Zurich’s management says the general insurance business in Australia remains strong in a very difficult market and the business is not for sale.

Zurich Australia Insurance reported a fall in profit from $105.2 million to $34.7 million for 2010, with CEO General Insurance Shane Doyle saying the general insurance business in Australia “remains strong in a very difficult market following a series of catastrophes”.

He says the past 18 months have affected all insurers because of the unusually high level of catastrophes. But if the impact of catastrophes is removed from Zurich’s results, the underlying business has reported a strong result.

Mr Doyle would not comment on speculation from the investment market that Zurich is trying to sell the Australian business, but a company spokesman told insuranceNEWS.com.au the local operation is definitely not for sale.

The general insurance operation reported direct premium and reinsurance revenue of $1.06 billion, up 4%, and reinsurance and other recoveries of $423.3 million, up 36%. Investment income rose 17% to $112 million. It paid its parent entity, Zurich Finance Services Australia Ltd, a management service fee of $160 million.

Zurich Insurance says it has paid out 99.2% of the flood claims it incurred and 98.7% of its business insurance customers have flood cover.