Insurer posts fall after floods and quakes

Zurich Financial Services has reported a 13 per cent drop in 2010 net income to $3.4 billion - partly as a result of higher catastrophe claims.

Switzerland’s largest insurer nevertheless said on Thursday that a vote of confidence in the future had raised its dividend to SFr17 a share.

“This highly attractive dividend proposal reflects our confidence in the success of Zurich’s business strategy,” Chief Executive Martin Senn said in a statement.

Profit in general insurance, Zurich’s biggest segment, was driven down by lower investment returns coupled with some large losses and an unusual frequency of disasters like earthquakes and floods.

Zurich said it was still calculating the damage caused by floods in Australia in January 2011, but that the damage would probably exceed that of the December floods, for which the firm expects a pre-tax loss of $100 million.

Zurich’s bottom line was also depressed by a series of one-offs announced earlier, among them a $104 million writedown in Russia and $295 million for settlement of a class-action lawsuit in the United States.