(Bloomberg) -- Zurich Insurance Group AG, Switzerland’s biggest insurer, surged after saying it will distribute more than $3.5 billion in cash this year and operating profit climbed.
The shares advanced as much as 3.7%, the biggest increase since November 2011, and were up 3% at 268.4 francs at 3:30 p.m., valuing the company at 40.1 billion Swiss francs ($44 billion). The Bloomberg Europe 500 Insurance Index rose 0.1%.
Zurich Insurance told investors in December that it plans to distribute at least $9 billion in cash to the holding company over the next three years, which can then be used for dividends or acquisitions. The bigger-than-expected cash remittance for this year may bolster payouts to investors, said Stefan Schuermann, an analyst with Vontobel Holding AG.
“The expected above $3.5 billion cash remittance driven by general and farmers’ insurance is good news for the dividend,” Schuermann, who is based in Zurich and recommends clients hold the stock, said in an e-mailed report.
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