WELLINGTON: SUNCORP Group, the ASX-listed general and life insurer whose local brands include Vero, AA Insurance and Asteron Life, has lifted annual earnings from its New Zealand businesses as the company benefited from fewer claims in the year.
THE insurer’s New Zealand business delivered a net profit of $175 million in the 12 months ended June 30, compared to $110m a year earlier, the Brisbane-based company said in a statement. Of that, general business lifted trading profit to $NZ159 million ($A143.51m) from $NZ97m a year earlier, on a 2.9 per cent increase in gross written premiums.
Underpinning the improved profitability was a reduction in severe weather claims and a reduced impact from earthquake reserve strengthening, Vero New Zealand chief executive Gary Dransfield told BusinessDesk.
“The top-line growth in kiwi dollars, at 2.9 per cent, was reasonably flat compared to recent years, and it’s much more a lower claims story,” he said. “I’m hoping for a continuation of the relatively benign weather compared to the preceding three years or so, because that’s good for our shareholders and good for our customers.”
The New Zealand general insurance segment’s performance was in line with the wider Suncorp group, which reported a 55 per cent increase in annual profit to $1.13 billion on 2.1 per cent gain in revenue to $16.72b.
New Zealand gross written premiums rose 9.9 per cent in NZ dollar terms across Suncorp’s motor business on record car sales and increased premiums, while home insurance revenues grew 7.9 per cent.
Suncorp’s commercial insurance premiums fell 2.8 per cent as an increasingly competitive environment led to heightened discounting for renewals and new business. Mr Dransfield said he didn’t expect to see more consolidation among underwriters after Insurance Australia Group bought the New Zealand Lumley business.
“Now you’re probably seeing competitors seeing an opportunity to start up and try to build positions in niches,” he said. “It’s hard to see more consolidation in the underwriters, but in the brokers certainly.”
Mr Dransfield said the insurer was about 90 per cent through its post-earthquake commercial claims in Christchurch, though residential claims were lagging behind, in the high-70 per cent area, where more complex insurance arrangements, such as multi-unit dwellings, have slowed the process.
