revenue to €6.4 billion, with gross written premiums rising 8.7% to €8.6 billion. Profit before tax grew by 10.5% to €531 million. The company maintains market leadership in Austria and numerous CEE countries.
VIG plans to acquire a majority stake in Germany’s NUERNBERGER insurance group, with closing expected in the second half of 2026. The acquisition, valued at €1.38 billion, will be fully financed from internal resources and is expected to significantly increase VIG’s market share in Germany.
On a pro forma basis combining 2024 figures, VIG’s €15.2 billion in gross written premiums plus NUERNBERGER’s €3.7 billion would create a business likely exceeding €20 billion in gross written premiums by 2026.
While NUERNBERGER reported a €77 million net loss in 2024 due to challenges in its property/casualty portfolio, the company showed significant improvement in the first half of 2025. Its combined ratio improved to 90.8% from 110% a year earlier, and group net income rose to €48 million.
S&P expects VIG to further improve its earnings diversification, with net income projected to exceed €650 million in 2025 and gradually increase through 2027. The group’s net combined ratio is anticipated to remain strong at 92%-94% over this period.
VIG’s Solvency II ratio stood at 259% at the end of the second quarter of 2025, while NUERNBERGER’s was 247%. Despite the acquisition and NUERNBERGER’s higher equity investment exposure, S&P expects the combined group’s financial risk profile to remain very strong.
The rating agency could upgrade VIG if it continues to expand profitably and diversify group earnings, successfully integrates NUERNBERGER, and maintains strong capital adequacy.
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