Zurich to raise dividend despite profit slump

(Reuters) – Zurich Insurance said Thursday it would raise its dividend by 9% despite posting a net profit decline in 2022, weighed down by smaller capital gains.

Also denting profit were losses on divestments, such as the sale of its back-book in Italy, as well as a charge related to inflation in Argentina, the insurer said.

Net income attributable to shareholders fell to $4.603 billion in 2022, down from $5.202 billion the previous year and slightly better than analysts’ expectations for net profit of $4.546 billion.

“These were tough years with unexpected challenges during which we had to stay very agile and focused on our goals,” CEO Mario Greco said.

The insurer plans to increase the dividend payout to 24 Swiss ($26.16) francs per share from 22 francs.

In November, the company set more ambitious financial targets for the next three years as insurers are expected to benefit from rising premium rates.

Insurers globally have faced losses from unexpected events such as the COVID-19 pandemic, the war in Ukraine and large natural catastrophes. They have responded by raising prices and restricting coverage, with a view to shielding their profit.