Suncorp says it has taken advantage of improved reinsurance market conditions to boost its cover with an aggregate arrangement providing $800 million of protection annually, up to a total of $2.4 billion across five years.

The cover starts next financial year with an attachment point of $1.85 billion and will be indexed for exposure growth over time.

Acting CEO Jeremy Robson says the arrangement reinforces Suncorp’s commitment to customers and optimises long-term shareholder value.

“The underlying margin outlook remains unchanged at the upper end of the target range, but with significantly improved resilience and reduced volatility in earnings,” he said.

“This additional aggregate cover, in combination with the remainder of our reinsurance program, increases the resilience of our business to natural hazards and the related uncertainties for the next five years.”

The arrangement supplement’s Suncorp’s wider reinsurance program for catastrophes, meaning an accumulation of smaller events above the allowance would gain cover.

Related article: Reinsurance renewals ‘insulated’ in early days of Iran crisis

Suncorp’s natural hazard experience this financial year is expected to be about $250 million above its $1.77 billion allowance, subject to no further material events.

Next year it is expected to be $1.85 billion, or $1.8 billion excluding claims handling expenses and profit commission.

The aggregate cover is anticipated to cap natural hazard costs at the attachment point in about 90% of scenarios in any year, while reduced net claims cost volatility is expected to result in a one-off capital release of about $100 million through a modestly lower capital target.

Mr Robson says improved market conditions have made the aggregate cover a viable part of the overall program. The company is still working on renewal of the remainder of its reinsurance, including its main catastrophe cover, with arrangements on track to be finalised by June 30.

The underlying insurance trading ratio for this year is expected to be towards the upper end of a 10%-12% range, while gross written premium growth is likely to be about 3%.

That reflects New Zealand dollar weakness, which is anticipated to reduce growth by about 0.41 percentage points in Australian currency terms, and impacts from “improved risk mix shifts in home”.

At its half year results, the company said it expected GWP growth to be about the “bottom of the mid single digit range”, with CEO Steve Johnston defining that range as 4%-6%.

---

From the latest Insurance News magazine: Find out what the market has in store for you, as we reveal some highlights from Insurance News and Finity's 2026 INFORM report

---