Zurich Financial 4Q profit increases fivefold

ZURICH -- Swiss insurer Zurich Financial Services Group on Thursday reported a fivefold increase in fourth-quarter net profit thanks to higher premiums and fewer writedowns.

Zurich North America is based in Schaumburg.

Net profit for the quarter ending Dec. 31 was $1.05 billion, up from $205 million in the same period in 2008, when Zurich suffered losses and writedowns on investments amid the global financial crisis.

Cost cutting also helped boost the result. Zurich said it met its objective of saving $400 million in 2009.

Gross premiums for the quarter rose to $13.35 billion from $12.8 billion in the year-earlier period.

Zurich announced an increase in its gross dividend to 16 Swiss francs ($15.15) from 11 francs ($10.42).

Swiss bank Vontobel said it expected a slightly higher fourth-quarter profit, but was positively surprised at the dividend increase.

The combined ratio for the quarter -- a measure of profitability in the insurance industry -- rose 0.75 percentage points to 96.62 percent. A level under 100 indicates profitability.

Shares in Zurich closed 4.44 percent higher at 242.10 francs ($229.3) on the Zurich exchange.

CEO Martin Senn said 2009 was an excellent year for Zurich.

"It is that proven ability to generate consistent earnings and achieve growth in targeted market segments that underpins my confidence looking forward," said Senn, who took the helm from retiring James Schiro at the end of December.

Zurich's full-year net profit was $3.2 billion, up from $3 billion in 2008.