Zurich Financial Services Group (Zurich) today reported a business operating profit of $1.2 billion and net income1 of $751 million for the third quarter as part of a solid operating performance for the nine months ended September 30, 2010.
Global Life and Farmers supported the Group's profitability by delivering ongoing top-line growth coupled with strong profit margins.
General Insurance benefited from past rate increases earning in and managed to successfully continue targeted rate increases into the third quarter. However, it was impacted by a high occurrence of catastrophe- and weather-driven events particularly in the first half of the year.
Zurich's business operating profit for the nine months includes the impact of increased banking loan loss provisions of $330 million, before tax, as reported at the half year. Net income takes into account a previously announced third-quarter charge of $295 million related to the proposed comprehensive settlement agreement in the matter of Fogel vs. Farmers Group, Inc. The Group's capital and regulatory solvency positions remain strong, underpinning a well-diversified portfolio of businesses.
Zurich’s Chief Executive Officer Martin Senn said: “Our core businesses continued to deliver a robust operating performance in spite of the difficult economic environment in our major markets.”
“At Global Life, our focus on delivering relevant solutions for the growing protection needs of our customers is paying off resulting in both higher margin and increased volumes.”
“Farmers continues to show good results generating strong operating margins. I am particularly pleased by the enduring appeal of the Farmers brand and the value propositions offered by the Farmers Exchanges to their customers.”
“In General Insurance, we are managing the business with a strong focus on protecting profit margins, as demonstrated by our successful efforts to implement targeted underwriting actions.”
“We are investing in growth markets, while continuing to focus on sustained profitability, operating efficiency and effective risk management.”
Dieter Wemmer, Chief Financial Officer, added: “Our capital and regulatory solvency positions remain strong and we are confident that we are well prepared for new regulatory requirements.”