The local general insurance industry is experiencing premium growth that it hasn’t seen for some time, a leading professional services firm reports
Signs continue to show that a hardening of the general insurance market in Australia is beginning to occur.
KPMG’s latest General Insurance Industry Review, released in November, reported 25% growth in the insurance industry’s profits in FY2017 to $4.849bn, with a rise in premiums and a drop in claims costs.
Scott Guse, KPMG partner and ASPAC head of IFRS Insurance, described FY2017 as “a very positive year” for general insurers, and said the firm believed it was “the start of a long-awaited upswing in the insurance cycle”. He noted that the overall increase in gross written premiums was primarily rate-driven, calling it a clear sign of market hardening.
KPMG believes it’s essential for insurers to maintain their pricing discipline and not risk eroding their growth “by aiming for short-term market share expansion”. It said automation had “a crucial role to play”.