Swiss Life is looking back on an extraordinary year 2019, as it was able to take full advantage of the decision by a competitor to exit a key segment of the business. Shareholders can expect a handsome increase of their dividend.
Swiss Life’s net income rose 12 percent to 1.2 billion francs in 2019, the Zurich-based company said in a statement on Friday. The insurance giant led by CEO Patrick Frost will reward shareholders with an increase of the dividend to 20 francs per share (from 16.50 francs a year ago). It will also launch a share buyback program worth 400 million francs due to start in March 2020.
The decision by rival Axa Switzerland to no longer offer so-called full insurance policies – a product mainly popular with small- and medium-sized businesses – has had a direct impact on the result of its competitor Swiss Life. Its premium volume surged to 23 billion Swiss francs ($23.8 billion) from 19.2 billion a year ago. Swiss Life expects the volume to decline in 2020.
Strong Increase in Fee Income
Premiums in Switzerland jumped to 13.5 billion francs, up from 9.53 billion a year ago. In France, premiums reached 5.3 billion euros, up 5 percent, while Germany had a volume increase of 2 percent to 1.24 billion euros. The global business unit saw premiums drop by 3 percent to 2.07 billion euros.
Fee income reached 1.82 billion francs, which corresponded to a year-on-year increase of 16 percent, Swiss Life said. Swiss Life Switzerland contributed 265 million francs to the total, while France added a total of 293 million euros and Germany a fee income of 448 million euros.
Surge of Third-Party Assets
The asset management business generated net new assets from third parties worth 8.92 billion francs, boosting total third-party assets to 83 billion francs by the end of the year – 17 percent more than a year earlier.
Total income at Swiss Life Asset Managers rose 16 percent to 853 million francs, with operational growth, consolidation effects and the acquisition of Beos all contributing their part.
