QBE Knocks First-Half Result Out of the Park but Crops Can’t Take the Heat

QBE’s first-half 2021 cash NPAT of USD 463 million was much stronger than we expected, a welcome change after a disappointing 2020. On strong premium growth and much-lower-than-expected claims, we almost double our 2021 cash NPAT forecast to USD 664 million. In the first half, stronger-than-expected premium growth and the release of reserves (bucking a trend of recent reserve increases) finally offset persistent increases in claims inflation and large natural hazard events. Gross written premium growth of 20% on last year benefited from continued price increases across all regions. Net earned premium was up 10% on last year, with reinsurance taken out for growth in crop premiums.