QBE European Operations delivers strong GWP growth and improved COR

QBE-European-Operations-financial-results

QBE European Operations posted positive results today, extending its five-year track record of strong performance. Gross Written Premium for 2018 was £3.27bn, a 4% improvement on last year (equivalent to 6% on a constant currency basis).  The combined operating ratio was 94.8%, down from last year’s figure of 95.2%.  Multiple factors contributed to the strong 2018 performance, not least of which an average premium renewal rate increase of 4.4%.  Financial Lines, UK Motor and International Property continue to benefit from the strongest rate improvements while, in the second half of the year, improvements were also experienced in most Marine classes and International Casualty.

Underwriting discipline remains a core emphasis, which in addition to refocussing the business on delivering the right customer outcomes has driven the strong result.  The deployment of technology to improve business processes, risk selection and pricing has also contributed to the positive performance.

Key results for QBE European Operations

Gross written premium: £3.27bn – 4% improvement (see note 1 below)

Net earned premium: £2.63bn – 5% improvement

Net Underwriting Result: £137m2 – 13% improvement (see note 2 below)

Combined operating ratio: 94.8% - 0.4% improvement (see note 2 below)

1. Up 6% on a constant currency basis. 2. Excludes the impact of changes in risk-free rates used to discount net outstanding claims.

Richard Pryce, Chief Executive Officer of QBE International (which includes the European Operations division) comments “Last year’s excellent performance is the result of an unwavering focus on delivering positive outcomes for our customers, a continued strong stance on pricing and cost control and an uplift in market conditions. Our investment in and deployment of technology across our risk selection, pricing and claims functions is yielding considerable benefit both in terms of performance of our portfolios and the enhanced levels of service we are providing our customers.”

In response to the Brexit challenge, QBE now has a fully operational and well capitalised (re)insurance company in Belgium. This enhances its presence across Europe and resulted in the successful renewal of existing business in Continental Europe at 1st January 2019.

Pryce adds “The current business environment is marked by uncertainty and our customers are exposed to greater levels of unpredictability than ever before. Our post-Brexit plans ensure a continuity of service irrespective of the outcome of the political negotiations. Further challenges may arise for businesses however, as the details of the exit are finalised, and the insurance industry has an important role to play in supporting our customers in the UK and across the European Union through this period of change.”

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