Barring disaster, Moody's predicts profits
Sydney Morning Herald
Tuesday March 30, 2010
THE global ratings agency Moody's Investors Service expects profits for Australia's general insurers to rise this year if the impact of future natural catastrophes falls within insurers' planned allowances.Moody's said the outlook for the local general insurance industry was stable, noting that insurers were still benefiting from higher property values and the federal government's stimulus packages and infrastructure spending.Local insurers' revenue has not been cut by shock losses driven by poor underwriting or exotic financial products, the vice-president of Moody's, Wing Chew, said."If the frequency and scale of natural catastrophes do not exceed the planned allowances, Australian general insurers may reap higher insurance profits in light of rate increases and the improving investment environment," he wrote.But he warned industry growth this year may still be subdued as consolidation continues in order to secure lower costs and productivity gains.
© 2010 Sydney Morning Herald
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