QBE is back in the black, reporting a $US390 million ($545 million) after-tax profit for last year following a $US1.2 billion ($1.7 billion) loss in 2017.

All key divisions improved as the insurer quit underperforming markets and streamlined its structure under CEO Pat Regan’s “stronger and simpler” turnaround program.

Lower catastrophe losses and rate momentum also bolstered the business.

“Overall, I am encouraged by the progress we have achieved… and the momentum we have going into [this year],” Mr Regan said today.

“The actions we have taken to simplify the group, implement a rigorous performance management framework and upgrade core capabilities in pricing, risk selection and claims management delivered meaningful improvement in the underlying quality of our business and our financial performance.”

The insurer achieved a $US480 million ($671 million) underwriting profit compared with a $US507 million ($709 million) loss in 2017, and the combined operating ratio improved to 95.9% from 104.5%.

QBE is targeting a 94.5-96.5% combined operating ratio this year.

Group-wide premiums grew an average of 5% last year, with Australian and New Zealand operations enjoying the strongest rise at 7.3%, excluding premium rate changes from the NSW compulsory third party (CTP) scheme.

“Rate conditions in all our markets have remained positive in the second half,” Mr Regan said.

Overall gross written premium increased 2% to $US13.7 billion ($19.1 billion), while catastrophe claims fell to $US523 million ($731 million) from $US1.2 billion.

North American operations returned to profitability, with an insurance profit of $US221 million ($308 million). The European business recorded a decline to $US311 million ($434 million) from $US335 million ($468.1 million).

Profit for Australian and New Zealand operations moderated to $US420 million ($586 million) from $US438 million ($612 million), as rate reductions due to NSW CTP legislative changes had an impact.

Asia-Pacific losses narrowed to $US12 million ($16.8 million) from $US93 million ($130 million), with the business lifted by efficiency and simplification programs.