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Zurich Insurance Group AG Sees Growth in P&C Insurance, Initiates Share Buyback Program

Zurich's P&C insurance revenue up 12% with a strong solvency ratio of 232%, despite a downturn in life insurance premiums.

By Bill Bullington

5/16, 02:30 EDT
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Key Takeaway

  • Zurich Insurance Group AG's P&C insurance revenue rose 12% in Q1, driven by higher premiums, with notable growth in Asia and Latin America.
  • Despite a decline in life insurance new business premiums, Zurich initiated a share buyback program, reflecting confidence in its financial health.
  • Financial stability highlighted by a Swiss solvency test ratio of 232%, despite the aborted transaction of its Zurich Life Legacy back book.

Premium Growth in P&C Insurance

Zurich Insurance Group AG reported a notable increase in its property and casualty (P&C) insurance revenue, marking a 12% rise on a like-for-like basis in the first quarter. This growth was primarily fueled by higher premiums across its operations, with gross written premiums in the sector climbing 9% compared to the same period last year. The insurer highlighted that its performance in Asia and Latin America compensated for a slight downturn in North America. This development underscores Zurich's ability to leverage its global footprint to sustain growth in key insurance segments.

Life Insurance and Share Buyback

Despite the positive momentum in P&C insurance, Zurich observed a decline in new business premiums for its life insurance segment. The specifics of this downturn were not detailed, but it contrasts with the overall positive financial narrative of the company. Concurrently, Zurich confirmed the initiation of a share buyback program announced earlier in February, signaling confidence in its financial health and a commitment to returning value to shareholders. This move follows a year where Zurich achieved its highest return on equity on record, illustrating a robust financial position.

Financial Stability and Strategic Moves

Zurich Insurance Group AG also shared key financial figures, including a Swiss solvency test ratio of 232%, indicating strong financial resilience. The company reported P&C insurance revenue of $10.3 billion and Farmers gross written premiums of $7.08 billion, with Farmers management services fees increasing by 6%. These figures reflect a solid operational performance across its diverse portfolio. However, Zurich faced a setback earlier this year when a planned transaction to offload its Zurich Life Legacy back book in Germany to Viridium Holding was aborted due to issues related to Viridium’s ownership structure. Despite this, Zurich remains committed to finding a solution for the portfolio, which administers around 700,000 life insurance policies in Germany.