Good day and thank you for standing by. Welcome to QBE Half Year 2025 results. At this time all participants are in a listen only mode. After the speaker's presentation there will be a question and answer session. To ask a question during the session you need to press Star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press Star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Chief Executive Officer Andrew Horton. Please go ahead. Good morning and thank you for joining us today. I'm here today with Inder Singh, our Group CFO, and this morning we'll take you through what are another great set of results for QBE. We're well on track for a strong year and I think the business is on an exciting trajectory. Before we begin, I'll start by acknowledging the Traditional Owners of the many lands on which we meet today. For me, this is the Gadigal lands of the Eora Nation and recognize their continuing connection to land, waters, and culture. I pay my respects to the Elders past and present and I extend this respect to any First Nations people joining us today. Moving to slide four with a snapshot of our result. It's clear we've had a good start to the year with strength across the board from growth to underwriting, investments to capital headline. GWP growth picked up to 6% which was driven by underlying ex-rate growth of 7%. Profitability is attractive across the majority of portfolios and we remain motivated to grow the business. Our first half combined ratio of 92.8% is essentially in line with our full year outlook and represents another marker of more predictable, resilient performance. To this end, catastrophe costs were comfortably below allowance in a period pegged as the worst first half for the industry in over a decade. We had favorable prior year releases which is encouraging following our efforts to de-risk and build resilience into the balance sheet. Finally, we've delivered steady performance in a backdrop which was quite complex with escalating conflicts, tariff disruptions, plus an active period for large claims. As expected, premium rate increases moderated through the period. This was most noticeable in certain commercial property and Lloyd's portfolios, while the remainder of the business was much more stable at around 4.5%. Our investment result was broadly steady on the prior period with income of close to AUD 800 million representing an annualized return of almost 5%. Collectively, return on equity of 19.2% was excellent and we're on track to deliver another year of high teen returns. Our capital position and balance sheet remain well positioned and through the period we welcomed credit rating upgrades from S&P and Fitch, who've both moved to AA. Finally, we've announced an interim dividend of AUD 0.31. Turning to slide 5, I wanted to open with a recap on the key pillars underpinning our medium term aspiration for QBE, outlined here at the bottom of the slide. We shared these with you in February, which appear to have resonated well, giving you a sense of what QBE wants to be known for over coming years. In effect, they are five simple ambitions which we think if done consistently can be differentiating and drive significant value for shareholders. This is exciting as the pivot in our focus and ambition is occurring at a point where industry fundamentals are quite attractive. To expand on that a little, we operate in an increasingly uncertain world and the risk landscape is really quite complex. As you think through the prior half decade, the world has encountered a global pandemic, material economic and geopolitical uncertainty, significant impacts from extreme weather, high profile cyber incidents, plus more active conflict than we've seen in many decades. Our customers have been impacted to varying degrees and as a result are more risk aware and ultimately more risk averse. Commercial P&C has an incredibly important role to play in this backdrop and we're motivated to deliver great solutions for our customers. I think commercial P&C also has a critical role to play in supporting a number of major global growth thematics over the coming decade, from the renewables transition to the shift toward digital assets, infrastructure for growing populations, and the evolution of mobility. All themes need innovative and dependable insurance partnership. Along this path, new risks will undoubtedly emerge as technology and economies evolve. We'll be well integrated into these structural shifts given our problem-solving culture, leading broker relations, and strong presence in our key markets. As we look at the industry today, returns are attractive and the market remains disciplined. In aggregate, we think this speaks to the inherent complexity in the commercial P&C landscape currently and the need for more consistent industry returns. With improved pricing and claim sophistication over the past decade, those in the industry who truly understand risk plus a scaled diversified operations will be best placed to navigate these trends and capitalize on emerging opportunities. Turning to slide 6, how is our strategy evolving to capitalize on this backdrop and support our medium term aspiration? You'll recall in February we suggested 2024 was a period of transition for QBE. In the years prior, we'd have been incredibly focused on initiatives to de-risk the business, achieve better balance, reduce volatility, and sustainably improve performance. Where we stand today, we feel the health of our underwriting portfolio is excellent. We're on track to further reduce underperforming sales this year, and our strategy is becoming more future focused for portfolio optimization. That means evolving beyond a period focused on fix, repair, and exit to one where we continually look to optimize the portfolio across dimensions of growth, ROE, combined ratio, and volatility. As a result, we've had more time to concentrate on our growth strategies and align as an enterprise behind our most compelling success structural opportunities. Our modernization strategy is evolving too. With a number of important foundational system and data workstreams behind us, we're well placed to lift our pace on transformation. We have a sound data and AI strategy and understand the foundations required for QBE to deploy AI at scale across the enterprise, which in some cases will involve functional transformation. We have a number of great partnerships in this space from the world's largest companies through startups, which can experiment and build solutions at a much faster pace than us. Our progress, execution, and momentum are all underpinned by ongoing stability in senior leadership, which is important for consistency. On balance, there's a great deal of change occurring at QBE, and it's a real privilege to be leading the company through this transition. Putting this all together, what do we want to be known for medium term? Firstly, we're a uniquely positioned international carrier with strong presence and relationships across all key markets and platforms. This lends us a level of portfolio diversification, which now in better balance will drive more predictable underwriting performance. We want to keep growing and effectively build on this better base. We're building a business which can deliver sustainable value, mid single digit volume growth. Beyond growth, we're building a more efficient and effective business, and over time this will unlock significant value. Finally, we want to be known for being highly disciplined in how we allocate and manage capital, and we shared our capital allocation framework with you in February. Collectively, continued delivery around these ambitions will generate high quality performance which we expect will be rewarded by markets. Turning to slide 7, this slide unpacks one of the points I just made, giving you some color on the balance in our portfolio and how it drives predictable performance. We've shared a handful of different views of our business on the left. No matter how you cut it, QBE is one of the most uniquely differentiated and diversified carriers in the world. Unlike many international insurers, we aren't over-indexed to our home market, have true balance across our key regions of operation. We have broad expertise both in product-led and more service-led segments and have talent and capability across all key classes of business. This broad presence is underscored by leading relevant franchises which gives us representation across all key insurance and reinsurance hubs and markets. Ultimately, insurance is all about diversification and QBE is a fantastically diverse business. With our portfolio now in better balance, we have confidence in sustaining more consistent performance. To illustrate this point, we've included the chart on the right. What this shows is a view of our 13 underwriting pools which are an aggregation of our multiple cells into broad domains of commercial, specialty and reinsurance which we use for internal performance measurement. For instance, North America Commercial is a pool, QBE Re is a pool, our U.K. commercial business is a pool, and so on. It gives you some sense of the distribution of our growth and rate this year, but also the distribution of our combined ratio across the business shown here relative to this year's outlook of 92.5%. At any point in time there is a wide spread of profitability across our portfolios with varying price, claims, combined ratio and ROE dynamics. While a lot of attention gets placed on where premium rate increases are relative to inflation in forums like the problems like today's, in reality this is only one of many drivers feeding into the outlook for underwriting margins. Mix, portfolio management and portfolio optimization initiatives are incredibly important in this regard as are terms, risk selection, retention plus also efficiency and the volume growth in this chart supports margin as the business scales. You can see some pools have a combined ratio which is accretive to our 92.5% outlook which we are generally growing. Others are dilutive, which we are shrinking in the most notable instances. In some cases, however, we're growing pools which have a combined ratio above 92.5%. In many instances, these pools have a slightly higher combined ratio, though need less capital and give us a highly accretive ROE. For example, at 1.1 this year, we grew our U.S. A &H business substantially, which plans around 96%, though has low volatility, it's capital light, and we'd love it to be even bigger. In other instances, we may be growing a combined ratio dilutive pool for strategic reasons. For example, we're standing up adjacencies in North America. These are multi-year investments which take time to grow and scale. Pool C will draw some focus, which is experiencing premium rate reduction. This is International markets, which is effectively our Lloyd's business. Rate is negative, though it has an accretive combined ratio, and most Lloyd's underwriters will tell you some of the most attractively priced business in many years, which we're trying to add more of. When you double click into this chart, behind it is 50+ cells, all with different profitability dimensions. While we guide to a combined ratio, we manage and view profitability across multiple dimensions and often make trade-offs between combined ratio versus ROE, which is ultimately what drives shareholder returns. To close here, we create a lot of value through active portfolio management, particularly as markets become more nuanced. Our diversification gives us many levers to optimize performance. Moving on to Customer and growth, on slide 8 we outlined our ambition for sustainable mid-single digit volume growth at our briefing in February. We're with a presence which spans most products and regions, all with their own unique profitability cycles. There will always be something we can grow. X rate growth in the first half was 5%, or closer to 7% excluding exits and Crop, and we're well on track to extend our track record of sustainable growth in 2025. I want to spend some time on our customer strategic priority today. Our work and ambition in this space will be another important enabler of our growth strategy. In February, I flagged that Julie Miner has joined us as Group Head of Distribution and will lead our customer strategic priority. The two key pillars underpinning this work will be, firstly, to better serve our customers and, secondly, to build deeper relationships with our distribution partners, taking each in turn. We've never had an enterprise customer strategy and this is an exciting direction for us. We serve customers right across the spectrum from consumers and small businesses through Fortune 500 multinationals. We think there's a significant opportunity to better serve the unique needs of our customers. Across these segments, we commenced building the data and capability to tailor our products and services, leveraging an enterprise-wide CRM system to improve customer data and analytics. We've also started mapping key customers across the enterprise to senior relationship leads to improve engagement, and this year included a customer component within the non-financial metrics underpinning our long-term incentive program. Turning to Distribution, our historic approach to distribution has been somewhat fragmented, and since joining QBE I've been motivated to build an enterprise strategy. We have a lot to gain by better leveraging our global scale and becoming more targeted in our distribution strategy. We can also gain from improving engagement at all levels of the organization. This year, we've commenced mapping GEC sponsors to each of our largest trading partners to support and grow key relationships. With that, I'll now pass to Inder. Thank you, Andrew, and good morning. As Andrew has referenced, we've had a strong start to the year and this is an excellent set of results. Our performance across both underwriting and investments is tracking in line with or better than our 2025 plans and our annualized return on equity at 19.2% is particularly pleasing. Our ambition is to continue to shape the business to deliver sustainable industry-leading performance over the medium term. I'll start with an overview of our result on slide 10. Gross written premium of AUD 13.8 billion was up 6% over the prior period or around 8% excluding Crop and business exits. Our combined ratio improved by around one point and positions us well to deliver our full year outlook. The improvement was driven by the reduced strain from non-core lines, some favorability from catastrophe, a modest release from prior year reserves, and consistent current year underwriting performance. Our high-quality investment portfolio delivered an annualized return of almost 5% which was broadly stable versus the prior period despite what has been quite a volatile six months for financial markets. This was driven by a fairly steady core fixed income yield of around 4% and a strong performance in risk assets. The net impact of changes in risk-free rates was again broadly neutral this period, a pleasing outcome given the elevated volatility and macro uncertainty. We had a tax rate of 23%. This was a little better than expected, driven by the mix of our earnings tilting towards our North American tax group. We continue to see our effective tax rate trending at around 25%. Now that we've fully exhausted our U.S. deferred tax assets, I do want to call out two items which are more one-off in nature. Firstly, we had an FX gain of around AUD 35 million which gets accounted for in our investment result. Secondly, as we work through the final phase of our U.S. non-core runoff, we booked a gain on sale of around AUD 18 million associated with the wind down of our homeowners portfolio. Adjusted net profit for the half was a record AUD 1 billion, up almost 30% versus the prior period. Group return on equity was excellent at 19.2%, increasing by around two points. Our capital position remains very strong with the PCA multiple at 1.85x. The board has declared an interim dividend of AUD 0.31 per share which equates to a first half payout ratio of around 30%, consistent with prior years. Our distribution is a little lower in the first half and we will true this up with the final dividend at the end of the year. We have slightly increased our dividend franking rate to 25% from 20% previously and we expect to maintain this over the medium term. Turning to growth on slide 11, we've had a good start to the year for growth and are on track for our full year outlook. Group GWP growth of 6% was substantially higher than the 2% we delivered in the prior period. The drag from exited lines is now moderating and the headline growth rate more clearly illustrates the strong momentum we've built in the business. Excluding the impact of Crop, GWP growth was 6% and on further excluding the impact of portfolio exits, growth was closer to 8%. This was driven by average rate increases of around 2% and ex rate growth on the same basis of 7%. Andrew spoke about market conditions in his remarks. To add some additional color, premium rate increases for the half were broadly in line with expectations for North America and for International, though were a touch softer than anticipated. In Australia Pacific we are seeing modest rate reduction in commercial property lines and most Lloyd's portfolios. Rate in some of these segments has increased by well north of 50% in recent years. Profitability is excellent and giving up some modest rate will have limited near term consequence for the overall group margin if we adjust for these two segments. Group premium rate increases for the half were around 4.5%, down modestly from the prior year. Volume growth in the period was a function of organic growth in a number of Northern Hemisphere segments including Accident & Health, US Specialty, Crop, Cyber, Portfolio Solutions, and Reinsurance. We have highlighted many of these segments as key growth focus areas through recent briefings. Our modernization and customer strategic priorities are well aligned to this ambition and we're investing to build capabilities to support growth. Our premium retention rate was stable over the period and, pleasingly, continues to improve for the core North American business. For the full year we continue to expect a drag from exited portfolios of around AUD 250 million, with roughly AUD 200 million of that having occurred this half. Turning to slide 12 for some comments on our underwriting performance. Our underwriting result was excellent and one of the strongest in many years. The combined ratio improved by around 1 point to 92.8%, essentially in line with our full year outlook. The year over year trend can be broadly attributed to three main drivers. Firstly, the drag from non-core lines is significantly lower, which benefited from a modest release from prior year reserves. Secondly, we had some favorability from CAT alongside a modest prior year release in the core business, predominantly from short tail lines. Finally, we continue to benefit from favorable market dynamics with a combination of moderating inflation, compounding rate increases, and operating leverage tempered by slightly elevated large loss experience. Catastrophe costs of around AUD 480 million were comfortably within our allowance of AUD 550 million. This is particularly pleasing given industry estimates for insured losses show the first half as being the costliest start of the year for insurers in over a decade. We feel good about the resilience of our CAT risk settings given the portfolio and profile of our book and the construct of our reinsurance program, where we continue to retain all upside in benign periods. Pleasingly, on reserves we saw favorable development around the central estimate of AUD 90 million compared to AUD 20 million adverse in the prior period. We saw releases in a number of North American and Australian short tail classes alongside a continuation of releases in Crop, in CTP, and in LMI. The ex-CAT claims ratio was relatively steady versus the prior period. The benefit from supportive market conditions was offset by a change in business mix and the slightly elevated large claims experience I referenced earlier. In the middle of the slide, we've included a view of our premium rate increases by business segment indexed back to 2020. This chart highlights the extent of rate increases in recent years and provides some insight into the strong levels of profitability embedded in our portfolio. It is worth noting that these rate increases have been accompanied with significant improvements in broader policy terms and conditions, such as lower limit deployments in many classes of business. Moving to expenses, our expense ratio was steady at around 12%. We continue to benefit from positive operating leverage and will maintain a healthy level of reinvestment to support the higher change spend associated with our transformation agenda. As we referenced in February, we expect the expense ratio to remain in the 12%- 12.5% range again this year. As Andrew noted earlier, we see a significant opportunity to become a more efficient and effective organization, and this together with the benefits from our modernization programs should support a lower expense ratio over the medium term. Moving to divisional performance on slide 13, importantly, each of our divisions performed well through the first half, and this speaks to the broad strength and quality of our earnings base in North America. The combined ratio continues to edge lower, and the non-core runoff is well on track. We achieved another period of strong growth in accident, health, and financial lines, and some of our newer adjacencies and specialty lines such as construction and healthcare are building momentum and market presence. We're now moving into the final months of the non-core runoff and are very pleased with the progress we've made. As you can see on the left-hand side of this slide, the non-core result for the half was an underwriting loss of just AUD 20 million. This is an exceptional outcome given the CAT activity in the period, and this outcome has significantly de-risked our full year underwriting targets for this segment. The core segment result of 96% slightly missed our plan, though we continue to expect a full year result of around the mid-90s. The combined ratio of the core business was impacted by some large loss activity in our aviation book, plus some impacts from business mix given the recent growth in accident health, which runs at a higher combined ratio. The Crop result of 92% benefited from favorable prior year development, while the current year combined ratio was booked at 95%, consistent with the approach adopted in the prior period. Over the last few months, we have conducted a comprehensive review of our Crop strategy with the objective of constructing a better balanced portfolio and improving performance of private products like hail and livestock. We've been able to enact a number of important changes for the 2025 season, including much higher usage of the Federal Reinsurance scheme, which is reflected in our net insurance revenue decreasing by 6% during the period. Despite our gross written premium increasing by 9% for private products, we commenced pushing substantial rate increases and reducing exposure in certain areas. We've appointed a new CEO for the business alongside other senior leadership changes we've made last year. Moving to International, the combined ratio of 92.5% increased by around 3 points, which was a resilient result in light of industry loss activity in the period. This was driven by a 2 point increase in catastrophe costs, where the majority of QBE's L.A. wildfire exposure sat within International. Despite this, both insurance and reinsurance portfolios delivered excellent underwriting results. Importantly, growth momentum remains strong, and we achieved rate growth across all of our segments, including Lloyd's, Reinsurance U.K., Europe, and Asia. The level of premium rate increases has moderated, albeit this is most pronounced in our Lloyd's business, where established market participants are looking to grow at what continue to be healthy levels of profitability across most portfolios. Overall, premium rate increases in International ran at around 1% this half, though when you look below this headline, rate increases were roughly 4% across our Reinsurance U.K. and European segments. Moving to Australia Pacific, the combined ratio here was excellent, improving significantly versus the prior period, which was impacted by elevated catastrophe costs. Through first half 2025, catastrophe costs ran closer to budget despite a reasonably active period of storm and flood events. We saw strong favorable prior year development supported by LMI, CTP, and multiple short tail portfolios where inflation continues to gradually tick lower. The growth story has been a little bit more challenging closer to home. The market remains fairly competitive, albeit still rational in light of declining inflation and attractive profitability across most lines. Similar to the Northern Hemisphere, rate has moderated in most, most in commercial property, while other commercial portfolios like Farm, Commercial Packs, and Commercial Motor continue to see rate in the mid to high single digits. Turning now to our investment result on slide 14, despite a host of macroeconomic and geopolitical challenges, financial markets have remained supportive. This year, our portfolio delivered total investment income of almost AUD 800 million, which represents an annualized return of nearly 5%. Through the height of the tariff-related volatility in April, the portfolio exhibited pleasing resilience and delivered predictable performance. The fixed income yield has trended around the 4% range through most of the year and exited the half at approximately 3.8%. Total duration is now up to around two and a half years. When we cast our mind towards year end, futures markets currently imply the fixed income yield will exit 2025 at around 3.6%. This is obviously a point in time view. As of today, our investment farm increased quite meaningfully in the period, up 11% over the last six months. It's worth noting that FX movements accounted for roughly half of this increase, with constant currency from up around 5%. We suspect FX will remain a notable influence in the current environment, and some of these increases have likely reversed through July and early August. As previously flagged, we have built a portfolio of fixed income securities that will follow fair value accounting, with mark to market impacts being recorded within equity or other comprehensive income. This portfolio has now reached around AUD 3.5 billion or 12% of our core fixed income portfolio, where it should remain broadly stable. Our risk asset portfolio performed well, led by strong returns in equities and enhanced fixed income. It's also been pleasing to see commercial property valuation stabilize, resulting in a modest positive return in our unlisted property sleeve. I referenced an FX gain of around AUD 35 million earlier. This is reported within the expenses and other line shown in this table. Moving now to slide 15. The strength and quality of our balance sheet remains a great story. During the period, we received two important credit rating upgrades. Both S&P and Fitch have moved their rating to AA from single A. This is the first time ever that QBE Insurance Group Limited has held a AA rating, and it represents strong external validation of the progress we've made to improve the quality and resilience of our business. Turning to our capital position, we ended the half at a PCA multiple of 1.85x, which was broadly in line with the prior period. This was predominantly supported by an increase in our core equity tier 1 ratio to 1.34x. As the quality of our capital continues to improve following the payment of the interim dividend, we will hold a pro forma PCA position of 1.81x. Debt to total capital increased by around 5 points to 25%, primarily due to the redemption of our tier 1 notes which totaled around AUD 900 million and were accounted for as equity. This funding has effectively been replaced by new tier 2 issuance, which will result in a slight improvement in our overall cost of capital. We expect gearing will glide back towards the middle of our target range over the medium term. It's important to note that following these redemptions, we currently have no Tier 1 instruments in our capital stack, which leaves us significant flexibility should we need to engage these markets in the future. I'll pause here and hand back to Andrew. Thanks Inder. No changes to note on our outlook. We're on track to achieve constant currency gross written premium growth around the mid single digits. The drag from exited lines remains pegged at around AUD 250 million this year, which should be negligible. In 2026, we maintained our group combined ratio outlook at around 92.5%. Finally, on investment returns, our exit yield was 3.8%. Taken together, return on equity in 2025 should be excellent, continuing somewhere in the high teens. We'll hold our usual third quarter update on November 27 and look forward to discussing second half performance. I want to thank our 13,000 people for their contribution. This is an excellent result and ultimately represents the collective output of our steady, measured execution and effort over recent years. With that, I want to thank you for joining us and I'll pass back to the operator for Q&A. Thank you. As a reminder, to ask a question, please press Star one and one on your telephone keypad and wait for your name to be announced. To withdraw your question, please press Star one and one again. Please stand by as we compile the Q&A roster. First question comes from Kieren Chidgey from UBS. Your line is now open. Hi guys, couple of questions, maybe just starting on some of the commentary around business conditions. Slide 7, the portfolio management sort of data you unpack. Can you just talk to I guess collectively what the GWP growth was in the segments where you're achieving better than 92.5% group core relative to the segments that aren't, and also sort of off the back of that just touch on or expand on the commentary on the Outlook slide where you sort of in the combined ratio commentary talking about underlying business settings continuing to improve, which just seems a little bit at odds with being a softening in premium rates down to 2% relative to your low to mid single digit inflation outlook. Okay, so picking up on those, I haven't got the breakdown between the ones above 92.5% and below 92.5%. I was also trying to flag that obviously some of the things like A& H, which we grew by more than 10%, was going to be above 92.5% but still contributes to the ROE. What we're trying to show within that slide is that there is a great opportunity within our pools to also alter business mix if rating pressure becomes too great in some areas. We're also trying to align that to where technical pricing is at this point in time. Technical pricing across a number of our portfolio still looks pretty good. That's picking up the second point you made, that while technical pricing is good, despite rates coming off, we still want to grow those areas. A great case in point, and this gets more focus than almost anything else, is everybody's focusing on property, generally insurance and reinsurance, and within that to some extent property CAT, which is having the most negative rate decrease at this point in time, probably having had the most rate increase over the past four or five years. It is still quite priced relatively well. We can still write that and it can still be a contributor to our ROE and our combined ratio. That's what we're trying to do. Your point's a really good one of where actually is inflation going, because the most important element for the success of all insurance companies, including us, is trying to get that claims inflation number right. Although rating is important, obviously where prices are going is important. If claims inflation is double that or half that, then that makes a material difference to your potential profitability at some point in the future. I think we're still holding a reasonably good position on the claims inflation. We don't want to lower our expectation yet of it, mainly because it's feeding into our pricing. I want to try and hold pricing in the market up as much as possible as we can. We'll have to see where inflation goes over the next few years. Where the gaps between claims inflation and rate is obviously in international markets because there's no way inflation's going backwards at this point in time. You see international markets has got a rate reduction, but a number of lines of business rate is still holding above what our expected claims inflation are. There are some exceptions and property is one and the international markets more broadly is another. Okay, thanks. The second question just fly off the back about, I guess, sort of the difference in this result and, I guess, prospectively maybe moving forward between underlying and reported combined ratios this period. You've seen really good support, slight support, I guess, from below budget cat outcomes, despite being the worst first half globally in over a decade. We're seeing very good sort of balance sheet, sort of prior year reserve releases start to come through. You potentially have a lot of capacity there. Two questions around that. The cat budget where it is at the moment, in the context of what was a really tough half globally, is it too conservative now? Are you getting proper credit for that? Are you sort of including that budget within your pricing and maybe missing some growth opportunities because of having an overly conservative view there? I think it's a really great question, isn't it? Because if we look back over the years, we got our cap budget wrong and went over it and were sort of criticized for that. Now we have this much more positive challenge of are we being too conservative in the cat budget? I think I've said a number of times I really like having the cat budget at a relatively conservative level. We're obviously doing it at roughly the 80% percentile. Four out of five years, theoretically, if we've got it right, we should be under the cat budget. That's good. I like having that within the businesses though, because they do have to hold discipline on pricing. Your point is a valid one. We need to look at whether that just makes us completely uncompetitive. I like the idea it's fed down into each of the three divisions to ensure that pricing covers the cat budget, which we've got. I don't really want to reduce it below the 80% percentile, which would be a way to do that, because I think we'll just exacerbate the market dynamics, which is putting property under pressure anyway. We've obviously got to continue to look at it and we do look at it, but I think it's the right thing to do is hold a relatively conservative position on the cap budget, ensure the pricing is conservative, and we're trying to keep discipline in the market with our own underwriters. Just a final point to check the large loss commentary you called out this period. Can you give us some sense for how significant that was, and what drove it? I know this time last year, first half of 2024, we had Baltimore, which I think from memory was about a AUD 70 million impact. Relative to that, was it a bigger impact this period? I might hand that to Inder in a second. I mean, what we've talked about is some aviation losses and a couple of large oil refinery related losses. That's what we're flagging in the first half of the year, which were exceptionally large. I don't really have a number. I mean it's slightly, I would say Kieren, slightly higher. Obviously, within that, when we look at the year-on-year comparison, we've also got some mix changes playing into when you're looking at the current accident year, stripping out the CAT. To the overall point that Andrew's trying to make around CAT and prior year, et cetera, we are looking to preserve the risk settings that we've established over the last few years as we go forward. We very much feel that planning for CAT at the 80th makes sense. Obviously, in reserving, we've got to make sure that the inflation assumptions remain sensible as we go forward. At least if we start to see some changes in rate adequacy, we know where some of those emerging issues are coming up and we can be quick to react. We definitely are more consistent with our medium and long tail reserving now, where we are holding reserves for up to three years before we start releasing them. We are trying to put more resilience in the balance sheet. It does not necessarily mean it is more conservative, but it is definitely more consistent and holding onto them for a bit longer before we truly know where the claims are settling. Right. Thank you. Thank you. Just a moment for our next question, please. Next we have Nigel Pittaway from Citi. Your line is now open. Good morning, guys. Just first of all, if I could, please, just how far off do you think we are in terms of rate adequacy needing to deteriorate before that would really start to curtail your growth? I mean, I hear you saying that there's always something you can grow, but with rate increases, I guess, down to 0.8% in the second quarter, taking on board that you're still saying that rate adequacy remains supportive, it's an attractive rate environment. How far off are we from rate adequacy deteriorating and curtailing the growth? I mean, Nigel, it's such a broad question because you're doing it across the total portfolio. There are certain lines in my view, and we've talked about this before, D&O, which is not rate adequate at this point in time. Some things are already beneath that. There aren't many lines of business that are below the 100% rate or technical adequacy at this point, and there are going to be many lines of business that never go close to it. There are certain lines in my view, obviously Crop is one, the A&H business is generally one, which just are not particularly cyclical. They have to pick up the claims inflation based on what's actually happening. In the case of A&H, it's medical inflation, but most of it's done on January 1. It generally picks up the inflation for the year and the market bears it. There are a number which in my view will struggle to ever go below the 100. That's the beauty about the balance in the portfolio. In the case of property, it's falling, it's still above 100. If it fell by, I don't know, 5%, 10%, 20% more, it would definitely go underwater. We'll have to see what happens in the property world. Even within that, it varies on what part of the world you're in. Our European property portfolio, we didn't see major falling in rate in the first half. Even within the world of property, there is variation depending on where you are. It's a really tough question to answer. Some can take a reasonable rate before they go below the 100. Some are already there, D&O and others, and your small amount. The beauty, what we're trying to flag is within the portfolio we've got, we've got quite a lot of elements which in my view are never going to even get close to 100. They're always going to be above 150, and we'll obviously focus on those if others fall below it. Yeah. The vast majority of our business, with a couple of these exceptions we've called out around wholesale property and Lloyd's more broadly, everything else is still positive rate and we feel pretty good about that. I think in terms of some of the middle market businesses and some of the SME businesses, they're obviously a different dynamic in terms of how the rating cycle may play through. Overall profitability across many of the middle market books remains very strong. If you look at even the reinsurance business, that's been interesting because the market is quite rational at the moment. The QBE rebook has actually been positive rate even in property, given that the reinsurers absorbed some of the losses from the L.A. wildfires. We think as loss emergence is happening through the course of the first half, the market is being relatively rational. That's great. Thank you for that. I think that gives us a good feel despite the broadness of the question. Maybe just turning to the U.S. division, I just wanted to get an understanding of how you're feeling about your scale in the U.S. now. Obviously, you're saying that the contribution from adjacent strategies continues to build, you reference construction and healthcare, but how far off getting appropriate scale in the U.S. do you think you are, and how quickly can these adjacent strategies grow? It's a really good question. I think during this call, setting targets for my other U.S. underwriting teams outside Crop. Almost everything has the possibility of growing. We are very relevant in our A &H business and financial lines, but they still have possibilities to grow because they haven't got massive market shares. They've got potential new distribution partners that they can open up and can get larger. The adjacency you're talking about of healthcare and construction, they are relatively nascent and therefore they can be somewhat larger than they are in the tens of millions of dollars. The large commercial casualty business, which we've now been in three years, is growing well to somewhere between AUD 200 million and AUD 300 million, but there's a lot of large commercial casualty we could write, and it's growing at a reasonable rate. It's very focused on a specific part of the market in the wholesale and large retail markets. There is an opportunity to broaden that out. Programs is an interesting one because you've got to find profitable programs to grow. That's a harder one to grow because you either have to start from scratch and then if someone's giving up on a program, you just wonder why a carrier's giving up on it and whether there are other reasons. There is plenty of opportunity to grow. The key to me, Nigel, is relevance and we have great relevance in the lines of business we're focusing on. We've got underwriters of high quality, we've got a great claim service backing it up, we've got good distribution support. We're not in anything where we're never going to be relevant. Nobody's interested in placing business with us. It's not a scale play per se. It doesn't really matter if it's twice as large or three times as large. It's are we relevant and are we getting access to the business we want to write and can we write it at the margin we want to write it at. In many of our lines we've got underwriters who are very relevant in the market who do get access to the business they want to write and therefore distributors supply that business to us and we can write it at the right margin. It can be a lot larger than it is. It's going to be an issue of time. Sorry, Inder, you're going to add to something. I was going to say, in terms of the, you know, even if you look at the total acquisition cost and the way it plays through, Nigel, we're delivering a mid-90s combined ratio and a decent return on capital on that core business and obviously absorbing some of that cost that has historically been supporting the non-core business. Yes, we've rationalized that. Effectively, the business will be standing on its own two feet next year as we run off the non-core element. Totally. I think from a total acquisition cost, from a return on capital perspective, from a combined ratio perspective, the business is competitive, and middle market was the big issue for us because that required significant investments in technology. You had to get to a certain size to be able to really make that work. That doesn't apply to the specialty-focused business that we have now. Great, thank you. Maybe just one final question. Obviously you've talked about the work you've done on the net exposures within the Crop business. My understanding is you might still have a little bit more work to do on the gross exposures. How are you feeling about the sort of 93%- 94% combined for full year, for this year? Is that still guidance and you feel the work you've done on the net exposures will allow you to get there or how should we think about that? It's obviously always famous last words, isn't it, guessing on what crop is going to be at the end of the year. What I've learned, of course, it's nice to get to harvest time and then you find out what's really happening. Based on what we're doing, we still believe those are the sort of returns the crop business can achieve. The work we put in at the beginning of the year I thought was good on retaining a bit less, keeping more of the business that's historically been more profitable. That should stand us in good stead. I think your point is a valid one. I think this is a two year exercise we're going to be doing more into 2026 than we did in 2025, which will enhance it further. I feel pretty comfortable about it at this point in time, subject to what we've done so far. Great, thank you very much. Thank you. Just a moment for our next question, please. Next we have Freya Kong from Bank of America. Your line is now open. Hi, thanks for taking my questions. Could you help me run us through the moving parts of the ex-cat ratio that moved backwards by 0.2 points year on year? I just want the breakdown between rate increases, net of claims inflation, change in business mix, and any large loss volatility within this number, please. Thanks. Freya, thanks for your question. I think as we've referenced a couple of times on this call, we're really managing to the overall combined ratio, and then we sort of give you the component parts within that. I think on the ex-cat, the two main issues that we're calling out relative to prior year are some elevated large losses. We've talked a bit about that in response to an earlier question, and we're also seeing some mix changes as some of the books that we're growing, like Accident & Health, have a slightly higher, call it, attritional loss ratio. They contribute more, on a relative basis, to the ex-cat. Those have been really the two main drivers year on year. We're really trying to manage the business to an overall combined ratio. That's the main metric we look at. Okay, great. How should we think about the changes in business mix that you're driving going into more attritional lines of business with low volatility? How will this affect the combined ratio? Sorry, go on. Yeah, I mean, it comes back to that overall slide that Andrew was referencing. Ultimately, here we're trying to make sure that we're delivering a return that is in excess of our cost of capital at a decent margin. ROE is a big focus for us now. Within that portfolio, if we see opportunities to grow businesses that have a different mix of a traditional large and catch, you know, or a slightly high combined ratio, but carry a little bit less capital, but still have strong returns on equity, we will do that. The opportunities we've seen through the first half have been in some of those areas. I mean, obviously return on equity is what we focus on first and foremost. When we set targets internally, we use the combined ratio because we can't have every underwriter having a go at trying to manage the capital allocation. We don't do that. The combined ratio to return on equity is never going to be a direct comparator because, as we've said, some businesses need to run on a much lower combined ratio to deliver the return on capital and some can run on higher ones. We're not trying to move the combined ratio up or down. We're trying to deliver overall a good mid teens ROE. Okay, great ROE focus. That sounds good. Just a follow up question on the reserve releases, which were quite high in the half. Some of it was driven by short tail inflation and de-risking of the overall portfolio. Do you see favorable or meaningful favorable PYG as an increasingly important part of your P&L going forward? I think on the key drivers, as we said earlier, we are trying to make sure that we're booking our loss ratios with a level of prudence around inflation assumptions. As it played out this half, some of our loss picks for the short tail businesses that we wrote last year played out positively, and therefore we've released those reserves. In terms of the long tail business, clearly that's a lot longer timeframe we're looking at. As Andrew referenced earlier in one of the answers to the questions, we will be holding those loss picks for at least three years against that long tail business to see how it develops. I don't think at this stage we're going to be providing any guidance, forward looking guidance on prior year reserve movements, only to say that the settings that we're running the company with have never been better. Okay, that's helpful. Just on your use of reinsurance, that stepped up a little bit in the period mostly because of Crop. I guess looking through the cycle and as we're entering a soft cycle, how do you see reinsurance come into play in your business or how do you expect to use it during the cycle? I mean I don't expect the reinsurance spend as a proportion of the total to change that much really. I mean generally reinsurance rates move up and down with insurance. We're not expecting to do that. It's not as though we'll start thinking about reinsuring more or less out. We quite like where we are. The Crop may vary a bit because of course that's got a big gross to net. If we don't like certain things, we do have the option of increasing or decreasing that. Ideally, as we get the Crop portfolio into a better place, we would retain more of it because it'd be in better balance. I mean, our cost of reinsurance really ultimately is going to be driven by how well we manage the portfolio. All the de-risking work that we've done over the last few years obviously had a big positive impact in terms of our ability to get the retention levels down on reinsurance. You have to look at reinsurance holistically across both the rate that we're paying, but also the terms and conditions and where the attachment points are. Okay, thank you. Just final question on the modernization drive. Should we expect this to come through the P&L through lower expense ratios, or do you see opportunities for more growth and potentially underwriting improvements as well? Yeah, look, over time, the whole objective of the modernization programs is to continue to make the business more competitive. Make sure that we're investing in connectivity with brokers, make sure that we're being responsive in terms of the times it's taking us on both underwriting and claims. A lot of the modernization work is very much focused around improving our customer propositions, making the business more competitive. We do see over time we should be able to drive better customer outcomes and support the growth agenda as well as making the organization more efficient, more effective. It's a bit of both. Okay, thank you. Thank you. Next we have Julian Braganza from Goldman Sachs. Your line is now open. Good morning, guys. Thanks so much for taking our question. Just an initial one from me. In terms of the large losses, given the persistence in some of these large losses over the last half year of the Baltimore Bridge and also some of the aviation losses this period, just holistically and strategically, how do you think about these losses with a large loss allowance or within the sort of separately the cat budget, but also your reinsurance program, just managing the volatility can lead large losses going forward. Any comments around that. Yeah, I mean, obviously we've talked about the Baltimore loss last year. We talked about a couple of large losses in the first half this year. There was relatively benign large loss activity in the second half of last year, which obviously didn't get as much focus. Look, period on period, we're going to see some level of volatility. We have a very large, call it, allowance set aside for large losses. We look at that by each of the businesses, and we don't see any of this as being particularly concerning. Right? When we look at each of these large losses and we look back at how we wrote the business, we do lots of peer reviews of what happened there. When we look at each of these risks we've talked about, we would have written that in the ordinary course. We don't see any issues with either the exposure that we wrote or the clients that we wrote that with. It's the sort of nature of the business and we can, across a very broad book of business, manage some of that volatility. Okay, and just to give us a little bit of color in terms of if we do see a normalized environment for large losses, what does that mean for your ex- cat claims ratio in terms of the benefit that we could sort of expect? I mean this period obviously was offset by some of these aviation losses, and maybe we could have seen a more bigger benefit just given the barrel speed and also the reserve relation. Just understanding what could potentially be a normalized view of the ex- cat. This is the issue, Julian. I think when you look at cat or prior year and large losses and you start to sort of take some out and don't take others out, it just gets a little spurious. I think what we're saying is that the combined ratio target for the year is 92.5%. At the half year, we're well on track. The fact that we've had some favorability from cat and prior year actually speaks more to the risk settings and the quality of the business than it does that. It just so happens that these outcomes have resulted in the first half and the large loss volatility is very much business as usual, part of the business. There's nothing we've seen in these large losses that causes us any concern in terms of the business we've written and we remain pretty confident that we can deliver the full year outlook and manage some of that large loss volatility. To sort of start stripping some losses out and say, here's the underlying view of the ex-cat is just very difficult because you're going to see that from period to period. No, we definitely don't want to do that. If we do continue with an elevated level of large losses, we need to adjust our large loss allowance going forwards, of course, which we will do. The best view is see where we are at the end of the year. They were large for the half. We'll see whether they are large for the whole year or not. That depends on what happens in the second half. Last year, as you said, we had a relatively quiet large loss period in the second half. See where we end up. We are trying to balance, we are trying to manage the combined ratio rather than every element within it. Of course, every line of business is trying to achieve a certain return on capital and the beauty about the diversification is that some aren't going to do it and we still have some cells where we want to improve the profitability on them and some are going to outperform. We're going to outperform on cat this half. This year we underperformed ex-cat, but overall it could reverse in the second half. There is no reason why they've got to continue to run at where they are. Sadly or excitingly in insurance, nothing ever does. Everything ends up changing. I'm sure the second half will look somewhat different to the first half. I would love it to be the same and love to guarantee exactly the same numbers in 2026. Sadly that won't happen. Got it. No, thanks. Thanks so much for that. Just a second question on Australia Pacific, just given the growth pressures there, just interested in sort of strategy here to get growth in what you sort of called out of the competitive market. What will it take from here to improve your position? I mean, I think the Australian business is obviously a fantastic business and it's delivered a great result at the half year. It is more competitive both from local and international players here. I think the key strategy for us is build on the long term relationships we've had with our broker and customers over many, many years. That has been our focus, trying to renew as much as we can at the pricing we like and then also continue to build on those relationships, get deeper relationships with them and come up with initiatives we can work with them on that can enhance our premiums going forward. I still think there is good growth. The technical adequacy of our Australian business is pretty good. It's purely the competitive market rather than the pricing that is an issue here, that there are a lot of people competing after the market premiums. I think that's being our focus now. We've got one or two initiatives with various brokers that come to fruition. Also trying to think innovatively in this market about what other products we can add that are going to help our clients and help the ease of doing business. The modernization which Inder talked about earlier on is really important and it launched its first products in the first part of 2026. Making it easier to do business and of course, building on some of the fantastic brands we have here are going to be the things we're doing to protect and grow our business. We've been here a long time, been here since 1886. It's a fantastic business. We have these deep relationships here. Got it. We should start with, perhaps some improving trends in FY 2026 is how you're pitching it. Sometimes you turn with brokers. Sorry, I missed that. Yes, I mean, I think sort of better trends in 2026. Look, there's a lot of work going on to improve our positioning, our service propositions, but also at the same time, we want to make sure that we're being disciplined in the way we execute in the market. We've got a strong business and we want to build on it, but we also want to be cautious about market conditions, staying rational as well. Okay, got it. I think a final question for me in terms of just seasonality in your volume growth, obviously a strong first half despite the portfolio entries, which from what I understand will be meaningful in the second half, given your previous guidance. Just keeping it at sort of mid single digits for the full year implies some sort of softening in the second half, if I'm not mistaken. Can you maybe just talk to the seasonality of the growth and what's driving that? Thanks. Yeah, look at the margin. I mean, if you look at some of the areas we're looking to grow, the Reinsurance business probably has a bit of a skew first half, second half. The Accident & Health business, which is growing strongly, also has a bit of a skew first half, second half. Yes, at the margin, it's more a mix issue rather than necessarily a run rate, the second half being slower than the first half. It's just a sort of renewal cycle that we see through the course of the year. Okay, great. Thanks so much for that. Thank you. Our next question comes from Andrei Stadnik from Morgan Stanley. Your line is now open. Good morning. Can I ask my first question around the client service initiatives that you've highlighted? What are some of the examples that you're thinking about, and how important do you think this can be in terms of helping to win intermediate business on services first to price? It's a great question and it's been, I guess, one of my frustrations and excitements of being in insurance for quite a while is we don't spend enough time talking to our customers over what they would truly like from the insurance industry. In very simple terms, it's going to be starting to talk to our more major clients because as we talked during the presentation, we have a suite of products. We often have a lot of clients that are either mono product or dual product, and there is an opportunity to sell more products from QBE to individual clients. There's also the possibility of innovating and thinking about other coverages clients want. It's not a complicated thing. It just means having a certain set of service standards and approach to how we talk to clients. Often we get the question, will our distribution partners be keen on this? Of course it enhances their reputation as well because it helps them think through what else they can do for their clients with the support of an insurer that wants to do it. It's hard to quantify. Others do do this to some greater or lesser extent. It's not something we've really focused on as much as we could. That doesn't mean we haven't focused on it anywhere. It's just been in pockets across the organization. Julie Miner is just bringing this level of consistency about what our service standards to our customers should be from the consumer to the super large and how we should approach them, how we should talk to them and how we should innovate and deliver service to them. We've been doing it for about six months under Julie's leadership. It's got a lot of resonance within the organization with our new brand launch which is much more customer centric. It's got resonance outside the organization. I do think it's a great opportunity to grow but hard to put numbers around at the moment, this point in time. Of course it needs to have some measurement of it, and we do have within our long term incentives going forward customer metrics. Inder and I plus a number of people within the organization are going to have more customer centric metrics in our reward. Thank you. Maybe a partly related question in terms of the broker facilities, the likes of which Marsh and some of the others have been setting up and we can see publicly that QBE has been supporting. How are you thinking about those? Are you happy with how they're performing and do you see further growth opportunities for those? Yeah, so generally we are happy with how they're performing. It's a business that we probably are the market leader on in writing more of them, which has been excellent for us. The performance has been good for us over a number of years now and we are seeing other brokers set them up and when other brokers are setting them up, they're interested in having QBE support because we've underwritten others and we have the expertise to do it. The quality of the data behind these facilities has really improved over the years as well. You have much more insight into what's actually going on, which is excellent. I do still think it's a growth area. It's definitely one of the areas of focus now. What we need to be mindful of as the market in some areas is turning and these facilities do have property exposure in them is that we don't become too exposed to them and there's a good balance within it. Even within our facilities portfolio, there's probably 10- 15 relatively large ones in there, so we're not just dependent on one or two. If one or two don't work as well, then that could cause the facilities business a problem. Even what is a diversified business in itself, because by default the facilities are diversified, pool the business. We want to have a diversified set of facilities within that. I do think it's been excellent for us, definitely want to grow it, and I think it is where the market is moving because it is efficient for us, it's efficient for the broker, and it gives cost savings to the end client. Everybody wins within it. Thank you. If I can ask my third last question around Cyber, like how large is your Cyber book at the moment and how do you think about the opportunity? We can see some of your London peers have maybe a third of their book in Cyber and printing low 70% combined ratio. How do you think of the opportunity in Cyber? Started on our global Cyber initiative a couple of years ago. We've made good progress because I think when you look at Cyber, you need to ensure that you're getting your pricing consistent across the organization. You've got your appetite right. You manage the claims consistently, and the bad actors don't differentiate between which region they're focusing on. I think we've made good progress on bringing the Cyber expertise together. I think it must be a few hundred million dollars. Four hundred. Four hundred, yeah. It's around AUD 400 million, Andrei. It can be multiples of that. We've got to do it within the right time frame. Cyber market has softened a bit over 2025, having softened in 2024, but margins can be really good. Also, Cyber, you've got to be very mindful of how the claims are. Trends change because all of a sudden you get one type of claims, and then the market responds to that and you get a different type of claim. Cyber is continually evolving, but we're really pleased with the growth from where we were, which was probably considerably less than AUD 200 million, to around AUD 400 million. Great opportunity across the QBE portfolio, and our aim is to grow it in all areas. Yes, can be multiples of that, but even if it hit AUD 1 billion in a period of time, it's still going to be less than 5% of what we do. Thank you. Thank you. Just a moment for our next question, please. Next we have Siddharth Parameswaran from JP Morgan. Good morning, gentlemen. Just a couple of questions, if I can. Firstly, just on the capital position, I just wanted to make sure I understood what was happening with the PCA there. It seems to have increased quite sharply over the half, about 12%. I just can't remember, is there any seasonality in that number or why did the number increase so much over a half? No seasonality, Sid. It's really the earnings coming through. We've had a very strong earnings half. That definitely helps. All we're doing is deducting from that the growth charges, at the margin, the fact that we are now earning healthy profits in North America, for example, in our North American tax group, we're actually able to work through the deferred tax asset, which itself is a deduction from capital. As we earn that through from a cash tax payment perspective, at the margin, things like that are a positive tailwind. There's no specific seasonality first half, second half, that's discernible in the first half this year. The question was there's a 12% increase in the actual, the prescribed capital amount. That seems to be worse. I was just wondering why that got. Why is it 12% higher? The prescribed capital charge? Yeah, the prescribed capital charge, PCA. Yeah. I mean, that's got to be driven largely by the growth charges, Sid. If you can see, if you look at the ICRC, you know, that in itself is broadly flat. The rest of it's really driven by the insurance risk charges. Okay. It just seemed like a high increase to me. You're saying it's, I mean, why are those risk charges up so much? Because we've had the growth, this half was 6% compared to 2% in the prior period, if you think about that way. It's a 12% increase over the half, so it's over just over six months. It's 6% GWP growth over every year. Anyway, maybe I'll just take it offline. You just pick it up offline. Okay, so the second question I had was just around comments you made six months ago, just around rate versus inflation. I think you said your expectation was rate would cover inflation. Obviously, second quarter we saw rate at 0.8% and you have made some comments around inflation being low to mid single digit. They're not on the same basis. I think one is supposed to include exposure growth, one doesn't. Just keen to understand how you're looking at these two numbers at the moment. Is rate covering inflation the way you see it? If you just give us a comment on that. Yeah. I mean overall, you know, you can see for the half year the rate is 2%. We have said that inflation we're picking at in the low to mid singles, I mean, and we've said that we continue to do that and that's obviously aggregate numbers, Sid. The couple of areas that we've called out, particularly property and particularly some of these books in Lloyd's, you know that rate is negative. Right. If you strip those out, more generally across the business rate and inflation are tracking okay. Yeah, should I take that it's in aggregate, it's not covering. I mean, presumably. I mean, that's what the math suggests. In aggregate, it's obviously not covering, is it because we've got a rate increase of 1%_ 2% and inflation tied that it is not covering it. I just want to be clear because previously you'd said that they weren't on the same basis. I just want to be clear. I just wanted it definitely some basis differences. I mean these are sort of large aggregations across the company. What we're saying is that at rate at 2% and inflation being booked in the low to mid singles, there is a difference, but that's mainly around two or three of these areas of the business that we've talked, we've called up. Okay, that's clear. Just a final question, just on the expense ratio. I think you said we should expect it to be in the 12-12.2% range this year, but it should track lower. I think you previously said you could take up to a percentage point off. When would that start? Would that start next year? Just keen to understand what are the investments being made now and what will drop off. Yeah. Yeah, I mean we've sort of always said over the medium term, Sid. I think in the near term we continue to invest reasonably meaningfully in these modernization programs. It does take some time. Some of these are very large technology shifts, particularly the one we're making here to a new platform in Australia. It'll take time. I don't think we're guiding to a 1% improvement in the expense ratio as soon as next year. Think about that as an achievable aspiration over the next three years. Yeah, I mean the modernization spend next year is going to be pretty nappy between Australia Pacific, between AUSPAC and International. Okay, great. Thank you. Thank you. Next question comes from Andrew Buncombe from Macquarie. The line is now open. Hi guys. Congratulations on the results. Just three quick fire questions from me. Just to wrap up a couple of questions from before on the global facilities or what you guys would call trackers, is there any seasonality in volumes on those or should we expect them to be pretty consistent over the course of a calendar year? Thanks. I don't think there's much seasonality in them at all. It'd be a bit like Inder's comment regarding seasonality earlier on. It's at the margin. No, I wouldn't think about that. Because there's such balance in them, because some are a portfolio of MGAs, some are broker facilities. No. Perfect, thank you. The second one, LMI in Australia was obviously a bright spot this half, with further reserve releases coming through. There's a couple of large clients who are currently changing providers. Has QBE won the CBA or ING accounts? Just thinking about growth and opportunity for that portfolio going forward. Thanks. I'm not sure whether there's public information out on that, is there? No, I'm not sure it's something we can comment on at this point. Fair enough. The final one, maybe this is a question for Inder given the length of time, but going back a couple of years, QBE made significant reserve strengthenings for COVID and the Russia Ukraine conflict. How close are we coming to seeing some of that released? Thanks. I'm not sure, Andrew. We're really thinking about this bucket of strengthening from COVID we're still hanging on to. I think the point was that at that point in time the reserves needed strengthening, and we've seen some of that come through in the claims since then. We've also done some loss portfolio transfers, which have de-risked some of those legacy reserves. I wouldn't necessarily point to any specific pockets of reserves that we would see as being tailwinds. I think what we're saying is that the overall settings around reserves are better than they've ever been. Excellent. That's it for me. Thank you. Thank you. Next question comes from Marcus Barnard from Bell Potter Securities. Please go ahead. Yeah, morning and again congratulations on good results. I'm just interested in your rate increases across the portfolio. You talk in the first half about across the 83% business renew. I'm interested in the other 17%. Obviously you didn't renew it, so you don't know what the renewal premium is compared to last year. Given you've got your AUD 1,350 underlying sales, you must have an idea of what sort of rate increase has gone on in that 17%. I'm sure you've also got an idea of if you had to discount to win the business. That's the first question. Do you want to answer that? It's a question I've had enough times over the years. The logic is not surprising that the underwriters have certain underwriting guidelines and technical pricing, and they assess new and renewal business on exactly the same basis. We don't find generally the renewal book performs at a worse profitability than the new book to the renewal, mainly because they have the same technical pricing model and the same underwriting guidelines. Logic would suggest that it is done in an identical way, and you can win it for a number of reasons. You can win it from a claims position, you can win it from a service and responsiveness point of view rather than purely undercutting the incumbent on price. It's not as though you win everything based on a lower price than the incumbent. You can win it based on the depth of relationship you have with that customer and the depth of relationship you have with the distribution partner. There are many other reasons why you win business against competition. Responsiveness can be the winning formula for getting new business. That's similar to the same sort of reasons why you lose business. It's not always someone undercutting us. It can be some issue people have had with us in the past, or it can be again responsiveness from our competition. There's so much more to it than that. All I can confirm to you, having looked at this a number of times over the past couple of decades, new business does not perform worse than renewal business. Okay, that's very helpful. The second question is from a more general point of view, how are you seeing the North American economy? I'm thinking in terms of growth, what you're seeing from the underlying commercial businesses, inflation, and the U.S. Dollar. You might not have a view on those, but I'm just interested in what you're hearing and it goes at least from your people, rather than perhaps any sort of strategic view you might have from an economist. Yeah. In broad terms, still see the U.S. as a good opportunity for growth for us in terms of our insurance business there. That is definitely what we're focused on. We have not seen clients shy away from buying insurance. One of the challenges with any economy in the world is two things that are a problem for insurers. One, when countries or areas of the world go into some form of recession because people tend to buy less insurance. We're not finding that. Our clients are still happy to buy insurance, which is good. The second element we need to think through is inflation. Are things happening which are inflationary? You need to build that into your pricing if you think the claims are going to settle at a higher level because of inflation. Those are the elements I think we're thinking of. In terms of the U.S., we have a good business there. We want to make it larger, want to grow it and add people to it and add more product to it, and that all seems to be fine. We need to keep an eye on, not only in the U.S. but everywhere within the QBE world, are certain actions that are taking place inflationary, and are we building our expectation of inflation into our pricing models? I think that's one of the things which in my view is keeping the market in a relatively disciplined position at this point in time, is generally this uncertainty of where inflation is going to go. That's really helpful. Thank you very much. Thank you. Our last question comes from Andrew Adams from Barenjoey, please go ahead. Hey, guys. Thanks. Take the question. You mentioned pricing's based on CLR and ROE targets. Can you give us a bit of color on how we should think about the ROE? I think you just printed above 19%. We're not aware of explicit targets, but I think we can see from the REM settings that you target about 10%- 15% currently. Does that mean in your pricing settings that at the moment we're happy to write, you know, well below the ROE we're currently doing or how should we think about that? ROE and pricing? Yeah, I mean, the foundational principles, Andrew, which we've talked about previously that feed into our pricing models is we're really looking for a return of 10% above risk free, you know, across all portfolios. Now, clearly, you know, at the moment, we are comfortably in excess of that. When you look at, you know, the current investment yield, et cetera, we've got to, you know, really take through the cycle view of what we think that can deliver. Yes, look, we are looking at a very minimum, you know, to make sure it's 10%+ risk free and then obviously trying to optimize the portfolio to maximize that. Because that's what shareholders would like us to focus on. Yeah, below the 90% we did agree. I mean, that's in fact how we set all of the underwriting plans as well. 10%+ risk free. All right, great. Thanks, guys. Thank you for all the questions. This concludes our Q&A session and conference call. Thank you for participating. You may now disconnect.