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The net combined operating ratio improved to 82% from 85%, indicating enhanced operational efficiency. Total insurance revenue rose to AUD 20.1 billion from AUD 19.2 billion in the same quarter last year, underscoring the sector's resilience amid evolving market risks.
Premium increases have been instrumental in offsetting claims costs and sustaining earnings. S&P Global Ratings forecasts that while revenue growth may decelerate across most insurance lines in 2026, the sector's profitability will remain supported by ongoing premium adjustments and a stable claims environment. Insurers are also focusing on operational efficiencies to manage expenses.
However, the sustainability of these profit levels is contingent upon various factors, including the frequency and severity of natural disasters, regulatory changes, and market competition. Insurers must continue to adapt to these dynamics to maintain financial stability and meet the evolving needs of policyholders.
For small and medium-sized enterprises (SMEs) and sole traders, understanding these industry trends is crucial. Rising premiums may impact the affordability of insurance coverage, making it essential for business owners to assess their insurance needs carefully and explore options that provide comprehensive protection without overextending their budgets.
Published:Thursday, 22nd Jan 2026
Source: Paige Estritori
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