Insurer declares ‘stable premiums’ in GI division

Insurer declares ‘stable premiums’ in GI division | Insurance Business

Insurer declares ‘stable premiums’ in GI division
Premiums will “stay relatively stable into the future” in Suncorp’s general insurance division the group CEO has assured customers.

Patrick Snowball said at a group update yesterday that reinsurance pricing had improved and with plenty of capacity in the market, it expects to report lower reinsurance pricing upon finalising renewal.

”All of this means that insurance premiums can stay relatively stable into the future, which is welcome news for our customers, but also gives us certainty over the stability of our margins.”

The group has revised its growth target to be in the range of 4% to 6% due to pricing growth across GI set to be subdued in the medium term.

The GI business is said to be performing at well above the meet or beat 12% commitment and the bank margin “well within” the target range.

“Most importantly, we are re-affirming our target ROE of at least 10% to be achieved next year,” Snowball added. “This is an important stake in the ground for Suncorp both internally and externally. It will stretch us as an organisation, but I am confident that we can achieve it.”

The capital position is said to be “extremely strong” so the company can be confident about another capital initiative at the full year subject to regulatory approval.

Thanks to dry weather conditions, the frequency of large claims has fallen. The GI division has $75m sitting in its natural hazard allowance for the second half of the year.

“At the same time,” Snowball said, “we're not seeing any signs of claims pressure in either our long-tail or short-tail books and we have maintained an ITR that well exceeds 12% in both an underlying and reported basis.”