As volatile markets put the brakes on investment earnings and a cluster of fire and floods send claims surging, the insurers are being forced to revisit their underwriting performance.

Last week's results from the domestic heavyweights QBE and IAG shed some light on their aptitude, while Suncorp takes its turn in the spotlight tomorrow.

Regardless of the Queensland-based insurer's final figures, its results will reveal what its major competitors have already revealed: that no insurer was immune from rising claims and the impact that had on underwriting figures.

It's a fact that makes QBE's record $1.02 billion first-half profit all the more remarkable.

To its credit, IAG has emerged from a rebuilding year with a clearer focus and $181 million annual net profit, after recording a dismal $261 million loss last year.

The appointment of Mike Wilkins as CEO appears to be paying dividends. Still, with a combined ratio of 100.1% and underlying gross written premium growth of just 4%, he won't be celebrating too loudly.

Suncorp has forecast a net profit of between $340-360 million, as much as 39% down on the $556 million it earned last year. New CEO Patrick Snowball will be expected to do better.

QBE, which gets most of its earnings from its diverse foreign operations, has underpinned its reputation among brokers as the market kingpin, turning in a record first-half performance that against tough investment and trading conditions is of a different class.

Its healthy result and the warning of Group CEO Frank O'Halloran that the group will continue to seek acquisition opportunities will keep the market on its toes. Most senior managers in the industry still expect one more round of consolidation at the top, but no one is prepared to predict who will buy who.

Turn the clock back two years and all three insurers were travelling well. QBE reported a first-half profit of $921 million in 2007, while IAG socked away an annual profit of more than $550 million.

Suncorp earned a lofty $1.06 billion, making its forecast 2009 profit look like spare change by comparison. How did Suncorp and IAG fall so far behind?

For the most part, Morningstar insurance analyst David Walker says external circumstances haven't been kind.

"We've had two years of elevated claims due to high natural peril costs which have been above budgeted allowances," he told insuranceNEWS.com.au. "The soft commercial market has been ongoing and market volatility has thrown investments off track."

That's presented a bigger challenge to IAG and Suncorp, while QBE's diversified global reach has acted as a hedge against the worst extremes at home.

"QBE has strong attritional loss ratios while the others have been hit by storms, given they are more exposed in Australia," Credit Suisse analyst Arjan van Veen said.

Against that backdrop, Mr Walker believes Mr Wilkins "is kicking a lot of his goals" at IAG and is particularly impressed by the group's $191 million reduction in reserve releases.

That fiscal prudence was apparently lost on IAG's army of retail investors, who beat a hasty retreat and sent the stock 7% down on Friday to close at $3.55.

JP Morgan analyst Siddharth Parameswaran expects greater things from IAG next year, as dividends flow from the recent restructuring. He says IAG's net profit met projections, though its forecast was below the market consensus.

"I think [restructuring] will really show through next year, as IAG took an extra hit from falling interest rates this year that they couldn't unwind," he told insuranceNEWS.com.au.

Morningstar's David Walker rates Mr Snowball as an industry veteran and says he could make a good start at Suncorp by reducing the company's reliance on reserve releases. He says the company has picked the right man for the job.

Mr van Veen suggests QBE's rivals would do well to take note of its underwriting discipline.

"They don't write business where they don't have to, and they don't chase business where they don't have to."

It's a blueprint QBE's rivals will be seeking to adhere to in the coming year.