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Weather warning: QBE says climate change putting pressure on insurance premiums

Mr Regan said climate change was a “big topic” in the sector, requiring the insurance giant to “up its game on a number of fronts”. QBE boosted its reinsurance program for catastrophic events to $2 billion in a process that would be reassessed each year, Mr Regan said.

“What that means is you could have a one-in-200-year storm and we’d be protected,” Mr Regan said.

“Whatever your more broad thoughts on climate change are, the evidence is clearly there that the frequency and severity of weather events is increasing over time.

“The evidence is there for all to see that the amount of weather events globally, not just in Australia, is consistently rising and most of the worst years on record have happened in the last 10 years.”

The insurer reported a one per cent drop in revenue to $22.6 billion in its full year results on Monday. Profit after tax was up by 41 per cent as QBE sold off a suite of assets including its insurance operations in Indonesia and the Philippines, Australian livestock-in-transit businesses and personal lines business in North America. The net profit after tax was $818 million compared to $580 million the previous year.

In December, QBE announced a profit downgrade following an especially wet spring in North America that saw hail, sleet, frost and snow ruin crops in the region, causing the company’s underwriting activity to become unprofitable.

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The group is investing in artificial intelligence technology to improve its underwriting and claims processes.

The earnings per share for 2019 is 62 cents, compared to 43 cents last year and the franked dividend per security paid out 27 cents.

Source: Sydney Morning Herald

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