Anders Malmström, chief financial officer of Swiss Re, one of Europe’s four largest reinsurance companies, said this morning that the company had set aside approximately $400 million in additional reserves in the first quarter of 2026 to deal with the potential inflationary impact of the ongoing conflict in the Middle East.
After releasing strong results for the first quarter of this year, Swiss Re Group Chief Financial Officer confirmed in a conference call with the media that additional reserves for the Middle East war were divided into $350 million in property and casualty reinsurance and $50 million in corporate solutions.
Malmström stressed that overall, Swiss Re did not have any direct claims from war, given the war exclusion clause in its policies.
“But we do see secondary risks from the Middle East,” Malmstrom said. “When you take into account all the disruption, supply chains and especially rising energy prices, we strongly believe inflation will increase.”
Later in the call, the CFO reiterated that within property and casualty lines, direct exposure is very limited and while specialty lines do sometimes include more, reinsurers have not had any significant claims so far.
“Now, when you think about the big increases in energy prices that will drive inflation, the impact of the war is really a second-order effect. Also, disruptions in supply chains will drive inflation.
“So that’s why we think it’s prudent to set aside money for higher inflation. It’s against the business that’s been written, not claims, they haven’t happened yet, but claims are going to come, it could be property prices, it could be construction, it could be anything. That’s why we believe higher inflation will have an impact.”