Third quarter performance for American and global insurers was decidedly mixed.
Insurance Business America reports on notable movement from carriers active in the US.
Zurich
Zurich Insurance Group was down 6% from the same period last year, reporting a business operating profit of $1.21 billion versus last year’s $1.28 billion. Net income after tax attributable to shareholders was also down 16%, $928 million versus $1.1 billion.
These results missed analyst expectations, largely due to losses in the general insurance unit.
CEO Martin Senn has cut 670 jobs to help lower costs by $250 million annually, Bloomberg reported, as well as sold under-performing businesses such as a Russian general insurance company that went to Olma Group.
AIG
American International Group beat analysts’ expectations this month, announcing revenue of $8.63 billion and an after-tax operating income of $1.7 billion—up 23% from the same period last year.
The news benefitted AIG stock market shares, which rose more than 1% in after-hours trade.
New AIG President and CEO Peter Hancock attributed the good performance to “consistent performance across our businesses,” adding that the board has authorized share repurchases of $1.5 billion.
“I am excited to lead AIG forward and further build on our capabilities to serve all our stakeholders,” Hancock said.
The Hanover
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Hanover Insurance Group experienced a steeper 10.4% decline compared with the third quarter of 2013. The Massachusetts-based insurer pulled in $54.9 million in net income in Q3 2014, versus $61.3 million in the same period last year.
The Hanover attributed the dip to “unusually large catastrophe activity in Michigan,” which translated to an $88.1 million loss this quarter. That’s significantly higher than cat losses in Q3 2013—$30.6 million.
“The strength of our earnings this quarter, particularly in light of higher-than-expected catastrophe losses, demonstrates that our company is more resilient than ever before and is well-positioned to profitably grow despite industry headwinds,” said company president and CEO Frederick Eppinger.
Selective Insurance
Selective Insurance Group saw a significant increase in net income, up 62.7% to $53.2 million in Q3 2014 compared to $32.7 million in 2013.
Operating income was also up to $43.3 million, an 81.2% increase from a year ago, fueled by gains in standard personal lines renewal and standard commercial lines renewal. Excess and surplus lines net premiums also rose 11% in the quarter thanks to a 10% increase in new business.
Swiss Re
Zurich-based Swiss Re AG posted a more than 14% increase in third-quarter profits Friday, attributing the success to rising premiums and fee income, which topped out at $8.31 billion. Swiss Re reported $7.48 billion in the same quarter a year earlier.
Property/casualty premiums at the insurer also increased to $4.31 billion, up from $3.95 billion last year, and net profit rose to $842 million—up from $784 million.
Swiss Re is on track to meet financial targets for 2015, the company said.
