SOURCE: Hannover Rückversicherung AG

March 07, 2006 09:11 ET

Hannover Re fundamentally reorganises its US specialty business with Praetorian launch

HANNOVER, GERMANY -- (MARKET WIRE) -- March 7, 2006 --

Hannover, 7 March 2006: Hannover Re is fundamentally restructuring its US primary insurance business: all specialty business - henceforth the strategic focus - is to be transferred to the newly established Praetorian Financial Group, Inc. Clarendon Insurance Group, Inc., which had previously been responsible for these activities, will concentrate on the professional and proactive management of around 200 terminated programs as well as existing commodity business that falls outside of Praetorian's focus.

"With this separation we have taken the last logical step as part of our restructuring measures geared to maximising the value of our specialty insurance business group", Wilhelm Zeller, Chief Executive Officer of Hannover Re, explained today at this year's Midwinter Conference of the Association of Insurance and Financial Analysts (AIFA) held in Scottsdale, Arizona.

Praetorian - led by its Chief Executive Officer Rodman Fox - will remain rigorously focused on specialty lines such as the insurance of select niche automobile risks and unusual professional risks as well as - inter alia - risks involving art collections, health insurances for pets, mobile phones and jewellery businesses. In view of its excellent financial strength ratings and market leadership Praetorian enjoys clear competitive advantages, prompting Mr. Zeller to speak of the company getting off to a "flying start".

"By putting in place a clear distinction between the companies we have also kept open more options for the future of our specialty business: over time we can consider continuing to manage Clarendon's activities internally, engaging the services of additional external experts or moving towards more extensive outsourcing solutions and other alternatives", Mr. Zeller emphasised. Based on Praetorian's positioning as a specialty insurer Hannover Re can generate highly attractive earnings in the years ahead and has also given itself the option of enlisting partners and thereby profiting from the above-average valuation ratios for such specialised insurers. "Irrespective of whichever avenues we may ultimately decide to pursue", Mr. Zeller stressed, "we are not under any time or financial pressure whatsoever".

For further information please contact:

Press and Public Relations / Investor Relations:
Eric Schuh (tel. +49 / 511 / 56 04-15 00, e-mail:
eric.schuh@hannover-re.com)

Press and Public Relations:
Gabriele Handrick (tel. +49 / 511 / 56 04-1502, e-mail:
gabriele.handrick@hannover-re.com)

Investor Relations:
Gabriele Bödeker (tel. +49 / 511 / 56 04-1736, e-mail:
gabriele.boedeker@hannover-re.com)
Hannover Re, with a gross premium of approximately EUR 10 billion, is one of the largest reinsurance groups in the world. It transacts all lines of property/casualty, life/health and financial/finite-risk reinsurance as well as specialty insurance. It maintains business relations with more than 5,000 insurance companies in about 150 countries. Its worldwide network consists of more than 100 subsidiaries, branch and representative offices in 18 countries. The rating agencies most relevant to the insurance industry have awarded Hannover Re very strong insurer financial strength ratings (Standard & Poor's AA- "Very Strong" and A.M. Best A "Excellent").

Disclaimer:

Some of the statements in this press release may be forward-looking statements or statements of future expectations based on currently available information. Such statements are naturally subject to risks and uncertainties. Factors such as the development of general economic conditions, future market conditions, unusual catastrophic loss events, changes in the capital markets and other circumstances may cause the actual events or results to be materially different from those anticipated by such statements. Hannover Re does not make any representation or warranty, express or implied, as to the accuracy, completeness or updated status of such statements. Therefore, in no case whatsoever will Hannover Re and its affiliate companies be liable to anyone for any decision made or action taken in conjunction with the information and/or statements in this press release or for any related damages.

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