Suncorp New Zealand’s net profit for the first six months of its 2025 financial year was almost 8% or $18 million higher than the general insurer’s total net profit after tax for the entire 2024 financial year.
While profit shot through the roof, the second largest general insurer in Australia and NZ reported a much smaller increase in insurance premium growth.
Suncorp released its half-year results for the six months to the 31st December on Wednesday, which showed annual Gross Written Premium (GWP) growth in NZ edged up 6% to $1.49 billion.
GWP is the total amount of money customers are required to pay for insurance coverage on policies issued by an insurer.
While it is a lower GWP increase compared with Suncorp NZ’s half-year results in 2024, when GWP jumped 20% to $1.41 billion, the insurer still managed to make almost $1.5 billion in insurance premiums during the first six months of its 2025 financial year.
Suncorp NZ reported a half-year net profit after tax (NPAT) of $248 million in Wednesday’s results.
It’s $154 million higher than the prior comparable period and $18 million more than Suncorp NZ reported in net profit during the full 2024 financial year.
Suncorp NZ boss Jimmy Higgins said the company’s half-year interim profit had been driven by solid investment income returns, an easing of claims inflation pressures, and a benign natural hazard claims environment.
The NZ insurer’s investment income rose to $66.7 million, up from $51.1 million in December 2023.
Suncorp NZ’s net incurred claims fell 4.2% to $594 million in the half-year period. This was due to natural hazard costs being lower relative to 2024, but the company also said working claims experience benefitted from a moderation in claims volumes and inflationary pressures.
“Over the last six months we’ve grown our customer base and paid out $700 million in claims. Generally favourable weather conditions and a softening of inflation and construction prices have contributed to a decrease in claim costs and supported bottom-line growth,” Higgins said.
Of the $700 million paid in claims during the six months to 31st December 2024, approximately $300 million was paid out in property losses and $250 million in vehicle related claims.
Suncorp NZ currently has approximately 870,000 customers and almost $600 billion of assets across the country. Its consumer portfolio has grown 10.5% compared to consumer numbers at the end of December 2023.
The insurer’s Group report said the total cost of natural hazards came to A$503 million for the six months to the 31st December, A$277 million below the company’s allowance in the half.
“The Group benefited from a benign natural hazard period, with six weather events above A$10 million in Australia in the half, and no significant weather events in New Zealand,” the company said.
Suncorp Group’s report said “alternative reinsurance structures” for the 2026 financial year were continuing to be assessed with an update being provided in early July later this year.
Higgins said the natural hazard events that hit NZ in 2023 “fundamentally changed” the risk outlook reinsurers have towards NZ and this had resulted in a “significant rise” in reinsurance pricing.
“These costs have begun to stabilise however, and when coupled with the easing of claims inflation, should contribute to a moderation of premium increases in the second half of the year, helping to reduce pressure on consumers,” Higgins said.
The 2023 North Island flooding and Cyclone Gabrielle events have cost insurers $3.8 billion as of July 2024, according to figures out of the Insurance Council of NZ.
“It’s vital we meet the needs of New Zealanders and deliver the products and services they want and need. This requirement is more important than ever given the complex environment and the impacts of climate change on our communities,” Higgins said.
Single digits
Suncorp Group is anticipating GWP growth to be in the “mid to high single digits” for the full 2025 financial year as the insurer expects pricing to moderate in line with easing inflationary pressures in some portfolios – particularly in NZ.
Suncorp is both Australia and New Zealand’s second largest insurer and holds more than a quarter of Australia's general insurance market.
The insurer has the Vero Insurance brand and the joint venture AA Insurance business in NZ. It used to also own Asteron Life but announced the NZ$410 million sale of the life insurer in 2024.
Suncorp Group was paid NZ$250 million in its first payment from the sale after it was completed in January. The remaining NZ$160 million will be paid out in 18 months time.
Asteron Life provides insurance for life, trauma, income protection, total and permanent disability, and business cover to the NZ market. Suncorp NZ reported a life insurance profit after tax of $19 million, $5 million more than a year earlier.
Higgins said Suncorp NZ was focussed on making sure insurance remained affordable and accessible for customers.
“To do that, we need to make Suncorp the most efficient and effective business we can. After the recent sale of Asteron Life we’re now a more streamlined general insurer, enabling us to better serve the needs of our customers and brokers,” Higgins said.
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