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Suncorp's outstanding Canterbury quake claims costs rise, expects $50M of Kaikoura claims

Monday 23rd January 2017

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Suncorp Group, which owns general insurer Vero in New Zealand, has increased its outstanding claims provision for the 2010 and 2011 Canterbury earthquakes after getting new claims from the Earthquake Commission. Separately the insurer released a claims estimate from last November's temblor in Kaikoura.

Brisbane-based Suncorp lifted its provisioning for outstanding Canterbury quake claims by $112 million, most of which will be covered by the insurer's reinsurance programme, leaving it a net cost of $18 million, it said in a statement. The increase was "primarily due to the notification of new 'over-cap' claims from the New Zealand Earthquake Commission", it said, referring to those claims that exceed the EQC's $100,000 cap. 

Last year Vero increased its assessment for the likely cost of the Canterbury quakes by $123 million. A number of insurers have had to upgrade their expectations for the cost of the Canterbury quakes, with more complex claims taking longer to settle, while at the same time repair and rebuild costs increase. 

Separately, Suncorp said it anticipated a net impact of $50 million from the November earthquake near Kaikoura. At the time, Suncorp's Vero arm said it had received more than 1,000 claims relating to the 7.8 magnitude quake, though it couldn't tell whether premiums, which were already rising due to increased motor vehicle claims and higher building costs affecting houses, would get pushed up further. 

The ASX-listed shares fell 0.9 percent to A$13.225. 

BusinessDesk.co.nz

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