QBE gross written premiums up 11% in Q1

The insurance firm expects to record a 10% growth for 2023.

Australia-headquartered QBE Insurance Group saw its gross written premiums for the first three months of the year rise by 11% year-on-year (YoY).

Renewal rate increments for the group also averaged 10%, due to re-acceleration among property classes and higher rate increases from its reinsurance businesses.

Catastrophic events continued to occur at a heightened level in the early months of 2023. 

Notable incidents include Cyclone Gabrielle and the flooding in New Zealand's North Island, as well as a series of storms in North America and Australia. 

As of April, the net cost of claims resulting from these catastrophes amounts to approximately AUS$480m. This figure is compared to QBE's allocated budget for catastrophes in the first half of 2023, which is set at AUS$535m.

QBE has faced challenges with regard to the development of natural catastrophe events, predominantly taking place in late 2022. 

Owing to the timing and intricacy of these events, particularly winter storm Elliot, only a limited number of claims were received and evaluated before the reporting period of 2022. As a result, QBE has bolstered its reserves by AUS$130m to account for these events.

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Further, the core fixed income running yield for the first quarter of 2023 increased to 4.2%, surpassing the previous year's running yield of 4.1% at the end of 2022.

The slow path to reducing risk-free rates in the quarter resulted in unrealised gains on fixed interest securities of AUS$78m but was counterbalanced by a contraction in the claims liability discount impact of about AUS$100m.

Total investments funds under management (FUM) went up to AUS$29.1b. It is expected in the second quarter of the year that FUM will be dragged by AUS$1.9b from the reserve transaction announced in February.

However, due to its first-quarter performance, QBE expects GWP to grow by approximately 10%.