Zurich posts operating profit just above forecasts

(Reuters) — Zurich Insurance Thursday reported slightly higher-than-expected annual operating profit.

Europe’s fifth-largest insurer reported operating profit of $7.8 billion for 2024, just ahead of analysts’ estimate of $7.7 billion in a company-provided consensus.

The closeness with consensus is “perhaps the clearest indication that the group has become reassuringly reliable,” Jefferies analysts wrote in a note.

Zurich said that the fires in California, which destroyed thousands of homes and killed dozens of people, heightening concerns for insurers, are estimated to have a pre-tax impact of $200 million including its Farmers business.

“It is definitely not too much,” CEO Mario Greco said about the impact in a call after the results were released.

“However, we are not insuring private homes in California as Zurich. This is what Farmers does. So, we have exposure only to some commercial businesses there,” he said. Zurich does not own Farmers business but it manages it and receives fees from it.

As anticipated in a three-year plan in November, the company expects compound annual growth in core earnings per share to exceed 9% between 2025 and 2027.

It posted a rising combined ratio in its core property/casualty business, in line with analysts’ expectations of 94.2%.