Insurance company Swiss Re reports third-quarter net profit of 334 million francs

GENEVA — Swiss Reinsurance Co. reported a third-quarter net profit of 334 million francs ($327 million) Tuesday as insurance claims fell due to fewer natural disasters.

The profit beat analyst expectations and compared to a loss of 304 million francs in the same period last year, when Swiss Re was forced to make heavy payments linked to hurricanes Gustav and Ike.

Earnings per share reached 0.97 francs ($0.95), compared with a loss of 0.93 francs per share in the third quarter last year, according to the Zurich-based company.

Shares in Swiss Re closed up 6.4 percent to 45.10 francs ($44.12) on the Zurich exchange.

The lower payouts for property, health and life insurance claims helped Swiss Re compensate for an 11 percent drop in overall premiums, which are a key indicator of a reinsurer's growth. Premiums tallied 5.84 billion francs for the quarter.

Reinsurance companies sell backup coverage to other insurers, spreading risk in the event of huge losses.

Swiss Re's property and casualty unit saw premiums drop 12 percent to 3.17 billion francs. The unit's profit per premium rose markedly in the quarter.

Life and health premiums dropped 9 percent to 2.65 billion francs.

Swiss Re said overall results would have been higher had writedowns and impairments not cost the company nearly a billion francs in the quarter.

Swiss private bank Wegelin said the results were "reasonably solid," although estimates had varied greatly.

Swiss Re's chief executive said underlying performance remained "very strong" and that the company had made significant progress in stripping risk accumulated before the global financial crisis.

"The outlook for our company is encouraging," Stefan Lippe said. "In the first nine months of 2009, we restored our capital position."

Geneva-based broker Helvea welcomed the result.

Swiss Re's "cleanup campaign remains well on track with exposures being reduced," it said.