Outlook for Australian General Insurers to Remain Driven by Moderating Premium Growth, Jefferies Says
The outlook for the Australian general insurers will remain driven by moderating premium growth, while share prices will likely reflect the sector's defensive characteristics, Jefferies said in a Wednesday note. Premium growth moderated in fiscal 2026 due to increased competition, affordability issues, and lower reinsurance costs. Commercial lines remain in a rate-reduction phase due to increased capacity, while domestic personal lines should remain positive due to persistent weather-related vulnerability. The sector's shares have performed well, with QBE Insurance Group (ASX:QBE) up 28% year-to-date, followed by Suncorp Group (ASX:SUN) at 6.5%, and Insurance Australia Group (ASX:IAG) 2.8%. Jefferies attributed the performance to the sector's defensive characteristics and earnings resilience. The investment firm retained the buy rating on Insurance Australia Group and raised the price target to AU$9.45 from AU$8.75. It downgraded QBE Insurance to hold from buy and raised the price target to AU$27.50 from AU$26.25. It retained the hold rating on Suncorp and raised the price target to AU$19.75 from AU$18.40.
The outlook for the Australian general insurers will remain driven by moderating premium growth, while share prices will likely reflect the sector's defensive characteristics, Jefferies said in a Wednesday note.
Premium growth moderated in fiscal 2026 due to increased competition, affordability issues, and lower reinsurance costs.
Commercial lines remain in a rate-reduction phase due to increased capacity, while domestic personal lines should remain positive due to persistent weather-related vulnerability.
The sector's shares have performed well, with QBE Insurance Group (ASX:QBE) up 28% year-to-date, followed by Suncorp Group (ASX:SUN) at 6.5%, and Insurance Australia Group (ASX:IAG) 2.8%.
Jefferies attributed the performance to the sector's defensive characteristics and earnings resilience.
The investment firm retained the buy rating on Insurance Australia Group and raised the price target to AU$9.45 from AU$8.75.
It downgraded QBE Insurance to hold from buy and raised the price target to AU$27.50 from AU$26.25.
It retained the hold rating on Suncorp and raised the price target to AU$19.75 from AU$18.40.