Oct. 30 (Bloomberg) -- Munich Re, the world’s biggest reinsurer, may report its highest profit in six quarters, helped by higher investment income and fewer catastrophe claims.

Net income probably was 715 million euros ($1.05 billion) in the three months through September, after a loss of 3 million euros a year ago, according to the median estimate of 14 analysts surveyed by Bloomberg. The estimates ranged from 633 million euros to 775 million euros.

Munich Re, led by Chief Executive Officer Nikolaus von Bomhard, hasn’t yet given an earnings target for 2009, citing the global financial crisis. In March, the Munich-based reinsurer scrapped a goal to reach profit of 18 euros a share by 2010. Reinsurers help primary insurers such as Allianz SE and Axa SA shoulder risks for clients.

Investment income may have increased almost threefold to 1.94 billion euros in the quarter, according to the estimates. The year-earlier figure of 662 million euros was cut by equity writedowns and losses related to the collapse of Lehman Brothers Holdings Inc.

Munich Re is scheduled to release third-quarter earnings on Nov. 5 before stock markets open in Germany.

This year’s hurricane season, which can produce the reinsurance industry’s most costly claims, has only seen one named system, Tropical Storm Claudette, which touched the U.S. Last September, Hurricane Ike slammed into Texas, costing the industry about $20 billion, while Hurricane Gustav produced claims of about $4 billion, according to estimates by Swiss Reinsurance Co., the world’s second-biggest reinsurer.

Hydro Plant Accident

The quarter’s major claims may include the Aug. 17 accident that destroyed turbines at OAO RusHydro’s Sayano-Shushenskaya plant and killed more than 70 people. The repairs will cost 40 billion rubles ($1.38 billion) over four to five years, Russia’s largest hydropower producer has said. Munich Re hasn’t disclosed whether it incurred claims relating to the accident.

Munich Re announced on Oct. 1 the repurchase of as much as 1 billion euros of its own stock as it resumes a share-buyback program that it put on hold amid the global financial crisis. The program envisages the repurchase 5 billion euros of stock by the 2011 shareholder meeting, with 3 billion euros of that completed by the last meeting in April.

Gross premiums are expected to rise 11 percent to 10.3 billion euros in the quarter, boosted by the $739 million December acquisition of U.S. specialty insurer Hartford Steam Boiler and so-called capital relief transactions in life and health reinsurance.

Munich Re has dropped 2.2 percent this year in Frankfurt trading, valuing the reinsurer at 21.4 billion euros. That compares with a 6.7 percent gain in the 30-member Bloomberg Europe 500 Insurance Index.

The following is a table of the analysts’ estimates and the year-earlier figures. Munich Re revised last year’s numbers to reflect changes in reporting standards. The numbers, except the combined ratio, are in millions of euros.

                        Q3 2009             Q3 2008
                      Median Estimate       Reported

Gross premiums          10,333                9,270
Net premiums             9,900                8,857
Investment income        1,938                  662
Operating profit         1,126                  373
Net income                 715                   -3
(after minorities)
Combined ratio              96.8%               101.2%
property & casualty
reinsurance

The following banks participated in the survey: BBVA Securities, CA Cheuvreux, Citi Investment Research, Collins Stewart, Deutsche Bank, Equinet Institutional Services, Goldman Sachs, Kepler Capital Markets, Landesbank Baden-Wuerttemberg, Merck Finck & Co., M.M. Warburg, Nomura, UniCredit, WestLB.

To contact the reporter on this story: Oliver Suess in Munich at osuess@bloomberg.net

Last Updated: October 30, 2009 12:29 EDT