The industry’s after-tax profit from continuing operations was $2.31 billion in the June quarter, as the closely watched householders line returned to the black with an underwriting gain of $713 million.

The insurance service result – a measure of underwriting performance – was $2.67 billion for the three months, up from $2.18 billion a year earlier, according to Australian Prudential Regulation Authority data released today.

The industry profit figure was up from $1.54 billion a year earlier. Insurance revenue increased to $19.7 billion from $18.58 billion, and investment income tripled to $1.84 billion.

Incurred claims cost the industry about $9.88 billion, compared with $9.73 billion a year earlier.

Short-tail property classes including householders recorded an underwriting gain of $1.38 billion, up from $1.1 billion, and the net combined ratio improved 2 percentage points to 85%. Gross written premium climbed to $13.17 billion from $12.49 billion.

The householders line’s underwriting result follows a $191 million loss in the March quarter and was up from $538 million a year earlier.

The line generates the second-largest GWP in the industry – $4.26 billion in the June quarter, just behind domestic motor at $4.65 billion.

Householders incurred claims fell to $1.45 billion from $1.66 billion, and amounts recoverable from reinsurers dropped to minus $41 million from $383 million a year earlier and $2.16 billion in the March quarter.

“It’s telling that the amount recoverable from reinsurance is basically zero because we haven’t had any [catastrophe] events throughout the period and insurers have not had to draw on their reinsurance protection,” KPMG partner Scott Guse said.

He says the insurance industry is taking the right actions in the homeowners line.

“It takes time to turn around a portfolio, so we need to look beyond one positive quarter result,” he told insuranceNEWS.com.au.

“We’ve got to get a sustained position … but it’s certainly on the right trajectory.”

Mr Guse says the industry’s disciplined approach to pricing and focus on expense reduction in the past few years is paying off.

“The results that APRA released, they’re in line with the strong performance reported by insurers in their statutory financial statements that most of them have now released,” he said.

“They needed to have that disciplined approach to pricing, given inflation over the years and weather events, and they’ve held that, and that’s appropriate.”

The Insurance Council of Australia cautions against reading too much into the June quarter results.

"It is welcome that household insurance lines have returned to profitability after being unprofitable in the March quarter," an ICA spokesperson said.

"However, the longer-term trends haven’t changed."

The spokesperson says Swiss Re research shows global natural catastrophe losses growing 5-7% annually and that insurer profits consistently trail state government insurance taxes, with states collecting more than $8.9 billion in FY25 compared to $7.2 billion in combined insurer profits. 

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