Profit after tax for the 12 months ended Dec. 31 dropped 40 percent to 50 percent from 2010, Sydney-based QBE said in a statement today. Its insurance profit margin, a key measure of performance, was 7 percent to 7.5 percent, down from the 11 percent to 14 percent range forecast in August.

QBE is among Australian insurers battered by a surge in catastrophe claims for natural disasters including Cyclone Yasi, floods in Queensland state and earthquakes in New Zealand. Chief Executive Officer Frank O’Halloran said today he aims to increase the insurance profit margin to “around 15 percent” this year through increased premiums, reinsurance and “other changes to our business and current interest yields.”

QBE shares tumbled 23 percent to A$10.05 at 12:54 p.m. in Sydney trading, the most since September 2001 and to the lowest level since January 2004.

To contact the reporter on this story: Jacob Greber in Sydney at jgreber@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net

http://www.bloomberg.com/news/2012-01-12/qbe-insurance-shares-tumble-most-in-10-years-on-slump-in-full-year-profit.html

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