General Insurance Industry Review 2015

General Insurance Industry Review 2015

In the 12 months to June 2015, Australia’s general insurers faced tough conditions – a mix of natural disasters, strong competition and a volatile economy. While not every year is marked by cyclones, without doubt the competition, both at home and abroad, is here to stay and will continue to create havoc on insurers’ premiums if they don’t successfully adapt their business strategies

Partner and ASPAC Head of Insurance Accounting

KPMG Australia

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KPMG's General Insurance Industry Review 2015 includes the financial results of general insurers that represent a significant part of the Australian market. We provide commentary on market conditions and outlook, as well as share price performance of the major listed insurers.

In addition, our review also highlights the top 10 opportunities and risks facing the general insurance sector and offers pragmatic advice on how best to deal with these current and emerging themes.

Key findings

  • Australian insurers produced an insurance profit of just $3,735 million, down 23.6% from the 5-year high of the previous 12 months.
  • Sustained competition throughout the industry has had a significant impact on premiums, the growth rate slowing to almost nil in each of the three quarters to March 2015 before increasing slightly to 1.3% in the June 2015 quarter.
  • Five natural disasters in 12 months to June 2015 cost the industry about $3.6 billion. Consequently the industry’s loss ratio increased to 67.2% from a 5-year low of 61.6% in 2014.
  • Insurers revisited investment strategies and ventured into alternative assets as they continued to operate in a low interest rate environment in Australia and globally.

General Insurance Industry Snapshot 2015

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