The 2010 financial year has been good for general insurers, with premium earnings up and losses down, according to the Australian Prudential Regulation Authority’s (APRA) half-years statistics.

Gross premium revenue for the 12 months ending June 30 was $32.7 billion, up from $31 billion in the 2009 financial year. Reinsurers only wrote $2 billion of the total this year.

While most direct business segments reported premium growth in 2010, public and product liability dropped from $2.1 billion in 2009 to $2 billion in the latest financial year.

Professional indemnity premiums also fell from $1.4 billion in 2009 to $1.3 billion at June 30 this year.

Strong premium growth was reported in the homeowner segment, up from $4.3 billion in 2009 to $5 billion this year.

Another strong performer was domestic motor insurance with premiums in the 2010 financial year at $6.5 billion compared to $6 billion in 2009.

NSW is still the strongest source of gross premium revenue, with $11.2 billion of premiums being written in the 2010 financial year. It is followed by Victoria with $5.6 billion and Queensland with $5.3 billion. Tasmania and the territories accounted for $636 million of gross premium in the 12 months to June 30.

The strong premiums compared to claims of $22.6 billion, down from $25.6 billion during the corresponding period in 2009.

APRA says insurance provisions in the previous year were impacted by reductions in the discount rate due to falling government bond yields.

“This increased the value of insurance provisions and led to higher gross incurred claims in the previous year,” the regulator said.

“In contrast, bond yields in the current year partially recovered and this difference in yields across the two years was a major cause of the drop in gross incurred claims.”

The improved claims management has resulted in the general insurance industry almost doubling its net profit in the last financial year.

The industry reported a $4.4 billion net profit in 2010 compared to $2.5 billion in the 12 months ending June 30, 2009.