The QBE Insurance Group Ltd (ASX: QBE) share price is trading in the red on Wednesday afternoon. At the time of writing, the shares are 1.63% lower and changing hands at $20.285 a piece.
The share price has experienced several peaks and troughs over the last 12 months. After reaching an all-time-high in early June, it began a slow downward trajectory. The shares suffered a sharp drop in early-August following the release of its half-year results.
The share price is still 21% higher than this time last year.
The question is, where are QBE Insurance shares headed next? Is there an uptick in sight or will the price keep tumbling?
Here's what Macquarie Group Ltd (ASX: MQG) thinks.
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Upside ahead for QBE Insurance
In a note to investors detailing the results of its Australian General Insurance survey, the broker upgraded QBE Insurance shares to outperform (previously neutral) and confirmed its $23.30 12-month target price.
At the time of writing, that represents a potential 14.9% upside for investors over the next 12 months.
Insurance survey findings
Macquarie's survey asked 136 Austbrokers members to rate each insurer's claims and underwriting service from 1 (poor) to 10 (excellent). The respondents represented a variety of states and staff titles.
The survey found that overall, findings remain below broker expectations for the three listed Australian insurers – QBE, Insurance Australia Group (ASX: IAG), and Suncorp Group Ltd (ASX: SUN).
The survey results from underwriting respondents were fairly consistent. Chubb, SUN, and Allianz were regarded best by principals (business owners); and brokers rated IAG best in class for underwriting service. Claims respondent results showed Chubb was the standout, consistently rating highly for claims service across all respondents. QBE was the lowest amongst Principals.
The results by state were much more varied. Underwriting respondents rated Allianz and QBE highest across New South Wales, while SUN and Allianz scored highest in Queensland and IAG and AIG scored highest in Victoria. However, claims respondents gave QBE the second-worst performance among all insurers when considering performance across all states.
"Broker feedback relating to insurer service slightly improved this year and we believe this will align with the slight improvement in market share for Australian-listed insurers. Looking forward however, there remains work to be done to lift service and hold off competition from underwriting agencies," Macquarie said in its note.
