Global insurer Zurich saw its business operating profit (BOP) increase by 20% in 2018, helped by improved underwriting performance in its property & casualty (P&C) business despite the challenging market landscape.
At $4.6 billion, Zurich’s BOP for the full-year 2018 increased 20% year-on-year, while the firm’s net income, after-tax and attributable to shareholders, increased by 24% to $3.7 billion.
The company’s P&C segment performed well in the period despite challenging market conditions, increasing its BOP by 35% to more than $2 billion, while gross written premiums (GWP) and policy fees increased ever so slightly to $33.5 billion. The P&C segment’s combined ratio strengthened from 100.9% in 2017 to 97.8% in 2018.
Zurich attributes the increased P&C segment BOP to an improved underwriting performance, and says that its 97.8% combined ratio was lower as a result of 1.1 percentage point improvement in the accident loss ratio ex-catastrophes, and lower levels of catastrophe events of 1.8 percentage points.
Surrounding the catastrophe events of 2017, Zurich states that prior year development was 2.3 percentage points, which reflects the positive development in reserves held related to hurricanes Harvey, Irma, and Maria, as well as the continued strength of the firm’s reserves.
Zurich’s Chief Executive Officer (CEO), Maria Greco, said: “We are very pleased with the excellent progress achieved in 2018 in executing our customer-led strategy. We set challenging goals and are delivering against them. We have continued to strengthen our profitability and lower costs while growing our business, expanding our global footprint and broadening our range of innovative solutions to meet the changing needs of customers.
“This performance gives us great confidence as we enter the next phase of our development over the year ahead.”
Away from its P&C business, and Zurich’s Life unit also reported an increased BOP in 2018 of $1.6 billion, driven by growth in Asia Pacific and Latin America.
