Coffs Harbour hailstorm smash Suncorp as natural catastrophe claims jump

A growing list of natural catastrophe events has seen Suncorp hit with a flurry of claims that could hit $492m.

Suncorp could be hit by insurance claims totaling as much as $492m following a flurry of natural disasters since July. Picture: Frank Redward

Suncorp looks set to be slugged as much as $492m for insurance claims after a string of natural disasters since July, which sees the insurer eat up half its natural hazard allowance.

In an update to the market, Suncorp said on Tuesday that while it was too early to know the full costs of the disasters it expected claims costs to run between $382m to as high as $492m.

The insurer has been hammered by five declared storm events in October to date, with the month capped off by a hailstorm in Coffs Harbour on the NSW North Coast last week.

The Coffs Harbour hailstorm, which is understood to have caused significant residential and vehicle damage, looks set to be the most expensive natural disaster this year for the insurer, with expected costs of $70-100m in claims.

Last month’s Victorian earthquake is expected to cost Suncorp $50-70m in claims costs.

Cars and shops in Toormina, south of Coffs Harbour, were lashed with damaging hail and rain Picture: Frank Redward

Suncorp chief executive Steve Johnston said while it was too early to estimate the ultimate cost of these events, preliminary ranges were being provided based on lodgement claims and historical average costs.

“We will continue to work with governments to ensure we can get tradespeople and assessors on the ground and across borders as necessary,” he said.

However, Suncorp warned in September closed national borders risked blow outs in costs as assessors struggled to access hard hit areas.

Mr Johnson had said the insurer was dealing with a growing claims backlog which was seeing valid claims go unassessed or repaired.

Relaxed restrictions in NSW have seen Suncorp better placed to respond to hail damage in Coffs Harbour, with the state more freely granting essential worker permits.

Suncorp has a comprehensive reinsurance program in place for major events.

Suncorp’s full year natural hazard allowance is $980m, which aims to cover both halves of the year.

The maximum event retention on the catastrophe program is $250m.

However, the growing claims costs comes after Suncorp was stung by natural disaster costs exceeding the insurer’s claims limits.

Suncorp last year was slugged $932 in claims for natural disasters, up from $783m in the 2020 financial year. This saw Suncorp hit with $34m in claims above its $898m allowance.

The floods and rains that lashed NSW in March saw Suncorp hit with $217m in claims.