Suncorp has used its half-year financial results to send a message that current discounting of many commercial lines rates is unsustainable.
Big losses in the Brisbane hailstorm last year have failed to dent the group’s half-year profits too much, with the insurance giant posting an overall profit increase of more than 14%.
Results released this morning show a marginal decrease from the previous corresponding period in commercial gross written premium, to $830 million.
However, Suncorp Commercial Insurance CEO Anthony Day says they are well-positioned in a competitive market, adding that some competitors were using price reductions to drive growth.
“Suncorp Commercial Insurance doesn’t view this pricing as a sustainable long-term strategy and will we will continue to focus on margin over growth,” he says.
“Our customer and intermediary relationships are strong; our market-leading claims performance continues to improve; and we have a superior underwriting regime – this is a solid base to grow the business in this market.”
The November hailstorm caused claims of $250 million for Suncorp, pushing its natural hazard claims $172 million above its long-run allowances.
However, the storm also demonstrated how technology is improving the claims experience, with Day describing their claims management as a standout.
“Claim lodgements were faster; the average wait time for a claims lodgement was one minute and 26 seconds, and Suncorp was the first insurer to communicate with the broker market,” he says.
Suncorp Insurance as a whole also set internal records during the storms, with more than 10,000 claims lodged in a single day, as well 1500 cars assessed in one day.