The commercial insurance market in Zurich

Insurers, reinsurers and brokers

Zurich shares with Munich the distinction of being home to both a global primary insurer and a global reinsurer of the first rank. Swiss Re, founded in 1863 and treated in the preceding chapter, has its head office further along the same lakeshore at Mythenquai. Together with the Swiss subsidiaries of foreign groups, the specialty carriers and the Swiss companies of AXA, Allianz, Generali, Helvetia Baloise and others, they form a market in which a Swiss industrial client can place most of its insurance without leaving the city. The comparison with Geneva, examined in the companion volume, is instructive. Geneva developed as a centre of private banking, commodity trading and the international organisations, with an insurance activity concentrated on the needs of those clusters. Zurich, by contrast, became the seat of large balance sheets that carry industrial and catastrophe risk for the world.

Brokers are the second pillar of this market. For large corporate risks, the client seldom deals with the insurer directly. An insurance broker analyses the risk, designs the programme, prepares the submission to the market, negotiates terms with several insurers and helps the client with claims. The largest Swiss independent broker, Kessler, has its origins in the maritime trade that also gave birth to Zurich Insurance: Johann Kessler founded the firm in 1915 as a specialist in cargo insurance for worldwide shipments, and it is still run by the founding family in its fourth generation, with its head office in Zurich and a presence in Liechtenstein. The firm’s logo, a ship’s wheel, recalls those beginnings. Internationally the firm cooperates with the Marsh network.¹

Under the revised Insurance Supervision Act, insurance intermediaries are regulated by FINMA with a distinction between tied and untied intermediaries. Untied intermediaries, which include brokers, must register with FINMA, meet training requirements and hold professional indemnity cover or equivalent financial security. The details belong to the next chapter. For the present purpose it suffices to note that brokers who deal directly with Swiss policyholders on behalf of foreign markets such as Lloyd’s must also be entered in FINMA’s register of insurance intermediaries.²

Lloyd’s in Zurich

Lloyd’s of London has a formal presence in the city. It is licensed in Switzerland to write all classes of insurance except life, sickness and legal expenses insurance and has its Swiss seat of administration and general representative at Seefeldstrasse 7 in Zurich. All Lloyd’s policies covering Swiss risks must name the Zurich office as the address of the general representative. Brokers placing Swiss open market business at Lloyd’s must be approved as open market correspondents, and global contracts for Swiss-headquartered clients must comply with Swiss insurance law.³ The Swiss branch of Lloyd’s thus gives Swiss companies access to the syndicates of the London market, including in the specialty lines of marine, aviation, political risk and cyber, under the protection of Swiss supervisory law. The completion of the Beazley acquisition will bring one of the leading Lloyd’s groups under the ultimate control of a Zurich holding company.

Industrial insurance as a Zurich cluster

Several features make Zurich a natural place for industrial and commercial insurance. The first is capital. Large corporate risks require insurers with strong balance sheets and high ratings, because clients and their lenders will not accept cover from weak carriers for risks that may cost hundreds of millions. The second is expertise. The Federal Institute of Technology, whose role in the development of actuarial science was described in Part D, and the University of Zurich supply engineers, mathematicians, economists and lawyers. The concentration of risk engineers, claims specialists and underwriters at Zurich and Swiss Re creates a labour market in which specialists can move between insurers, reinsurers, brokers and captives. The third is law. Swiss insurance contract law has traditionally left commercial parties wide freedom of contract. The Swiss courts, above all the commercial court of the canton of Zurich, have long experience with complex insurance disputes. The revised Insurance Contract Act, examined in the next section, has preserved and in part extended that freedom for large clients.

The fourth feature is neutrality in a broader sense. A Swiss insurer that leads a global programme for a German, French or American industrial group offers a counterparty based outside the European Union and the United States, subject to a supervisor whose solvency regime the European Commission has recognised as equivalent to Solvency II while it remains independent of both blocs.⁴ The reverse side of this position is that Swiss insurers need market access agreements, local subsidiaries and branches to write business in the European Union, a subject that the Swiss insurers have handled through their extensive networks of foreign subsidiaries since the nineteenth century. The Federal Agreement on Direct Insurance other than Life Insurance concluded with the European Economic Community in 1989 secures freedom of establishment for branches and agencies of non-life insurers on both sides, while the cross-border provision of services remains outside its scope.⁵

Notes

1. Kessler & Co AG, “Tradition and history”, https://www.kessler.ch/en/about-kessler/tradition-and-history. ↩
2. Lloyd’s, “Doing business in Switzerland”, https://www.lloyds.com/market-resources/multinational/our-global-network/switzerland, which requires Lloyd’s brokers dealing directly with Swiss policyholders to be registered in FINMA’s public register of insurance intermediaries. ↩
3. Lloyd’s, “Doing business in Switzerland”, https://www.lloyds.com/market-resources/multinational/our-global-network/switzerland. ↩
4. Commission Delegated Decision (EU) 2015/1602 of 5 June 2015 on the equivalence of the solvency and prudential regime for insurance and reinsurance undertakings in force in Switzerland based on Articles 172(2), 227(4) and 260(3) of Directive 2009/138/EC, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32015D1602, in force since 14 October 2015. The equivalence is treated in the next chapter of this Part. ↩
5. Federal Department of Foreign Affairs, Europe Division, “Versicherungen”, https://www.europa.eda.admin.ch/de/versicherungen. The page states that Swiss insurers may set up or acquire agencies and branches in the EU on equal terms, that the agreement applies only to direct non-life insurance, that life insurers, reinsurers and statutory social security schemes fall outside its scope and that it governs only freedom of establishment, not cross-border insurance activity (SR 0.961.1). ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of September 2025.