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Recent severe weather in the North Island is expected to cost insurer Tower a higher than expected $4 million in claims, out of a total $70 million for the industry.
The second half of Tower's financial year usually featured higher claims due to weather-related events, but the amount this year was expected to exceed budget by about $2.7 million after tax. That assumed no other one-off events in the six months to September 30.
Tower received claims related to the Taranaki tornadoes, and flooding in Auckland, Northland and Coromandel, all in July.
Recent Hawke's Bay floods had not resulted in significant insurance claims.
"The recent extreme weather events were an issue for the whole industry, and although significant in severity and unusual in frequency, are not totally unexpected for an insurer such as Tower which operates in this market," chief executive Rob Flannagan said.
Last year, Tower's New Zealand net profit rose 36 per cent to $33.8m. The general insurance division has been hit by claims resulting from rioting in Tonga last November.
Shares in Tower last traded up 1 per cent, or 3c, at $2.33.
- NZPA
