Zurich Financial sees Q2 profit halved to $707 mn

GENEVA: Swiss insurer Zurich Financial Services Group reported a 51 per cent drop in the second-quarter net profits to $707 million as earnings were hit by payouts for weather-related losses and the earthquake in Chile.

This compares with a profit of $1.43 billion during the same period last year.

The Zurich-based company says investment income fell and it took in less insurance premiums than during the second quarter of 2009. Premiums and policy fees fell 5 per cent to $10.67 billion during the quarter.

Zurich noted that results also suffered because of $300 million worth of provisions it has made for commercial property development loans in Britain and Ireland.

Analysts gave a muted response to the results, noting that they were largely in line with expectations despite higher disaster payouts.

Zurich's cash reserves remain strong and the core business is stable, with particular promise in its Farmers Market unit, said Helvea's Marc Effgen.

Shares were 3.2 per cent lower at 241.70 Swiss francs ($231.16) on the Zurich exchange by late morning.