Big general insurer QBE appears to have emerged better than most from the spate of natural disasters, forecasting today that its net profit for the first half is currently expected to be 50-60 per cent higher than the $US440 million reported for the first half of 2010.
While QBE acknowledged the impact of large catastrophe claims including the Queenland storms, Cyclone Yasi, the Victorian storms, the Christchurch earthquake, the Japan earthquake and eight major tornadoes in the US, it said large risk claims were in line with its targets.
It appears that the impact of the natural disasters on the balance sheet were somewhat mitigated by strong investment performance, with net investment income being nearly five times higher to the end of May than the corresponding period in 2010.
Commenting on the year-to-date performance, QBE chief executive Frank O’Halloran said that while the unprecedented frequency and severity of catastrophes in the first five months had materially impacted a large number of insurers and reinsurers, QBE’s diversification and comprehensive reinsurance protections had enabled it to outperform the majority of its peers in the first half.
However he said that achieving the company’s targeted 2011 insurance profit margin would be largely influenced by the level of large risk and catastrophe claims incurred in the remainder of the year.
