Premium income at Switzerland’s life insurer Swiss Life declined last year. As the company still managed to increase profit, it proposes to raise the dividend payment by almost a third.
Swiss Life had net income of 926 million Swiss francs in 2016, up from 878 million a year earlier, the company said in a statement today. Adjusted operating profit rose by the same margin of 5 percent to 1.4 billion.
The insurance company exceeded analysts' expectations. They forecast net income of 914 million francs and an operating profit of 1.37 billion.
The board of directors proposes to increase the dividend to 11 francs per share from 8.5 francs a year ago.
Fee Income Rises
The fee and commissions business developed better than the average, with the fee result adding 14 percent to reach 396 million francs, Swiss Life said.
The asset management unit also had a good year, with net new assets from its third-party business amounting to 8.5 billion francs. Third-party assets under management rose 28 percent to 49.6 billion francs.
Premiums Decline
By contrast, premium income dropped 8 percent to 17.4 billion francs. «This is primarily a result of the continuing focus on profitability and capital efficiency,» the company said. Swiss Life is moving away from traditional life insurance contracts, which require more capital as back up, toward a fee-generating business. The move is part of the «Swiss Life 2018» corporate program.
Shareholders’ equity increased 12 percent to 13.7 billion francs. The adjusted return on equity was 9.6 percent, which compares with 9.7 percent in 2015.
