Australia’s claims drop, earned premiums rise

Australia’s claims drop, earned premiums rise

Net earned premium for the Australian insurance industry in the year ended 30 June 2012 was $27.8 billion, up 7.4% from the previous year’s $25.9 billion, according to the Australian Prudential Regulation Authority (APRA).

The increase in net earned premium was driven by increases in gross earned premium for the short-tail classes of business of houseowners/householders and fire and ISR, and the inwards reinsurance class of business.

Gross incurred claims for the period was $27.9 billion, down 22.3% from the previous year’s. The high gross incurred claims in the year ended 30 June 2011 was due to a series of natural catastrophes including the Queensland floods.

Gross incurred claims for the short-tail classes of business of houseowners/householders and fire and ISR in the year to 30 June 2012 was $5.3 billion, down 54% from the previous year ($11.5 billion).

The net loss ratio for the industry was 71%, up from 68% in the previous year. The net loss ratio for direct insurers was 71%, up from 68% in the previous year. The net loss ratio for reinsurers was 65%, down from 74% in the previous year.

The total assets for the industry were $118.2 billion as at 30 June 2012, an increase of $3.2 billion (2.8%) from the previous year. Direct insurers accounted for $105.5 billion (89.3%) of this figure.

Industry assets were offset by liabilities of $87.1 billion, an increase of $1.6 billion (1.9%) from the previous year. Industry net assets were $31.1 billion at 30 June 2012, an increase of 5.3% from the previous year.


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