Suncorp has announced that its net profit after tax in New Zealand fell from AU$183m in FY16, to AU$82m as it was impacted by the Kaikoura earthquake and additional claims from the Canterbury earthquake.
New Zealand general insurance profit dropped to AU$45m but the underlying ITR was above the group target of 12% whilst GWP grew by 6.3% thanks to motor and home portfolios.
Life insurance delivered net profit after tax of AU$37m.
The firm said that the New Zealand business will see AU$30m in capital released thanks to its sale of Autosure.
Overall, the group announced that net profit after tax has risen by 3.6% as the Australian insurance division saw profit increase by 30%.
The Australian insurance division of the firm saw net profit after tax hit $723m, up 30% from $558m last year, with gross written premium up 3.9%.
However, the Australian commercial insurance business of the firm saw GWP reduced by 2.2% as pricing increases and strong SME retention rates were offset by lower retention in the corporate segment.
Michael Cameron, Suncorp CEP and managing director, said that the group result reflects a disciplined management of margin and balance between reducing overheads and investing in future growth.
“Our focus on elevating the customer has resulted in an increase in total customers, driven by improved volumes and better retention,” Cameron said.
The firm announced that it will keep similar reinsurance cover to FY16 when additional aggregate cover was purchased.
The new cover provides $300m of cover once the retained portion of natural hazard events greater than $10m exceeds a total of $475m.
The firm will invest a further $100m after tax in its One Suncorp strategy as it has commenced a group-wide business improvement program.
The investment will bring together the digital experience into a single platform for the entire Suncorp network through the Suncorp Marketplace app and will see the company complete its brand refresh.
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