ZURICH (Reuters) – Zurich Insurance Group’s first-half business operating profit jumped 60% to $2.71 billion as strong underlying earnings and a reduced impact from COVID-19 more than compensated for higher losses from extreme weather events, it said on Thursday.

The market had expected first-half business operating profit of $2.52 billion, according to a company-compiled consensus.

Chief Executive Mario Greco had told Reuters in June that Europe’s fifth-largest insurer expected a “strong rebound” in profits in 2021.

Net income attributable to shareholders rose 86% to $2.19 billion thanks to the operating profit boost and higher levels of realised capital gains.

Its Swiss Solvency Test (SST) ratio of 206% showed strong capitalisation, it said, adding it remained on track to achieve 2022 targets.

We achieved outstanding results in the first six months of 2021 with profits back to the levels of 2019, when we reported our best first half in a decade. This is a remarkable achievement considering the elevated natural catastrophe losses in the period and the ongoing public health crisis,” Greco said in a statement.

It took a $73 million hit to operating profit from COVID-19, down from $686 million in the first half of 2020.

Higher mortality-related claims in life insurance offset a net favourable impact in property and casualty, where reduced claims frequency associated with COVID-19 restrictions more than compensated for COVID-19 related claims, it said.

Property and casualty premiums grew 12% on a like-for-like basis, with strong growth in both commercial insurance and retail business, it said.

It saw “significant rate increases” in commercial business across all regions, “with these trends expected to continue through the second half of the year.

(Reporting by Michael Shields, editing by Kirsti Knolle, John Revill and Kim Coghill)