Claims drain industry profits
New figures from the Australian Prudential Regulation Authority (APRA) show the insurance industry’s net profit plunged 39% in the 12 months to March 31, with high claims expenses leading to an underwriting loss of $900 million.
The regulator’s latest quarterly general insurance performance report, issued on Friday, shows industry net profit was $2.2 billion for the 12 months to March 31, against $3.6 billion in the previous period. Net premium revenue climbed 5.7% to $23.8 billion.
For the quarter ended March 31, net premium revenue increased 7% to $5.2 billion, while net profit declined 35% to $150 million. The net underwriting result for the quarter improved from a $252 million loss to a loss of $22 million.
Growth was hampered by a surge in claims expenses, with the net loss ratio for insurers rising to 138% from 64% last year. Net incurred claims rose 27% to $18.3 billion.
Heavy claims contributed to the $900 million underwriting loss, which compared poorly with underwriting profit of $1.9 billion last year.
At the end of the period the industry held total assets of $93.8 billion, a 3.5% increase on the previous period. Net assets improved 10% to $28 billion.
The regulator’s latest quarterly general insurance performance report, issued on Friday, shows industry net profit was $2.2 billion for the 12 months to March 31, against $3.6 billion in the previous period. Net premium revenue climbed 5.7% to $23.8 billion.
For the quarter ended March 31, net premium revenue increased 7% to $5.2 billion, while net profit declined 35% to $150 million. The net underwriting result for the quarter improved from a $252 million loss to a loss of $22 million.
Growth was hampered by a surge in claims expenses, with the net loss ratio for insurers rising to 138% from 64% last year. Net incurred claims rose 27% to $18.3 billion.
Heavy claims contributed to the $900 million underwriting loss, which compared poorly with underwriting profit of $1.9 billion last year.
At the end of the period the industry held total assets of $93.8 billion, a 3.5% increase on the previous period. Net assets improved 10% to $28 billion.