Insurer Zurich has announced a $1-billion share buyback and dividend increase, despite profits falling by 15 per cent in 2017. Last year’s large and catastrophic series of hurricanes hit the insurer hard, with $700 million being wiped off operating profits in 2017. The company finished with an overall profit of $3.8 billion.
Despite these setbacks, the company asserted that it is still on course to hit its 2017 to 2019 targets, despite the higher number of claims, and has pushed its dividend up six per cent to SFr18 per share.
According to Zurich, the share buyback would offset dilution from shares issued to staff in the past as part of its bonus plans. In the future, Zurich will buy shares for its bonus plans from the market, instead of issuing new ones.
“In a year of historic weather events, our focus and discipline delivered strong performance,” said Zurich Chief Executive Mario Greco. “We improved underwriting, reduced costs and expanded our service offerings, while growing premiums and improving our customer retention levels. These achievements made us resilient in the face of challenges and give us confidence as we look ahead to delivering our 2017 to 2019 targets.”