Zurich is on track to deliver its targets for next year, despite rising catastrophe costs and a “more challenging” business climate, according to CEO Martin Senn.

Just weeks after revealing a 16% drop in net profit to $US2.7 billion ($2.6 billion) on writedowns of its German general insurance business for the nine months to September, Zurich has moved to calm investors and reaffirm its commitment to pricing discipline and portfolio management.

Mr Senn says the combined operating ratio at an underlying level has improved by 2.8% since the same time last year. Zurich aims to improve the total combined ratio by 3-4% in 2013.

“Our targets for 2013 remain unchanged and we are making good progress to achieve them,” Mr Senn told investors last week in Switzerland.

“These are very ambitious targets given the environment… has become even more challenging in 2012.”

Zurich has set more general targets in other segments. It aims for its global life operation to be among the top five European-based global companies for new business, and for its US subsidiary Farmers to maintain top-tier growth in personal lines. Both are on track, Mr Senn says.