Good morning or good afternoon. Welcome to Swiss Re's half year 2021 results conference call. Please note that today's conference call is being recorded. At this time, I would like to turn the conference over to Mr. Christian Mumenthaler, Group CEO. Please go ahead. Thank you very much, and good morning and good afternoon to everyone. I hope you're all safe and well, no matter where you are. I'm here with John Dacey, our Group CFO, and together with Thierry Léger, our Group Chief Underwriting Officer, and Thomas Bohun, our Head of Investor Relations, to talk you through the half year results. I'll just say a few remarks from my side before going into the Q&A session so that you get a bit of my perspective on this H1 year. I'd say that overall, as you can imagine, we're quite happy or very happy about the results because we see a lot of hard work that went into the businesses over the last two years, finally paying off and being visible. The underlying results last year were already quite a bit better, but overshadowed by COVID, whereas this year, I think it's in the open and extremely visible. If I quickly go through the different businesses, I look at P&C Re with 94.4 combined ratio. I think that's an excellent result. Also normalized 94.4, so it's below the target we have set of 95% combined ratio. On top, I remember the skepticism in this circle in January when we took some quite radical actions on the underwriting side to cut some of the casualty business and some of the aggregates in Nat Cat. I think you could see that we could catch up with the volume by year- to- date, where 85% of the renewals is now done, and we're flat, but with a significantly better portfolio and further price increases, despite the fact that with our scale, the efficiency, and the life and health diversification, with a combined ratio of 94.4, we have a very high ROE already. I'm very pleased with P&C Re and the trajectory it is in. Life & Health Re, obviously heavily impacted by COVID. I think everybody has been surprised by the huge amount of deaths, unfortunately, in the U.S., but also in India, South Africa. We pay for that. With all the underwriting measures we took on the wording side of the 1/1 renewal actually are in full effect, and you can see that very little losses are left in Corporate Solutions and P&C Re. The underlying in Life & Health is also looking very good. I'd just be a little bit cautious here because there's not an exact science how to separate COVID from non-COVID losses. As you know, there's different methodologies. You can try to estimate that. I'd be cautious around the underlying here. Overall, Life & Health, the technical side has worked very well, also in this H1 year. CorSo, I'm very pleased. In my eyes, the turnaround is finished, successfully completed, and you can see the results here now. They continue to have price increases. They had year- to- date 13%, which is quite something, I would say. That, as you know, will be earned over about two years. The momentum is very strong, continues to be strong. You've noticed that the normalized combined ratio is still above the target we have. CorSo is on a trajectory. We're very confident to be able to hit that when you look at the full year figures. Yeah, very pleased with the overall direction, where they stand, and the position they have in the market. Finally, on the COVID losses, we continue, I think, to have a good estimate. We're comfortable about the overall estimate. There's still a big portion of IBNR, as you have seen in the slides. I think it's 43%. Time will tell how much we need that. At this stage, we feel that's the best guess we can have at the final losses. As I said before, it's tapering off on the CorSo and P&C side. We gave a figure of less than $200 million on these two business lines until the rest of the year. On the Life & Health side, it will obviously very much depend on how many deaths we have in the markets we are active in. I think there's encouraging signs looking at the U.K. in particular, with the Delta variant and number of cases now going down and through all this fourth wave, a very significant reduction in hospitalization and deaths. Vaccines are working against all variants at this stage. If that's the case, I think that bodes well for the rest of the year and beyond. That's just a few remarks. I'm sure you have more questions, I'd like to hand over to Thomas Bohun, who will lead into this Q&A. Thank you very much, Christian, and hello to all of you from my side as well. Before we start, as usual, if you could restrict yourself to two questions and then rejoin the queue if you have additional questions. With that, operator, could we have the first question, please? The first question comes from the line of Andrew Ritchie with Autonomous. Please go ahead. Cool. Hi there. Good afternoon. Guess I'm not normally the first to ask. Two questions, both relating to comments that John made this morning. First of all, you used the term protecting the yield of the fixed income portfolio, hence there was much lower fixed income realized gains. Over the last five years, 70% of Swiss Re's realized gains have come from fixed income. I'm not quite sure how to take that sort of guidance, I suppose. Are you expecting non-fixed income returns, I guess returns on alternatives in particular, to make up for the loss of fixed income realized gains? Maybe you could just guide us to where we should think the running yield on your new definition should go to. I noticed the underlying fixed income, recurring income has dropped quite materially, very materially year-on-year. I'm just trying to interpret what you're saying about this protecting yield. It seems like it's a new element. The second question is, again, John, you made a comment, it's on Bloomberg, it's a headline. I can't see the detail. You say that insurers need to be, quote, "more realistic on weather losses." Who are you referring to there? Your cedents, people buying reinsurance, or the industry in general? I guess in that context, does that signal that you need to think again about where you're positioning in terms of NatC at versus frequency or who are you aiming that comment at? Thanks. I guess, I'll answer these two questions, Andrew. Thanks for asking them. With the first one. You're right. I was quoted protecting the yield. I think in the H1 of the year, we just wanted to point out that the relatively solid investment result, 3.2, got delivered without having to move on the fixed income portfolios in a point where the outlook on future interest rates is unclear. I think we're comfortable at the moment, or we're comfortable during the H1 of the year that, one, the continued caution around credit. We managed to avoid any impairments whatsoever on the credit side. The positive marks we got on the private equity portfolio in particular, were more than sufficient for us to go through the quarter. I don't think you should interpret this as us giving up intelligent moves in the fixed income portfolio when we see opportunities to realize a reasonable level of gains. We're not going to squeeze the portfolio down to nothing when reinvestment rates are where they are. As you said, the recurring investment yield is down to 2.3% from 2.5% a year ago. That's not surprising, given where interest rates are. The 10-year was climbing back up at 1.7, but when last I checked this morning, I think we're back at 1.25. We're just going to have to manage through this. The most important thing is that we're pricing our business to reflect the current yield environment and not some hopeful reversion scenario. That's what's going on. I think we're fine. I don't think you should interpret this as any material change in strategy. Just a recognition that during the H1 of the year, we were able to move forward and achieve this without any significant realization of gains out of credit and/or other fixed income instruments. On the second one, the Bloomberg quote, to the degree that I was aiming at anyone, I think it is both the primary industry and frankly, people that buy retail insurance. The reality is, what we've priced into our rates for secondary perils is what we think needs to flow down into homeowners in Florida or in California, to commercial enterprises around the world to be able to deal with the losses that we see from more extreme weather events. It doesn't mean that we need to do another round of improvements in our models. Our models, we think, are already reflecting the current reality. Not everyone agrees with us on where some of these prices have been. The classic example was in the state of Florida, where we've continued to be underweight because we think the prices that start at the very beginning of this chain are not reflecting the risks that are there. Over time, we hope to be able to demonstrate that our picks, which seem to be relatively high, are the right picks for people to go with. If that cascades down into underlying policies, that's the right answer. A great example of where that did happen for us was frankly, in Japan property after the typhoons of 2018 and 2019, where the primary companies fundamentally changed their rates as a result of the pressure that we put on them in our reinsurance side. Thank you, Andrew. Could we have the next question, please? The next question comes from the line of Will Hardcastle with UBS. Please go ahead. Hey there. Afternoon, everybody. Two questions. The first one is, I guess a competitor this week suggested it would be looking to increase its catastrophe budget expectations in light of recent track record. I guess in that regard, are you still confident that your catastrophe budget is struck sufficiently robustly, or could this be something that Swiss Re looks at as well? The second one is within prior year development, it's a very small number. It's nice to see that the adverse development on casualty lines has come down a long way. Is it possible to break this out, perhaps in quantum between the adverse development on North American liability and cyber versus that favorable workers' compensation development? What drove it, the adverse? Is it just specific cases, or are there any assumption changes within there? Thanks. John, would you like to take those questions? Sorry, microphone. The first one, our belief is that we've got, and we frankly look at every year and during the course of the year, the expected losses we've got on NatC at, we allocate that during the course of the year with an overweight in Q3. We've got a larger expected budget on Q3 than any other quarter. It served us well, frankly, with the exception of 2017 and the HIM losses, I don't know that we've been particularly far off and over any longer period of time. We've actually been very close to budget on average. Any particular year is going to be up or down, given the good or bad luck. I think you should expect that we do review this constantly, and we're comfortable where we've got the picks for this year. That has on NatC at alone probably $700 million expected losses between reinsurance and CorSo for the Q3. That doesn't include the large man-made events. On the prior year development, you're asking for a level of specificity which I don't think we're going to provide. What I can say is, in any one quarter, we evaluate different lines of business. If there are places where we think it would be prudent to reinforce certain reserves, we'll do that. On a net basis, the reality for P&C Re has been very clear. It's been positive for the year- to- date. We don't believe we've got any holes in the reserving positions. We'll continue to evaluate if we've got new information or new events that make us think that we should do that. We'll reinforce where we need to. The good news is we found redundancies in many other parts of the book, whether it's in the property side, some of the accident and health businesses, other places, and we've been able to fully cover the funding of some minor adjustments during, actually for the last four quarters now. Thank you, Will. Could we have the next question, please? The next question comes from the line of Kamran Hossain with RBC. Please go ahead. Hi, afternoon. The first question is just following on from Will's one about cat budgets. Could you just talk a bit about how you actually calculate the Cat budget? I guess based on my understanding and conversations with other kind of companies and people in the sector, a lot of cat budgets are calculated on a backwards-looking basis. It's from historical data kind of overlaid onto your portfolio. The issue that these models have is that they don't tend to factor in changing climate. Just a few words on kind of how you calculate the cat budget, and kind of factor climate change, which seems like it is happening into models. The second question is just on the, I guess, the level of prudence in your COVID reserves. Obviously, the kind of 43% IBNR reflects kind of event cancellation and mortality losses. If I look at the kind of business interruption block, it looks like you've got $1 billion plus of IBNR for events that really happened more than a year ago. Just interested in how those reserves have moved year-on-year, and whether actually you'd expect to get more clarity on whether these claims will develop or not in the coming quarters. Thanks. Thierry Léger, do you want to take the first question and then John Dacey the second? Happy to. On the NatC at budget. The starting point is always with the expected loss. You have to imagine that in our costing, we price in an expected loss for a given year for the business we write. That's the starting position for defining the budget. We do several adjustments, with regard to profit sharing agreements, reinsurance premium. Of course, retro comes into play as well, because the expected loss is on growth, late reportings and things like that. That's how we get to the budget that we disclose. More specifically to your question around climate change, of course, that is part of our expected loss we start with. As we actually change our views on our loss pick, for example for climate change, that would impact the expected loss and accordingly, also the budget over time. Maybe if I could jump in, Thierry, because it could be that some reinsurers are really using just historical loss data over the last 10 years, 20 years. I think it's important to stress that we have a team of dozens of NatC at experts who program forward-looking models, physical models for hurricanes, for example, et cetera. Of course, their ambition is to capture all trends and have a forward-looking view and model, and that's the figure we use here. Of course, that gets calibrated indirectly. When you do models, you always calibrate to the back, but it includes all information we have about climate change, for example. There should be definitely a forward-looking element in the cat budget you see. Kamran, on your second question with respect to the COVID reserves, you correctly identified that the level of IBNR for the business interruption claims around the property book remain strongly in IBNRs. This frankly reflects a current market dynamic where the presentation of claims has been very slow from the primary markets. Here where, in some cases, they themselves are trying to come to a final conclusion of what their losses are, then thinking through the specific issues of event definition and accumulation, where in some cases, I'm guessing we'll have a pretty coherent view ourselves of the way they're thinking about it. In other cases, we may have a seriously different view of the way that they're looking to pull together a potential claim or recovery. What I can say is there's been relatively little movement on this specific bucket in the property side over the last two quarters. I would expect probably around year-end as we look again to the renewal season, that we might sort out some of the uncertainty. This is probably going to continue into next year at some level. I wish we were in a different state as an industry. We're not. There's not much we can do until the primary markets come to us with a clear proposal about what they're expecting, and we can either agree or disagree with that. The discussions have been occurring. I don't want to say that there's been no discussions or nobody's thinking about this. It remains, as you say, a big chunk of this $1.4 billion that we've got in this bucket to be resolved. We continue to believe that we are well-reserved. Thank you, Kamran. Could we have the next question, please? The next question comes from the line of James Schuck with Citi. Please go ahead. Hi. Thanks very much. Good morning. Good afternoon. My two questions, firstly on the fixed income running yield in the, I think you showed in the appendix. I think it was at $886 for the H1 of the year, which looks like a yield of about 2.1%. I think you're saying that new money at the moment is about 1.25%, at least based on the treasuries. Can you just remind me about your strategic asset allocation, and where you are versus that, and how we should think about the scope for risking? I think your market risk as shown in the SCR is actually quite low by historical standards. If I just annualize that fixed income yield of sort of around $1,800, $1,900 or so, is that number directionally going to go up as you change the asset allocation? That's my first question. Secondly, on CorSo. I hear the comments that you say, Christian, about very confident with the outlook and the trajectory. I'm just a bit puzzled about the H1 result because it's 97.7 normalized, but that's not normalized for man-made losses, and man-made losses were about a two-point benefit. Excluding that, we're sort of closer to 99 or closer to 100. When you make your comments around on track below 97, that's getting the benefit from a low level of man-made losses. Just comment about why you're so confident you're on track versus plan would be helpful. Thank you. John, do you want to take the first question and then Christian the second? Yeah, sure. James, with respect to the current investment portfolio, I think on the slide deck in the appendix we had on page 25 or 26, I have trouble reading this with this light. Page 26 40% government bonds, 30% in credit. Another 10% in equities and mortgages and other loans, some policy loans. I think that to give you a sense, we have increased modestly the risk from the beginning of the year. We've reduced our cash position from 17% down to 14%. We continue to have some runway if we want to bring in additional risk onto the balance sheet at this point in time. I think the asset management team is reasonably comfortable with where they are. The underlying point you have, which says with current interest rates, will this return and the recurring investment yield continue to trend down? The answer is probably yes. I don't think anything dramatically. We don't see an inflection point on this. We'll look to continue to see what's available on the alternative side, and we've got teams that have done a very nice job, frankly, in private equity and other alternatives to support a strong yield. The core fixed income side of this is, not just for Swiss Re but for the industry, going to be under some modest pressure with reinvestments. That's why the kind of price increases we see in Corporate Solutions, we need to continue the underlying primary industry. Getting those rate increases helps us directly in that slide, but also frankly, has a spillover effect to our reinsurance portfolio as well. Of course, though, I think you're right. If you add manmade, we come to a slightly lower number, so our team would say 98% something. If you look at the trajectory of the price increases and as it gets earned through over two years, I think mathematically, I have quite some confidence that we get there by the end of the year. Just looking at the progress of quarter- by- quarter and how it gets earned through. Yeah, clearly we push them down. We give them tough targets. They now have also elipsLife, which is a different type of business and so on. I'm confident we will get to 97% at this stage. Thank you. James. Could we have the next question, please? The next question comes from the line of Iain Pearce with Credit Suisse. Please go ahead. Hi. Thanks for taking my questions. The first one was on the dividend upstreaming from the different segments. I notice P&C Re didn't upstream any cash to group this half year. The only cash remittance was from Life and Health. Is there anything to sort of flag there? Is it due to the cash inflows you've had from some of the divestments or the sort of restructuring that's happened to the different operating entities? Should we be expecting a sort of normal remittance pattern in the H2 of the year? Just following up on the Corporate Solutions point. I was a bit surprised to see the underlying development worsen this year on the combined ratio. Just if there's anything to flag there as to why that has worsened. If you look at slide four, does the historics include elipsLife when we're looking at that underlying combined ratio? John, do you want to take the first question? Yeah. With respect to dividends, you're right in the flag that we have done this restructuring of the legal entities in Switzerland effective July 1st. I don't think I would read anything into what you saw in the H1. We continue to be highly liquid, both at overall the Group, but also more broadly in the consolidated businesses. We'll think through what dividends we might want to see, either in the H2 of this year or next year between the legal entities. I don't think that there's any particular cause for concern about our ability to manage both liquidity and capital between the subsidiary and the parent company. Maybe the question on the normalized combined ratio. I think the issue here is we don't normalize for manmade to make it comparable to P&C Reinsurance. If you did the normalized with manmade last year, it would be higher, the combined ratio than it is now. I can't remember the exact figure, but Investor Relations can provide that to you. Thank you, Iain. Could we have the next question, please? The next question comes from the line of Vinit Malhotra with Mediobanca. Please go ahead. Yes, good afternoon. Thank you. My first question is on the kind of the flood and the weather we talked about. Earlier in the year, we've been talking about the reduction in secondary perils. Are you able to give us some kind of directional indication or some kind of quantification that, okay, because of all those underwriting measures, there was a slightly lower loss to be expected from these floods? Anything to that effect would be very helpful. That's the first question. Second thing is, John, there is a very strange remark in the Bloomberg headlines. Again, might not be fully accurate, but just to read out what I see, it says that you said there's still some more mortality, so continue to see major mortality losses. Just to understand, I would have assumed that from your comments as well, that mortality should trend down loss-wise from in H2. If you could just rephrase that or clarify, that'd be very helpful. Thank you. Thierry, if you could take the first question and then John the second. Yeah. Take the first one on the flood and the weather, as you called it. Indeed, we reduced our exposure to these secondary perils, and we were actually a ssuming at the time, you will remember, we also talked about it already at the investor day. We were assuming that the trend of the secondary perils, the volatility that we have seen emerge over the last years, is not going to go away suddenly. We viewed this as a real trend. What we did were actually two things. One is that John mentioned already, was the adjustment of models, for example, in Japan, but we've also adjusted the models in other areas. Obviously, we continue as we learn from new claims, we continue to adjust our models. That's the one thing we did, which leads over time to an increasing loss pick. The other thing we did is we looked at structures that we don't like, and in this regard, we very closely looked at these catastrophe aggregates that can actually pick up these secondary perils quite easily. In a way, we didn't like as much anymore. We did indeed address those and reduce our exposure, but not only to these aggregate covers, we also had Top and Drop structures. Everything in that frequency area we did reduce. Our own estimation is that it would certainly be a triple-digit amount of losses. It was certainly a triple-digit amount of loss that we have avoided with those actions. Vinit, thanks for bringing up. I'm not quite sure exactly where the headline came from. What I did say is the mortality losses were the only significant COVID loss that we had in the H1 of the year, and I'm not sure if that's somehow misunderstood of my point. What I can say very clearly is, obviously, our biggest exposure for Life & Health Reinsurance losses in COVID are mortality losses and in the U.S. We've had some losses in other countries in the past, the U.K., not much on continental Europe. The U.S. has been dominant. What we saw was on Q1, our biggest single quarter, because of the number of deaths in January and February in particular, that has tailed down considerably. The Life & Health Reinsurance losses overall reduced by 60% Q2- over- Q1. Given the trends of vaccination and the continued success of the vaccines against the variants to date, we would, all things being equal, expect that to continue to trend down. What we did see in the Q2 was some losses that were booked from geographies other than the U.S. About half of that number that we've booked, the 240, was U.S. related. The other half came from some other countries where losses were established or reported. India, South Africa, and some small numbers out of certain Latin American countries. We do not expect that those numbers will be substantial going forward. What was booked in the Q2 was losses actually in the Q2 and probably a little bit of catch up from previous quarter deaths that were reported to us after considerable interactions with the primary company. I think we would expect the run rate with what we know today and the current trends of both the functionality efficacy of the vaccines vis-a-vis the different variants and the slowing but still increasing levels of vaccination to reduce these losses in future quarters. I hope that helps. Thank you, Vinit. Could we have the next question, please? The next question comes from the line of Thomas Fossard with HSBC. Please go ahead. Oh, yes. Good afternoon. Two questions on my side. The first one will be related to CorSo. I think that you're flagging the end of the turnaround program at CorSo and potentially you're flagging more or return to more normal growth. Could you help us to understand what we should expect now in terms of top line goals for CorSo, opportunities you're currently contemplating in the market, and if on top of what you're getting in terms of rate increases, we should start thinking about growing exposures. The second question would be related to the renewals. Year- to- date, you're coming with 4% nominal price change. Can you update us on what the impact of those on a combined ratio basis, on a net profit basis? At the end of the day, I'm guessing that it's net of everything, it's 2% higher. Just was wondering if you could put some qualitative comment on this and say if, in your view, this is enough, or actually it needs to be further improved going forward? Thank you. John, would you like to take the first question? Yeah. With respect to CorSo, I think it's important to remember that Andreas Berger came in in 2019, took responsibility. The pruning was severe. A third of the portfolio was jettisoned. Teams were shut down, disbanded, and picked up in some cases by some competitors. We were consequent in removing ourselves from certain lines of business, whether it's excess and surplus liability in the U.S., umbrella liabilities. We just decided that we would be better off not in these lines of business. For the absence of doubt, there's no reconsideration of those lines that we did exit from. We're very comfortable that we can move forward without necessarily being players in what we consider to be more challenging lines, at least over any reasonable period of time. What we have reached is the inflection point, and that's what you see actually here, in the H1. Premiums earned are starting to grow again, not by much, but as a result of these price increases coming through on the book of business and the potential expansion in certain lines. The European property book, of CorSo, is growing. We're adding new risks, but we're also getting good pricing. We would expect then to see an increase in premiums earned, at the very least, from these price increases. They may not be 13% in the next quarter. We're not making a prediction of what they are, but there is momentum carrying the commercial rates forward. Even if the book doesn't necessarily grow very much, this momentum unearned, we should see. To the degree that the CorSo does see valuable opportunities for writing new business in lines where they're already present, they've got our support and we've encouraged them to put that capital to work. We're not making a prediction on where they're going to end the year. I'd be very surprised if you wouldn't see some acceleration of the growth from where we are today. Thierry, on renewals. I start on the renewal and quality question, Thomas, that you asked. Indeed, you're right. There is this nominal price increase that we disclose, and against it, we have the yield increase that we observed early in the year, and we have the loss picks that we mentioned already that you have to set against it. Of course, if you deduct them from the nominal price increase, then what's left is not as much as we promised the result improvement will be. The difference is actually, and the difference is significant, is coming from the improved portfolio mix. We said that, and we have disclosed it as well. We are on the one side, addressing our underperforming treaties in the casualty space and in the property space. One, we reduce exposure to social inflation LCR. Those are typically treaties with a high combined ratio. You're addressing the lower layers in, for example, Cat and property. Those are equally businesses with typically higher combined ratios. As we move more and grow more, and by that I mean also exposure, into businesses with relatively lower combined and actually reduce business with relatively high combined ratios. Overall, we quite strongly improve as a result the combined ratio of the portfolio through an improved mix. Thank you, Thomas. Could we have the next question, please? For any further questions, please press star and one on your telephone. Star followed by one. The next question comes from the line of Ashik Musaddi with JPMorgan. Please go ahead. Thank you and good afternoon. Just a couple of questions I have, if I may. First of all, you mentioned that the expected losses from the recent flood et cetera is about a mid triple digit million. If I heard it correctly, you mentioned that the Q3 budget for cat losses is $700 million. That leaves a gap of just $200 million. How confident you are that the hurricane season would not more or less exceed those extra $200 million left? We are still left with the whole hurricane season. That's one question I would ask. The second thing is, if I think about the growth, at the moment, you're trying to make sure that the portfolio is more profitable, especially in the P&C Re business. Pricing is the main focus where volumes is not. What needs to happen for the volume to start picking up as well? When do you think that the volume can start moving higher as well in the P&C Re? Corporate Solutions is pretty clear. Pricing is driving volume, total premium as well. In P&C Re, the premiums are still kind of flattish. The third one is, you mentioned there is $200 million of remaining losses from COVID in P&C and Corporate Solutions. Like this quarter, you have booked almost nothing. What is the reason for that $200 million? Is just because there's just no visibility and uncertainty, or is it that you have some line of sight which makes you put that $200 million? Thank you. John, do you want to start on those? Yeah. Maybe I can. With respect to the floods, what we said is the combination of what is a man-made event, the social unrest in South Africa and the floods in Germany are likely to be a mid three-digit loss. We'll clearly be working on this in the next weeks to try to get more precision on this. As long as it's consistent with what these preliminary estimates are, we'll just move forward. I think with respect to the NatC at budget, you should not expect that all of this is going to land in the NatC at book. The part in South Africa will be outside of that calculation for us. I think we've probably got a little more room than you might indicate, if our preliminary guesses are there. We do have some expectations for manmade losses, which would take the number over $800 million, when you combine it with the NatC at budget. The third question, I think I'll answer as well. With respect to future P&C losses on COVID. What we said at the beginning of the year is we still saw three potential opportunities for us to take losses. One is the very constrained exposure we now have on property treaties that are multi-years or otherwise, might pick up some losses if there were to be a new set of lockdowns. Obviously, that's not happened in any material way in the H2 of the year. The second was on the event cancellation. What I can say there is one, good news, lots of events are occurring, including the Tokyo Olympics. Very pleased to see, also even some of the other ones that were canceled, what we saw was the ultimate cost of that cancellation was lower than we might have had reserved, especially in the CorSo book. What you saw in the Q2 was actually a bit of a positive on event cancellation, which covered some modest losses other places. Last, on the credit and surety side, the reality is, the governmental support and fiscal stimulation continues to keep companies in pretty good shapes. We didn't see any material losses that we would have linked to COVID activity in the H1 of the year on credit and surety are very small. The $200 million that we tagged for what's left in the year is basically a maximum amount if things were to go relatively poorly in those categories for the H2 of the year. If they go well, it'll be a lot less than $200 million. We're not prepared to predict that at this point of time. I think we specifically use the phrase less than $200 million to give you a maximum that we would expect. It may well be materially less than $200 million, given the experience we've had in the H1 of this year. There's nothing we see on the horizon, which says we're going to be close to that number today. Thierry Léger, on the growth opportunities. Yeah. On the volume pickup. I mentioned, I think, and John Dacey mentioned the same, there are underlying lines of business that we are growing, that CorSo has been growing, that P&C Re has been growing through the whole transformation and turnaround they have been through. NatC at has been an area where we have always found spots of nice growth, and that's also what we have seen in the H1 this year. I mentioned specialty across CorSo and P&C Re. We have seen very attractive growth there. rise, for example, in credit surety, where we are still a bit on the brakes currently, but that could potentially, if the markets become attractive, become another area of growth for us. Casualty, I'd be much more careful because social inflation is here to stay very clearly, and there are no signs or indications that this would go away to the country. We think this social inflation impact could also move into other lines and therefore, certainly on casualty, we will remain careful. The other elements that is difficult to predict, how it's going to evolve is that we've seen a trend generally to non-proportional, which in my view is a very good trend. It's usually a trend to quality portfolio when we move because we have a very good understanding of non-proportional costing. That's usually a sign of confidence and very positive. We have seen a decline in the H1 on the proportional business. That's very difficult to predict. How will the commissions behave with our customers? What actions do our customers take on their portfolios? All of that is more difficult to predict. Equally there, if opportunities present themselves, we will try and find opportunities to grow there too. Thank you, Ashik. Could we have the next question, please? The next question comes from the line of Vikram Gandhi with Societe Generale. Please go ahead. Hello, good afternoon. It's Vikram from Societe Generale. Hope all of you are doing well. I've just got one question. We're seeing some settlements in the U.S. with regards to the opioid crisis. I know the group has been fairly cautious on the casualty side over the past year and a half. If you can just share some of your thoughts as to your level of comfort with the historical pharma sector exposure, that would be great. Thank you. Yeah, Vikram. Thanks for this. We have had historically, we were among the first movers, early 2000, with regard to pharma exposures, with pharma exclusion, that we have implemented across our businesses since. I think I can say with confidence that we have been adopting a very cautious approach to pharma exposures in particular. However, we do find still exposures, but certainly, it's a very measured approach we take still today. The settlements that you see, you read in the news, all of those were ongoing settlements we've been observing, monitoring, but none of them has been a surprise to us and is in line with our expectations, I would then say. No particular bad news or good news to us. Thank you, Vikram. Could we have the next question, please? The next question is a follow-up from Mr. Thomas Fossard with HSBC. Please go ahead, sir. Yes. Thank you. Just wondering if you wanted to make any comments on your capital position at mid-year, direction, and actually you disposed also a couple of stakes since the start of the year. Any hints on what could be the use of them, and if you've got some ideas and clear plans already? Thank you. Thomas, hi, it's John. What we've indicated is that our SST ratio is above the midpoint as of June 30th. We'll go through the work we have to go through to get a more precise answer and share that with the market with the Q3 results. The robustness of our capital, I don't think anybody questions. Your question, I think, is going further than that, which says, are there going to be any additional capital measures. I think it's premature to discuss those. We'll obviously look to complete the year. We are very much pleased with the H1 performance and with the underlying economic earnings as well as the U.S. GAAP earnings that are coming through. We'll see how this plays itself out in the H2 of the year. Our overall capital framework remains intact. We looked at one, make sure that we've got a very strong position. Check that box. Two, we support important growth. That's what you see doing, the premiums are up, earned 8%. Life and Health Re, I think is a franchise that you should not ignore in terms of the relatively strong growth that we continue to see there in terms of value creation. Frankly, even if it remains a very small business, our iptiQ business is another place where we're continuing to invest in as it grows very strongly year-on-year. If we find ourselves in a great position with more capital than we know what to do with, we'll come back to you with some of those ideas. Thank you, Thomas. Could we have the next question, please? The next question comes from the line of Ivan Bokhmat with Barclays. Please go ahead. Hi, good afternoon. Thank you. I've got a couple questions. The first one is on Life & Health Re. Just wondering, the underlying performance, excluding COVID, has obviously been very strong for a couple of quarters running now. I was just wondering if you could share some views on the drivers. Some of the stuff we're reading is that the flu pandemic has actually been very benign. Just wondering if there is any one-off effect that you can flag within those numbers. Secondly, just on some of the earlier comments you've made on increasing the Nat Cat exposure. Obviously, you said that you're still being very selective on the regions and then the types of coverage you take, but I was wondering if you could just suggest which geographic areas have you been growing into, if it's, let's say, not Florida. How is the portfolio changing? Thank you. On the Life & Health underlying drivers, Christian mentioned, I think it is an important point that the allocation between the COVID losses and non-COVID losses is somewhat sometimes a bit of an intellectual debate and not straightforward. There could be some element or noise coming from that allocation. We have seen, however, positive mortality developments, for example, across the board. We have seen good developments in disability, for example, in Australia, which was positive after some more difficult quarters. We have also seen some positive developments in China. Generally, a positive underlying technical result. We say that we shouldn't take this obviously as an indicator for the H2 of the year. On the NatCat side, you used the word selectively. I think selectively has more to do with structures and with specifically frequency related layers. Otherwise, we model 185 different perils, we're actually very keen to grow every single one of those. There is no particular preference. There are areas where we are indeed very cautious. We have been historically cautious. Historically is a big word, but cautious over the last year in Florida, for example. That is no news. Other than that, as I just said, we have actually quite a balanced appetite across the board. I think there's not much more I can say. If I could just add on the first point on the life and health underlying performance. As Thierry said, the technical performance has been strong universally across geographies and products. We're pleased with that. It's a little unusual. Normally, there's one or two places where you might see some temporary relapse to a less good situation. The other thing, the current return on equity is being flattered by a relatively low level compared to where we set the targets at 10%-12%. The business was supported by a notional $8 billion of equity capital. The reduction of the unrealized gains in supporting that business has reduced that below $6 billion, I think, right now. We've got a situation where the ROE looks good, in part because the E is more constrained. The earnings themselves at over $500 million for the H1 of the year are probably better than anticipated, and no matter how you count it, at the high end of what we might have expected. Thank you, Ivan. We probably have time for one more, if there's someone waiting in the queue. Yes, we have a follow-up question from Mr. Andrew Ritchie with Autonomous. Please go ahead. Oh, hi there. I think they're fairly short ones. Apologies if this is a simplistic question. I'm curious as to why the loss cost assumption in the pricing disclosure, you gave us the nominal price in January, and you knocked off 1.5% for loss cost, and that's become - 1%. I guess I'm just setting it in the context of, generally, there's been an increase in loss cost expectation across the industry year-to-date, given the inflationary backdrop. How come that's not the case for you? I'm assuming that's something to do with the mix of the type of renewal, but if you could just clarify that. The second question, I think is also for Thierry. On the Nat Cat growth, I'm thinking specifically U.S. Obviously, we are in hurricane season. When I think about your exposures, have they grown across all return intervals? Is it more, I don't know, one in 50 and return intervals below that? Is there anything unusual about the growth across the return intervals? I put myself off. On the loss cost assumption that you've mentioned, indeed, we have reduced that slightly. When you look at the numbers we disclose, in reality, it indeed has to do with the mix of business that obviously has an impact as well on this number. We have been growing more in specialty and property. The adjustment on the loss pick side has just been much smaller compared to what we actually think we need on, for example, casualty. That explains that relatively, in my view, anyway, small change between the earlier part of the year and the later part. The second point on NatC at U.S., we have indeed changed somewhat the exposure to the different, you called it, I think, return periods. We have clearly moved away from the higher return periods. Those are the 5-year, 10-year return periods we're talking about, and moved into what we call the belly, so more in the middle part. Not necessarily to the 150 years + that you mentioned. Andrew, I might just add on Thierry's first answer. Even on the January 1 renewals, we took a position on coming inflation related to not just social inflation, but also the risk of broader-based inflation that was in the pricing model. I think while it became a bit fashionable for people to talk about cost of goods and other loss inflation in the middle of that half year, we'd already made some moves earlier on for those inflation assumptions. You might not have seen that delta increase in our own costing models that you're thinking about. With that, we've come to the end of the call. We'd like to thank you all for attending. Thank you for your questions. If you have any additional questions, please reach out to the investor relations team. Have a nice weekend, and thank you again. Operator, back to you. Thank you for your participation, ladies and gentlemen. You may now disconnect.