QBE CEO Pat Regan says rising global interest rates “bode well” for its investment returns next year.

“Given our short asset duration, QBE is uniquely positioned to benefit from rising interest rates,” he told the UBS Australasia Conference last week.

“While global investment markets have been quite volatile in the second half of the year, and especially so in October, it is pleasing to see risk-free rates continue their upward trajectory, led by US Treasuries.”

Mr Regan says the insurer is achieving above-market premium growth, while retention levels are holding up.

Group premiums increased an average of 5.9% in the third quarter, up from 5.1% in the preceding three months and 4% in the first quarter.

For the nine months to the end of September, rate increases averaged 5% compared with 1.4% in the corresponding period last year.

“While market conditions are certainly a little more supportive, we believe our forensic approach to portfolio analysis and increasingly sophisticated assessment of premium rate adequacy by class of business is contributing to above market-average premium rate increases,” Mr Regan said.

In the Australian business, commercial property rates have risen 17.7%, while gains of 14.2% were reported for aviation and 10% in strata.

Australia and New Zealand rates grew 6.9% overall in the third quarter, excluding compulsory third party, outpacing gains of 4.3% in North America, 4.6% in Europe and 1% in Asia-Pacific.

Mr Regan says QBE aims to have global underwriting standards in place by the end of the year as part of its Brilliant Basics program. The insurer is also pursuing technology advances and insurtech partnerships in areas such as pricing, risk selection and data analytics.

QBE recently appointed Tim Pitt from XL Catlin as Global Head of Pricing to help accelerate its efforts.

On December 11 the company will update the market on its cost-reduction program and the final details of next year’s reinsurance program.