Zurich Insurance posted its best first-half operating profit since 2008, while net income attributable to shareholders rose slightly. It also announced a special share buyback.
Operating profit at Zurich Insurance was up 25 percent in the first half of the year to $3.4 billion from $2.7 billion during the comparable year-ago period with growth driven by an underlying improvement across all businesses, even while natural catastrophe and weather-related claims were slightly above expected levels, the company said Thursday. Net income after tax attributable to shareholders was $2.2 billion, up 1 percent over the prior-year period.
The property and casualty business saw a 32 percent increase in operating profit which rose to $2.1 billion in the first half of this year from $1.6 billion. The reduction was mainly driven by an improvement in underwriting profitability with higher prices feeding into the results.
«The impact of COVID-19 on business operating profit continues to decline,» Zurich said.
On Target to Exceed Goals
The insurer said it is also on track to exceed the targets of its current three-year plan. It plans to introduce the next such plan in November.
Group Chief Executive Officer Mario Greco said «We are on track to beat all our targets for the second successive three-year cycle. This is particularly remarkable because the last three years have brought unprecedented and unexpected challenges.»
Special Buyback
During the first half of the year, Zurich announced agreements to sell two legacy traditional life insurance back books in Italy and Germany.
The Group plans a 1.8 billion Swiss franc share buyback to offset the expected earnings dilution from the agreed sale of the Germany life back book, to commence in the coming months, subject to market conditions and regulatory approvals. The primary goal of the German transaction is to reduce capital volatility. The portfolio is and has been, a reliable contributor to earnings and it is not possible to immediately redeploy capital to offset this effect.
