Zurich Confirms $387 Million Loss in 2001

March 11, 2002

Zurich Financial Services confirmed analysts’ fears, and its previous forecast, with today’s announcement that it expects to report a net loss of $387 million for 2001, and will accordingly slash its dividend by 50 percent.

The company cited net losses from the Sept. 11 attacks, which resulted in pretax losses of $706 million, along with the depressed global equity markets and the surge in asbestos claims as the principal reasons for the earnings decline. Loss expectations had been in the $200 to $400 million range.

The results were reported under International Accounting Standards, which the company recently adopted, requiring that the $2.33 billion in net income it reported in 2000 be adjusted to around $2.1 billion.

Zurich did report a 13 percent increase in premium income to around $56 billion, but it also saw is combined ratio rise to 109 percent last year, from 104.2 percent in 2000 – excluding the impact of Sept. 11.

The full details of Zurich’s operations for 2001 will be released at the end of March.

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