Zurich Insurance Group AG’s operating profit beat estimates and announced a buyback program of up to 1.1bn Swiss francs (€1.16bn).
Operating profit rose 21% to €6.8bn in 2023, above analyst estimates, and resulted in the insurer’s highest-ever return on equity at 23.1%, with positive momentum expected to continue, the company said in a statement on Thursday. The results were driven by growth in Zurich’s commercial insurance business and record performance in its life business unit.
“I expect this positive momentum to continue and to achieve earnings-per-share growth above 10% over the cycle,” Chief Executive Officer Mario Greco said in the release.
“One year into the three-year plan we are beating or running to beat all the targets for 2025.”
Net income rose 10% compared to the previous year to €4.05bn, slightly below analyst estimates. The firm’s life insurance new business premiums increased 26%. The dividend for 2023 will increase to 26 Swiss franc per share.
Insurers have coped well with unexpected claims in recent years from issues such as COVID-19, climate disasters and the war in Ukraine, mainly by raising premiums and excluding some business.
Zurich Insurance’s key property and casualty unit saw a slight increase in its operating profit of 7% to $3.9bn Swiss francs (€4.1bn), driven by the increase in insurance revenue and an improvement in investment results.
Last month, the Swiss firm’s plan to offload its $20bn Zurich Life Legacy back book in Germany to Viridium Holding fell through after the insurance consolidator pulled out of the deal due to considerations relating to Viridium‘s current ownership structure.
Zurich, Europe’s fifth-largest insurer, said at the time it was committed to finding a solution for the portfolio, which administers around 700,000 life insurance policies in Germany, and would continue to explore options.
Reuters and Bloomberg.
