Australia's biggest insurer by market value QBE Insurance Group Ltd. recorded the biggest drop in Sydney trading in five months as it reported first half profits were off target.

The firm [QBE] listed in the S&P/ASX200 lost 5.2 percent to A$17.04 at 11:05 a.m. local time, set for the biggest decline since Feb. 26. The benchmark S&P/ASX 200 index was up 0.8 percent.

The margin in the six months ended June 30 was 15.7 percent, below QBE's 2010 target of between 16 percent and 18 percent and lower than the 17.5 percent reported a year earlier, the Sydney- based company said in a statement today.

QBE said the result is an impact of lower interest yields on claims provisions, reduced yields on policyholders' funds and the record level of catastrophes."

The company, which maintained the full-year margin target, also said profit after tax in the first half dropped 40 percent from A$1.02 billion ($920 million) a year ago because of lower investment income.