QBE Insurance Group Ltd., Australia’s largest insurer by market value, forecast an unexpected net loss of about $250 million for 2013 due to write downs at its North American operations.

The forecast loss in the year ended Dec. 31 compares with a mean estimate for a $1.07 billion profit in 2013 from 11 analysts surveyed by Bloomberg. The Sydney-based company reported a $761 million profit a year earlier.

The latest guidance reflects QBE’s continued struggle in North America, where gross written premiums dropped 16 percent in the six months to June 30. North America provided 29 percent of the gross written premiums in the period. The insurer in February wrote off $407 million for amortization and impairments largely on its U.S. operations, pushing it to miss its full-year profit forecast for 2012, filings show.

“We are emphatically dealing with the North American issues that have been detrimental to confidence and underwriting performance over recent reporting periods,” Chief Executive Officer John Neal said in a statement. “As painful as these decisions are, we are confident that our business in North America will trade profitably in 2014.”

QBE is increasing prior year accident claim provisions by $300 million, adding a $150 million one-time charge for impaired assets and a $330 million goodwill write-off, the company said, following a review of its North American business. It expects the business to break even in 2014.

QBE shares were halted from trading on Dec. 6 pending the financial update. The insurer’s shares have climbed 42 percent this year, the biggest increase among Australian insurers.

–Editors: Iain McDonald, Edward Johnson

Topics Profit Loss