Zurich, Aegon and Beazley reveal earnings results

Zurich, Aegon and Beazley reveal earnings results | Insurance Business Canada

Zurich, Aegon and Beazley reveal earnings results
It’s been a day of earnings reports from three of the big players in the insurance industry – so we thought we’d make life a little easier by gathering the results into one place.

So how did the big three of Aegon, Zurich and Beazley fare? Here is a wrap up.

Zurich Insurance
Earnings reports don’t come much better than for Zurich Insurance today. After a series of difficulties that prompted a host of organizational changes, the company has reported a 342% jump in third-quarter profits.

Net profit for the Swiss insurer reached $912 million – that’s significantly above estimates from Reuters analysts, which put the figure around $722 million.

“The strengthening of Zurich’s management team and simplification of the group organizational structure have been completed, while absolute costs have continued to fall reflecting actions taken earlier in the year,” Chief Financial Officer George Quinn said in a statement.

Zurich has been on a cost cutting drive for months, which was further heightened by the arrival of CEO Mario Greco, the former Generali head, in March. With underperformance in its general insurance sector in the past, the company appears to have secured a turnaround with the business’ combined ratio standing at 98.5% - an improvement from the same quarter last year when it stood at 108.9%. Any figure below 100% indicates a profit.

Aegon Insurance
Netherlands-based insurance titan Aegon, which sold its Canadian life insurance business to Wilton Re in July last year, enjoyed a recovery of its own, with the release of its third quarter earnings. Its net income stood at 358 million euros – that compares to a loss of 385 million euros during the previous quarter and a loss of 551 million euros during the same quarter last year.

In its statement releasing the results, the company noted that charges from assumption changes and model updates were offset by gains from fair value items. However, underlying earnings before tax were down to 461 million euros compared to 495 million euros with expense savings offset by adverse US mortality and low interest rates.

“Aegon’s Solvency II ratio remains strong and our management actions enabled us to mitigate adverse market impacts,” commented Alex Wynaendts, Aegon CEO. “While our annual assumption changes and model updates had a limited impact on earnings, there was no impact on our capital position or capital generation going forward. Earnings from our US life insurance business continued to be volatile as a result of higher than expected claims. 

“We are particularly pleased by gross deposits of EUR 25 billion during the quarter. In the US, the integration of Mercer’s defined contribution retirement plan administration business is on track. We did experience outflows
following the acquisition of this business, as anticipated.” 

Total sales for the quarter climbed 13% to 2.90 billion euros from 2.56 billion euros during the same period last year.

For Lloyd’s of London insurer Beazley Plc, which launched data breach response insurance in Canada back in March, the first nine months of the year were buoyed by specialty lines growth.

The company reported a 2% rise in gross written premiums, which reached $1.67 billion in the nine months up to September 30 – an increase from $1.64 billion a year earlier.

“We have maintained our momentum in the third quarter, driven principally by the strong performance of our specialty lines division, where premiums grew by 10% compared to the equivalent period last year,” said Andrew Horton, chief executive officer. “We continue to attract talented underwriters to Beazley in London, the US and continental Europe.”

The underwriter, which specializes in casualty, property and marine insurance, also noted that it had filed an application for its Irish reinsurance business to become a European insurance company – therefore maintaining access to the European bloc even if Lloyd’s of London loses access.

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