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Zurich UK reports strong half-year performance with profits up 74%

August 8, 2019

Zurich UK today announces its half year results for the period ended 30 June 2019 for its business units. Zurich Insurance (the Group) announced its results earlier today.

Zurich UK

Earnings up 74% to £248 million from £142 million in 2018 
Combined Ratio (CR) improves to 85.6% from 95.5% in 2018
Life New Business Value (NBV) up 38% on a like-for-like basis*
General Insurance Gross Written Premium (GWP) in line with 2018 with solid growth in target markets

General Insurance 
Business Operating Profit (BOP) of £185 million, an increase of 144% from the £76 million reported for 2018 
Gross Written Premium (GWP) of £1,204 million – in line with the £1,202 million reported for 2018 
Combined Ratio (CR) of 85.6%, a 9.9 percentage point (ppt) improvement over 95.5% in 2018

Life & Savings
Business Operating Profit (BOP) of £63 million – slightly lower than the £67 million reported for 2018
Annualised Premium Equivalent (APE) of £172 million is 8% lower than the £187 million in 2018 on a like-for-like basis   
New Business Value (NBV) of £30 million is 38% higher than the 2018 result of £22 million on a like-for-like basis*

Tulsi Naidu comments on the UK's 2019 H1 resultsCommenting on the UK results, Zurich’s UK CEO Tulsi Naidu, said: “This is a very strong performance with year-on-year profits up 74%. These results are built on the actions we have taken over the last few years to strengthen our underwriting discipline, enhance our customer propositions and reduce costs.  As a result, we have a simpler, more digital and disciplined business. We are pleased to have made such a strong contribution to Zurich Group’s best half-year results in a decade.   

“We are proud of our focus on customer satisfaction, our record of paying 99% of claims and our ongoing commitment to the community, as demonstrated by the work of the Zurich Community Trust and our very high levels of employee volunteering and fundraising.  We continue to give priority to creating a modern and progressive workplace which attracts the very best talent. We have begun to advertise every job vacancy as available part-time or as a job share, resulting in a 25% increase in women applying for jobs at all levels.  And three out of four employees in our UK business now also benefit from ‘FlexWork’, our agile working programme.

“I’m grateful to everyone in our UK team, whose hard work and talent has helped us reach this important milestone in the transformation and growth of our business.  And our sincere thanks to our customers and distribution partners for placing their ongoing trust and support in us.”

General Insurance

Zurich’s UK General Insurance business delivered a strong first half performance with profits increasing 144% to £185m and the Combined Ratio improving to 85.6% (a 9.9 ppt reduction vs. H1 2018).  While benefiting from benign weather earlier in the year and lower large losses, Zurich’s result has been driven by targeted actions to strengthen the Company’s underwriting discipline, capacity management and portfolio quality.  

Over the last six months, Zurich UK has continued the transformation of its digital capabilities, with the launch of Zurich Online, a new SME trading platform for brokers.  The Company has enhanced its regional footprint, opening refreshed and sustainable office spaces in Leeds, Whiteley and Birmingham. And it has also increased the strength and depth of the UK leadership team with a number of key strategic appointments, including David Martin as Head of Retail, and Robert Kuchinski as Head of Commercial Insurance UK.  

Like other insurers, Zurich is disappointed by the Government’s failure to change the Ogden discount rate to a balanced level.  However, the Company does not expect this to have a material adverse impact on its business and these results take the revised rate into account.

Commenting on the General Insurance results, Tulsi Naidu added: “This is an excellent set of numbers. Over the last three years, we have improved efficiency and laid the foundations for growth by investing in our people and capabilities. This investment is now paying off with improvements to both our top-line trading and bottom-line profitability across our general insurance business.  While we have benefited from benign weather and continued favourable claims development, the core underlying performance is strong and reflects our focus on technical excellence and a disciplined and targeted approach to growth.   I am particularly pleased to see the development of our commercial businesses in these results.”

Life & Savings

Life & Savings (L&S) Business Operating Profit of £63m is in line with expectations albeit slightly behind the £67m reported a year ago. On an underlying basis, the Business Operating Profit result is 2% ahead of 2018, despite tough market conditions.  New Business Value generated by L&S is 38% ahead of 2018 on a like-for-like basis. This reflects a balanced L&S portfolio, with strong sales of the higher-margin protection products – where Zurich is continuing to reap the benefits from the re-launch of its retail protection proposition – complementing lower-margin investment products.

Commenting on the Life & Savings results Tulsi Naidu said: “Our Life results are solid and behind the headline numbers some very pleasing themes are emerging. Our retail protection proposition is delivering the choice and convenience that customers and advisers demand, and they are repaying us with their business.  This has been a standout success, spurring a 146% increase in APE from independent financial advisers on our term protection products. Overall, our Life earnings are pleasing, and we have seen improvement in the underlying year-on-year results.”


Tulsi Naidu concluded, “I’m very pleased with the broad-based progress we are making across our UK businesses. This was a superb set of results in H1.  We have a strong franchise, a simpler, more digital platform and, with positive trading momentum behind us, we look forward to the second half, and beyond, with confidence.”

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*  2018 included the impact from a significant longevity swap deal.  We did not expect to write a similar scheme in 2019.  2019 Life APE is 41% down and NBV is 11% down on 2018 including the impact of this longevity deal

For further information please contact: 
Chis Johnson, Media Relations Manager
07812 265 245 / chris.1.johnson@uk.zurich.com