Suncorp Group’s reported results for the financial year 2021-2022 (FY2022) show the Australian insurance business’ profit after tax dropped to $174 million, down 68.2 per cent on the $547 million recorded in FY2021.
Motor increased by 8.7 per cent with average gross premium driven by pricing for inflation, including increases in the sums insured. Additionally, benefits were realised from ongoing strategic investment in AAMI marketing and enhanced digitisation of the sales process, driving positive unit performance.
Gross written premium across all portfolios, excluding portfolio exits, was up 9.2 per cent to $9.25 billion, with an acceleration to 10.7 per cent in the second half.
Group net profit after tax dropped by 34.1 per cent to $681 million, while cash earnings were down 36.7 per cent to $673 million.
According to Suncorp, the results were impacted by volatile investment markets and elevated natural hazard costs. The La Nina weather pattern across Australia and New Zealand led to 35 weather events and around 130,000 natural hazard claims. This caused Suncorp to exceed its natural hazard allowance by $101 million, with significant recoveries made under its reinsurance programme.
Despite the growth, the company expects gross written premium to grow by “mid-to-high single digits” in FY23.
Steve Johnston, CEO of Suncorp, said the company maintained momentum and delivered on its key strategic initiatives despite the “challenging year”.
“First and foremost, we have thrown our full support behind our customers, many of whom have been displaced by the far-reaching impacts of the La Nina weather pattern,” Johnston said. “At the same time, we have maintained our focus on executing our strategic initiatives and this has allowed us to offset increasing inflationary pressures, particularly in home and motor vehicle repairs.
“A highlight of this result is the GWP growth that has been delivered and the increased underlying ITR, which demonstrates that we can meet the needs of customers and make good progress against our strategic initiatives.
“We are proud of what we have delivered this year, and the hard work we have done over the past three years means we are able to reaffirm our FY2023 targets.”