Zurich Insurance Group full year 2025 results investor and media presentation/Investment result and reinsurance
Slide 36: P&C investment income continues to benefit from book yield expansion
| Component | FY-24 | FY-25 | Change |
|---|---|---|---|
| Investment income | 2,503 | 2,635 | +5% |
| Realized capital gains/losses | 269 | 211 | −22% |
| Re-/Insurance finance expenses (incl. unwind of discount) | −1,233 | −1,338 | +8% |
| Total investment result | 1,539 | 1,508 | −2% |
| Metric | FY-24 | FY-25 |
|---|---|---|
| Investment income yield of Group investments | 3.8% | 3.9% |
| Book yield (debt securities) | 3.6% | 3.9% |
| Reinvestment yield (debt securities) | 5.0% | 4.5% |
| Insurance finance expense (% of liabilities for incurred claims) | 2.8% | 2.8% |
Notes:
- Net of investment expenses. Investment income yield calculated based on average Group Investments (accounting view) during the period on an annual basis.
- Book yield calculated as weighted-average portfolio yield of debt securities during the period on an annual basis. Reinvestment yield calculated as a weighted-average trade yield of purchased debt securities with maturity >90 days during the period on an annual basis.
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Slide 37: Commentary – P&C investment result
Net investment result decreased 2% compared to the previous year as higher investment income was more than offset by lower realized capital gains and the increase of the unwind of discount.
Investment income was up 5% (USD 132m) compared to the prior-year period, driven by improved investment yields.
Realized capital gains in BOP of USD 211m were driven by an appreciation of the market value of the hedge fund portfolio in 2025 compared to USD 269m in the prior year period.
Insurance finance expenses of USD 1,338m increased 8% compared to the previous year due to an increase of the unwind of discount.
The book yield for debt securities rose to 3.9% while reinvestment rates on debt securities decreased to 4.5%.
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Slide 38: Reinsurance program protecting our balance sheet
The Group's catastrophe reinsurance program comprises the following layers:
| Layer | Coverage/Limit | Attachment | Notes |
|---|---|---|---|
| Europe all perils | 505 | 463 | EUR 390m in excess of EUR 425m (EUR/USD 1.18795) |
| U.S. all perils | 650 | 550 | |
| Rest of world all perils | 200 | 300 | |
| Global cat treaty | 400 | 400 | |
| Global top cat | 400 | 850 | |
| Global aggregate cat treaty | 215 | — | Occurrence deductible USD 50m; placed USD 380m of USD 400m limit (5% co-participation) |
| North America earthquake swap | 400 | — |
The total program provides USD 1,200m of protection each for Europe all perils, U.S. all perils, and Rest of world all perils when combining regional treaties with the Global cat treaty and Global top cat layers.
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Slide 39: Commentary – P&C reinsurance
Effective January 1, the Group renewed the Global Aggregate Cat treaty with an increased capacity (95% vs 87.5%) with risk adjusted stable prices.
The Global Top Cat XL was renewed including an added cyber coverage with a risk adjusted reduction in renewal pricing, reflecting reinsurers' strong confidence in the portfolio.
Other treaties such as the Global Surety XOL or U.S. Liability Quota Share have been renewed without major changes at fairly stable conditions and favorable pricing.
Overall, the Group sees stable renewal conditions and favorable pricing.