QBE is in “better shape” and looking to grow, having transformed its operations and recorded a first-half profit increase.

The insurer has reported net income of $US488 million ($663.66 million) for the six months to June 30, up 24% on the corresponding period last year.

The strong result was achieved despite increasing catastrophe claims in Australia, following the worst series of weather events since 2011.

The combined operating ratio for the half-year improved to 95.3% from 96.5%, while gross written premium increased almost 2.4% to $8.69 billion ($11.82 billion).

Group CEO John Neal says a commitment to non-core businesses has affected premium income but strengthened the balance sheet and reshaped profitability.

“With remediation initiatives largely behind us, it is time to turn our attention to growth,” he said. “Our business is more streamlined, more focused and in far better shape to compete strongly in increasingly competitive conditions.”

North American operations struggled against a backdrop of “substantial reorganisation”, but European operations performed strongly.

In Australia and New Zealand, heightened catastrophe activity added short-term pressure to “an already competitive landscape”. Tropical Cyclone Marcia and storms on the east coast caused major flooding in NSW and southern Queensland, plus hail damage in Sydney.

“In spite of this, Australian and New Zealand operations delivered an especially strong result, reporting a 90.8% combined operating ratio and 14.8% insurance margin,” QBE says.

Competition in personal lines has intensified and the commercial market remains tough, “although there are some early signs of potential price flattening”.

Standard & Poor’s (S&P) says QBE’s ratings remain unchanged following its “solid” performance and strong capital position.

The insurer’s core operating companies are rated A+ and stable, while the holding company is rated A- and stable.

“QBE’s operating performance for the first six months… was in line with our expectations of a gradual improvement in underlying earnings and reduced volatility,” S&P says.