QBE Insurance Group Upgrades Climate Resilience and FY24 Results

About QBE Insurance Group Limited

QBE Insurance Group Ltd (ASX: QBE) is a multifaceted insurance and reinsurance firm based in Sydney, Australia. It functions in 27 nations, providing customised insurance solutions while striving for innovation to tackle global risk concerns. QBE, a leading entity on the ASX All Ordinaries, remains a significant force in risk mitigation and strategic global alliances.

Climate resilience initiatives and reinsurance strategies maximise risk management.

QBE Insurance Group Ltd. is enhancing its extensive risk management to fortify its strategic growth pipeline. The Group reduced its catastrophic reinsurance retention threshold from $400 million to $300 million in early 2025 as a component of its reinsurance strategy. This optimises its financial agility to manage catastrophic claims. The insurer secured $250 million in multi-year collateralised capital to address peak North American risks through its first catastrophe bond in over a decade. This reinsurance innovation diminishes dependence on traditional markets and diversifies funding avenues.

QBE and the non-profit InnSure are conducting a pilot programme for flood resilience in Salem, Massachusetts, to mitigate climate-related vulnerabilities. Through community planning and disaster prevention, this endeavour tackles the risks of natural disasters. These initiatives bolster industry objectives to construct disaster-resilient infrastructure and communities. It anticipates a mid-single-digit growth in Gross Written Premiums (GWP) for FY25, attributed to stringent underwriting practices and market pricing dynamics. As a result of taking this innovative stance on climate change, new opportunities have arisen for businesses.

Unprecedented gains indicate strong growth.

The Group announced a 31% rise in statutory net profit after tax to $1.78 billion in FY24. Adjusted net profit surged by 30% to $1.73 billion, surpassing projections. Notwithstanding consistent assertions, average premium rates increased by 5.5%, propelling topline growth in principal markets. Gross Written Premiums (GWP) risen to 3% year-over-year and 9% organically, excluding crop and non-core business divestitures, reaching $22.4 billion.

Investment income of $1.5 billion generated a 5% return, illustrating robustness in a favourable investment climate. The consolidated operating ratio strengthened to 93.1% from 95.2% in the previous year. This metric falls significantly short of QBE’s internal threshold of 93.5%, signifying effective underwriting and claims administration.

A total of $0.87 per share was distributed to shareholders as a result of a 40% increase to $0.63 per share in the final dividend. Return on Equity (ROE) increased to 18.2%, the highest level in more than ten years. These figures illustrate strategic achievement in converting operational efficiencies into shareholder value.

Leaders, cyber insurance, and optimising portfolios deliver stability to markets.

Proactive leadership and innovation were demonstrated through the development of strategic roadmaps. The appointment of industry veteran Neil Maidment as a Non-Executive Director on February 21, 2025, altered its governance framework. Maidment’s extensive global reinsurance expertise assists the board in navigating evolving opportunities and risks. Pursuant to the board’s succession procedures, Rolf Tolle is scheduled to retire in May 2025.

Along with new management, the Group fortified its cyber insurance policies by forming partnerships with key cyber-tech companies. Cyber insurance currently encompasses 11 business categories, highlighting flexibility in mitigating digital risks. Technological advancements and enhanced risk-placement platforms provide cyber insurance and financial institutions with a competitive advantage.

Reinforcing its disciplined growth, QBE has strategically rebalanced its property portfolio. The enterprise decreased reinsurance expenditures from $4.23 billion in FY23 to $3.97 billion in FY24 by divesting from non-core segments and optimising Australian cyclone pools. Efficiency improvements assist the company in managing underwriting profitability in fluctuating markets.

Digital transformation strengthens climate resilience and addresses regulations.

Inflationary pressures and risks associated with climate change are managed by the Group in the insurance industry. It advocates for increased resilience programmes in response to escalating repair expenses and climate-related hazards such as floods, fires, and catastrophic losses. QBE, in conjunction with other industry stakeholders, endorses a $30 billion federal flood defence fund aimed at safeguarding disaster-prone communities.

Moreover, the insurer has proactively adjusted to technological advancements that transform the insurance sector. Algorithmic underwriting and the expansion of digital platform capabilities are examples of digital integrations that are driving modernisation. These innovations signify a broader industry trend towards efficiency and customer personalisation for competitive advantage.

Insurers face heightened regulatory and economic scrutiny from ASIC due to claims handling concerns. QBE’s significant underwriting enhancements demonstrate resilience and adherence to evolving industry standards. The Group can address external challenges and foster sustainable growth by investing in proactive flood mitigation and sophisticated underwriting.