Emerging Markets business review

Emerging Markets delivered a solid result in 2016, recording a stable combined operating ratio and double-digit gross written premium growth. We remain focused on winning and retaining business where we see the highest potential for further profitable growth.

David Fried
Chief Executive Officer   •   Emerging Markets

Gross written
premium (US$M)


6% from 2015 1
Net earned
premium (US$M)


8% from 2015 2
Gross written chart, net earned premium

  1. Up 10% on a constant currency basis.
  2. Up 8% on a constant currency basis.

2016 in review

In 2016, Emerging Markets posted solid underlying growth and a stable combined operating ratio through the continued implementation of our profitable growth strategy.

On a constant currency basis, gross written premium and net earned premium grew by 10% and 8% respectively, largely due to an enhanced focus on driving profitable growth in four key areas of business: Specialty, Commercial, SME and Personal Lines with strategic partners.

The division also recorded a stable combined operating ratio of 99.5% despite several large individual risk and catastrophe claims during the year. The underwriting results were protected by an improved reinsurance structure implemented in 2016.

This solid overall performance can be attributed to close management of portfolios, strategic remediation and tight expense control. Following a business review to address Latin American underwriting margins, in December 2016, the QBE Group entered into an agreement to sell 1 its small and currently unprofitable Chilean operations to the current management team of QBE Chile Seguros Generales S.A. Additionally, the Group finalised the buyout of the remaining 45% of paid-up shares of the joint venture operation in Indonesia previously held by PT Pool Advista Indonesia Tbk and purchased an additional 23% stake in our Indian joint venture, Raheja QBE.

To sustain long-term growth ambitions, Emerging Markets continues to pursue improvements in productivity, efficiency and consistency through implementation of a single operating model across the division. A new operating structure has been introduced in Hong Kong to ensure QBE is well positioned to meet the evolving business needs in this market.

The establishment of a Centre of Excellence in Miami has delivered a more robust governance structure, strengthened relationships with major trading partners (MTPs) and enhanced underwriting expertise and control in Latin America. For example, profitable growth achieved by working more closely with MTPs in Colombia increased by more than 70% on the prior year.

The long-term outlook for Emerging Markets remains positive and will continue to drive premium growth for QBE.

  1. Subject to regulatory approval.

Outlook for 2017

Emerging Markets remains committed to maintaining strong premium growth with an overarching focus on profitability. We continue to build strong partnerships with customers by providing products where the QBE Group’s core strengths are best utilised. We remain focused on the areas of business where we see the highest growth potential.

In Asia Pacific, the outlook for all the markets we serve is positive. Strong growth is forecast this year in a number of economies, providing a solid platform for us to continue to expand our business in the region.

In Latin America, overall GDP growth is expected to rebound in 2017. The region has the potential to sustain strong economic growth with more than 160 million people between the ages of 15 and 29.

The favourable longer-term economic outlook for emerging markets in general should translate into additional trade and infrastructure investment, with corresponding positive implications for our business growth.

The Latin American Art Museum of Buenos Aires (MALBA), which opened in 2001, relies on multiple insurance and risk management solutions from QBE to safeguard its treasured 20th Century art collection. Each year, more than 400,000 people visit the museum from across Latin America and beyond, to experience its unique collection of the region’s art in all its forms. The partnership with QBE provides the museum with general liability cover and all risks property cover, to protect against the physical loss or damage to irreplaceable pieces. The museum’s mission is to collect, preserve, research, and promote Latin American art in all mediums and we at QBE are very proud to partner with MALBA to make this happen.

Innovation: Qnect

QBE Qnect, an innovative online insurance portal, provides instant quotes, policy issuance and policy services through any web‑enabled device, making it possible for intermediaries to immediately satisfy their customers' insurance needs. First launched in Hong Kong and Singapore in 2014, Qnect has been extended to seven markets including Argentina in Emerging Markets.

“To sustain long‑term growth ambitions, Emerging Markets continues to pursue improvements in productivity, efficiency and consistency through implementation of a single operating model across the division.”

In the community – Asia Pacific Operations: Relief after Cyclone Winston

In February 2016, Fiji was left devastated by Cyclone Winston. To assist the people of Fiji, QBE Emerging Markets organised a multi-faceted fundraising program.

Approximately $25,000 was raised through employee donations from across the division, which was then matched dollar for dollar by QBE, along with an additional $25,000 donation by the QBE Group Foundation. As a result, almost $50,000 was given to the Save the Children to help in the relief efforts. Local teams also organised a drive for clothing and household items.