Allianz Group has posted a 3.8% rise in net profit to €6.2 billion ($8.9 billion) for last year, as revenue topped €120 billion ($172.7 billion) for the first time.

The German insurer expects the “challenging” business environment to persist, exacerbated by low interest rate policies in Europe and the US.

“We are very sceptical about this policy of ‘cheap money’ in the eurozone,” CEO Michael Diekmann said. “Economically speaking, its benefits are controversial.” 

He says the ultra-low interest setting has resulted in “virtually zero” returns, with savers the hardest hit.

“All in all, [this year] is likely to paint a similar picture to last year’s. Economic opportunities and challenging financial markets sit alongside a plethora of political risks.”

Mr Diekmann says last year’s $230 million purchase of the Territory Insurance Office’s insurance operations will strengthen Allianz’s general insurance foothold in Australia.

Gross written premium from the property and casualty (P&C) division grew 3.7% to €48.32 billion ($69.5 billion) last year, and operating profit gained 2.2% to €5.4 billion ($7.8 billion).

The combined operating ratio remained at 94.3%.

Allianz says the P&C division benefitted from relatively benign natural catastrophes last year, despite the recent hailstorm in Brisbane.

The life and health division’s operating profit increased 22.8% to €3.3 billion ($4.7 billion), while statutory premiums grew 18.6% to €67.3 billion ($96.8 billion).

Operating profit from the asset management arm fell 17.6% to €2.6 billion ($3.7 billion).