Zurich 9 Month Net Jumps 25% to $4.157 Billion; Farmers up 6%

November 15, 2007

Zurich Financial Services Group is having a good year with nine month net profits increasing by 25 percent to $4.157 billion, compared to $3.326 billion for the same period in 2006.

Other earnings highlights included the following:
— Annualized return on equity (ROE) of 21.4 percent4
— Business operating profit (BOP) of $4.9 billion, an increase of 10 percent. Annualized BOP ROE after tax of 18.9 percent
— General Insurance gross written premiums and policy fees of $27.3 billion, up 4 percent or 0.4 percent in local currencies, and a combined ratio of 96.9 percent, a 2.4 percentage point increase primarily as a result of storms and floods in the UK as well as winter storm Kyrill
— Global Life new business value up 44 percent, with new business margin ( percent of APE) of 24.0 percent and APE up 15 percent or 8 percent in local currencies
— Farmers Management Services’ management fees and other related revenues up 6 percent to $ 1.7 billion
— Shareholders’ equity of $ 28.4 billion, an increase of 11 percent over year end after paying both the dividend and completing the share buyback

“I am pleased with the performance of our businesses as they are generating record profits in today’s challenging financial markets,” commented CEO James J. Schiro. “As our results indicate, we are growing in our selected markets, maintaining a keen focus on profitability, and benefiting from sound risk and investment management strategies.”

Zurich also announced that, as a resuly of the strong earnings, it is extending and increasing its operational improvement targets, “The Zurich Way.” The budget will increase from $2 billion of after-tax improvements over the three years 2007 to 2009, to $3.1 billion over the four years 2007 to 2010.

The Group’s bulletin also said it is “well on track to exceed its $700 million target for 2007, and as part of the enhanced goals will target $ 800 million for 2008.”

Farmers Management Services, which provides services to the Farmers Exchanges that Zurich manages, but does not own saw management fees and other related revenues grow by 6 percent to $1.7 billion for the first none months of 2007. Zurich said the increase reflected “successful investments in distribution capabilities and product enhancements,” enabling Farmers to “achieve premium growth of 5 percent in the nine months despite otherwise flat market conditions.”

The full report and additional information can be obtained on the Group’s web site at: www.zurich.com

Source: Zurich

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