2023 Taylor Fry Radar

Rebounding staunchly during FY2023, the general insurance industry recorded a profit of $4.6 billion — the highest in almost a decade, with a healthy return on capital of 14.2 per cent.

But beneath the robust figures, affordability, impacted by inflation and climate risk, has become the primary concern affecting everyday life for millions of Australians, and raising sustainability concerns for insurers.

In Taylor Fry’s annual publication, RADAR, which assesses general insurance performance across the industry, actuary and Principal Win-Li Toh warns, “The pressure is building for householders, with elevated inflation an ongoing hurdle, increasing the risk of underinsurance if sums insured are not adjusted accordingly.”

Taylor Fry’s analysis reveals that this situation may worsen, as many insurers are flagging double-digit rate changes in key classes of business. 

Householders, in particular, were the only class posting an underwriting loss for the second year in a row.

The report identifies construction, motor parts and travel especially as key drivers of claims cost inflation for property, motor, and travel insurers. 

It outlines several critical steps for insurers, including being alert to an increase in the number of vulnerable customers; focusing on customer retention strategies; and considering the potential for increased fraud and claim-exaggeration activity.

Download the 2023 Taylor Fry RADAR