UPDATE 2-Swiss Re upbeat on profits after taking floods hit

Thu Aug 8, 2013 10:49am EDT
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* Q2 net profit $786 mln vs Reuters poll of $659 mln

* Says good July renewals in Americas, Australia, New Zealand

* One-time factors helped cushion blow from natural disasters

* High claims from floods in Europe and Canada

By Alice Baghdjian

ZURICH, Aug 8 (Reuters) - Swiss Re shrugged off the cost of floods in Europe to post a better-than-expected second-quarter profit on Thursday and said it could beat its main annual performance target if claims remain stable in the second half.

The world's second-largest reinsurer took a heavy hit from claims for the floods across Europe as well as in Canada, pushing it into lossmaking territory according to the industry's main measure of profitability for the first time in two years.

That prompted a 1 percent drop in shares, but Chief Financial Officer George Quinn said he was optimistic on the firm's profitability target for the year and most analysts agreed, saying prospects for a dividend payout also looked intact.

Reinsurers like Hannover, Munich and Swiss Re help insurance company customers cover the cost of major damage claims like hurricanes or earthquakes in exchange for part of the premium.   Continued...