Suncorp (SUN) provided an update on the tragic storms and flooding that have devastated large areas of Queensland. Group CEO Patrick Snowball said the thoughts of all Suncorp people were with those Queenslanders who have been impacted and the Group stood ready to support its customers as they commenced the process of rebuilding.
The Group said its comprehensive reinsurance program would limit the cost of claims relating to storm and flood damage in Brisbane and areas of south-east Queensland since 8 January to between $70 million and $90 million. It is also likely to incur additional reinsurance costs of around $120 million to reinstate multiple covers for the remainder of the financial year.
Releasing an update on the cost of natural hazards for the six month period to 31 December 2010, the Group said it had received approximately 2,500 claims from the first weather system that impacted Central and south-west Queensland from 25 December 2010. Based on preliminary estimates, Suncorp expects the pre-tax cost of this event to be between $130 million and $150 million. This cost will be included in the Group’s half-year result to 31 December 2010.
As a consequence of the Central and south-west Queensland weather event, as well as other natural hazard events during the course of the first half, the Group expects to have eroded between $220 million and $240 million of retained costs under its aggregate reinsurance program.
The aggregate reinsurance cover, along with the Group’s property catastrophe program, will limit the financial impact of any further natural hazard events, including the current weather system impacting Brisbane and south-east Queensland, over the remainder of the 2010/11 financial year.
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