UK motor claims continue to hurt insurer
Swiss insurance group Zurich Financial Services’ UK general insurance revenues fell 9% to $2.11bn (£1.31bn) in the first nine months of 2010 from $2.32bn in the same period last year, according to the company’s latest results statement.
The insurer also revealed it was continuing to suffer the effects of claims farming in the UK personal lines motor market.
Total Europe general insurance gross written premiums and policy fees were down 7% to $10.38bn from $11.21bn, and the Europe-wide general insurance net underwriting result dipped 5% to $233m from $245m.
Zurich said rate increases and underwriting improvement strategies improved the Europe GI loss ratio by 0.9 percentage points to 72.1%. However, it added that lower reserve releases had an adverse impact in a number of countries, particularly Germany.
In addition, Zurich said the business continued to experience adverse claims development in personal lines motor, particularly in Russia and also the UK, where it said the increase in underlying loss ratio “continues to be attributable to the claims farming experience”.
Group-wide, Zurich’s general insurance operating profit fell 22% to $1.96bn for the first nine months of 2010 from $2.51bn in the same period of 2009. General insurance gross written premiums and policy fees were down 3% to $25.53bn from $26.32bn, and the combined ratio worsened by 0.9 points to 97.8% from 96.9%.
The company attributed the fall in operating profit to a higher occurrence of weather-related losses globally, the Chilean earthquake in the first quarter, continuing decline in investment returns and a $104m goodwill impairment charge in Russia in the third quarter.
