Australian insurer Suncorp has revealed that it expects to suffer a loss of between $160 million and $170 million from the severe storm and hail that struck the Melbourne, Victoria region in December, which has taken the firm past its natural catastrophe budget for the first-half of the year.
Suncorp said that for the six months to December 31st 2017, the first half of its financial year, the insurers sees $406 million to 416 million of natural catastrophe claims costs, which reaches $60 million to $70 million above the insurers allowance for the first-half.
That suggests that Suncorp could be calling on some of its main catastrophe reinsurance program or aggregate coverage to assist it in paying catastrophe claims later in its financial year.
Suncorp said that it expects to receive over 21,000 claims across its insurance brands from the Melbourne area hailstorm. Most of these claims are due to home and motor vehicle damage and the insurer expects the total financial impact will near $170 million.
The level of losses suffered by Suncorp from this December hailstorm in the Melbourne, Victoria region suggests that the industry-wide loss will rise much higher and other major Australian insurance companies will also be finding their losses are in the hundreds of millions.
Suncorp said that it remains well protected by reinsurance against future catastrophes, with its main catastrophe program and its Natural Hazard Aggregate Protection in place for the 2018 financial year.
This coverage offers Suncorp $300 million of protection once the retained portion of any catastrophe or weather losses greater than $10 million passes a total of $475 million.
As of the 31st December 2017 Suncorp estimates that between $259 million and $269 million of the deductible has been eroded. The insurer has an allowance for natural hazard losses of $346 million for the remainder of its financial year.
