Zurich Financial profit falls, suspends buyback

* 9-month business operating profit down 15 pct at $4.2 bln

* Average of analysts' forecasts was for $4.5 bln

* Company suspends share buyback programme

* Share price falls 4.8 percent

(Adds further comments by CFO, analysts; updates share price)

By Jason Rhodes

ZURICH (Reuters) - Zurich Financial Services AG (ZURN.VX) posted a below-forecast 15 percent drop in nine-month business operating profit to $4.2 billion, hit by hurricane claims and capital losses, and suspended share buybacks.

The Swiss insurer said its underlying performance was resilient in "particularly adverse circumstances" and that it stayed in profit in the third quarter despite writing down $595 million for claim payments related to hurricanes Gustav and Ike and record capital losses for shareholders of $1.1 billion.

"We believe that achieving a net profit for Q3 despite $1.7bn impacts from storms (both natural and financial) is a great achievement," said Helvea analyst Marc Effgen.

The last week has seen a raft of disappointing results from European insurers hit by the financial crisis. Swiss Life (SLHN.VX) warned on profits on Wednesday and cut its dividend, while Dutch group ING (ING.AS) posted its first quarterly loss.

At 1129 GMT, Zurich's shares were down 4.86 percent at 205.30 Swiss francs as investors punished the company's decision to suspend buybacks.

Other Swiss financial stocks, including banks UBS (UBSN.VX) and Credit Suisse (CSGN.VX), were also under pressure.

"It's a good result compared to other European insurers," said Sal. Oppenheim analyst Rene Locher. "I have a 'buy' rating on the share and it remains one of my favourite stocks in the insurance sector."

Zurich Financial, Europe's fifth-largest insurer by market value, said gross written premiums for the nine-month period rose 7 percent to $29.2 billion.

'PRUDENCE COMES FIRST'

Citing current market volatility, Zurich Financial said for the time being it will not repurchase shares under its ongoing 2.2 billion Swiss franc ($1.86 billion) buyback programme.