Insurer Allianz today bounced back from heavy losses a year ago with a forecast-beating surge in profits on sharply higher revenues.

The Munich-based firm, Europe's biggest insurer with large business interests in the UK, said profits rose to 1.32 billion (£1.18 billion) in the third quarter from a loss of 2 billion in the same period last year. Analysts had forecast 1.18 billion after revenues in July, August and September jumped 4.3% to more than 22 billion.

Allianz, which last year sold its unprofitable Dresdner Bank unit to German rival Commerzbank, has seen its shares rise nearly 6% since the start of the year. It said it is well-capitalised and financially secure after months of concerns over the health of insurers across Europe.

The return to profit was driven by a strong performance at its life and health insurance business, which raked in profits of 859 million, four times what it made a year ago. Its financial services unit made profits of 332 million but profits from property insurance fell 18%.

Allianz, which owns Cornhill Direct, the UK brand which offers car, home and travel insurance, was hit last year by heavy writedowns.

European insurers are struggling to return to their 2007 record profits as the recession weighs on premium income and low interest rates and smaller equity holdings weaken investment returns.