(Recasts, adds CEO quote, background details)
SYDNEY Feb 22 Insurance Australia Group
, the nation's largest general insurer by market share,
on Wednesday raised its full-year gross written premium growth
guidance after posting a 4.3 percent fall in first-half net
profit that topped market expectations.
IAG, which specialises in motor and property insurance, said
net profit fell to A$446 million ($342 million) in the six
months ended Dec. 31 compared with A$466 million a year ago but
beat the A$419 million estimate of three analysts polled by
Thomson Reuters I/B/E/S.
The company said strong equity markets increased investment
income and gross written premium growth of 4.7 percent was
higher than expected due to rate increases.
IAG said gross written premiums were expected to rise at low
single-digit levels for the full-year, up from its prior
guidance of relatively flat growth.
"This is a sound result for our core businesses in Australia
and New Zealand," IAG Chief Executive Peter Harmer said.
IAG, which has a strategic partnership with U.S. investor
Warren Buffett's Berkshire Hathaway Inc, reported an
insurance margin of 12.6 percent for the half-year, near the
bottom of its target range of 12.5 to 14.5 percent. IAG on
Wednesday said full-year margins were expected to fall in the
middle of the range.
Moody's on Feb. 16 said there were emerging signs that
premium rates had started to slowly rise across the Australian
insurance industry, particularly in motor insurance and to a
lesser extent in home insurance.
The insurance sector has become a hotbed of corporate
activity in the region.
Suncorp Group on Wednesday said it had bought 11.1
percent of New Zealand general insurer Tower Ltd and
submitted a non-binding takeover offer to the company's board
that would top a NZ$197 million ($141.1 million) bid from
Canada's Fairfax Financial Holdings Ltd on Feb. 9.
Allianz SE has considered a potential bid for
Australia's QBE Insurance Group, which has a market
value of A$17 billion, according to sources familiar with the
($1 = 1.3024 Australian dollars)
(Reporting by Jamie Freed; Editing by Robin Pomeroy and Hugh