QBE delivers 17.7% ROE and lifts dividend in 1H26 results presentation
In its 1H26 results presentation delivered to investors and analysts on 14 August 2026, QBE Insurance Group outlined a first-half result headlined by adjusted net profit after tax of $1,033M, up 4% on 1H25, and an adjusted return on equity (ROE) of 17.7%.
Management confirmed an interim dividend of A¢33 per share, a 6% increase in AUD terms. For the half year ended 30 June 2026, gross written premium (GWP) grew 6% on a constant currency basis, while the combined operating ratio (COR) held at 92.8%.
The strategic message conveyed throughout the briefing was one of “consistent, disciplined execution against our plan,” reflecting a result management described as consistent with all key targets.
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The numbers management put forward: 1H26 headline results
QBE reported a set of metrics that management framed as an excellent start to the year. The interim dividend represented a 33% payout ratio and was approximately 30% franked.
Adjusted diluted earnings per share (EPS) came in at A¢97, up 4% in USD terms. The presentation flagged that foreign exchange movements reduced the AUD-cents figure relative to 1H25’s A¢103.
Management commentary
“Solid returns continue, with ROE of 17.7% comfortably above medium-term outlook of 15%+”
An ROE of 17.7% sits comfortably above the company’s stated medium-term target of 15%+, underscoring the profitability of the underwriting and investment engine even after a step down from 1H25’s 19.2%.
| Metric | 1H24 | 1H25 | 1H26 |
|---|---|---|---|
| GWP growth | 2% | 6% | 6% |
| Combined operating ratio | 93.8% | 92.8% | 92.8% |
| Adj. NPAT ($M) | 777 | 997 | 1,033 |
| Adj. ROE (%) | 16.8 | 19.2 | 17.7 |
| DPS (A¢) | 24 | 31 | 33 |
Underwriting discipline and divisional performance
The combined operating ratio held steady at 92.8%, which management said keeps the group on track for its FY26 outlook of approximately 92.5%. Two factors supported the underwriting result: favourable prior year development of 4.2% and catastrophe claims of 4.7%, which tracked below allowance.
The presentation also called out timing matters. Ex-cat claims included an “onerous contract provision within A&H representing a full-year underwriting loss, which is expected to reverse in 2H26.” Middle East impacts in the period comprised $75M of catastrophe costs alongside approximately $50M of associated large losses, with management noting the FY26 impact is expected to be more balanced given significant demand in Marine.
Divisional snapshot
North America recorded a COR of 97.3%, broadly stable, with benign catastrophe losses offset by elevated claims inflation in Accident & Health. International improved to 91.6% from 92.5%, supported by momentum across key growth areas and lower catastrophe claims. Australia Pacific delivered 88.2%, resilient despite higher catastrophe costs primarily driven by the January bushfires.
| Division | 1H25 COR | 1H26 COR | Commentary |
|---|---|---|---|
| North America | 97.2% | 97.3% | Benign cat losses, higher A&H claims inflation |
| International | 92.5% | 91.6% | Improved on growth momentum, lower cat claims |
| Australia Pacific | 86.8% | 88.2% | Resilient despite January bushfire cat costs |
What a combined operating ratio actually tells investors
The 1H26 COR broke down into three components:
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Net claims ratio: 62.3%
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Net commission ratio: 18.1%
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Expense ratio: 12.4%
Capital efficiency moves: buyback, business sale and loss portfolio transfer
Management detailed a series of capital initiatives aimed at reducing capital intensity. An A$450M buyback was completed in April 2026, and alongside the results QBE announced the sale of its Trade Credit business together with a $1.6B reinsurance Loss Portfolio Transfer.
The Loss Portfolio Transfer is subject to regulatory approval and is expected to improve the APRA Prescribed Capital Amount (PCA) multiple by approximately 2pts. QBE also issued a notice of redemption for approximately A$500M of Tier 2 notes on 25 August 2026, which reduces the PCA multiple by approximately 4pts on a pro-forma basis.
The pattern of active balance sheet management extends beyond the 1H26 window: QBE’s Tier 2 note redemption of USD524M in subordinated notes due 2046, completed in June 2026 with APRA approval, illustrated the same capital intensity reduction logic the group is now applying at scale through its Loss Portfolio Transfer and A$500M redemption notice.
The group reported an APRA PCA multiple of 1.82x, at the top of its 1.6x–1.8x target range, with capital held above the S&P ‘AA’ level. Management outlined these actions as levers to reduce capital intensity and return any excess capital via share buybacks.
The four capital efficiency actions detailed were:
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QBE Re Casualty Side Car
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QBE Group CAT Bond
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Reinsurance Loss Portfolio Transfer
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Sale of the Trade Credit business
Management noted a near-term outcome of an approximately 6pt PCA benefit from these initiatives.
Outlook: guidance reaffirmed for FY26 and beyond
Management guided to mid-single digit GWP growth on a constant currency basis for FY26, a combined operating ratio of approximately 92.5%, and a 4.1% 1H26 exit investment yield. Over the medium term, the outlook targets mid-single digit GWP growth, a low-to-mid 90s COR through-cycle, investment returns above 3%, and an adjusted ROE of 15%+.
The presentation flagged several 2H26 tailwinds, including the reversal of the A&H onerous contract provision, a more balanced Middle East impact supported by Marine demand, and continued focus on lowering the expense ratio.
| Key metric | FY26 outlook | Medium-term outlook |
|---|---|---|
| Gross written premium | Mid-single digit growth (constant currency) | Mid-single digit growth (constant currency) |
| Combined operating ratio | ~92.5% | Low-to-mid 90s through-cycle |
| Investment returns | 4.1% 1H26 exit yield | >3% |
| Adjusted ROE | — | 15%+ |
The presentation positioned QBE as a diversified international property and casualty carrier entering its stated “high quality, capital efficient growth” phase from 2026 onwards, building on a track record spanning 140 years in insurance.
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