Zurich Insurance Group Ltd

Ladies and gentlemen, welcome to the Zurich Insurance Group Q3 Results 2022 conference call. I'm Andrei, the chorus call operator. I would like to remind you that all participants will be in this and only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Mr. George Hawking, Head of Investor Relations and Rating Agency Management. Please go ahead, sir.

Thank you. Good afternoon, everybody, and welcome to Zurich Insurance Group's nine-month 2022 Q&A call. On the call today is our Group CFO, George Quinn. Before I hand over to George for some introductory remarks, just a reminder for Q&A, if you could please keep to a maximum of two questions, that would be appreciated.

George. John, thank you. And good morning and good afternoon to all of you. So before we start the Q&A, I just want to make a few opening remarks. As you've seen from this morning's press release, the group is on track to exceed its strategic and financial targets for the 2020-2022 cycle. In P&C, we've grown strongly with commercial rates in excess of lost cost trends, which is something that we expect to continue into next year. North America, for example, grew by 14%, benefiting from increasing rates of 8%. In our retail business, we also observe a continuation of the trend seen in the first half, albeit the mirror image of commercial. On Hurricane Ian, the group estimates a net impact of $550 million pre-tax. This number is exposure-based, and it sits a bit below our reinsurance attachment point. Our life business continues to experience positive operating trends, and we expect original currency earnings to meet to exceed guidance. but this is likely to be offset by the combination of weaker financial markets and the strong U.S. dollar. As you know, about half of the group's total operating profit is in U.S. dollars, and this gives us an FX translation effect of about $30 to $40 million for every point of U.S. dollar appreciation. Farmers is demonstrating strong rate-driven growth, also supported by the integration of the acquired met life business and we also expect this rate environment to continue into 2023. SST ratio remains very strong. It includes the anticipated effects of the 1.8 billion Swiss franc buyback and the cash tender that we made in October, but does not yet include the positive effects of the Italian and German backbook transactions. We're all looking forward to seeing many of you in Zurich next week, as we raise the bar for our next three-year cycle of the investor day. With that, I'd be happy to take your questions.