Swiss Re AG’s first-half profit beat estimates as the reinsurer saw all key business units perform in line with targets, while the firm announced a fresh round of cost cuts.

Profit for the second quarter was $1.3 billion, resulting in net income of $2.8 billion for the six months to June, the Zurich-based company said in a statement Thursday. Return on the group’s investment portfolio was 4% for the first half of the year, aided by realized gains from real estate sales in the first quarter.

Swiss Re announced that it is raising its operating-cost reduction target to $500 million by 2028, up from a prior goal of $300 million by 2027. The expanded target will primarily streamline non-client-facing operations.

Lower major catastrophe losses supported Swiss Re’s profits in the period, though pricing pressure across the industry is expected to continue into next year. Inflation and macro-economic uncertainty are also challenging for insurers; Swiss Re set aside $400 million earlier this year in additional reserves.

In its key property and casualty reinsurance business, Swiss Re reported $1.4 billion in net income in the first half, up 18% on a year earlier. Swiss Re warned of continued “challenging” market conditions for the segment.

Read more: Insurers Are ‘Actively Evaluating’ New Catastrophe Risks as Europe Burns

In its life & health reinsurance business, Swiss Re posted a net income of $1 billion, up 21%. The business, which had been suffering for some time with profit falling quarter after quarter, has seen a turnaround. The unit missed its net income yearly target for 2025.

The firm has also appointed Velina Peneva, currently group chief investment officer, as chief executive officer Life & Health Re. She will succeed Paul Murray, who stepped down after more than 20 years at the company.

Earlier this year Swiss Re announced a new share buyback program. The firm will repurchase up to $1.5 billion of its own shares in 2026, including $500 million as part of its annual buyback program. Swiss Re said it is making good progress on the new program, having already completed approximately 60% through the end of July.

Photograph: Swiss Re AG’s headquarters in Zurich; photo credit: Philipp Schmidli/Bloomberg