Zurich continues to grow and considers additional share buyback
Published: Thursday, Nov 9th 2023, 07:31
Updated At: Friday, Nov 10th 2023, 00:53
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The Zurich Insurance Group continued its growth in the first nine months of the year. It was able to make further gains in both property and casualty insurance (P&C) and new life insurance business. The Group is now considering an additional share buyback in addition to the dividend.
Gross premiums in property and casualty insurance amounted to 34.59 billion dollars from January to September, as Zurich announced on Thursday. This corresponds to an increase of 8 percent compared to the previous year; adjusted for currency effects and on a comparable basis, growth amounted to 9 percent.
The Farmers Exchanges increased gross premiums by 2 percent to 20.64 billion dollars. The decline in sales of insurance for commercial ride-sharing services in the first quarter reduced the positive impact of higher premium rates, according to Zurich. In the US business, Zurich will now focus on improving the underwriting result.
Limiting the risks
The measures taken to limit risks and volatility from natural catastrophes have paid off, the company added. Zurich remains on track to keep losses for the full year within the targeted range, despite severe flooding and hailstorms in Europe in the third quarter.
In life insurance, Zurich put the cash value of premiums from new business at 12.17 billion dollars. This corresponds to an increase of 21 percent or 23 percent on a comparable basis compared to the previous year's figure provided by Zurich.
On track with financial targets
Zurich maintained its momentum in the third quarter, CFO George Quinn is quoted in the press release. He is confident that Zurich will finish the year strongly and achieve its financial targets for the period 2023-2025.
Capital adequacy remains solid. Zurich puts the Swiss Solvency Test (SST) ratio at 266% after 263% at mid-year. This is still well above the company's own target of 160%.
Update an Investorentag
Zurich is also holding out the prospect of an update on capital management for next week's Investor Day in London. This will include plans for "dealing with the current high level of capitalization".
Despite the recently announced transactions, the insurer expects capital to remain at a "high level" and intends to consider an additional share buyback in addition to the dividend. The combined distribution will not exceed 100 percent of the underlying net profit attributable to shareholders.
The insurer's claims business figures were below analysts' expectations. However, the estimates were subject to major uncertainties because Zurich presented a nine-month result for the first time as part of the IFRS 17 adjustments.
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