Zurich Insurance Group AG, Switzerland’s biggest insurer, fell short of an earnings target as fourth- quarter profit fell 20 percent on lower income from the general insurance unit. The shares declined.

Net income fell to $858 million from $1.07 billion a year earlier, the Zurich-based insurer said in a statement. Operating profit from general insurance, the biggest unit, declined 30 percent to $518 million on lower revenue. The shares dropped 3 percent to 303.4 francs at 9:16 a.m. in Zurich.

“While we made good progress last year in executing the strategy we set out in December 2013, we cannot be satisfied with our 2014 earnings,” Chief Executive Officer Martin Senn said. Business operating profit return on equity was 11 percent in 2014, and “below our target range,” he said.

The company has cut 670 jobs to help lower costs by $250 million annually by the end of this year. It also started selling under-performing businesses including a Russian general insurance company to Olma Group to help it boost earnings. Zurich targets a return on equity, a measure of profitability, of 12 percent to 14 percent in the three years through 2016.

The insurer plans to maintain its dividend at 17 Swiss francs ($18.30) a share, matching the Bloomberg Dividend Forecast. The payout remains the top priority of Zurich’s capital management, Senn said on a conference call.

Dividend Saved

“Like in 2012, when Zurich suffered from reserve increases in Germany, we think management realized balance sheet buffers in order to save the dividend,” Thomas Seidl, an analyst at Sanford C. Bernstein in London, wrote in a note to clients Thursday.

Fourth-quarter net income beat the $785 million average estimate of five analysts surveyed by Bloomberg.

Zurich’s return on its $206 billion of investments rose to 4.5 percent for 2014 from 3.5 percent a year ago, helped by full year and fourth-quarter gains on a mix of bonds and equities, Zurich said.

At the general insurance unit, initiatives “are showing positive early results,” Senn said. The sale of its Russian retail business resulted in a $247 million loss, less than the previously expected $300 million, Senn said, adding that “more work remains to be done in Latin America.” He declined to comment on plans for further divestments.