Home / Corporate / QBE sees pandemic impact on ‘multiple lines’
27 July 2020
QBE has forecast COVID-19 costs could be around $US600 million ($842 million), including impacts on multiple lines of business this year and next.
The figure flags $US264 million ($370 million) of potential further net claims that could emerge in the next 12-18 months, primarily in trade credit and lenders’ mortgage insurance.
Other lines already affected, or expected to be impacted, by the pandemic, include property (business interruption), reinsurance, workers’ compensation, casualty including directors’ and officers’, accident and health and landlords’ insurance.
The insurer last week said it expects a first-half loss of $US750 million ($1.1 billion) mainly due to the pandemic and natural disaster claims.
The six-month combined operating ratio will be around 104%, reflecting COVID-19 impacts of around $US335 million ($470 million) adverse catastrophe experience of $US60 million ($84 million) and prior year claims development of $US120 million ($168 million).
Amid the volatile conditions, premium pricing has continued to harden, with momentum in North America contributing to an overall acceleration during the half.
QBE says the second-quarter group-wide renewal rate increase of 10.1% was up from a gain of 7.3% in the first three months of the year.
Overall renewal rate increases averaged 8.7% for the half compared with 4.7% in the previous corresponding period, while gross written premium rose around 10%, adjusted for currency and asset sales.
QBE will provide full details on its half-year financial results on August 13.