he Australian Prudential Regulation Authority (APRA) has released its quarterly general insurance performance statistics and quarterly general insurance institution-level statistics publications for the March 2023 quarter.
The quarterly general insurance performance statistics publication provides industry aggregate summaries of financial performance, financial position, capital adequacy and key ratios. The publication also includes detailed statistics at a class-of-business level, a breakdown of operating income and expenses, and more granular solvency information.
The industry reported a net profit after tax of $3.7 billion and a return on net assets of 12 per cent. This mainly reflected increases in underwriting result and investment income. Higher premiums across most classes of business drove the increase in underwriting result. The rise in bond yields through the year drove the overall increase in investment income. Gross incurred claims remained relatively stable with an increase in long tail claims expenses being offset by a reduction in short tail claims expenses.
The prescribed capital amount (PCA) coverage ratio for the industry increased from 1.69x on 31 March 2022 to 1.75x on 31 March 2023.
Key performance statistics for the general insurance industry in the year ending 31 March:
March 2022 ($bn) | March 2023 ($bn) | Change (annual) | |
|---|---|---|---|
Gross earned premium | $58.9 | $64.4 | 9.4% |
Gross claims expense | $44.6 | $45.0 | 1.0% |
Underwriting result | $4.7 | $5.3 | 12.4% |
Investment income | -$0.9 | $2.0 | – |
Net profit after tax | $1.3 | $3.7 | 195.0% |
Key ratios for the general insurance industry:
March 2022 | March 2023 | Change (annual) | |
Net loss ratio | 65% | 66% | 1 percentage point |
Return on net assets | 4.3% | 12.0% | 7.7 percentage points |
Prescribed capital amount coverage ratio | 1.69x | 1.75x | 0.06x |
The quarterly general insurance institution-level statistics publication contains individual insurer information about financial performance, financial position, capital adequacy and key ratios. The quarterly performance statistics of insurers may be impacted by factors outside of their control, such as natural catastrophe events, as well as those driven by their internal processes, such as the timing of actuarial valuations. Users should take these factors into account when interpreting the statistics.
The March 2023 general insurance quarterly publications are available on APRA’s website at: .
