QBE says premium rates continued to rise in the first quarter, strong investment returns were achieved and the company is on track to meet financial guidance.

“We’ve had a good start to the year,” group CEO Andrew Horton told the annual general meeting in Sydney today. “Markets remain supportive, with continued momentum in gross written premium, while underwriting performance is tracking to plan.” 

The insurer expects constant currency group GWP growth in the mid single digits this calendar year and a combined operating ratio of about 93.5%. 

GWP grew 2% in the first quarter, while group-wide renewal rate increases of 7.3% were in line with expectations and reflected reduced rate gains across certain property and reinsurance lines compared with the previous corresponding period. 

Excluding rate increases, premium fell 2% in constant currency terms due to lower crop premium and property portfolio exits in North America and Australia.  

In the Australia Pacific division, first-quarter premium rate increases were 11%, with a retention of 76%. Rates increased 10.9% in North America and 5.1% in international. 

Mr Horton says that over the past year, QBE has made good progress building greater consistency and resilience into the business.

“Our efforts over the near term will continue to focus on reducing volatility, which we expect will further support consistent outcomes for our customers, shareholders and people,” he said. 

“While I am pleased with the progress we are making, I believe we can continue to improve our underwriting performance, and this remains a priority.” 

Net catastrophe claim costs in the four months to April were about $US300 million ($455 million). The insurer’s first-half allowance is $US609 million ($923 million). 

The period included some storms, mainly in Australia and North America, while a modest level of catastrophe prior-year development was recorded, mainly due to European events including hail in Italy. 

First-quarter investment income was just over $US400 million ($606 million), underscored by supportive interest rates and favourable returns in the risk asset portfolio. 

Mr Horton says optimisation initiatives last year in the property portfolio have improved balance across the group and reduced potential earnings volatility. 

The company wants to accelerate its data-centric capabilities and expand its ability to support customer resilience through new technologies such as artificial intelligence, he says. 

“Further progressing our acceleration of AI integration is a key priority for 2024. More broadly, we will continue to leverage technology to deliver better outcomes for customers through our modernisation strategic priority and QBE Ventures initiatives.”