Zurich Insurance Group AG, Switzerland’s largest insurer, said second-quarter profit rose 6 percent as it took fewer losses from natural catastrophes.
Net income rose to $837 million from $789 million a year earlier, the Zurich-based insurer said in a statement today. That missed the $947 million average estimate of seven analysts surveyed by Bloomberg.
“We have seen clear progress on the execution of our strategy and delivery against our targets,” CEO Martin Senn said in the statement. “While still early in our three year plan, we are on track for our 2014 to 2016 targets.”
Zurich, which said in December it seeks a return on equity, a measure of profitability, of 12 percent to 14 percent through 2016, revising the target from 16 percent, plans to save $250 million annually by cutting as many as 800 jobs and announcing restructuring charges of $400 million to $600 million. The insurer started reducing costs last year, eliminating 53 jobs across its general insurance operations in the Middle East, and has shed 670 jobs this year.
In general insurance, its biggest unit, operating profit rose 44 percent to $807 million, as there were no major catastrophe and weather-related losses. The combined ratio improved to 95.7 percent from 99.1 percent.
Operating profit in the life unit declined 11 percent to $315 million.
The shares have risen 0.8 percent this year, valuing the company at CHF38.9 billion [$42.81 billion]. That compares with a 1.5 percent drop of the 32-member Bloomberg Europe 500 Insurance Index.