SWISS INSURANCE giant Zurich, Europe’s fourth largest insurer, is planning to take operations in four more European countries under the wing of its main Irish holding company.
This will bring to 16 the number of countries where Zurich’s operations are routed through its main European operating company based in Dublin. Zurich’s operations in 12 countries, including Britain and France, already report into the insurer’s Dublin company.
The insurer is planning to bring operations in four more countries – Germany, Italy, Portugal and Spain – under the control of the Irish company, Zurich Insurance Plc, from the start of next year.
The value of the company’s business being channelled through Europe will reach $12 billion (€9 billion) – almost three times the value of the entire Irish insurance market – when the operations of the 16 companies are routed through the Dublin company.
Markus Hongler, chief executive of Zurich Insurance plc, said the company could not locate the headquarters of its European-wide business in Switzerland. It chose Ireland instead because the country was part of the euro zone, had a qualified, English-speaking workforce and had an insurance regulator with “experience in cross-border regulation”.
“Ireland was the winning country by far,” said Mr Hongler.
He said Ireland’s low-cost corporate tax regime was not the main reason for the move as the company paid taxes on operations in each country where it operates.
Mr Hongler said Zurich had moved 50 staff to the European headquarters in Ireland, 40 per cent of whom are from overseas.
He said Ireland has economic difficulties but added that all European countries were suffering.
“It doesn’t matter where you go in Europe – every country complains a bit about its own problems. Worldwide, economies are under stress but Ireland had a good starting position with the lowest public deficit,” he said.
“Of course, Ireland is suffering very strongly if you look at the numbers.
“However, I think you have protection by being part of the euro zone and with access to the European Central Bank.”
Mr Hongler said he found regulation of the insurance sector to be “strong” when it started transferring branches of its European operations to Ireland in 2005, despite the general concerns that have arisen about the supervision of the banking sector.
“I don’t know what went wrong with Irish banking regulation.”
Zurich has just over 9 per cent of the general insurance in Ireland, where it is primarily focused, making it the sixth largest player.
