QBE Insurance Group (ASX:QBE) has recorded a net profit of $455 million in its half year results in the financial year ended June 30 2015.

A fully franked interim dividend of 20 cents per share (up 33%) has been declared.

Adjusted combined operating ratio (COR) of 93.4%.

In view of “significantly improved earnings quality”, QBE said it plans to pay a maximum of 65% of its cash profits as dividends to shareholders, starting with the 2016 interim dividend.

The insurer, which operates in more than 50 countries, now expects net earned premium of A$12.3-A$12.7 billion compared with previous range of A$12.6-A$13 billion.

During the first half, QBE lifted its gross written premium by two per cent in constant currency terms. Revenues fell 6 percent.

But Mr Neal has also warned the company faces a tough competitive environment in Australia and overseas, which is limiting its ability to lift premiums.

Shares in QBE were up 34 cents, or 2.43 per cent, at $14.31 at 1020 AEST.

QBE chief executive John Neal said that the insurance giant had spent around a billion dollars on protection against wild weather events.

“While our commitment to exit non-core businesses has temporarily impacted premium income, these initiatives have significantly strengthened our balance sheet and materially reshaped profitability”, he said.

Following the sale of its mortgage & lender services business in July, it downgraded its full year outlook for gross written premium to A$15.2-A$15.6 billion from a previous target range of A$15.5-A$15.9 billion.

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