General insurance investment income in fell by nearly a quarter in the year ended 30 June 2013, according to statistics released by APRA.
Investment income for the industry was $4.1bn, down 24.5% from the previous year’s $5.4bn.
APRA said the decrease was due to a reduction in investment income arising from unrealised gains/losses from change in net market value which was a loss of $0.4bn for the year ended June 2013, down from a gain of $1bn in the previous year.
Return on total investments decreased to 5.8% in the year ended 30 June 2013 compared to the previous year (8.1%).
Gross written premium in commercial lines grew: Public and product liability crept up from $2bn to $2.1bn; employers’ liability rose to $1.8bn from $1.5bn and professional indemnity stayed flat at $1.5bn.
Net earned premium for the industry in the year ended 30 June was $29.9bn, up 7.4% from the previous year.
The increase in net earned premium was driven by increases in net earned premium for the short-tail classes of business of homeowners, fire and industrials special risks, and domestic motor vehicle.
Gross incurred claims for the industry were $24.6bn, down 11.8% from the previous due, due to decreases in gross incurred claims for the inward reinsurance class of business and the long tail classes of business.
Total industry net profit after tax in the year ended 30 June 2013 was $5.2bn, up from $3.7bn in the previous year. This represented a return on net assets of 16.9% in the year ended 30 June 2013, up from 12.3% in the previous year.