- Winners and Losers in Obama's Corporate Tax Plan
- More Asset-Buying Depends on Economy: BOE
- Greece Readies Debt Swap Under Bailout Deal
- Stocks Sputter as Investors Seek Next Catalyst
- RBS Hurt by Greek Charges But Pays Bonuses
- Nissan to Recall 250,000 Cars Globally
- T-Mobile USA Wants to Grow Again
- Greek Writedown Hits Commerzbank Earnings
- Wife of UK's Tony Blair Sues Over Phone Hacking
- Wandering Through Toy Land
- Dell Is Done, But Don't Discount HP: Analysts
- Comcast Deal Could Spell Trouble for Netflix: Analyst
- Reading the Tea Leaves in RIM Shake-Up
- Sam Adams Brewer Crafts Beer for the Granddaddy of All Marathons
- Stocks to Give Up for Lent
- You Want Retail Customers? Give Them Deals: Analysts
- NJ Governor Chris Christie to Warren Buffett: 'Just Write a Check and Shut Up'
- 7 Undervalued IPO Stocks That Could Rebound in 2012
MOST SHARED
- RBS Hurt by Greek Charges But Pays Bonuses
- China Internet Firm Qihoo Says Citron Allegations False
- More Asset-Buying Depends on Economy: Bank of England
- European Shares Extend Gains on Positive IFO Reading
- China Faces Japan-Style Stagnation Without Reform: Lawmaker
- Greek Writedown Hits Commerzbank Earnings
- T-Mobile USA Wants to Grow Again
- 7 Undervalued IPO Stocks That Could Rebound in 2012
- Break-Up, Greece Cause Huge 2011 Dexia Loss
- HP, Dell Watch Rising China Labor Costs for Apple
MOST POPULAR
HOT ON FACEBOOK
We're Coping in Low-Rate Environment: Zurich CEO
Text Size 
Assistant Producer, CNBC Asia-Pacific
 |
The decision by the U.S. Federal Reserve earlier this week to keep interest rates near zero through 2014, is going to likely have an impact on industries like insurance that depend on investment income. But Zurich Financial Services CEO Martin Senn says the insurer is coping well in a low interest rate environment as it is not solely reliant on such income.
"What you have to do is make sure that the product you are selling is not dependent only on the income on investments and that the model all together is not dependant on developments on financial markets," Senn told CNBC on the sidelines of the World Economic Forum in Davos.
He added that "We obviously have a big part of our investment income out of our fixed income investments, bond investments, and each time you do a reinvestment into the bonds, you do that at lower rates. And that's the immediate impact to the insurance industry."
But he said that Zurich Financial [ZURN.VX
Loading...
()
] was dealing well with the current situation. "If you have high guarantees set in the life business, which you have to meet, then obviously you do have a challenge. In our case, this is not the situation."
 |
On Thursday, the firm announced that it expects to see a net loss of between $200 million and $250 million in the fourth quarter of 2011 as a result of floods in Thailand and the increased cost of earthquakes in New Zealand.
The insurance business could also be impacted by the austerity measures being implemented in Europe that will eat into the continent's growth, Senn said.
"It's probably the consensus that within Europe economies will grow substantially lower, maybe drift into recession and with that there will be lower demand for general insurance products," he said.
- The economy is heating up but the Fed isn’t letting up. How do you play the fixed-income market?
- With its rich oil reserves and rampant corruption, Azerbaijan poses a dilemma for U.S. policy makers.
- Business owners should occasionally consider giving their work for free. Here are several reasons why.
- GOP Governor Chris Christie wants Warren Buffett to stop talking about higher taxes on the super-rich.
- There’s a shortage of hotel rooms in London for the Olympics, so many locals are renting out their opulent private homes.
- Boston Beer will be creating a special commemorative brew, the Samuel Adams Boston 26.2, to mark this year's Boston Marathon.
Data is a real-time snapshot *Data is delayed at least 15 minutes
