Australian general insurers, after a 5-year low, have witnessed a surge in their profits in 2024, buoyed by lower Nat CAT losses and higher investment returns.
The latest KPMG General Insurance Insights and Analysis report based on data from Australian Prudential Regulation Authority and Insurance Council of Australia revealed that profits for the general insurance sector surged to A$6.1bn in 2024.
With just two major catastrophes events in 2024 - the Valentine's Day storms in Victoria and severe weather in NSW and Queensland in April, the industry paid for 49,000 claims totalling A$566m in losses, which was way lower than the A$2.356bn paid out across 143,900 claims from Nat CAT events in 2023.
The KPMG report mentions that the industry profit tripled from the previous 5-year average of A$2bn, considering that the country did not see any major catastrophes between the Queensland floods in December 2023 and Cyclone Alfred in February -March 2025.
Gross written premium rose 3.8% to A$68bn, and the industry made a A$3.1bn profit excluding investment income, whereas investment income after tax was at A$3bn, compared with the previous 5-year average of A$1.03bn.
KPMG partner Scott Guse said that the result reflects the industry’s cyclical nature and the impact in previous years of significant weather.
Insurers made a profit on home cover for the first time since 2019. Mr Guse says it is likely premium increases will now move back to single-digit levels after recent double-digit gains.
The report identifies trends and forces that will drive the industry in 2025 and beyond, including resilience; digital and artificial intelligence; environmental, social and governance; simplification and cost optimisation; regulation and compliance; and cyber.