New Zealand-based insurer Tower has revised its market guidance on underlying net profit after tax for FY23, inclusive of large events, to between $7 million and $10 million, as the firm’s large event costs for the period has come in $1.5 million lower than previously expected.
The new profit guidance for FY23 compares with a previous range of a loss of $2 million to a profit of $3 million, announced by the firm in July.
At that time, Tower said that the Auckland floods in May and revisions to estimates for Cyclones Judy and Kevin in Vanuatu, excluding costs of reinstating reinsurance cover, saw large event costs hit $39.5 million.
However, due to lower-than-expected costs from Vanuatu cyclone claims, favourable foreign exchange rates and experiencing no large events since May 9th, the company now expects large events costs in FY23 to total around $38 million.
Additionally, the carrier has reported that gross written premiums are expected to hit $526 million, up 17% on the prior year reflecting rating increases, organic growth, and strong customer retention.
Towers says that reported profit will be impacted by additional non-underlying costs including an increase to the customer remediation provision.
Earlier this year, the insurer completed the renewal of its reinsurance programme for the 2024 financial year, decreasing its catastrophe upper limit to $750 million.
