Insurance companies Zurich Group posts record profit and increases dividend
The Zurich Group achieved a record profit in 2024. Shareholders will also benefit from this. They will once again receive a higher dividend. Thomas Jordan is a prominent addition to the Board of Directors.
20.02.2025, 06:50
20.02.2025, 08:08
SDA
Zurich's operating profit (BOP) rose by 5 percent to USD 7.75 billion and net profit climbed by a third to a record-high USD 5.81 billion, as the Group announced on Thursday. Analysts had expected less.
Record results were achieved in property and casualty insurance and in life insurance, while Farmers recorded profitable growth, according to Group CEO Mario Greco. However, the investment result also rose sharply in the good stock market year 2024 (+45% to 6.81 billion).
Shareholders should also benefit from the good performance. The insurer is proposing to pay them a dividend increased by CHF 2 to CHF 28.00 per share. In addition, former Swiss National Bank Chairman Thomas Jordan is to be elected to the Board of Directors at the Annual General Meeting on April 9.
Non-life insurance continues to grow
Property and casualty insurance continues to grow. Insurance sales increased by 6 percent to 46.6 billion dollars, with rate increases of 4 percent on average making a significant contribution to growth.
The division's operating profit rose by 8 percent to 4.20 billion dollars and the combined ratio, which is important for profitability, improved by 0.2 percentage points to 94.2 percent. If the figure is below 100 percent, an insurer is making a profit in this business without investment income.
The severe hurricanes "Helene" and "Milton", which hit parts of Florida in the fall, depressed the result by around 350 million. Due to the fires in California at the beginning of 2025, Zurich, including Farmers Re, expects costs of an estimated 200 million.
Profit growth in the life business
In life insurance, operating profit rose by a substantial 8 percent to 2.24 billion dollars. In addition to higher fee income, higher investment income and a positive effect (150 million) mainly from the revaluation of the old portfolio in Germany, which has not yet been sold, also contributed to this.
Premium income in the life business rose by 3 percent to 33.1 billion dollars, with sales of pension protection and unit-linked products performing particularly well. According to Zurich, this business grew in Europe and Asia, for example.
Meanwhile, the US partner Farmers, for which Zurich provides services and reinsures business, is making progress in expanding its business. The cooperative insurer's gross premiums increased by 4 percent and Zurich generated a stable operating profit of 2.29 billion dollars.
Outlook confirmed
In its outlook, Zurich confirms the strategic targets for 2025 to 2027 presented in the fall, including average annual earnings per share growth of over 9 percent and a return on equity to BOP of at least 23 percent. In 2024, this return rose by 6.6 percentage points to 24.7 percent.
In 2025, sales in the non-life segment are expected to continue to grow in the mid-single-digit percentage range, while operating profit in life insurance is expected to be similar to 2024. Zurich sees further good growth opportunities, explained CFO Claudia Cordioli in a conference call.
This is one of the reasons why Zurich is not currently planning a new share buyback program. Greco added that such a program would only become an issue if capital were to be released, for example through the sale of insurance units.
