Europe’s two biggest insurers, Allianz and Axa, have ridden buoyant equities markets and reduced claims to surpass market forecasts in their annual financial statements.

Axa, Europe’s second largest insurer, posted an 18% rise in net profit to €5.09 billion ($8.46 billion), beating analyst expectations of €4.84 billion ($8.05 million).

Axa purchased Swiss insurer Winterthur in 2006 – it sold Winterthur’s US arm to QBE last month – and is forecasting a €350 million ($582 million) windfall once the group is fully integrated.

The French insurer issued a dividend of €1.06 ($1.76) and plans to treble net earnings by 2012.

German rival Allianz turned in a €7 billion ($11.64 million) profit, despite losing nearly €193 million ($321.16 million) from its Dresdner Bank in the fourth quarter due to restructuring.

Net income rose 60.3% for the full year and 57.3% for the fourth quarter, buoyed by strong life/health insurance returns which were up 68.8% from the previous corresponding period. Stable growth in the group’s largest division, property and casualty, also contributed.

CEO Michael Diekmann says the company wants to nearly double its 2005 profit payout to 35-40%, partly through share buy-backs.

Allianz has set a target for operating profit growth of 10% between 2007 and 2009.