Munich Re, the world’s biggest reinsurer, raised its full-year profit target after net income beat analyst estimates on lower catastrophe claims. The shares rose.

Net income rose to 1.07 billion euros ($1.17 billion) in the second quarter from 758 million euros a year earlier, the Munich-based company said on Thursday. That exceeded the 819.6 million-euro average of seven estimates compiled by Bloomberg.

Munich Re raised its full-year profit target to at least 3 billion euros from a range of 2.5 billion euros to 3 billion euros. That compares with 3.2 billion euros in 2014.

Reinsurers are benefiting from lower claims for natural catastrophes, with earnings squeezed by falling prices and record-low interest rates. Expenditure for major catastrophe losses, man-made and natural, fell to 207 million euros in the quarter from 617 million euros a year earlier, Munich Re said.

“An increase in guidance is always pleasing,” said Peter Casanova, an analyst at Kepler Cheuvreux with a hold rating on Munich Re shares. “Their comments on renewals were also positive given that the declines were less severe compared to last year and the pressure on the industry seems to be easing.”

Shares Rise

The shares rose as much as 3.3 percent, the biggest intraday gain since April 2014. They were up 2.8 percent at 175.50 euros as of 10:08 a.m. in Frankfurt, extending their increase this year to 5.9 percent. The Bloomberg Europe 500 Insurance Index gained 15 percent over that period.

Munich Re cut prices by 2.1 percent on 2.3 billion euros of treaty business last month after a 3.6 percent decline a year earlier, the company said in the statement.

The insurer said in the statement that “pressure on prices, terms and conditions remained high, in particular for natural catastrophe covers.”

“There were relatively few disasters in the quarter, so expectations have been running quite high for the earnings,” said Christian Hamann, an analyst at Hamburger Sparkasse, who recommends investors buy Munich Re shares. “The environment is still tough given the low interest rates and the mass of capital which is pushing into this business and depressing prices.”

Investment income rose 6.5 percent to 2.5 billion euros in the quarter from a year earlier. Losses on derivatives narrowed to 133 million euros from 706 million euros in the first quarter as equity-based contracts increased in value with rising share prices, according to the company.

Munich Re said the share of fixed-income securities and loans made up 88 percent of its holdings at market value.

Swiss Re, Europe’s second-biggest reinsurer, last week reported second-quarter earnings that rose less than analysts forecast after prices declined.