QBE announced statutory net profit after tax of $151 million for the first half of 2022, compared with $441 million in the same six-month period last year.
The drop mainly owed to an H1 investment loss of $840 million, versus a return of $58 million last year, which QBE said had been caused by “adverse mark-to-market conditions”.
However, despite economic uncertainty, higher inflation, geopolitical tensions and record storm and flood events in Australia, QBE’s underwriting performance remained resilient in the first half of 2022.
Its adjusted combined operating ratio improved by 0.4% to 92.9%, and premium growth remained strong, with group-wide renewal rate increases of 8.1% in the first half of 2022, which supported gross written premium growth of 18%.
QBE said the improved combined ratio reflected strong rate increases and premium growth, lower net catastrophe costs, and a material improvement in total acquisition costs.
The net cost of catastrophe claims improved to $454 million, but was slightly ahead of the first half allowance of $442 million. Catastrophe costs included a $75 million allowance for the Russia/ Ukraine conflict.
“Despite the challenging operating backdrop, QBE demonstrated resilience in the period, with ongoing positive momentum across the business,” said QBE Group CEO Andrew Horton. “We have made good early progress against our new strategic priorities, and our outlook for the remainder of the year remains positive.”
Horton added that QBE had made “pleasing progress” on its new strategic priorities, launched February, which he explained have been designed to “support our new purpose, enabling a more resilient future, and our new vision, to be the most consistent and innovative risk partner.”
“Over the half we placed significant focus on our North America operations. We have materially simplified the business and I am confident we have the right strategy and team in place to drive a sustained improvement in performance,” he concluded.