Perth conglomerate Wesfarmers is finding it harder to achieve premium growth in its insurance division as the industry becomes more competitive.

Group CEO Michael Chaney told an investors’ briefing in Sydney last week that although profitability continues to be strong, growth isn’t as feasible as it was 18 months ago.

“We expect that premium growth will continue to be difficult for some time and that claims levels will return to longer-term averages,” he said, reflecting a view now held by most industry leaders.

Mr Chaney says while top-line growth is “under pressure”, the group is experiencing strong underwriting results from all of its insurance businesses. But commercial portfolios are experiencing greater competition, and claims are returning to “long term averages”.

Wesfarmers developed its insurance division in 2003 after acquiring Edward Lumley Holdings. The division comprises three general insurance companies – Wesfarmers Federation Insurance, Lumley General Insurance Australia and Lumley General Insurance New Zealand – as well as two premium funding businesses.