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QBE Insurance Posts FY Loss

QBE Insurance Group (QBE.AX,QBEIF.PK) reported that its net loss after tax attributable to ordinary equity holders of the company for fiscal year 2020 was US$1.52 billion, compared to a net profit after tax of US$550 million in 2019.

The latest-year results included an estimated US$655 million underwriting result impact from COVID-19, adverse prior accident year claims development, elevated catastrophe claims, a significantly reduced investment return as a result of extreme first-half market volatility, and goodwill and deferred tax asset impairments in North America of US$390 million and US$120 million, respectively.

The adjusted net cash loss after tax was US$863 million, compared to adjusted net cash profit after tax of US$733 million in the prior year.

On a constant currency basis and adjusting for disposals, gross written premium grew by 10% to US$14.64 billion reflecting premium rate momentum, improved premium retention across all divisions and strong new business growth, particularly in North America and International.

Net earned premium rose 4% to US$11.79 billion from last year, impacted by significant de-risking (reinsurance) initiatives.

In light of the substantial reported loss, the directors have elected not to declare a final dividend. In the prior year, the directors announced a final dividend of 27 Australian cents per share.

Subject to global economic conditions not deteriorating materially, the company expects to resume dividend payments -of up to 65% of adjusted cash profits -in conjunction with the 2021 interim result.

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