The Australian Prudential Regulation Authority (APRA) today released its Half Yearly General Insurance Bulletin which is compiled from audited annual returns from each APRA-regulated general insurance company for their financial years ending in the period 1 July 2006 to 30 June 2007.
Direct insurers reported gross premium revenue of $28.0 billion, making up 95.2 per cent of the total, while reinsurers accounted for the remaining 4.8 per cent or $1.4 billion. Gross premium revenue for the total industry increased $1.2 billion on the previous year.
Total assets reported for the industry were $88.0 billion, compared with $82.1 billion in June 2006. Total liabilities in the year ended 30 June 2007 were $62.6 billion.
Gross incurred claims reported in the year ended 30 June 2007 were up by around 13 per cent to $20.0 billion, with $19.5 billion (97.4 per cent) made up by claims on direct insurers.
The total reported loss ratio for the industry net of reinsurance was 56 per cent, down from 59 per cent at June 2006. The gross loss ratio before reinsurance, however, was 68 per cent, up from 63 per cent the previous year.
APRA Member John Trowbridge said that, even allowing for this increase in gross incurred claims, the industry had maintained a strong financial performance. "The industry suffered an increase in the incidence of claims due to some severe weather events over the 18 months to 30 June 2007. However, the minor impact on both the underwriting result and after-tax profit is a reflection of the reinsurance arrangements within the industry."
"Throughout this period, the industry also strengthened its overall financial position, with the total capital base growing by over three per cent to nearly $24 billion. The drop in the total industry solvency coverage from 2.36 at June 2006 to 2.06 in June 2007 is a result of the higher capital requirements for lenders mortgage insurers in place from January 2006," Mr Trowbridge said. "If lenders mortgage insurers are excluded, the solvency coverage for the rest of the industry has remained steady at 2.17 in June 2007. This compares with 2.21 in June 2006 and 2.20 in June 2005."
Copies of the Bulletin are available on APRA’s website at www.apra.gov.au/Statistics/General-Insurers-Statistics.cfm.
The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry. APRA is funded largely by the industries that it supervises. It was established on 1 July 1998. APRA currently supervises institutions holding approximately $3 trillion in assets for 21 million Australian depositors, policyholders and superannuation fund members.
Media and industry inquiries only:
Stuart Snell, Head of Public Affairs
Australian Prudential Regulation Authority
Telephone: 02 9210 3384
Mobile: 0407 250 276
All other inquiries:
APRA Contact Centre 1300 131 060.
