Analyst Note| Henry Heathfield, CFA |
Gross written premiums within property and casualty came in at USD 31.2 billion, a 14% rise on the same period in the prior year. The largest increase is attributable to North America where this gross written premium rose 15.9%. There have been double-digit rate increases here for at least a year. Annual premium equivalent for the life business in Europe rose by 11.5% to USD 1.7 billion. That has pulled overall Zurich Life up by close to 7%. The value of new business has been buoyed by increased sales of protection and unit-linked. There were geographically better sales in Zurich Santander, Chile and Brazil. Farmers Exchanges look to be doing well with gross written premium of USD 18.3 billion, an increase of close to 19%. Correspondingly, Farmers Management Services Fees grew to USD 3.1 billion, or 13%. Overall, the results seem to be all right from Zurich but we don’t really know what’s going on inside from this release. We decrease our fair value estimate marginally to CHF 444 per share to account for the change in foreign exchange. We maintain our narrow economic moat rating.