Zurich Is a Rare Structurally Advantaged Multiline Insurer

Since some problems started to arise a little over half a decade ago, Zurich has shifted its organization to an underwriting culture. The model that the business operated on previously was one that valued process and key performance indicators over expertise and autonomy of its product leaders, its underwriters. In taking strong measures and paring back its problematic books of business, not concerned about earnings growth or retention, management set a new standard and path for the business. If it wasn't going to be profitable from underwriting, Zurich avoided writing. This can be seen quite clearly in the tilting of the portfolio away from longer-tail lines where the business lacked visibility. As Zurich carried out these actions, we think it entrenched its position. Where lines were dropped and books tiered, the best and deepest relationships for Zurich were elevated. Here the concept of trust cannot be underestimated.