Australia’s general insurance industry is enjoying a strong 2007, with $21.5 billion of premium written over the 12 months to June 30. The latest data from the Australian Prudential Regulation Authority (APRA) shows the industry grew 1.7% over the period.

Premium revenue is up, and claims costs are down. Net incurred claims for the last financial year fell 5.4% on 2004/05 figures. The $12.4 billion in payouts included $11.4 billion of direct insurance claims and $1 billion in reinsurance costs.

However, underwriting expenses increased – taking an extra $600 million away from industry profits. Still, the total industry underwriting result was up 17.7% to $3.4 billion.

APRA won’t comment on the figures apart from suggesting they represent a strong position for the industry. It says its quarter-by-quarter information releases are typically volatile. The latest statement was influenced by the new “prospective” accounting method insurers are required to use.

Under this regime insurers must take account of premium revenue and expenses for bound contracts. Insurers that did not make prospective reports in the last quarter of 2005 have had to adjust their figures over the first half of this year.