«I am very pleased with this result, which reflects the excellent performance of all our business areas. This will continue to enable us to generate strong returns for our shareholders and grow our business profitably,» says Zurich CEO Mario Greco.

Greco is likely to have won over the analysts as well. They had recently been strict with the Swiss insurer, harboring almost excessive expectations.

Operating Profit Rose by 7 Percent

Despite some storms, particularly in the USA, the operating profit in the first half of the year rose to a record value of 4 billion dollars. This is 7 percent more than the previous year (2023: 3,7 billion dollar); analysts had expected 3,8 billion dollar.

The return improved by 2,2 percentage points to 25,0 percent. Thus, Zurich is on track with its three-year strategic program, which runs until the end of 2025 and targets a return goal of 20 percent.

Insurance revenue increased by 6 percent to 21,45 billion dollar.

Mario Greco (Image: zVg)

Private Customer Business: Higher Premiums Pay Off

Zurich continues to successfully push through higher premiums in the market. This was evident in the private customer business, where gross premiums increased by 10 percent compared to the previous year. Additionally, new business in Europe, the Middle East, and Africa (EMEA), the expansion of travel insurance in Asia-Pacific, and higher revenues in property, affinity, and motor insurance in Latin America positively impacted the results.

The only downside was the combined ratio of 96,4 percent, which was 0,6 percentage points higher than the previous year. According to Zurich, this is due to higher weather and catastrophe losses.

Profitability Secured Despite More Weather-Related Losses

In the property and casualty insurance business, the operating profit in the first half of the year was 3 percent higher than the previous year (2,2 billion dollar). Higher insurance revenue and an improved investment result contributed to this. However, higher weather and catastrophe losses were felt in Europe, the Middle East, and Africa (EMEA) and North America; natural catastrophe losses amounted to 2,4 percent, compared to 1,8 percent in the first half of 2023.

The corporate customer business continues to develop favorably. With a combined ratio of 91,4 percent – 3,0 percentage points of which are due to catastrophe losses – Zurich maintained high profitability, with an operating profit of 1,8 billion dollar.

Life Insurance Business Benefited from One-Off Effect

With a 12 percent increase to 1 billion dollar, Zurich achieved a record high in the life insurance business in the first half of the year. Particularly noteworthy is the positive development in Switzerland, the United Kingdom, and Italy. Additionally, the insurer benefited from a one-off effect of 50 million dollar. This resulted from an unfinished disposal of a legacy portfolio of traditional life insurance policies in Germany.

Farmers Brings Joy Again

The problems at Farmers, which Zurich grappled with in 2022 and 2023, are definitely off the table. With 1,1 billion dollar, the operating profit in the first half of the year reached an all-time high (+12 percent). The operating profit of Farmers Management Services increased by 10 percent. This is attributed to the continued premium growth at Farmers Exchanges and a higher margin compared to the previous year.

The combined ratio fell by 16,4 percentage points compared to the previous year to 95,2 percent despite high weather-related losses in the first half of the year.