Unsurprisingly, given recent disasters, Suncorp announced a decrease in profit after tax from $123 million for the half-year ended 31 December 2019 (December 2018: $128 million, adjusted for the sale of the Capital S.M.A.R.T and ACM Parts businesses).
The result was impacted by lower reserve releases, higher regulatory costs, increased reinsurance costs and the impact of the low yield environment. The insurance trading result for Australian general insurance was $148 million (December 2018: $191 million). Gross written premium (GWP) increased by 1.8% to $4,176 million (December 2018: $4,101 million) reflecting GWP growth of 3.1% in Home and Motor, 2.5% growth in Commercial and 20.1% growth in Workers’ Compensation and Other portfolios.
This was offset by an 8.9% decline in compulsory third party (CTP) revenue driven by the ongoing impacts of scheme reforms and market pricing dynamics. Normalising for the impact of portfolio exits in Commercial, GWP growth was 7.7% in this segment with strong premium rate increases in a hardening market, and a focus on growing volume in target markets and maintaining portfolio profitability. Net incurred claims increased by 0.2% to $2,861 million (December 2018: $2,854 million), due to lower prior year reserve releases and the unfavourable impact of falling yields on the discounting of new claims, partially offset by lower natural hazard costs.