Stock Market News

QBE Insurance’s rising catastrophic costs offset outlook hike, shares drop 9%

2023.05.11 21:40


© Reuters. FILE PHOTO: The QBE Insurance logo is seen on an office building in Melbourne February 28, 2011. REUTERS/Mick Tsikas

(Reuters) – Australia’s QBE Insurance Group Ltd said on Friday costs associated with catastrophic claims for the four months of 2023 had reached nearly 90% of the allowances it had set aside for the first-half, dragging its shares nearly 9%.

QBE, the country’s biggest insurer by market capitalisation, said net cost of catastrophe claims was around $480 million at the end of April, compared with the $535 million it had set aside for the first-half catastrophe allowances.

QBE said it experienced “elevated” catastrophe activity through the beginning of the year, underscored by cyclones and flooding events in New Zealand, as well as storms in North America and Australia.

The insurer added it was topping up last year’s reserves for adverse developments by $130 million, citing complexities and delays in receiving claims from natural catastrophe events that occurred late last year.

As a result of these increasing costs, QBE hiked its annual combined operating ratio target to around 94.5%, up from earlier target of around 93.5%. Combined operating ratio is the sum of ratios of claims, commissions and expenses incurred.

“While this mostly relates to particular events rather than underlying operating performance, this is nonetheless disappointing especially as industry loss estimates for some of these events seem to have been stable,” analysts at Citi said in a research note.

Shares of the insurer plunged as much as 8.8% to A$13.820, their worst intraday drop since Feb. 18, and clocked their fourth straight session in red. The stock was also the second-biggest loser on the benchmark index.

The rising claims costs eclipsed a strong start to the fiscal year, with gross written premium (GWP) clocking an 11% growth in the first quarter, prompting the insurer to hike its annual GWP forecast to around 10% growth from prior view of mid-to-high single digit growth.

Last year, QBE recorded GWP of $20 billion.

Source link

Related Articles

Back to top button
bitcoin
Bitcoin (BTC) $ 98,117.29 0.11%
ethereum
Ethereum (ETH) $ 3,360.37 1.84%
tether
Tether (USDT) $ 1.00 0.07%
solana
Solana (SOL) $ 252.29 2.08%
bnb
BNB (BNB) $ 662.50 0.31%
xrp
XRP (XRP) $ 1.41 3.55%
dogecoin
Dogecoin (DOGE) $ 0.424637 3.39%
usd-coin
USDC (USDC) $ 1.00 0.07%
cardano
Cardano (ADA) $ 1.01 5.36%
staked-ether
Lido Staked Ether (STETH) $ 3,359.28 1.94%
tron
TRON (TRX) $ 0.209083 2.51%
avalanche-2
Avalanche (AVAX) $ 41.64 1.97%
stellar
Stellar (XLM) $ 0.527019 5.00%
the-open-network
Toncoin (TON) $ 6.14 5.46%
shiba-inu
Shiba Inu (SHIB) $ 0.000026 3.78%
wrapped-steth
Wrapped stETH (WSTETH) $ 3,987.42 1.47%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 97,719.18 0.08%
polkadot
Polkadot (DOT) $ 8.68 11.43%
chainlink
Chainlink (LINK) $ 18.06 0.61%
bitcoin-cash
Bitcoin Cash (BCH) $ 512.01 1.12%
weth
WETH (WETH) $ 3,357.33 1.93%
sui
Sui (SUI) $ 3.37 2.96%
near
NEAR Protocol (NEAR) $ 7.08 9.24%
pepe
Pepe (PEPE) $ 0.00002 3.44%
leo-token
LEO Token (LEO) $ 8.57 0.37%
litecoin
Litecoin (LTC) $ 96.63 4.32%
aptos
Aptos (APT) $ 12.41 4.78%
uniswap
Uniswap (UNI) $ 10.87 0.77%
wrapped-eeth
Wrapped eETH (WEETH) $ 3,531.67 1.93%
hedera-hashgraph
Hedera (HBAR) $ 0.142763 6.48%
internet-computer
Internet Computer (ICP) $ 11.45 2.47%
usds
USDS (USDS) $ 1.00 0.30%
crypto-com-chain
Cronos (CRO) $ 0.188201 6.42%
polygon-ecosystem-token
POL (ex-MATIC) (POL) $ 0.562688 5.21%
ethereum-classic
Ethereum Classic (ETC) $ 28.50 5.10%
render-token
Render (RENDER) $ 8.02 1.79%
fetch-ai
Artificial Superintelligence Alliance (FET) $ 1.54 4.36%
bittensor
Bittensor (TAO) $ 535.04 0.26%
ethena-usde
Ethena USDe (USDE) $ 1.00 0.06%
kaspa
Kaspa (KAS) $ 0.151158 3.52%
bonk
Bonk (BONK) $ 0.000048 0.04%
whitebit
WhiteBIT Coin (WBT) $ 24.36 1.64%
vechain
VeChain (VET) $ 0.043336 0.39%
arbitrum
Arbitrum (ARB) $ 0.852766 3.95%
dai
Dai (DAI) $ 1.00 0.11%
filecoin
Filecoin (FIL) $ 5.64 0.52%
cosmos
Cosmos Hub (ATOM) $ 8.51 3.68%
celestia
Celestia (TIA) $ 7.78 9.34%
mantra-dao
MANTRA (OM) $ 3.62 1.99%
blockstack
Stacks (STX) $ 2.18 3.55%