Insurance Australia Group Ltd.'s full-year 2019 net profit after tax rose 16.6% to A$1.08 billion from A$923 million year over year.
Net profit after tax for the year includes profit of approximately A$200 million from the sale of its Thailand operations to Tokio Marine & Nichido Fire Insurance Co. Ltd., which was completed in August 2018.
Gross written premium was A$12.01 billion, up 3.1% from A$11.65 billion in the prior year. The increase is mainly attributed to higher rates, with approximately 4% like-for-like premium growth. The increase also reflects a favorable foreign exchange effect against the currency in New Zealand. Cash earnings for the year were A$931 million, down 10.0% from A$1.03 billion in the previous year.
The Australia business reported full-year 2019 gross written premium of A$9.33 billion, up 2.0% compared with A$9.14 billion in the previous year. The increase is attributed to a 4% to 5% short-tail personal lines rate increases, a 6% average commercial rate increase and "high and stable" levels of motor and home renewals. The company's move to exit smaller business areas reduced its gross written premium by approximately A$70 million.
The New Zealand business reported full-year 2019 gross written premium of A$2.66 billion, which grew 5.2% compared with A$2.49 billion year over year. The increase is attributed to approximately 5% consumer growth and about 5% business growth, driven by a deceleration of rate increases, lower overall volumes, strong commercial motor growth and improved retention.
Insurance Australia Group also reported a full-year 2019 underlying insurance margin of 16.6%, or A$1.20 billion, compared with 14.1%, or A$1.08 billion, in the prior year.