Suncorp expects to report gross written premium growth of about 2.7% for last financial year, with investment income down but guidance for the key underlying profitability measure maintained.

The insurer, which will release full-year results on August 12, today also confirmed placement of its main reinsurance program and said CEO Steve Johnston will return from medical leave on Monday.

A weak economy and soft commercial market in New Zealand, along with marginal demand reduction in Australia, have affected GWP growth.

In April, Suncorp said growth would be about 3%, after at the half-year indicating a gain “around the bottom” of the mid single digit range.

Investment income is estimated to be between $750 million and $800 million, down from $1.227 billion a year earlier, mainly due to accounting “mark to market” losses caused by rising bond yields.

Net natural hazard costs are estimated at $2.02 billion, compared with a $1.77 billion allowance, including 18 separate events. Queensland hail in November and eastern states severe thunderstorms in October were the costliest disasters.

Suncorp has affirmed the underlying insurance trading ratio is expected to be towards the upper end of the 10%-12% range.

The underlying ratio is adjusted for reported prior-year reserve releases and natural hazards claims costs above and below long-run expectations, investment income mismatch and any abnormal expenses.

The company has placed its main catastrophe program for fiscal 2027 after in April buying a five-year aggregate cover to provide added protection for an accumulation of events.

Acting CEO Jeremy Robson says the renewal maintains a balance between costs, earnings volatility and capital efficiency.

“It is pleasing to see improved market conditions reflected in the pricing of our comprehensive main catastrophe program, now complemented by the addition of aggregate protection to further enhance resilience and reduce volatility,” he said.

Total reinsurance costs are expected to rise, reflecting the added aggregate cover and exposure growth partly offset by improved main program pricing.

The hazards allowance increases to $1.8 billion for this year, with the aggregate cover expected to cap costs at $1.85 billion in about 90% of scenarios.

Mr Johnston, also chair of the Insurance Council of Australia, returns next week after the company said in March he would be taking leave to recuperate from a medical procedure.