@Zurich Insurance.
Following on from several major US insurers releasing their results over the past few weeks, some of Europe’s largest re/insurers have revealed their results and have kept a largely positive tone. However, the focus on interest rates and how it has benefitted investments returns were apparent.
Swiss-based Zurich, said in its press release on the results that for H1 2024 it had a “record operating profit”. In June, the Swiss National Bank lowered interest rates.
Group business operating profit (BOP) increased 7% to $4 billion, which Zurich said was the “highest ever return on equity (BOPAT ROE) of 25.0%”.
Net investment results for Group Investments were $3.38 billion for H1, compared to $2.57 billion for H1 2023 – a change of 32%. Net investment returns for the Group investments were 2.3% for H1 2024 compared to 1.8% in H1 2023.
The company’s P&C business delivered a strong BOP of $2.2 billion, up 3% in local currency. This was underpinned by increased insurance revenue and improved investment results, while EMEA and North America experienced higher weather and catastrophe losses.
“Overall, insurance revenue increased by 6% on a like-for-like basis, reflecting the Group's continued focus on profitable growth,” said Zurich. “Natural catastrophe losses totalled 2.4% compared to 1.8% in the first half of 2023.”
However, for P&C, the higher insurance revenue and a strong investment result were partially offset by a higher combined ratio.
“Market conditions have remained more favourable than anticipated."
For the Life segment, BOP was up 12% to USD $1.048 billion, an “all-time high” for the first half, the company said. “Growth was primarily driven by EMEA, which benefited from higher fees, investment result, favourable experience in Switzerland, the UK and Italy,” it said.
“Market conditions have remained more favourable than anticipated,” said Mario Greco, Group Chief Executive Officer on the results.
Zurich also said it saw a record business operating profit for 2023.
“In the first year of Zurich’s 2023-2025 financial cycle, Zurich posted its highest ever business operating profit (BOP) of $7.4 billion, an increase of 21% in US dollar terms," it said back in February.
Other insurers have also released their results this week. Allianz said its asset management business saw “Good operating profit and strong net inflows”. Allianz operates in Germany, a Eurozone country. The European Central Bank cut rates earlier this year, which caused a flurry of market activity in response.
For Q2 2024, Allianz said that “Operating revenues increased to €2 billion, up 4.4% adjusted for foreign currency translation effects. Higher Asset under management (AUM)-driven revenues more than offset lower performance fees."
Like Zurich, it said its H1 2024 results were also a record. For H1, total business volume rose by 6.4% to €91 billion, said its press release. “Operating profit increases by 5.3% to €7.9 billion driven by all segments,” it said.
It added that the “2024 operating profit target affirmed at €14.8 billion, plus or minus €1 billion”.
