The local industry is highly developed and well regulated, and although it has experienced record profits in recent years there’s still room for growth, according to a new report.

Federal Government agency Axiss Australia’s report, titled “Executive Briefing – Insurance Australia”, shows last year’s reporting season was the most profitable in Australia’s history, with gross written premiums of more than $25 billion.

Axiss – a division of Invest Australia – acknowledges the local market is highly concentrated. It says the top five insurers handle about 70% of net premium revenue and hold 63% of total industry assets.

But new players like Calliden and Assetinsure have heralded new opportunities for the industry, the report says. The industry’s greater underwriting discipline and improved pricing skills – as well as changes in profitability, tort reform and regulation – have attracted new participants.

“Opportunities exist for new products or new combinations of existing products and distribution channels.”

Axiss says the market has settled after the HIH collapse. “The general insurance market in Australia is sophisticated and mature. Its underwriters have considerable experience in risk management, claims management and evaluation, and its actuaries are acknowledged as world class.

“The conflict management requirements and generally stricter regulatory requirements in Australia have led to greater broker discipline and stability.”

As for brokers, Axiss says conflict management requirements and generally stricter regulatory requirements “have led to greater broker discipline and stability”.