Zurich Earnings: Solid Results; Shares Undervalued

Zurich Insurance has reported a solid first nine-month set of results. Its property and casualty unit has grown the premium it writes across all four regions with good mid-single-digit rate increases across the board and low-single-digit growth in volume of sales. Commercial insurance, in particular, has been able to achieve a 7% rise in prices. Rate rises in North America have been strong in property and motor insurance lines. In life insurance, Zurich has reported a double-digit rise in the present value of new business premiums that has mainly been driven by its Asia-Pacific and Latin America businesses. Fee revenue on investment contracts, mostly written in EMEA, has posted a double-digit percentage-point rise. New business has decreased in North America because of lower corporate contract sales. In the Farmers business gross premium written on the exchanges has grown by 2% over these first nine months. Farmers Management Services fees have correspondingly grown by 2% with stable margins. Zurich’s capital position has improved marginally to a Swiss Solvency Test of 266%.