Managers K. Hasler A. Ott J.-E. Rossier V. Tisi H. Zwingli
Deputy Managers E. Bart W. Belser W. Bruppacher V. Cachin A.-L. Chenaud W. Eschmann R. Farmer M. Grossmann H. Jecklin W. Küster G. P. Rehsteiner H. Ryffel M. D. de Balis A. Schütz
Assistant Managers K. Aerni G. Bassin E. Bosshardt C. E. Geiser G. A. Gubler G. Huguenin W. Leimbacher P. F. Niquille V. Philippi Ch. Robert-Tissot H. Salzmann E. Spargnapani
We have the honour to present to you the 97th Annual Report and Statement of Accounts of the Company for the year 1960.
Fire 347,724,000 346,549,000 Hail 9,377,000 9,147,000 Burglary 17,526,000 14,843,000 Machinery, Water Damage, Plate Glass and Livestock 10,423,000 9,668,000 Marine 84,809,000 78,252,000 Accident 69,691,000 65,125,000 Health 55,421,000 47,807,000 Third Party Liability 304,352,000 287,766,000 Fidelity and Surety 32,399,000 30,971,000 Credit 6,128,000 4,837,000 Life 160,038,000 148,441,000
The aggregate underwriting profit has indeed risen some­ what more than the premium volume; the profit margin, however, remains narrow, and we are unable to discern any signs of marked improvement. Technical progress is constantly bringing about an increase, both in number and size, in the large risks which the reinsurer has to accept and these are consequently weighing ever more heavily on the total business. Balance is thus naturally made more difficult to achieve. This state of affairs together with the steady growth in the volume of business have prompted us to allocate a further Sw. Fes. 5 million to the Fund for Extraordinary Losses. This special reserve now totals Sw. Fes. 25 million.
The Accident branches show a noteworthy growth in pre­ mium and over-all a very welcome improvement in results, which stems both from General Accident and Workmen's Compensation insurance. Contrary to previous years, how­ ever, Aviation Accident insurance has run badly on ac­ count of the serious aircraft accidents in the U.S.A. — In Health insurance we are able to report not only an impor­ tant rise in premium income but also a higher surplus.
The increase in premium shown in Third Party Liability insurance derives mainly from General Liability. Although motor traffic has again risen sharply in density, we were able to keep the premium growth in our Motor business within modest dimensions; the concern which this difficult class has caused us for many years has not been mitigated in any way. The number of serious road accidents has continued to multiply and the awards made by the courts have shown a further tendency to increase. Both these factors react above all to the disadvantage of the reinsurer. For these reasons there has been a worsening of the loss experience in various countries, particularly in the U.S.A., which has resulted in a larger deficit in this branch than in previous years. On the other hand, the results are con­ siderably better for General Liability insurance. The Aviat­ ion Hull business, contrary to last year, produced a profit, whilst the Aviation Liability section again closed with a loss.
A slight rise in premium income in Surety, Fidelity and Credit insurance was accompanied by an even worse result than in 1959. Contract Guarantee business from the U.S.A. is primarily responsible for this unfavourable experience, as this class of business in that country is in the throes of an acute crisis as a result of the recession. The liquidation of the Venezuelan credit losses has also necessitated further settlements, though the amounts involved are con­ siderably lower than in previous years. In most of the remaining territories, the business has run very satisfac­ torily.
In Life assurance, the volume of new business has remain­ ed large with an increased return. New business exceeded Sw. Fes. 1,600 million. The gross business in force increased to Sw. Fes. 6,500 million. No mean contribution to the gratifying result has been made by our non-European busi­ ness. The mortality experience in most countries has re­ mained very satisfactory. The expenses of our new business have, as in previous years, been written off immediately.
Interest Income and Investments The further increase in our interest-bearing investments from Sw. Fes. 1,595 million to Sw. Fes. 1,802 million — cor­ responding to the growth of our business volume and of our assets — has resulted in a very substantial rise in interest income. This gratifying improvement in yield is due also, however, to a higher average return on our in­ vestments, the distribution of which is as follows: Securities and loans Sw. Fes. Sw. Fes.
Common Shares of Public Utility, Industrial, Railway and other Companies 104,215,000 95,772,000
The number of our staff has risen from 471 to 480. The amount of business travelling has been very considerable. For these reasons and in consequence of costs incurred on alterations to our offices and in connection with the more extensive mechanization of our operations, the total man­ agement expenses have increased; the ratio to the pre­ mium income, however, remains favourable. The incidence of taxes at Sw. Fes. 8.9 million has risen, indirect taxation abroad being substantially higher. In comparison with 1959 the depreciation account has increased by Sw. Fes. 8.3 mil­ lion. The depreciations partly concern permanent holdings. The fluctuations in foreign currency also included under this account give a heavy deficit and significant amounts were written off on securities, in some cases as a pre­ cautionary measure.
In short, despite increases in management expenses, in the incidence of taxation and in amounts written off, a some­ what improved underwriting result and a gratifying rise in interest income have combined to produce an increased net profit for the year of Sw. Fes. 26.2 million, which, when the balance brought forward is added, amounts to Sw. Fes. 29.7 million.
The last General Meeting re-elected Mr. Paul Keller, Mr. C. J. Abegg and Mr. Paul Ruegger to the Board of Directors.
2 Bank of Canada Building, 250 University Avenue with the offices of the Canadian Branch and the Canadian Reinsurance Company.
If this proposal is accepted the dividend will be Sw. Fes. 60.— per share; after deduction of the Federal Coupon Tax of 3 % and the Federal Withholding Tax of 27 %, Sw. Fes. 42.— will be paid on presentation of Dividend Coupon No. 5.
Capital Funds After approval of the Annual Statement for the business year 1960 the capital and free reserves of the Company amount to Sw. Fes. 168,998,241.
All Classes excl. Life Sw. Fes. Sw. Fes. Sw. Fes. Sw. Fes.
Cash Deposits with Ceding Companies Sundry Debtors Securities and loans Real Estate and Fully-owned Real Estate Companies Accrued Interest
North American Reassurance Company 161 East 42nd Street, New York 17 with Offices in Dallas, Chicago and San Francisco
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