I'm not too concerned about duration, given their fixed income...

I'm not too concerned about duration, given their fixed income portfolio has a average duration of 1.6 years. If rates start to rise materially, say for example because Trump's spending and/or trade restrictions add to inflation, this will be a significant benefit to QBE. QBE's investment portfolio (about AUD33b) is almost 3 times the size of IAG's, even though IAG's market cap is higher, so QBE should be a relative outperformer in this segment if rate rises continue.

I agree that underwriting and costs are critical, but I think the poor recent results give the new mgt team the flexibility to take a conservative approach now (to cost cutting, loss provisioning and underwriting) that will benefit them in the next 2-3 years. Its harder for insurers that are doing well to keep growing without additional risk or understating provisions. I also don't have an issue with selling latam etc as these businesses are more distraction to mgt than they are worth.

If QBE can meet consensus forecasts for 2019 (which is about USD1bn of NPAT), we should start to see the share price at $15+. This would assume a P/E of 15, which would still be below IAG's current P/E of 18. Its also worth noting that this would represent an IRR of 30%+ p.a. based on Thursdays close.
Although nothing certain in investing, bad news doesn't last forever and the current share price doesn't factor in any good news.