The destructive bushfires witnessed over the end of 2019 and into the beginning of the 2020 have proven costly for Suncorp's (ASX: SUN) insurance arm, with natural hazard costs in 1H20 topping out at $519 million.
Since September 2019 the Queensland-based company has received more than 2,600 bushfire-related claims, with a total estimated cost of between $315 to $345 million.
The most expensive event came at the very end of 2019, with bushfires in Victoria, Tasmania, and New South Wales between the 30th and the 31st of December costing the listed company $145 million.
Suncorp estimates these costs will continue well into the new year as the bushfire crisis is ongoing. The group believes the costs for the 1-5 January period will come to between $75 and $105 million.
The total natural hazard cost of $519 million was $109 million above the group's 1H20 allowance. As such the company has put into place a broad reinsurance program with enhanced natural hazard protection in FY20 to limit the impact of further natural disaster costs.
Suncorp CEO Steve Johnston says the company is focused on supporting customers who require urgent assistance.
"Having visited some of the communities affected by these fires, it is difficult to describe the extent and indiscriminate nature of the damage that has been caused and how deeply traumatic and dangerous they have been for families, communities and emergency services personnel," says Johnston.
"We fully recognise that these bushfires are particularly significant in terms of their duration; the geographic breadth of the fire zones; the sheer destruction of property; and the associated impacts on people's lives, as well as local communities and economies."
"This recovery is going to take a long time as one of Australia's largest insurers we understand the role we need to play in that process. We are committed to continuing to do everything possible to help people and communities get back on their feet."
The insurer has increased its donation to the bushfire relief effort to $500,000 and continues to double match employee donations with over $90,000 contributed to bushfire relief agencies to date.
According to the Insurance Council of Australia as of January 10 insurers have received 10,550 claims from New South Wales, Victoria, South Australia and Queensland from customers affected by the bushfires.
The ICA estimates that losses will come to around $939 million.
Shares in Suncorp are up 1 per cent to $13.15 per share at 3.07pm AEDT.
Business News Australia
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