QBE has reported a net profit of $US345 million ($440 million) for the six months to June 30, up 30% on the corresponding period last year.

The combined operating ratio improved to 97.5% from 99% and gross written premium was up 3% on a constant currency basis.

However, as reported in a Breaking News bulletin last week, the emerging markets division’s combined operating ratio blew out to 110.8% from 99.5%.

Following a “detailed review”, emerging markets will revert to two separately managed divisions in Asia-Pacific and Latin America, and division CEO David Fried will step down, although he will continue to support QBE in a “strategic advisory” capacity.

Jason Brown, currently Group Chief Risk Officer, and Carola Fratini, currently Argentina CEO, have been appointed CEOs of Asia-Pacific and Latin America respectively.

Mark Lingafelter, currently MD Asia-Pacific, will become Chief Underwriting Officer Asia-Pacific reporting to Mr Brown.

QBE says the divisional review will “determine the remediation activities required to improve underwriting performance in the second half of [this year] and beyond”.

“In addition to the tightening of underwriting controls and discipline, improved pricing models are being introduced, enhanced reinsurance protections considered and cost reduction plans implemented,” it said.

In the Australian and New Zealand operation, premium rate increases, tightened policy terms and conditions, and strengthened underwriting discipline and claims management contributed to an improved combined operating ratio of 92.2%, compared with 93.9%.

North American operations delivered further improvements in underwriting profitability, recording a combined operating ratio of 98.2%, compared with 100.5%.

“Importantly, North America returned to top-line growth after an extended period of remediation and non-core asset sales, with gross written premium up 4% on an underlying basis,” QBE said.

“Despite challenging market conditions, our European operations reported a solid underwriting result. The division’s first-half combined operating ratio of 91.3% is a reflection of the team’s commitment to underwriting discipline and performance oversight.”