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Tower tips further cost hikes
ROELAND VAN DEN BERGH Last updated 05:00 26/11/2011
After jumping 25 per cent this year, household insurance premiums are expected to rise again next year due to the deepening European debt crisis, Tower Insurance warns.
Giant reinsurance companies were expected to lift premium rates around the world after being hit by big losses on government bond investments in Greece, Italy and Spain.
Tower yesterday reported an after-tax profit of $33.4 million for the September year, despite the impact of the Christchurch quake earlier in the year. The profit was down 43 per cent on the previous year, but shareholders will be paid a final dividend of 2c a share.
"This is a satisfactory performance – especially in light of the demands on our business from the Christchurch earthquakes," managing director Rob Flannagan said. Tower raised premiums by an average of 25 per cent this year after a significant increase in reinsurance costs in the wake of the Christchurch earthquake, the Japanese tsunami and storms in Australia.
Regions with a higher risk of damage from natural disasters had greater increases, including Wellington, where premiums were up 27 per cent, Flannagan said.
ROELAND VAN DEN BERGH Last updated 05:00 26/11/2011
After jumping 25 per cent this year, household insurance premiums are expected to rise again next year due to the deepening European debt crisis, Tower Insurance warns.
Giant reinsurance companies were expected to lift premium rates around the world after being hit by big losses on government bond investments in Greece, Italy and Spain.
Tower yesterday reported an after-tax profit of $33.4 million for the September year, despite the impact of the Christchurch quake earlier in the year. The profit was down 43 per cent on the previous year, but shareholders will be paid a final dividend of 2c a share.
"This is a satisfactory performance – especially in light of the demands on our business from the Christchurch earthquakes," managing director Rob Flannagan said. Tower raised premiums by an average of 25 per cent this year after a significant increase in reinsurance costs in the wake of the Christchurch earthquake, the Japanese tsunami and storms in Australia.
Regions with a higher risk of damage from natural disasters had greater increases, including Wellington, where premiums were up 27 per cent, Flannagan said.
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