Australia

The return of movement restrictions will haunt the sector.

The Federal Court has ordered AMP in February to pay for incorrect advice.

47% have reported a rise in mental health issues.

Regulatory disruptions have also reduced access to life insurance.

Effective policymaking has also protected the segment from external shocks.

Last year’s earnings dropped below the five-year average ROE of 10.7%.

The pandemic has had a negative effect on gross written premiums.

The sector will reach an ROE of 15% this year, lower than last year’s 16%.

Insurance profit skyrocketed to $861m from $62m in 2017. QBE Insurance Group has reached the end of the tunnel as it reversed from a $1.2b loss in 2017 to a $390m profit in 2018. According to the firm, the comeback was buoyed by the ‘significantly reduced catastrophic activity’, exclusion of a $700m non-cash goodwill impairment charge and a $230m non-cash write down of deferred tax assets. Insurance profit skyrocketed to $861m from $62m in 2017. In total, the firm’s gross premiums in 2018 grew 3% YoY to $13.7b. Moreover, the firm’s final dividend hit $0.36 (A$0.50) from $0.18 (A$0.26) in 2017. “Significant portfolio rationalisation and simplification, successful placement of the restructured 2019 reinsurance program, divisional consolidation, and initiation of a three-year operational efficiency programme position us well to deliver further value to our shareholders in 2019,” group CEO Pat Regan said in a statement.

Australia represents an attractive market for Japanese insurers amidst shrinking markets back home.