Zurich Insurance CEO sees strong profit rebound, eyes closed life sales

Zurich Insurance Group AG (ZURN.S) is expecting a “strong rebound” in profits in 2021 and may sell books of life business closed to new customers, the head of Europe’s fifth-largest insurer said on Wednesday.

Insurers across the globe were hit by claims from COVID-19 last year, but the impact of the pandemic on earnings was waning, Mario Greco, chief executive of Zurich, said in an interview at the Reuters Future of Insurance USA conference.

“What we see so far is a strong rebound, the business is coming back very strongly in growth and profitability,” he said.

Greco said the insurer was “constantly looking” to sell books of European life insurance business closed to new customers, after several such transactions in recent years.

“We continue assessing if it is the right time for us to dispose or not,” he said.

Zurich is looking to offload an Italian portfolio of closed life insurance policies with an equity value of around 200 million euros ($239.20 million).

Zurich is also looking to sell its German life back book business, several sources said.

Greco said the insurer would consider closed life portfolio sales “not necessarily only in these two countries”.

But Greco said the firm planned only to be “opportunistic” in making any acquisitions, rather than setting aside a specific M&A budget.

“Our strategy is defined in that it’s not counting on acquisitions, but we do have capabilities,” he said.

“We could deploy capital that will contribute to our work and targets…As soon as we see an opportunity, we are in a position to go for that.”

Zurich and Farmers Exchanges last year agreed to buy MetLife’s (MET.N) U.S. property and casualty business for $3.94 billion.

Zurich is also taking steps to limit risk in its cyber insurance policies, Greco said.

“Cyber has not been an issue for ourselves financially, we’ve been really careful in underwriting cyber risk.”

Businesses worldwide are fighting sophisticated data scientists as they battle to protect their data-rich computers from cyber crime – and the costly attacks are not going to stop, a top expert at insurer Sompo Holdings Inc (8630.T) told the conference on Tuesday.