Group Head Office adopts new organizational structure

Zurich, March 6, 2001. - Following the announcement of a major corporate restructuring last November, Zurich Financial Services Group (Zurich; Ticker Symbol ZURN) is now implementing its new organizational structure at its Group Head Office. Zurich's intent is to focus its Group Head Office activities on governance, strategic management and knowledge exchange.

The transfer of non-strategic functions and projects as well as a general downsizing will lead to a net reduction of some 230 positions. This will largely be achieved by natural attrition over the next two years. For employees who will not have a position within the new Group structure, an appropriate assistance will be provided. Out of the current 1,110 positions at Group Head Office some 380 positions will be moved to the 11 business divisions, to a shared service system with Zurich Switzerland or to profit centers. By March 2003, the total of Group Head Office positions will be reduced to approximately 500. The initial pre-tax expense savings for the Group are expected to reach CHF 200 million on an annualized basis by year-end 2001.

The group-wide transformation to the new Zurich will enhance its efficiency and will facilitate its customer centric business strategies. Eight regions and three global businesses were created. Also five new Customer Segment Practice Boards and four Functional Practice Boards were established to support regions and global businesses. "The implementation of best practice and global knowledge exchange aims at avoiding duplication and scaling innovation", says Frank Schnewlin, Head Corporate Center and Member of Zurich's Executive Committee.

As part of the transformation, Adriano Passardi (1942), Member of the Group Management Board responsible for Group Head Office Operations, has elected to retire by the end of 2001. Until then he will support the implementation of the transformation process and lead special projects.

The Zurich Financial Services Group 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 over 35 million customers and employing 68,000 people. Based on consolidated figures for 1999, the Group achieved gross premiums of USD 48 billion. This amount includes insurance deposits as well as premiums from the Farmers Exchanges. The net income amounted to USD 3.26 billion. On June 30, 2000, the Group had USD 435 billion of assets under management of which USD 260 billion represent funds managed for third-party institutional and retail customers.

For further information please contact:
Zurich Financial Services
Media and Information, Iris Roth/Claudia Kraaz
8022 Zurich, Switzerland
Phone +41 (0)1 625 21 00, Fax +41 (0)1 625 26 41
http://www.zurich.com