Zurich Insurance Co. Ltd.

The stable outlook reflects our view that, over the next two years, ZIC's globally diversified business profile will allow it to source strong, low-volatile earnings and be among the performance leaders in its GMI peer group. At the same time, the group's risk-tolerance policies will continue to target comfortable capital buffers within the very strong capital adequacy range. Although unlikely, we might consider lowering the ratings if: ZIC cannot maintain its record of operating performance compared with the GMI peer group. This could be the case if ROE falls below 8% for a prolonged period while its P/C combined (expense and loss) ratio materially exceeded 100%. This might result from an unexpected and prolonged negative claims trend in long-tail, P/C

...Zurich Insurance Co. Ltd. (ZIC) is a globally diversified multiline insurance group, with one of the leading positions in the global commercial insurance market. ZIC benefits from a highly diversified business mix across the globe. ZIC is currently benefiting from an upswing in the commercial insurance market, with steadily rising pricing, after years of fierce competition and stable or declining premiums. We believe the group is well positioned to tap growth, given the global reach of its commercial insurance business, its broad product offerings, and excellent reputation. This should support group's premium volumes, as demonstrated through resilient 2020 performance and strong growth in first-quarter 2021. We expect that ZIC will continue to use favorable commercial insurance market conditions to further increase prices and source premium growth, while retail premium volumes pick up in line with local economic recovery. Stable fee income from its Farmers Management Services should also...

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