Zurich Insurance Takes Out Savings Drive Policy--Update

(Adds clarification on annual dividend)

 
   By John Letzing

ZURICH--Zurich Insurance Group AG (ZURN.EB) said Thursday it aims to boost profit and save about $1.5 billion over the next few years by cutting costs under its recently-installed chief executive.

The Zurich-based insurer also said it plans to maintain an annual dividend of 17 Swiss francs ($16.95).

In March, former Assicurazioni Generali SpA Chief Executive Mario Greco assumed the CEO role at Zurich Insurance after a difficult period for the Swiss insurer under his predecessor.

Mr. Greco, a onetime Zurich Insurance executive, had previously said he would divulge details about his future plans for the insurer at Thursday's investor day.

Zurich Insurance said it plans to make the savings by 2019, primarily by undertaking a "comprehensive review of IT systems and contracts and shared services procurement processes." The moves will result in restructuring charges of about $500 million in both 2017 and 2018, the company said.

The insurer's business operating profit after tax return on equity, a measure of profitability, should exceed 12% by next year and increase in subsequent years, Zurich said.

The company said it would maintain its annual dividend, while also aiming for a payout ratio of about 75% of its net profit.

Write to John Letzing at john.letzing@wsj.com

(END) Dow Jones Newswires

November 17, 2016 02:32 ET (07:32 GMT)

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