Insurance Sector Reports $1 Billion Profit Amidst Household Strain

0

Short-tail property categories – including householders, commercial motor, domestic motor, and fire and industrial special risks – contributed an underwriting profit of $271 million. Although this figure represents a decline from the previous quarter's $1 billion, it surpasses last year's $192 million. Notably, householders were the only sector within short-tail properties to post an underwriting loss, with a $190 million deficit, following three continuous quarters of gains.

According to Tim Yip, Director at Taylor Fry, the general insurance industry has delivered a robust outcome overall. Despite the apparent setback in the householders' line, this is consistent with expectations due to seasonal patterns. The March and December quarters typically pose challenges because of cyclone season, spanning November to April, alongside other severe weather risks. The March quarter accounted for damages from Ex-Tropical Cyclone Alfred, resulting in an industry-wide cost exceeding $1.2 billion.

Even with the March-quarter downturn, the year-to-date underwriting result for householders remains positive, tallying a $443 million profit, Yip noted. Remarkably, the December quarter's underwriting profit of $217 million was the first positive performance during that time frame in six years.

Scott Duncan, Principal at Taylor Fry, highlighted that average householders' insurance rates rose by 11% over the year to March, following a 20% hike in the previous year. He emphasized that despite the overarching figures, granular pricing adjustments mean some properties face more pronounced cost pressures. Thus, issues of affordability and accessibility persist.

This financial report underscores both the resilience of the insurance sector and the ongoing economic strain felt in household coverage, with consumer costs remaining a focal point for potential improvements and strategic adjustments in the forthcoming months.

Published:Wednesday, 11th Jun 2025
Source: Paige Estritori

Share this news item:

Insurance News

Clear

AFCA Upholds Insurer's Decision on Claimant's Non-Disclosure 12 Jun 2025: Paige Estritori A recent ruling by the Australian Financial Complaints Authority (AFCA) supported Auto & General's decision to deny a motor policyholder's claim after a crash. The decision stemmed from the policyholder's failure to disclose a driving-related good behaviour bond, despite his claims of a learning disability affecting his understanding of the policy's inquiries. - read more

Insurer Ordered to Cover Restaurant Arson Despite Director's Unrevealed Criminal Record 12 Jun 2025: Paige Estritori In a recent decision, the Australian Financial Complaints Authority (AFCA) directed insurer QBE to honour an arson claim for a restaurant, despite the owner's failure to disclose prior criminal convictions during the policy's inception. The restaurant, which operates from a leased location, suffered extensive damage due to an arson attack on August 2 of last year, halting its business operations. While the arsonist was apprehended, QBE initially denied the claim, citing non-disclosure of the director's criminal history. - read more

Insurance Sector Reports $1 Billion Profit Amidst Household Strain 11 Jun 2025: Paige Estritori The insurance industry secured a net profit after tax of $1.11 billion in the March quarter, with major contributions from insurers at $990 million and reinsurers at $123 million, as revealed by the latest data from the Australian Prudential Regulation Authority. The insurance service result, a key indicator of underwriting success, reached $1.32 billion during this period, while investment returns added an impressive $1.18 billion. - read more

ASIC Accuses Choosi Pty Ltd of Misleading Insurance Comparison Practices 10 Jun 2025: Paige Estritori The Australian Securities and Investments Commission (ASIC) has initiated legal proceedings against Choosi Pty Ltd, alleging deceptive practices in its insurance comparison service. The regulatory body charges that from July 2019 to June 2025, Choosi misrepresented its offerings, claiming to compare funeral and life insurance policies from multiple insurers while actually only comparing products from a single provider, Hannover Life Re of Australasia Ltd. - read more

Individual Disability Income Insurance Extends Profitable Streak into Fifth Quarter 10 Jun 2025: Paige Estritori Recent figures from the Australian Prudential Regulation Authority reveal that individual disability income insurance (DII) recorded an underwriting profit of $231 million for the first quarter of 2025, continuing a five-quarter streak of profitability. This performance shows promising growth compared to the December 2023 quarter, which saw an $86 million loss. Although the latest profit is up from $138 million in the last quarter, it still falls short of the $419 million achieved a year before. - read more