Munich Re estimates net profit this year will increase by €200 million ($320 million) to €2.5 billion ($4 billion).

The earnings target is based on projections that its reinsurance and Ergo primary insurance arms will produce better results.

Reinsurance will account for €2.1 billion ($3.4 billion) of the projected profit and Ergo €400 million ($639 million), it says.

Munich Re expects the combined operating ratio for the property and casualty arm to improve 1.4 percentage points to 98%.