Suncorp Group insurer increase Canterbury quake claims by millions

  • 23/01/2017
Close up of Insurance Claim Form with pen and calculator

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.

The insurer has also released a claims estimate from last November's tremor in Kaikoura putting it at $50 million.

Brisbane-based Suncorp lifted its provisioning for outstanding Canterbury quake claims by $112m, most of which will be covered by the insurer's reinsurance programme, leaving it a net cost of $18m, it said .

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 $123m.

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 $50m 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 per cent to $A13.225.