UPDATE 1-Hannover Re shrugs off Sandy and lifts profit hopes
* Targets 2012 net above 800 mln eur, sees 800 mln in 2013
* Expects to absorb hit from Sandy within budget
* Share up 6.3 pct, top gainer among German mid-caps
(Adds detail, background, shares)
FRANKFURT, Nov 6 (Reuters) - Hannover Re does not expect to be blown off course by damage from Hurricane Sandy in the United States, the German reinsurer said on Tuesday, as it beat quarterly profit forecasts and lifted expectations for this year and next.
Shares in the world's third-biggest reinsurer surged over 6 percent in early Tuesday trading after it predicted net profit of at least 800 million euros ($1 billion) this year, a third higher than last, helped by surging investment income and a lack of big damage claims.
``In view of the opportunities on international reinsurance markets and its very good positioning, Hannover Re is expecting a very good result for the 2012 financial year,'' the company said in a statement.
After keeping silent on earnings guidance in the run up to the stock market flotation of its parent, Talanx, Hannover Re also said it also expected to earn net profit of around 800 million euros in 2013.
This is well above analysts' average expectation of around 770 million euros this year and 760 million in 2013, according to Thomson Reuters data.
Hannover Re's share were up 6.3 percent to 56.93 euros by 0930 GMT, the biggest rise on Frankfurt's MDAX index of mid-cap stocks. The STOXX Europe 600 insurance index rose 0.8 percent.
While it is too early to give an estimate for damage claims from Hurricane Sandy, Chief Financial Officer Roland Vogel said he expected the company to be able to absorb any losses, including those from business interruption claims, within its projected budget for the year.
``We don't see our annual (disaster) budget in danger in view of current developments,'' Vogel told a conference call with journalists.
The company expected to stay within budget if the insured market loss from the storm remained within the $5 billion to $20 billion estimated by risk modelling agencies, Vogel said.
Hannover Re has used up only 193 million euros in the first nine months of the 560 million it had pencilled in for big damage claims in 2012.
The company's net profit beat forecasts in the third quarter, rising by 63 percent to nearly 266 million euros.
The highest forecast in a Reuters poll was for 240 million euros, with the poll average coming in at 213 million.
Hannover Re, in which insurer Talanx has a 50.2 percent stake, trades at 8.4 times 12-month forward earnings, a premium to Munich Re at 8.0 times, but a discount to Swiss Re , which trades at a multiple of 8.8, according to Thomson Reuters StarMine, which weights analysts' forecasts according to their track record.
($1 = 0.7823 euros)
(Reporting by Jonathan Gould; Editing by Mark Potter)