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QBE Insurance GrpLtd (35WU)

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Thursday 24 February, 2005

QBE Insurance GrpLtd

Annual Report and Accounts

QBE Insurance Group Limited
23 February 2005

                              MARKET ANNOUNCEMENT


The directors of QBE Insurance Group today announced a record operating profit
after tax of $820 million for the year ended 31 December 2004, up 43% on the
profit of $572 million last year.  Pre tax profit was up 41% to $1,080 million.
Fully diluted earnings per share increased 35% to 104.5 cents and the return on
average shareholders' funds was 21.2% compared with 18.3%.

Insurance profit before tax increased 45% to $908 million, despite net claims
from large catastrophes of $320 million compared with $27 million in 2003.
Insurance profit to net earned premium was 13.4% compared with 10.4%.  Cash flow
from operations was again strong at $2,110 million compared with $2,089 million.

Gross earned premium was up 10% to $8,571 million and net earned premium
increased 12% to $6,781 million.  The impact of the stronger Australian dollar
on premium growth was significant.  Using 2003 rates of exchange, gross and net
earned premium would have increased 16% and 17% respectively.

In recognition of the strong operating performance, the directors have declared
a 36% increase in the final 2004 dividend from 22.0 cents per share last year to
30.0 cents per share.  The dividend will be 50% franked.  Books close for the
final dividend on 7 March 2005 and the dividend reinvestment plans continue at a
discount rate of 2.5%.

Mr Frank O'Halloran, QBE Group's Chief Executive Officer, said 'We have exceeded
our main financial targets for 2004, achieving a record operating profit,
improving underwriting profits and insurance margins in all our insurance
divisions and outperforming our overall investment benchmarks with a low risk
investment strategy.'

QBE has upgraded its expectations for the insurance profit margin for 2005 from
the previously announced range of 12% - 13% to 12.5% - 13.5% of net earned

Mr O'Halloran added 'acquisition activity during 2004 added over $1.5 billion in
annualised gross premium, of which $0.7 billion was written in 2004.  This
underpins the Group's 2005 growth targets of a 10% increase in gross written
premium to $9.6 billion and a 12.5% increase in net earned premium to $7.6
billion.  Even though overall premium rates were slightly less than our
expectations for the major renewal season of 1 January 2005, the quality and
diversification of our insurance businesses around the world and the strength of
our liabilities for outstanding claims and unearned premiums give us confidence
that, subject to the usual caveats, we can increase our profit after tax by more
than 10% in 2005.'

For further information, please contact:

Frank O'Halloran, Chief Executive Officer                    +61 2 9375 4400
Neil Drabsch, Chief Financial Officer                        +61 2 9375 4216
Duncan Ramsay, General Counsel and Company Secretary         +61 2 9375 4422
Gayle Tollifson, Chief Risk Officer                          +61 2 9375 4102

24 February 2005

                      This information is provided by RNS
            The company news service from the London Stock Exchange