Suncorp NZ profits fall amid higher natural hazard costs

Suncorp New Zealand saw posttax profit fall by 23% in the 12 months to June amid higher natural hazard costs and lower investment returns.

The NZ insurance group made $165 million over the year, as Australian parent Suncorp announced a net post-tax profit of A$681 million, down 34%.

Chief executive Jimmy Higgins said the business had experienced topline growth and decent underlying performance in a disrupted year.

“This disruption came from the impacts of Covid-19, including the war on talent in a tight employment market, the restrictive environment our people have had to work in, and employees being off sick with Covid.”

“Multiple weather events experienced during the year resulted in the highest volume of claims since 2018; and customers experienced longer waiting times for repairs to their homes and vehicles because of the delay in getting materials.”

“This year, we’ve experienced a highly volatile investment market – the most volatile we’ve seen in a long, long time. Despite this, the underlying business has performed well, and we’ll continue to be a strong, well-capitalised company that can support customers in their time of need.”

Higgins said Suncorp New Zealand’s strategy was focused on making things easier and faster for its customer.

“Our focus remains on improving outcomes for our customers, and we are doing this by investing in our people, technology and processes. We’ve a deeply held purpose to support New Zealanders when they suffer loss. Our products and services are designed to protect what matters to customers and everything we do is directed to that purpose.”

The New Zealand general insurance business, which comprises Vero Insurance, Vero Liability and direct channel AA Insurance delivered a net post-tax profit of $150 million, down 15% on the year before.

Suncorp said the intermediated channel experienced “strong growth reflecting the value New Zealanders place on expert advice and the important role that insurance brokers play in the insurance market”.

The group said Vero Liability also delivered strong results.

Across Suncorp’s NZ general insurance business, gross written premiums grew 14%, with intermediated and direct channels recording strong growth through a combination of customer growth and pricing increases that were “necessary to offset the inflationary pressures that we continue to experience”.

Higgins fired a warning about the year ahead, predicting natural hazard weather events would become more frequent and expensive, leading to higher reinsurance costs.

Higgins added premiums would also be impacted by the pressure on materials and labour costs in repairing homes and cars, and increases in Toka Tū Ake EQC levies following the increased EQC cap changes in October later this year.

“The strength of our reinsurance programme allows us to provide insurance protection to customers throughout New Zealand and we are continuing to provide support to those customers that experience vulnerabilities, particularly as they manage through the costs of living pressures that exist in New Zealand today.

“The tight employment market and the living cost pressures in New Zealand makes it difficult to attract and compete for talent in other countries,” Higgins added.

Professional

College

Professional Development PIQ supports IBANZ members ahead of FAP transition period

Tim Larkin, Director of Professional IQ College, CCO of Dacreed

Professional IQ College is continuing to support the needs of IBANZ members as the FAP transition period rapidly approaches. Over the past few months, in addition to providing the normal NZ Certificate in Financial Services, PIQ has launched a number of initiatives to help advisers meet the new licensing requirements. Accelerated Certificate in Financial Services (full qualification or by strand)

The accelerated course is for existing advisers who already have a good knowledge of the industry and want to get through the qualification (or a strand) as quickly as possible. With a minimum of three years industry experience as a pre-requisite, the facilitated webinar sessions, allow you to review the material as a group and identify the key elements needed to answer the assessments. While there is a premium on the standard course, getting everything done in time and quicker, could make this a worthwhile investment for you. This course is ideal to do over December and January. Places are limited so reserve your spot now. An online-only bridging course for those who want a simple way to demonstrate they understand the new regulatory framework

If you have version 1 of the Certificate in Financial Services, you don’t need any more formal qualifications, but you do need to be able to demonstrate to the FMA that you are up to date with the new regulatory framework. If you want an easy way to review all the relevant content and complete a multi-choice test to confirm your understanding of this, we have a developed a bridging course that does just this for $200 plus GST.

If you would like to find out more about our courses, get in touch with PIQ: Website: www.professionaliq.co.nz Email: enrolments@professionaliq.co.nz Phone: 09 306 1731