Helvetia Baloise Reports CHF 631.6 Million Underlying Earnings, Raises 2026 Synergy and Efficiency Guidance

Helvetia Baloise reported CHF 631.6 million in underlying earnings for the first half of 2026 and raised its year-end guidance for merger synergies and efficiency measures after progressing faster than planned against a CHF 650 million annual run-rate target. The insurer said close to 50% of that long-term target had already been secured by June 30 and now expects around 60% to be secured by the end of 2026, up from previous guidance of around 50%. The ultimate CHF 650 million target is unchanged.

The first combined half-year result also showed an annualised underlying return on adjusted equity of 18.7%, above Helvetia Baloise’s 16% to 18% target range for 2026 through 2028. Group IFRS net income was CHF 84.6 million, while the non-life combined ratio came in at 92.0%. Those figures put the savings update alongside a solid operating result, but the gap between underlying earnings and IFRS profit is important because merger accounting had a large effect on reported net income.

In its September 17 half-year results release, Helvetia Baloise said IFRS net income was materially affected by CHF 671.7 million of accelerated amortisation of merger-related intangible assets. The company said that amortisation does not affect dividend capacity. Helvetia Baloise uses underlying earnings as an alternative performance measure alongside IFRS results, rather than as a replacement for them.

Underwriting supports the first combined half-year result

Non-life insurance was the largest contributor to underlying earnings. Business volume in the segment was CHF 7.13 billion, and underlying earnings reached CHF 399.4 million. IFRS net income for non-life was CHF 351.0 million. The group said all reporting segments posted combined ratios below 96%, with Switzerland a key contributor to the 92.0% group ratio.

Management attributed the underwriting result mainly to a low current-year loss ratio excluding discounting and natural catastrophes, together with progress in what it calls technical excellence. The benefit was partly offset by prior-year reserve development that was below the long-term average. The result therefore reflects both current underwriting performance and reserve movements, rather than a single source of improvement.

There is also a known second-half claims item that was not included in the June results. Helvetia Baloise estimates that the large hailstorm in Switzerland in August 2026 will generate CHF 120 million to CHF 140 million of claims costs, net of reinsurance and before tax. The company said those costs will be recognised in the second half of 2026 and had no effect on the first-half figures.

Life insurance produced CHF 273.5 million of underlying earnings and CHF 279.0 million of IFRS net income. Life business volume was CHF 4.61 billion, with a new business margin of 4.1%. The contractual service margin, or CSM, was broadly stable at CHF 8.3 billion. Helvetia Baloise said lower demand for full-insurance solutions in Switzerland weighed on volume, while its product mix remained focused on capital-efficient business.

The non-insurance area, which includes banking, asset management and fee income from Spain, recorded underlying earnings of negative CHF 41.3 million. It also carries external financing costs and group administration expenses. IFRS net income for this area was negative CHF 545.4 million, largely because the accelerated amortisation of merger-related intangible assets is reflected there.

Savings plan moves ahead of the 2026 schedule

The change in guidance is tied to the pace at which Helvetia Baloise says it is locking in synergies and efficiency gains. By the end of June, close to half of the CHF 650 million annual run-rate objective had been achieved. The group now expects around 60% of the target to be secured by year-end, compared with its previous expectation of around 50%.

The CHF 650 million target itself has not changed. The strategy set out earlier in 2026 divides that amount into CHF 350 million of merger-related synergies and CHF 300 million of efficiency measures, with around 90% of the total expected to be realised by 2028. The year-end 2026 percentage therefore describes progress toward an annual run-rate objective. It should not be read as an equivalent amount of profit that will automatically be booked in the second half of this year.

Merger integration costs are also still expected to land in the lower half of the previously communicated CHF 500 million to CHF 600 million range. Slightly more than CHF 200 million had been incurred by June 30. Helvetia Baloise said the total had risen only modestly from year-end 2025, although it expects more costs to be incurred during the second half.

Operational work has moved forward in several markets. In Switzerland, the group completed the legal integration of its insurance businesses in less than seven months, merging the two non-life insurers into one entity and doing the same with the two life companies. The new-business product and service offering in Switzerland is now marketed under the Helvetia brand. In Germany, the broker channel launched in May and the tied-agent channel followed in July, with rebranding completed in both Switzerland and Germany.

Other steps are still pending. Harmonised employment contracts in Switzerland are due to take effect on January 1, 2027. In Spain, the legal merger of Caser and Helvetia Seguros was completed in December 2025, while the remaining operational work includes a planned move under the Helvetia brand.

Merger accounting limits direct year-on-year comparisons

The first half of 2026 is the first reporting period for the combined Helvetia Baloise group following the merger of Helvetia Holding Ltd and Baloise Holding Ltd on December 5, 2025. Because the merger is accounted for as an acquisition under IFRS and closed shortly before the end of last year, the income-statement comparison figures for the first half of 2025 reflect Helvetia alone. Helvetia Baloise explicitly cautioned that this limits comparability between the periods.

That accounting backdrop matters when reading the CHF 631.6 million underlying earnings figure. It is a current-period measure for the combined group, while the prior-year income statement does not represent the same corporate perimeter. A simple year-on-year growth rate would therefore give a misleading impression of like-for-like performance, and the company did not frame the result that way.

Capitalisation remained high at the half-year mark. Total equity was CHF 13.0 billion at June 30, and Helvetia Baloise estimated its Swiss Solvency Test ratio at around 270%. The company describes that combined SST figure as an internal indicative estimate for capital-markets purposes rather than a regulatory SST ratio. S&P Global Ratings affirmed an A+ financial strength rating with a stable outlook in August.

The next test for the higher savings guidance will be how much of the annual run-rate target is secured by December while the group absorbs further integration costs and the Swiss hail claims. Helvetia Baloise’s financial calendar lists March 17, 2027 for publication of its 2026 full-year results, when investors will get the next broad update on earnings, capital and progress toward the CHF 650 million target.