Zurich posts record 1st quarter results

Zurich Financial Services Group (Zurich) said first-quarter profit rose 71% to a record $1.4bn (£705m).

James J. Schiro, Zurich's chief executive officer, commented: “These excellent results reflect our ability to balance operating discipline and selective growth across our well-diversified book of business. Going forward, we are confident this combination will provide further opportunities for profitable growth, particularly in emerging markets, parts of Europe and in personal lines in the United States.”

Performance highlights include:

Net income of $1.4bn, an increase of 71%. Annualized return on equity (ROE) of 23.5%.

Business operating profit (BOP) of $1.7bn, an increase of 25%. Annualized BOP ROE after tax of 21.4%.

“These excellent results reflect our ability to balance operating discipline and selective growth across our well-diversified book of business

James J. Schiro, Zurich's chief executive officer

General Insurance combined ratio of 93.3%, an improvement of 1.5 percentage points. Gross written premiums and policy fees of $10.2bn, up 4% or -1% in local currency.

Strongly increased Global Life new business value of $146m up 43%, with new business margin (% of APE) of 23.2% and APE up 8% or 2% in local currency.

Farmers Management Services’ management fees and other related revenues increased 4% to $542m.

Shareholders’ equity continued to increase to $26.5bn net of share buyback of $438m as of March 31, 2007.

Schiro added: “Driving these visible profit margin enhancements is our rigorous approach to operational excellence. Contributing to this is not only our operational improvement program The Zurich Way but also steady progress in areas such as capital management, tax efficiency and the further streamlining of our corporate structure. This, along with selective growth opportunities, gives us confidence going forward.”