Suncorp sees FY net profit of around $1.2bn as GWP increase 13.9%

Australian insurer Suncorp Group has revealed that net profit after tax for FY2024 was $1.197 billion, up from $1.071 billion in 2023, while cash earnings increased to $1.372 billion from $1.177 billion.

Suncorp also recorded a higher net investment income of $661 million, driven by a strong underlying yield on the interest-earning portfolio and stronger equity markets.

In the General Insurance business, gross written premium (GWP) increased by 13.9% in FY2024, reportedly reflecting both unit growth and targeted price increases in response to higher costs from reinsurance, natural hazards and claims inflation.

According to Suncorp, the UITR or margin for H224 in the General Insurance business increased to 12.0%, with the full year increasing from 10.6% to 11.1%. The improvement was supported by revenue growth, the impact on earnings from price increases in response to higher input costs, and from efficiency gains in the business.

Meanwhile, the total cost of natural hazard events for FY2024 was $1.235 billion, $125 million below the Group’s allowance.

“The Group managed 12 separate weather events in Australia and one event in New Zealand, as well as events covered by the Cyclone Reinsurance Pool. The Group’s natural hazard allowance for FY2025 is $1.560 billion with a comprehensive reinsurance program placed successfully at a cost broadly in line with the prior year,” Suncorp explained.

Reviewing by segment, Suncorp’s Consumer Insurance line delivered profit after tax of $424 million in FY2024, up from $200 million, with continued momentum in revenue growth driving margin repair. GWP in this line were $7.526 billion.

Commercial & Personal Injury profit after tax in FY2024 was $381 million declined $62 million, with the prior year benefitting from the release of the business interruption provision of $124 million. GWP here were $3.952 billion.

At the same time, Suncorp New Zealand delivered profit after tax of NZ$230 million in FY2024, with GWP of NZ$2.858 billion.

Suncorp Bank’s profit after tax decreased 19.4% to $379 million in FY2024, impacted by competitive pressures on NIM and increased operating expenses.

However, the Bank continued strengthening Home lending, growing the portfolio by $2.2 billion or 4.0%. Business lending grew 3.3% to $12.9 billion with growth across all portfolios.

On 31 July 2024, Suncorp completed the sale of Suncorp Bank to ANZ. Expected net proceeds of around $4.1 billion remain materially unchanged. The current expected statutory profit on the sale is around $235 million.

Suncorp CEO, Steve Johnston, commented, “While the headline results represent strong increases on the prior year it’s important to point out that the past three years have been very challenging for all insurance companies with inflation, natural hazards and a fundamental reset in global reinsurance markets.

“It’s pleasing that we navigated these challenges, and the complexity of the bank sale, and our earnings have rebounded to roughly where they were previously.”

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