ALLIANZ FORECASTS PROFIT GAINS IN 2006 AND 2007

Germany-based insurer Allianz has said that profit and premiums are likely to grow in 2006 and 2007 as a result of its absorption of Italian insurer RAS, which Allianz said would help it gain more business in the Italian market. The company predicted that net income in 2006 would probably rise to 4.92bn euro, increasing to 5.37bn euro in 2007 and to 5.91bn euro in 2008. It anticipated that the combined ratio would remain “mostly stable” at around 93%. Analysts at German investment bank WestLB said that the profit goals were “slightly above” its expectations, but warned that the company’s p/c insurance estimates might prove too optimistic. WestLB expressed disappointment in the planned dividend rises “considering the low absolute dividend level”. Meanwhile, Allianz has said that it anticipates full-year growth in its motor insurance business for 2006 after benefiting from German motorists’ willingness to switch insurers. German business paper Handelsblatt cited a study undertaken by consultancy Simon-Kucher, which noted that about 4m insurance customers, equal to 8% of the market, were changing motor insurance provider this year.