Reinsurer Munich Re saw its second quarter profit improve 10%, thanks to a better investment returns and fewer expenses for natural disasters.
It said net profit during the three month period rose to €812m from €738m in the second quarter last year. Gross premiums rose 5.5% to €12.63 billion.
Munich Re benefited from not having to write down Greek government bonds, which cost it €125m the same quarter a year ago.
That quarter's earnings had also been burdened by claims for tornados in the US.
Chief executive Nikolaus von Bomhard said the current low level of interest rates was a hazard for its business - "far greater than the volatility of markets or the worsened global economy."
It invests much of its premium income in interest-bearing securities. Bomhard said the company's "conservative approach" to investing and writing insurance "is proving robust in these uncertain times."
The company, whose biggest shareholder is US billionaire Warren Buffett at 11.2%, focused much of its earnings discussion on the first half rather than the second quarter. It said its investment result for the half improved significantly after some €806 billion in writeoffs last year.
Greece's bonds fell sharply in value because of the country's financial crisis, and its creditors eventually agreed to forgive €107 billion in debt earlier this year. Munich Re said it had reduced investment risk by shifting some of its holdings from bonds of riskier governments into safer investments such as US Treasuries and German government bonds.
It said however that the very low interest returns on those investments presented a challenge to its earnings and added pressure to make sure its basic insurance underwriting business is profitable.
The company had some 56.8% of its holdings in fixed-income investments and managed a total return of 3.8%, or €4.05 billion, in the first half compared to 3.6%, or €3.47 billion, a year ago.
Central banks including the US Federal Reserve, the Bank of England and the European Central Bank have cut interest rates to record lows, leading to tiny or even negative returns on some extra-safe government bonds.
Munich Re earns money two ways: by keeping claim payouts less than its costs and premiums, and by investing premiums to get market returns.
As a reinsurance company, it writes backup insurance for primary insurers so that the insurance industry can cover catastrophic claims, such as from natural disasters. It also has primary health and property insurance businesses.
