Global insurer Zurich has reported a 3% rise in property and casualty (P&C) gross written premiums (GWP) for the first nine months of 2020 to $27.3 billion, while P&C COVID-19-related claims are reportedly unchanged at roughly $450 million.
GWP growth in P&C during the period was driven by 9% growth in Europe, Middle East and Africa (EMEA) and 4% growth in North America, somewhat offset by year-on-year declines in both Asia Pacific and Latin America.
Zurich attributes the growth to higher premium rates as all regions saw increases driven by commercial insurance. In North America and EMEA, commercial premium rates increased by 18% and 15%, respectively, during the third-quarter of 2020.
As at the end of September 2020, Zurich reports that P&C claims related to the ongoing COVID-19 pandemic, net of reduced claim frequency, remain unchanged at roughly $450 million.
Additionally, Zurich’s P&C business was impacted by the active Atlantic hurricane season in Q3 2020, and alongside other weather events in North America and EMEA, losses from natural catastrophe events are expected to come in around 2 percentage points higher than normal for the second-half of the year.
George Quinn, Zurich’s Group Chief Financial Officer (CFO), commented: “Over the third quarter, the Group continued to successfully manage the unprecedented challenges of COVID-19, a global recession and a record number of hurricanes making landfall in the United States. Our priority remains the support of our customers and the safety and wellbeing of our colleagues as we continue to execute on our customer-focused strategy.
“Growth in our commercial business has remained strong with further improvement in commercial pricing and underlying underwriting performance. Our life business saw a return to growth in the third quarter despite ongoing challenges for face-to-face distribution channels, while Farmers continued to execute on their strategy to improve growth.”
In Zurich’s Life business, annual premium equivalent sales fell by 19% year-on-year to $2.6 billion, driven by a combination of government-enforced restrictions related to the pandemic, as well as some expected declines in certain markets from exceptional levels in 2019.
Zurich reports that the new business margin remained on an attractive level at 24.9%, while new business value declined 18% on a like-for-like basis, as a result of lower new business volumes, unfavorable economic assumption changes due to the reduction in yields in EMEA, and operating assumption changes impacting key countries in Asia Pacific.
“Through the nine months, the Group has continued to demonstrate its resilience and the strength of the balance sheet, with the capital position under the Z-ECM improving over the quarter,” said Quinn.