German insurance giant Allianz on Friday reported a drop in annual net profit for the first time since 2011, with natural disasters and the coronavirus pandemic taking their toll.

Net profit came in at €6.8 billion in 2020, down 14 per cent, the group said in a statement. Operating profit was €10.8 billion, down nine per cent, weighed down partly by €1.3 billion in pandemic-related costs.

The fourth quarter showed a more solid performance, with total revenues stable and operating profit up 8.2 per cent.

Costs linked to COVID-19 included pay-outs for cancelled events and suspended activities, with the group also feeling the pinch of lower premiums.

Allianz paid out €880 million for natural disasters, compared to €771 million the year before.

Allianz paid out €880m for natural disasters, compared to €771m the year before

Total revenues at the Munich-based group decreased by 1.3 per cent to €140 billion across the whole of 2020.

In property-casualty insurance, total revenues rose slightly by 0.4 per cent to €59.4 billion, despite declines recorded at Allianz Partners (travel insurance) and Euler Hermes (credit insurance).

“I am grateful for the trust and confidence that our stakeholders placed in Allianz during the challenging year 2020,” Oliver Baete, the group’s chief executive, said in a statement. The group is “in a good position to deliver on our 2021 ambition,” Baete added.

Allianz expects an operating profit of €12 billion in 2021, plus or minus €1 billion – a wider buffer than usual due to volatility in the financial markets.