Zurich Insurance Company South Africa’s year-end results
Johannesburg, March 24, 2009 – Zurich Insurance Company South Africa Limited today announced the group’s results for the year ended 31 December 2008.
The group has declared a final dividend for 2008 of 140 cents per share (2007: 700 cents per share). The group achieved a profit after tax of R210 million (2007: R289 million) for the period. Motor and property claims increased as a result of the frequency and intensity of unseasonal storms, accidents and crime-related losses. Motor repair costs, including the cost of repairing imported vehicles, continued to escalate well above inflation mainly due to currency depreciation.
“While the industry continues to operate in a competitive market, our results showed strong premium growth with premium revenue rising by 20.8% compared to the same period last year (2007: 12.5%),” comments Nick Beyers, Chief Executive Officer of Zurich Insurance Company.
“In order to limit the negative effect on the underwriting result, we have taken corrective measures by implementing actuarial rating which will improve our risk selection and pricing. This, combined with an increased focus on portfolio management in the personal lines segment, is intended to improve the underwriting result in 2009,” continues Beyers.
In addition to the expected normal inflationary increases, the apparent expense ratio deterioration from 2007 to 2008 was mainly due to a non-recurring pension benefit surplus taken in 2007.
Despite the Group’s conservative equity strategy, which limits overall exposure to equities, a diminution in the value of our equity portfolio in line with the market, as well as the impairment of certain equities was accounted for. As expected there was an increase in investment returns on our bond and cash portfolios.
“Our balance sheet and cash flows of the Group remain strong and even though the net asset value declined, mainly due to the significant drop in equity markets in the current year, the solvency at 42.6% remained within the Group’s target range,” says Beyers.
Ends
Note to editors Zurich in South Africa is a short-term insurance company headquartered in Johannesburg and listed on the Johannesburg Stock Exchange. Founded in 1965, it offers insurance products and services that respond to the needs of individual, commercial and corporate customers. It has a network of 11 sales areas and a series of service outlets across the country, and employs approximately 1,000 people. In addition, it has subsidiaries locally as well as in Botswana and Zimbabwe.
Zurich Financial Services Group (Zurich) is an insurance-based financial services provider with a global network of subsidiaries and offices in North America and Europe as well as in Asia Pacific, Latin America and other markets. Founded in 1872, the Group is headquartered in Zurich, Switzerland. It employs approximately 60,000 people serving customers in more than 170 countries.
