NU Online News Service, Aug. 19, 11:10 a.m.EST
|QBE Insurance Group says first-half profit increased 53 percentto $673 million, driven by gains from acquisitions.
|However, the Australia-based insurance and reinsurance companycut its profit margin for the six months to 11.2 percent from 15.8percent as catastrophe losses totaled nearly $1.1 billion.
|QBE targeted a 15-18 percent profit margin for the first half.Its expected profit margin for the second half is 11-14percent.
|Australia's leading insurer was hurt by storms in Queensland andVictoria, about a dozen tornadoes in the U.S., and earthquakes inChristchurch, New Zealand during the first half of the year.
|“The record level of catastrophes experienced by the worldwideinsurance industry during the first half and the recent fall inrisk-free interest rates necessitates that we lower our insuranceprofit range for the full year,” says Frank O'Halloran, chiefexecutive officer.
|QBE says it has purchased additional reinsurance to protectagainst the continuation of abnormal catastrophe activity for therest of the year.
|Gross premiums earned increased 30 percent to $8.94 billion fromrecent acquisitions over the last year, QBE says.
|QBE says its combined ratio was 95.7, up from 89.7 during thefirst half of last year. Halloran says QBE is still outperformingits peers, “many of whom have announced combined operating ratiosin excess of 100 percent due to the record level of catastropheclaims in the first half.”
|Premiums rate increases averaged 3 percent on renewed businessduring the first half of 2011. For the second half, QBE says itexpects overall premium rate increases of about 4 percent.
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