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THE CCR GROUP IN 2021
In 2021 the Group achieved strong results and continued its transformation. It demonstrated agility in serving the public interest with the roll out of public reinsurance for nuclear operators, tour operators and support for discussions on agricultural insurance. In the competitive business, CCR Re consolidated its development momentum, ahead of schedule.
Storms in the Seine-Normandy basin, the Paris Basin and in Champagne - June 2021
Due to a mass of warm air from the Maghreb and cool air from the Atlantic Ocean, France experienced significant thunderstorms in June 2021. From 3 to 5 June, thunderstorms caused heavy rainfall and flooding in Normandy, the Greater Paris region and the North-East. Between 18 and 22 June, the Paris Basin and Champagne were particularly affected.
Storms in the Seine-Normandy basin from 02 to 04 June 2021:
91 communes declared in a state of natural emergency.
Storms in the Paris Basin and in Champagne from 18 to 22 June 2021:
472 communes declared in a state of natural emergency.
Floods in South-West France - December 2021
In the Pyrénées-Atlantiques, after a succession of major snow storms, abundant rainfall occurred which thawed the ice between 9 and 10 December 2021. Below 1,500m in altitude, the snowpack melted, causing major floods. Damage was recorded in the Pyrénées-Atlantiques and in the south of the Landes.
171 communes declared in a state of natural emergency.
Floods in South-Eastern France - October 2021
Intense thunderstorms occurred on 3 and 4 October 2021 with very heavy rainfall in Lozère, Gard, Bouches-du-Rhône and Var leading to major overflows of the Cèze and surface runoff phenomena, particularly in Marseille.
129 communes declared in a state of natural emergency.
Flooding in the Gard - September 2021
On 14 September 2021, heavy rainstorms hit the Languedoc. In the Gard department, a stationary storm caused surface runoff and the overflow of the Vistre, Rhône and Vidourle rivers in the region of Nîmes.
60 communes declared in a state of natural emergency.
Flooding in the North East - July 2021
From 13 to 17 July 2021, the North East of Europe experienced cool and humid weather conditions. A cold drop phenomenon called ‘Bernd’ caused frequent and intense rainfall and extensive flooding in Germany and Benelux.
240 communes declared in a state of natural emergency.
Floods in the South West - February 2021 and December 2020
The winter of 2020/2021, very wet with a succession of heavy rainfalls, is crossed by storms Bella and Justine causing soil saturation and repeated flooding in South-West France, in February 2021 and floods of properties in the Gers and the Landes, in December 2020.
261 communes declared in a state of natural emergency.
2021 Drought
For the first time since 2016, 2021 was not affected by a major nationwide drought. However, Corsica and the South of France, from the Pyrenees to the Mediterranean, recorded greater-than-normal water deficit. The departments of Charente-Maritime, Vendée, Loire-Atlantique and some communes in Lorraine and Normandy were also particularly impacted.
40 departments affected by the drought.
Floods in South-West France - December 2021
In the Pyrénées-Atlantiques, after a succession of major snow storms, abundant rainfall occurred which thawed the ice between 9 and 10 December 2021. Below 1,500m in altitude, the snowpack melted, causing major floods. Damage was recorded in the Pyrénées-Atlantiques and in the south of the Landes.
171 communes declared in a state of natural emergency.
Floods in South-Eastern France - October 2021
Intense thunderstorms occurred on 3 and 4 October 2021 with very heavy rainfall in Lozère, Gard, Bouches-du-Rhône and Var leading to major overflows of the Cèze and surface runoff phenomena, particularly in Marseille.
129 communes declared in a state of natural emergency.
Flooding in the Gard - September 2021
On 14 September 2021, heavy rainstorms hit the Languedoc. In the Gard department, a stationary storm caused surface runoff and the overflow of the Vistre, Rhône and Vidourle rivers in the region of Nîmes.
60 communes declared in a state of natural emergency.
Flooding in the North East - July 2021
From 13 to 17 July 2021, the North East of Europe experienced cool and humid weather conditions. A cold drop phenomenon called ‘Bernd’ caused frequent and intense rainfall and extensive flooding in Germany and Benelux.
240 communes declared in a state of natural emergency.
Floods in the South West - February 2021 and December 2020
The winter of 2020/2021, very wet with a succession of heavy rainfalls, is crossed by storms Bella and Justine causing soil saturation and repeated flooding in South-West France, in February 2021 and floods of properties in the Gers and the Landes, in December 2020.
261 communes declared in a state of natural emergency.
2021 Drought
For the first time since 2016, 2021 was not affected by a major nationwide drought. However, Corsica and the South of France, from the Pyrenees to the Mediterranean, recorded greater-than-normal water deficit. The departments of Charente-Maritime, Vendée, Loire-Atlantique and some communes in Lorraine and Normandy were also particularly impacted.
40 departments affected by the drought.
INTERNATIONAL
Coupang fire in South Korea - 17 June 2021
The fire that broke out on 17 June, in the second basement of a distribution centre in Icheon Si, about 80 km south of Seoul. After first being brought under control by 150 firefighters, the blaze suddenly broke out from inside the building, spreading to the upper floors and causing extensive damage.
EUR 226 million in insured losses.
Series of storms over Northern and Central Europe - June and July 2021
Four storms successively hit Europe, causing severe floods in various European countries from 19 June to 24 July: VOLKER specifically affecting Austria and the Czech Republic, WOLFGANG Austria, the Czech Republic and Poland, XERO Germany and BERND Germany, Belgium and the Netherlands.
EUR 15 billion in insured losses.
Severe thunderstorm and hail in Calgary, Canada - 2-3 July 2021
A severe thunderstorm which came with hail flooded streets in Calgary, homes were struck by lightning, numerous traffic accidents occurred and broken trees damaged power lines.
EUR 180 million in insured losses.
Riots in South Africa - 8-15 July 2021
On the evening of 9 July, riots and demonstrations broke out in the South African provinces of KwaZulu-Natal and Gautengse. They then spread to Johannesburg. In human terms, 300 deaths were reported and financially speaking, the government estimated that the violence came at a cost of $3.4 billion to the economy.
EUR 1.7 billion in insured losses.
Flooding in Henan, China - 17-25 July 2021
Henan, a province in east-central China, experienced the heaviest rainfall on record: many dykes failed, cutting off access routes and submerging entire villages, affecting 13 million people. Materially: 15,500 structures collapsed involving 48,500 dwellings; 148,100 structures severely or moderately damaged affecting 446,300 families.
EUR 1.5 billion in insured losses.
Floods in Malaysia - 17 to 20 December 2021
Torrential rains caused floods in several towns and villages in Selangor and the eastern state of Pahang. 14 deaths were reported and over 70,000 people were displaced.
EUR 880 million in insured losses.
Canadian agriculture affected by extreme weather events in 2021
In 2021, Canadian farmers were hit hard by extreme weather conditions including drought in Western Canada and Northern Ontario, and floods and landslides in British Columbia.
EUR 350 million in insured losses.
Coupang fire in South Korea - 17 June 2021
The fire that broke out on 17 June, in the second basement of a distribution centre in Icheon Si, about 80 km south of Seoul. After first being brought under control by 150 firefighters, the blaze suddenly broke out from inside the building, spreading to the upper floors and causing extensive damage.
EUR 226 million in insured losses.
Series of storms over Northern and Central Europe - June and July 2021
Four storms successively hit Europe, causing severe floods in various European countries from 19 June to 24 July: VOLKER specifically affecting Austria and the Czech Republic, WOLFGANG Austria, the Czech Republic and Poland, XERO Germany and BERND Germany, Belgium and the Netherlands.
EUR 15 billion in insured losses.
Severe thunderstorm and hail in Calgary, Canada - 2-3 July 2021
A severe thunderstorm which came with hail flooded streets in Calgary, homes were struck by lightning, numerous traffic accidents occurred and broken trees damaged power lines.
EUR 180 million in insured losses.
Riots in South Africa - 8-15 July 2021
On the evening of 9 July, riots and demonstrations broke out in the South African provinces of KwaZulu-Natal and Gautengse. They then spread to Johannesburg. In human terms, 300 deaths were reported and financially speaking, the government estimated that the violence came at a cost of $3.4 billion to the economy.
EUR 1.7 billion in insured losses.
Flooding in Henan, China - 17-25 July 2021
Henan, a province in east-central China, experienced the heaviest rainfall on record: many dykes failed, cutting off access routes and submerging entire villages, affecting 13 million people. Materially: 15,500 structures collapsed involving 48,500 dwellings; 148,100 structures severely or moderately damaged affecting 446,300 families.
EUR 1.5 billion in insured losses.
Floods in Malaysia - 17 to 20 December 2021
Torrential rains caused floods in several towns and villages in Selangor and the eastern state of Pahang. 14 deaths were reported and over 70,000 people were displaced.
EUR 880 million in insured losses.
Canadian agriculture affected by extreme weather events in 2021
EUR 350 million in insured losses.
In 2021, Canadian farmers were hit hard by extreme weather conditions including drought in Western Canada and Northern Ontario, and floods and landslides in British Columbia.
NEWS AND EVENTS
“Le Paris de l’Hydrogène”, Energy Observer - May 2021
CCR participated as a sponsor in the event dedicated to the energy and ecological transition organised by Energy Observer on the Champ-de-Mars in Paris. Guests and CCR employees were informed of the challenges of hydrogen and clean mobility during the immersive and educational exhibition. The exhibition presented the on-board technologies of the laboratory ship, their applications at sea and on land and the sustainable solutions of the pioneers we met around the world (Web series). The highlight of the event was the illumination of the Eiffel Tower with low-carbon hydrogen.
12th CCR Nat Cat Day - June 2021
The twelfth edition of this event, which brings together each year the players of the French insurance market took place in a hybrid format - a novel format set up to comply with health regulations - that allowed participants, either on site or remotely on a digital platform, to interact on the topic of: “the Nat Cat scheme: Challenges and Adaptations”.
Presentation of the 2021 CCR Nat Cat Award – June 2021
The CCR Nat Cat Award, which rewards a PhD thesis devoted to the knowledge of natural disasters and its application to the insurance industry and risk prevention, was awarded by Laurent Montador during the 12th CCR CAT Day. The winner of this 7th award is Odile Platard, rewarded for her work at the Paris Doctoral School of Geography on the theme: “Rethinking the evacuation of a coastal population in an urban environment in a multi-hazard context: the STEP model”.
75 years of CCR - September 2021
On the company’s 75th anniversary, employees, clients and partners gathered to celebrate at the Musée Rodin. The guests were able to take advantage of the museum’s facilities to discover or rediscover this venue for which CCR and its subsidiary have been patrons since 2018.
Launch of the third sidecar sub-fund of 157 Re
Boussard & Gavaudan Investment Management LLP (BGIM) increased the capacity available to CCR Re to underwrite property catastrophe risk worldwide (Property Cat). This third subfund strengthens the relationship with the reference investor. As a sponsor of 157 Re, CCR Re benefited from the support of its investors, the expertise of Willis Re Securities (structuring and placement agent), France Titrisation (investment management company), BNP Paribas Securities Services (custodian bank) and the advice of Linklaters.
Insurance Linked Securities - ILS Shows
CCR Re created the first online show to discuss insurance-linked securities (ILS) in early 2021. Hosted by Mathieu Halm, Head of Retrocession & Alternative Capital at CCR Re, the show brings together four experts to discuss topics like: “How to structure an ILS under French law”, “What ESG challenges lie ahead?”...in front of an international audience.
“Reinsurance Hot Topics” Webinars
CCR Re launched a new international event in December 2021, a series of webinars called “Reinsurance Hot Topics”, which bring together leading reinsurance experts to discuss, in a round-table discussion, topical issues that impact the reinsurance industry. The first topic was climate change with the increase in frequency and intensity of natural disasters and the challenges that reinsurers are facing.
NEWS AND EVENTS
“Le Paris de l’Hydrogène”, Energy Observer - May 2021
CCR participated as a sponsor in the event dedicated to the energy and ecological transition organised by Energy Observer on the Champ-de-Mars in Paris. Guests and CCR employees were informed of the challenges of hydrogen and clean mobility during the immersive and educational exhibition. The exhibition presented the on-board technologies of the laboratory ship, their applications at sea and on land and the sustainable solutions of the pioneers we met around the world (Web series). The highlight of the event was the illumination of the Eiffel Tower with low-carbon hydrogen.
12th CCR Nat Cat Day - June 2021
The twelfth edition of this event, which brings together each year the players of the French insurance market took place in a hybrid format - a novel format set up to comply with health regulations - that allowed participants, either on site or remotely on a digital platform, to interact on the topic of: “the Nat Cat scheme: Challenges and Adaptations”.
Presentation of the 2021 CCR Nat Cat Award – June 2021
The CCR Nat Cat Award, which rewards a PhD thesis devoted to the knowledge of natural disasters and its application to the insurance industry and risk prevention, was awarded by Laurent Montador during the 12th CCR CAT Day. The winner of this 7th award is Odile Platard, rewarded for her work at the Paris Doctoral School of Geography on the theme: “Rethinking the evacuation of a coastal population in an urban environment in a multi-hazard context: the STEP model”.
75 years of CCR - September 2021
On the company’s 75th anniversary, employees, clients and partners gathered to celebrate at the Musée Rodin. The guests were able to take advantage of the museum’s facilities to discover or rediscover this venue for which CCR and its subsidiary have been patrons since 2018.
Launch of the third sidecar sub-fund of 157 Re
Boussard & Gavaudan Investment Management LLP (BGIM) increased the capacity available to CCR Re to underwrite property catastrophe risk worldwide (Property Cat). This third subfund strengthens the relationship with the reference investor. As a sponsor of 157 Re, CCR Re benefited from the support of its investors, the expertise of Willis Re Securities (structuring and placement agent), France Titrisation (investment management company), BNP Paribas Securities Services (custodian bank) and the advice of Linklaters.
Insurance Linked Securities - ILS Shows
CCR Re created the first online show to discuss insurance-linked securities (ILS) in early 2021. Hosted by Mathieu Halm, Head of Retrocession & Alternative Capital at CCR Re, the show brings together four experts to discuss topics like: “How to structure an ILS under French law”, “What ESG challenges lie ahead?”...in front of an international audience.
“Reinsurance Hot Topics” Webinars
CCR Re launched a new international event in December 2021, a series of webinars called “Reinsurance Hot Topics”, which bring together leading reinsurance experts to discuss, in a round-table discussion, topical issues that impact the reinsurance industry. The first topic was climate change with the increase in frequency and intensity of natural disasters and the challenges that reinsurers are facing.
“DESPITE THE HEALTH CRISIS, THE GROUP IS ACHIEVING SATISFACTORY RESULTS AND PREPARING FOR THE FUTURE.”
JACQUES LE PAPE,
Chairman of the Board of Directors
EFFORT AND RESPONSIVENESS
The year 2021 will have marked a year of economic transition, with the catch-up from the 2020 recession resulting in strong economic recovery despite the setbacks of the Covid-19 pandemic. For CCR, 2021 was therefore a year of effort and responsiveness. Thanks to the efforts and responsiveness of its employees, CCR was able to face its responsibilities as a public company serving the national community.
In the compensation of natural disasters, under which CCR benefits from the State guarantee, it has borne a significantly lower drought claims burden than in the previous year. This has enabled it to confirm its role as a long-term stabiliser, which is particularly important for a scheme that needs to be financially robust to help cope with the expected impacts of climate change. In addition to its role in managing this scheme, CCR is extending its research and prevention activities in the field of climate risks, by producing analyses on the management and sustainability of the scheme and by making its scientific work available to the national and international community, based in particular on the data at its disposal. This mission is the core business of CCR and the first axis of the strategic plan that our Board of Directors adopted in June 2021 for the next four years.
Throughout 2021, CCR also adapted its intercompany credit support through the CAP scheme. CAP was created during the 2008 crisis and was reactivated in 2020 in record time to respond to the declining capacity of the credit insurance market. The context of economic recovery made it possible to close this scheme at the end of 2021. At the same time, CCR’s teams focused their efforts on the operational management of new risks.
On the one hand, a public guarantee for the benefit of tour operators, the industry of which is still affected by the pandemic, was set up. On the other hand, risks incurred by nuclear energy operators can now be covered. Finally, CCR advised the State during the work on the reform of the natural catastrophe compensation scheme and on the reform of crop insurance, which supports French agriculture through the ecological transition.
All of these projects illustrate CCR’s expertise and action capacity at the service of the public authorities on risks that cannot be insured by the market. We plan to continue to develop this business operationally as part of the third pillar of our strategic plan.
Finally, our market reinsurance subsidiary, CCR Re, achieved most of the targets of its ‘Streamline 2020-2022’ development plan a year ahead of schedule. In addition to the Covid crisis, 2021 was also marked by summer floods of historic proportions in Germany and Belgium. Despite this, CCR Re achieved a financial year that erases the impact of the pandemic on its growth trajectory. We are currently considering with the French State how to give CCR Re the financial capacity for this development in the long run.
During the 75th anniversary of the creation of CCR, I got the opportunity to thank, on behalf of the Board of Directors, Bertrand Labilloy and the teams for their commitment to the general interest, their efforts and their responsiveness. It is thanks to them that the Group has been able to fulfil its missions and maintain a healthy financial situation with €1,893 million in gross written premiums and €196 million in profit.
This 2021 report will, I hope, give an overview of the business, projects and values of the CCR Group, at the service of its customers and the general interest.
CCR DEMONSTRATED STRENGTH AND AGILITY
Is 2021 the year of recovery?
For the economy, it is clearly the case and this is to be welcomed. In this context, in collaboration with the State, CCR gradually stopped the public reinsurance of intercompany loans in June (CAP Relais) and December (CAP and CAP+), while business was picking up, even if in certain sectors like tourism, business is still impacted by Covid variants. More generally, the recurrence of years of high Nat Cat losses is a basic trend which is reflected in a market movement of rate increases on Cat programmes and aggregates, as well as on lines or countries affected by losses, while the demand for capacity from ceding companies remains high. Lastly, the financial markets recovered but with growing uncertainty over inflationary pressures and their consequences for monetary policy, which could slow down the V-shaped recovery of the French economy.
“IN 2021, CCR CONTRIBUTED TO THE RESILIENCE OF THE ECONOMY AND CCR RE CONFIRMED ITS STRONG GROWTH MOMENTUM.”
BERTRAND LABILLOY,
CCR Chief Executive Officer
CCR Re Chairman and Chief Executive Officer
How did the CCR group cope with this very unusual year?
By getting involved! and I would like to say how proud I am of the CCR and CCR Re teams, for having achieved one of the best financial years the Group has ever had. Leaving aside the management of the pandemic, which did not pose any issues, I mainly note CCR’s great agility in serving the State through the expertise it provided for the reform of compensation for natural disasters, the implementation of a new reinsurance scheme for travel operators and the reform of agricultural insurance. In market reinsurance, with a level of business that is 25% higher and net profit that doubled that of 2020, CCR Re delivered strong growth in its annual results, one year ahead of its forecasts, which reflect the financial and operational momentum supported by all its business lines. The impact of Covid is erased.
And if we were to mention a few of CCR’s highlights?
For the economy, it is clearly the case and this is to be welcomed. In this context, in collaboration with the State, CCR gradually stopped the public reinsurance of intercompany loans in June (CAP Relais) and December (CAP and CAP+), while business was picking up, even if in certain sectors like tourism, business is still impacted by Covid variants. More generally, the recurrence of years of high Nat Cat losses is a basic trend which is reflected in a market movement of rate increases on Cat programmes and aggregates, as well as on lines or countries affected by losses, while the demand for capacity from ceding companies remains high. Lastly, the financial markets recovered but with growing uncertainty over inflationary pressures and their consequences for monetary policy, which could slow down the V-shaped recovery of the French economy.
In financial terms, how did CCR land?
Premiums collected by public reinsurance, all business lines combined, amounted to €1,051M, a level 13.6% lower than in 2020 due to the termination of CAP Relais in June and the sharp drop in its cession rate. The expense ratio of 2.0% stayed under control and the return on the financial portfolio was 1.1% as bond yields dropped. This brings us to €134 million in net profit, a very strong increase compared to the €61 million in 2020.
What about CCR Re?
The market reinsurance business performed exceptionally well, with premium income continuing to grow to €843M, reinforcing CCR Re’s position as one of the second tier reinsurers of this world. This performance was driven by the Property & Casualty and Life & Health lines.
At the same time, CCR Re maintained its solvency to 192%, while achieving a good year on the financial markets with a 1.9% return on invested assets. The expense ratio continued to decrease to 4.3% without slowing down investments for the transformation of operational processes and the hiring effort across all business lines. The current operating income was €62 million, up 59%. Net profit doubled from €18 million to €41 million. CCR Re maintains its mastered growth momentum.
What is the outlook for 2022?
Regarding 2022, it is still difficult to assess the impacts of geopolitical crises in addition to the Covid-19 pandemic on economies. But CCR Re’s strong results in 2021, its integrated development model, its ongoing transformation, the commitment of its teams and the loyalty of its clients allow us to look to the future with confidence. For CCR, a lot of agility will be needed in serving the State in all areas and working with the public authorities to preserve the balance of the Nat Cat scheme over the long run. Finally, as an investor, we will continue to invest in ESG-labelled investments with a €100 million landmark investment in the largest hydrogen impact fund in the world! It is also a way to build the future with optimism. In the medium term, despite the economic, monetary and geopolitical uncertainties in the world, CCR Re confirms an ambitious growth target in terms of gross written premium which could lead to the opening of its share capital to support this effort over the long term and to create a second international reinsurer in Paris.
CCR, BOARD OF DIRECTORS
JACQUES LE PAPE
Chairman
DAMIEN ANDRIES
Director representing the employees
ARNAUD BAILLEUL
Director representing the employees
LAURENCE BARRY
Independent Director
NATHALIE BROUTELE
Independent Director, Chairwoman of the Strategy Committee, Chairwoman of the Remuneration, Nominations and Governance Committee
PIERRE CHAVY
Director appointed by the Shareholders’ Meeting as proposed by the French State
BRUNO CINOTTI
Director appointed by the Shareholders’ Meeting as proposed by the French State
LIONEL CORRE
Director representing the French State
PATRICE FORGET
Independent Director, Chairman of the Audit, Accounts and Risk Committee
VÉRONIQUE LEHIDEUX
Director appointed by the Shareholders on the proposal of the State
ANTOINE MANTEL
Director appointed by the Shareholders’ Meeting as proposed by the French State
SOPHIE MASSET
Independent Director
DAVID MONCOULON
Director representing the employees
ELSA ROTHSCHILDGARNIER
Director representing the employees
CHRISTEL SADLER
Director representing the employees
CCR RE, BOARD OF DIRECTORS
BERTRAND LABILLOY
Chairman - Chief Executive Officer
JACQUES LE PAPE
Director representing CCR
PATRICK CERCEAU
Independent Director
JOHN CONAN
Director representing the employees
CHARLES LEVI
Independent Director
ANTOINE MANTEL
Director appointed by the Shareholders’ Meeting as proposed by the French State
GROUPE CCR, EXECUTIVE
BERTRAND LABILLOY
Chief Executive Officer
LAURENT MONTADOR
Deputy Chief Executive Officer
ISABELLE BION
Chief Operations Officer
CHRYSTELLE BUSQUE
Chief Financial and Steering Officer
SYLVIE CHANH
Head of Legal, Claims & Services
THIERRY COHIGNAC
Deputy Chief Underwriting Officer, Public Reinsurance and Guaranty Funds
PATRICK DELALLEAU
Chief Business Development Officer
VINCENT GROS
Group General Counsel and Compliance Officer
MATHIEU HALM
Head of Retrocession & Alternative Capital
JÉRÔME ISENBART
Chief Risk Officer and Chief Actuary
SÉBASTIEN JALLET
Chief Investment Officer
MARLÈNE LARSONNEUR
Chief Human Resources Officer
HIND MECHBAL
Chief Information Officer
HERVÉ NESSI
Chief Underwriting Officer
ANTOINE QUANTIN
Chief Underwriting Officer, Public Reinsurance and Guaranty Funds
KARINE ROBIDOU
Deputy Chief Investment Officer, Head of Real Estate, Infrastructure and ESG Investments