Ann: QBE finalises 2021 reinsurance program, page-2

An insurer's reinsurance program offers useful insights into how healthy it is and its risk appetite.

It all looks odd and mysterious to average investors, as though the insurer is trying to pull wool over our eyes, when in fact it is trying to do exactly the opposite.

Very broadly, QBE has modestly increased its risk appetite, the proportion of insurance it bears itself. This also increases QBE's potential profits (and losses) as reinsurance is expensive.

It does this after foreshadowing a $1.5b loss on 28 December. My comments then: https://hotcopper.com.au/posts/49676360/single. and https://hotcopper.com.au/posts/49727187/single

Many anticipated a big share price downgrade on that news, even me.

Today's announcement shows QBE, regulators and reinsurers all comfortable with its exposures. We will soon see if insurance analysts feel the same.

Insurance may be dull work, yet i do like the diversification it offers my portfolio, provided I am rewarded for risk.

Ash