Zurich Financial Services Group Introduces Zurich IC²

Dateline: 04/05/2001

Risk management service to optimize reward/risk strategy

BOSTON, Mass., April 30, 2001 -- Zurich Financial Services Group officially launched Zurich IC² SM (www.ic2.zurich.com), an independent consulting subsidiary, the company announced today. Developed as a solution for today’s business environment characterized by rapid change, global competition, shrinking margins, increasing regulatory and investor scrutiny as well as stakeholders’ growing demands for accountability, Zurich IC²’s services enable companies to understand and capitalize on business risk.

Zurich IC² SM helps companies assess the risks -- hazard, financial, operational and strategic -- in their business environment and optimize reward/risk decisions. Its consultants advise customers on how to identify and quantify risk quickly, comply with corporate governance requirements, streamline the decision cycle and measure their financial impact -- both in terms of value creation and impairment.

"Risk management traditionally has been about managing downside potential. At Zurich IC², while we don’t ignore mitigation, we focus on taking advantage of prospective rewards by quantifying and leveraging operational and strategic risks," said Wolfgang F. Friedel, president and CEO, Zurich IC² SM. "As our name -- short for ‘intellectual capital’ -- implies, we believe in developing solutions by listening to the people who know the company, harnessing their knowledge and applying leading-edge methodology and models that identify risk and quantify corresponding opportunities."

Zurich IC²’s consulting services are complemented by four processes that provide insight into reward/risk issues and requirements:

IC2 Profiler is a multidisciplinary process that capitalizes on the expert knowledge and judgment within an organization. Cross-functional brainstorming sessions led by Zurich IC² SM consultants draw out qualitative assessments of opportunities or risks affecting a company’s financial health. The result is a prioritized picture not only of risks facing an organization but also of the opportunities they may hold.
Quant 1 is a proprietary application that builds on Profiler, creating a predictive modeling process. Quant 1 transforms opinions into data that enable IC² SM consultants to model the impact of specific problems or scenarios -- in terms of both frequency and severity -- on an organization’s financial results.
Quant 2 is a financial modeling process that examines the relationship between risk and opportunity across an entire organization, modeling their mutual interaction and impact on financial results. Quant 2 generates a range of potential results and allows companies to act quickly to capitalize on opportunities.
IC² First is one of only two operational risk loss event databases commercially available to the public. It offers a dual quantitative and qualitative approach to the analysis of risk and includes in-depth case studies that discuss event triggers and consequences as well as hard numbers that can be downloaded for actuarial and modeling purposes. The database helps financial institutions to determine appropriate capital reserve levels required by international regulators and to identify systemic risks within their organizations.

The Zurich Financial Services Group (www.zurich.com) is a global leader in the financial services industry, providing its customers with solutions in the area of financial protection and asset accumulation. The Group concentrates its activities in five business segments: non-life and life insurance, reinsurance, Farmers Management Services and asset management. Headquartered in Zurich, Switzerland, the Group’s worldwide presence builds on strong positions in its three key markets: the United States, the United Kingdom and Switzerland. It has offices in more than 60 countries reaching 35 million customers and employing 70,000 people. Based on consolidated figures for 2000, the Group achieved gross premiums of USD 50 billion. This amount includes insurance deposits as well as premiums from the Farmers P&C Group. The net income amounted to USD 2.33 billion. On December 31, 2000, the Group had USD 440 billion of assets under management of which USD 259 billion represent funds managed for third-party institutional and retail customers.
####

Media contacts:

Esther Sprano
Zurich IC2 SM
(617) 962-2695
esther.sprano@ic2.zurich.com

Betty Schwartz
Miller DeMartine Group
(201) 567-7783
bschwartz@mdgpr.com