The Australian Prudential Regulation Authority (APRA) has published its latest quarterly general insurance statistics for the September 2022 quarter, following the release of its quarterly private health insurance statistics covering the same period.
The report provides industry aggregate summaries of financial performance, financial position, capital adequacy, and key ratios. It also includes detailed statistics at a class-of-business level, a breakdown of operating income and expenses, and more granular solvency information.
For the year ended September 30, 2022, the Australian general insurance industry saw a net profit after tax of $960 million and a return on net assets of 3.1%, a slight drop compared to the figures in the previous year because the industry’s stronger underwriting results were offset by significant investment losses.
Focusing on the stronger underwriting results, APRA pointed to an increase in gross earned premiums across all classes of business as the main driver of improvement. Gross claims expenses also increased and may be attributed to higher claims costs arising from catastrophe events throughout the year, mainly the catastrophic flooding in southeast Queensland and New South Wales (NSW) in the March quarter.
During the same period, the Australian general insurance industry recorded total investment losses of $3.0 billion, driven by unrealised losses on interest-bearing investments due to bond yield increases in the past 12 months.
The industry PCA coverage ratio also increased to 1.74x, up from only 1.72x for the same period last year.