Tower provides NZX update on floods

Asof February 9, Tower received 4810 claims relating to the floods that hit hit the upper North Island on Auckland Anniversary weekend.

The NZX-listed insurer noted that 2660 of the claims were for home insurance, 740 were for motor vehicle damage, and the remaining claims, mostly for contents, were down to flood damage and landslides.

Blair Turnbull, the chief executive of Tower, stated that the business had solid reinsurance coverage and a healthy balance sheet.

“Tower continues to invest in sophisticated underwriting capabilities and risk-based pricing which enhance our rating agility and accuracy and help to deliver sustainable margins.”

Although the financial effects of the event were still being evaluated, according to Tower CFO Paul Johnston, the company anticipated that the event would trigger Tower's catastrophe reinsurance coverage.

Tower has an excess of $11.875 million for catastrophe events — meaning it will pay that amount before its reinsurance coverage comes into effect.

According to Johnston, the excess was within the $30 million Tower had budgeted for large events in its fiscal year 2023.

He said that in order to maintain its full level of catastrophe protection, the company would probably buy reinstatement cover, with the costs being paid for within the current fiscal year.

The NZX-listed company did not say how much it would cost to purchase the cover but said its guidance remained unchanged.

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