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VIDEO: Tom de Swaan, CEO a.i. On Zurich's Annual Results 2015

Zurich Insurance Group (Zurich) reported a business operating profit (BOP) of USD 2.9 billion and net income attributable to shareholders of USD 1.8 billion for the full-year ended December 31, 2015.

Chairman and Chief Executive Officer ad interim Tom de Swaan said, “This is a disappointing result, reflecting the previously announced challenges in our General Insurance business and restructuring charges, and we have taken rigorous actions to improve profitability. This includes re-underwriting or exiting unprofitable portfolios, increasing cost efficiency and further simplifying the organization. The remainder of the Group continues to perform well, with both Global Life and Farmers making further progress in the execution of their strategies.”

“Given the challenges within General Insurance, it is unlikely that the Group will achieve its target of a business operating profit after tax return on equity of 12-14% in 2016. Nevertheless, Zurich is on track to achieve its other targets for 2014 to 2016. The Zurich Economic Capital Model ratio stood at 114% as at the end of September, within our target range, and the Group expects to deliver cash remittances in excess of USD 10 billion for the period, well ahead of our target.”

“Given the Group’s healthy cash generation and the strong capital position the Board proposes an unchanged dividend of CHF 17 per share. The Board has also concluded that it is important to maintain the Group's capital strength and flexibility in the current circumstances and has, therefore, decided not to return additional capital to investors at this time.”

“We have accelerated our efficiency program and now aim to exceed the previously communicated cost savings target for 2016 of USD 300 million, and are on our way to achieving group-wide cost savings of more than USD 1 billion by the end of 2018. These savings will be achieved through the application of new technology, lean processes and the offshoring and near shoring of some activities. We estimate that as a result of these necessary measures around 8000 roles across Zurich will be affected by the end of 2018. This figure includes initiatives completed or announced in 2015.”

“Our key priorities in 2016 will be turning around our General Insurance business and continuing actions to position the Group for 2017 and beyond, including enhancing efficiency and sharpening the Group’s retail footprint. We have an excellent management team in place that will be further strengthened with the arrival of Mario Greco, who will lead preparations for the new strategic cycle.”

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