QBE Insurance Group reported a strong first half in 2025, with net profit rising significantly and a stable capital position, underpinning confidence in its full-year outlook.
- Statutory net profit after tax rises to US$1.02 billion
- Adjusted return on equity improves to 19.2%
- Gross written premium grows 6%, 8% excluding exited portfolios
- Combined operating ratio improves to 92.8%
- Interim dividend declared at 31 Australian cents per share
Solid Financial Performance Amid Strategic Execution
QBE Insurance Group has delivered a robust financial performance for the half year ended 30 June 2025, reporting a statutory net profit after tax of US$1,022 million, up from US$802 million in the same period last year. Adjusted net profit after tax also rose to US$997 million, translating to an adjusted return on equity of 19.2%, a notable improvement reflecting the company’s effective execution of its strategic priorities.
The insurer’s gross written premium grew by 6% overall, or 8% when excluding exited portfolios, driven by organic growth in key focus areas such as Reinsurance, Accident and Health, Cyber, and Portfolio Solutions. This growth underscores QBE’s ability to expand its core business while managing portfolio optimisation efforts that balance diversification with returns.
Improved Underwriting and Investment Results
QBE’s combined operating ratio improved to 92.8% from 93.8% in the prior period, indicating enhanced underwriting discipline and favourable prior year claims development. The net cost of catastrophe claims fell to 5.4% of net insurance revenue, comfortably below the group’s allowance, reflecting effective risk management amid a period marked by extreme weather events globally.
Investment income remained stable at US$788 million, delivering a 2.4% return. While core fixed income yields moderated slightly to 3.8%, risk asset performance improved notably, supported by developed market equities and alternatives. Funds under management increased by 11% to US$34 billion, driven by premium growth and strong investment returns.
Capital Position and Dividend Policy
QBE’s indicative regulatory Prescribed Capital Amount multiple remained steady at 1.85x, well within the company’s target range of 1.6 to 1.8 times. The slight increase in debt to total capital ratio to 25.2% reflects recent Tier 2 issuances replacing Additional Tier 1 capital notes. The Board declared an interim dividend of 31 Australian cents per share, representing a payout ratio of 30% of adjusted net profit after tax, signaling confidence in ongoing capital management and shareholder returns.
Strategic Outlook and Market Positioning
Group CEO Andrew Horton emphasised that QBE remains on track to meet its full-year targets, driven by a clear strategic agenda focused on portfolio optimisation, sustainable growth, and business modernisation. The company’s approach has evolved from remediation to active portfolio management, delivering tangible financial benefits and positioning QBE to navigate future market challenges effectively.
With ongoing investments in transformation and a balanced product and geographic mix, QBE aims to sustain its momentum and deliver predictable, high-quality returns. The company also reaffirmed its commitment to supporting customers and communities affected by climate-related events, aligning its purpose with broader resilience goals.
Bottom Line?
QBE’s first half results reinforce its strategic momentum, but investors will watch closely for how it manages capital and growth amid evolving market risks.
Questions in the middle?
- How will QBE’s portfolio optimisation strategy evolve in response to ongoing climate risks?
- What impact might rising debt levels have on QBE’s capital flexibility and credit profile?
- Can QBE sustain premium growth and underwriting discipline in a competitive insurance market?