Zurich Financial Services clawed its way out of the red in the first half of 2003 with net income of $701m (£447.1m), from a loss of $2bn (£1.2bn) in 2002.

Chief executive James J. Schiro said the group was on target for a full-year profit.

The non-life combined ratio improved by 4.5%, excluding the effects of last year's provisions, to reach 98.8% from 103.3%.

The comparison figure including the provisions for the six months to 30 June 2002 was 119.7%.

Business volumes were up by 26% as measured by gross written premiums and policy fees, to $26.1bn (£16.6bn) in the first half of this year from $20.7bn (£13.2bn) in the same period last year.