3 Reasons:
First, the pricing cycle is turning. After seven years of sometimes sharply rising prices—from 2018 to 2024—reinsurance prices are softening, and the years of very strong profits are likely to have peaked. This affects not only Munich Re: All companies in the industry are being valued more cautiously overall. In the key January contract renewals for property and casualty business, the Munich-based company has had to accept price declines of 0.6% and 2.4% in the past two years. Premium volume also fell because the group no longer accepted every contract under the new terms.
Second, the strong euro is having a noticeable negative impact on earnings. Since Munich Re generates a significant portion of its business in U.S. dollars, the appreciation of the euro is correspondingly depressing reported premiums and profits. This is because the euro appreciated from around $1.03 at the start of 2025 to $1.15 to $1.20 in the first quarter of 2026—an increase of about 15 to 17%.
Third, concerns are growing about the upcoming storm season: 27 named storms are expected in the Western Pacific, including 18 typhoons.
First, the pricing cycle is turning. After seven years of sometimes sharply rising prices—from 2018 to 2024—reinsurance prices are softening, and the years of very strong profits are likely to have peaked. This affects not only Munich Re: All companies in the industry are being valued more cautiously overall. In the key January contract renewals for property and casualty business, the Munich-based company has had to accept price declines of 0.6% and 2.4% in the past two years. Premium volume also fell because the group no longer accepted every contract under the new terms.
Second, the strong euro is having a noticeable negative impact on earnings. Since Munich Re generates a significant portion of its business in U.S. dollars, the appreciation of the euro is correspondingly depressing reported premiums and profits. This is because the euro appreciated from around $1.03 at the start of 2025 to $1.15 to $1.20 in the first quarter of 2026—an increase of about 15 to 17%.
Third, concerns are growing about the upcoming storm season: 27 named storms are expected in the Western Pacific, including 18 typhoons.
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@Smudeo The price cycle thing is true—but I think it’s pretty much always been that way. At some point, premiums always go through a consolidation phase. Maybe there will be a few major claims that dampen things for a year or two. After that, though, premiums will go up again because of those very large claims, etc.—in my opinion, that’s not really scary or unusual. Especially if you plan to hold the stock for the long term.
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•@Smudeo You can always find reasons for a technical correction ;)
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@jkb92 nope, the point is that you should always find reasons. Why is the share -33% from ATH? If the answer is: "The market is dumb, I know the truth", you're already making a huge mistake. So, again it is not about the fact that you can always find reasons. I would rephrase it as: "you should always find reasons...". As such, I really appreciate the post from @Smudeo .
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