Australian insurer Suncorp Group has revealed that net profit after tax (NPAT) for FY2025 was $1.823 billion, up from $1.197 billion in 2024, while cash earnings increased to $1.486 billion from $1.372 billion.
According to the firm, FY2025 NPAT included $252 million from the one-off gain on sale of Suncorp Bank and $99 million for New Zealand Life.
The result also benefitted from a favourable natural hazard experience of $1.355 billion, $205 million below the allowance, and positive net investment returns of $766 million, compared with $661 million last year.
Suncorp also reported gross written premiums of $15.009 billion, up on the prior year’s $14.1 billion. Top-line growth reflected the pricing response to claims inflation and a higher natural hazards allowance.
While GWP growth slowed in the second half as inflationary pressures eased, and competitive activity increased in some portfolios, the company’s underlying insurance trading ratio (UITR) increased to 11.9%, in line with guidance, the firm explained.
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The improvement was primarily from the earn-through of price increases in response to higher input costs, which was slightly offset by a lower underlying investment yield.
Net incurred claims increased 8.6%, to $9.251 billion, primarily driven by working claims inflation and natural hazards experience, partially offset by the nonrecurrence of prior year reserve strains.
Working claims inflation began to moderate in some portfolios, most notably New Zealand and Motor, as repair capacity improved. Home working claims were impacted by elevated losses caused by fire and water, the firm noted.
General Insurance (GI) operating expenses increased $1.751 billion, reflecting increased investment in business growth.
However, a disciplined approach to cost management helped the total expense ratio fall to 18.6% from 19.6%
To address future risks, Suncorp successfully placed its FY26 reinsurance program at a reduced cost for similar cover. The natural hazard allowance for FY26 has been increased to $1,770 million, reflecting unit growth and inflation, and a stronger focus on resilience.
Suncorp’s Commercial & Personal Injury Insurance division saw an increase in net profit after tax to $422 million. This result reflects the earn-through of pricing adjustments, favourable prior year reserve movements, and positive investment returns.
The UITR reduced from 14.5% to 10.3%, due to higher loss ratios in the CTP portfolio and a reduction in Suncorp’s reserve release assumption to 0.4% of net insurance revenue, and lower underlying investment income.
GWP of $4,224 million increased 6.9%, reflecting growth across all portfolios. Growth was particularly strong in the Platforms portfolio, supported by new business in Commercial Motor. Net incurred claims of $2,720 million increased 11.9%. The increase was largely driven by portfolio growth and higher loss ratios in the Personal Injury portfolio.
Steve Johnston, Suncorp Group Chief Executive Officer, commented: “Suncorp’s FY25 performance demonstrates the strength and resilience of our business built over the past five years, and our ongoing commitment to creating value for our customers, communities and shareholders.
“Following the disciplined execution of our strategic and operational priorities, including the successful completion of our simplification journey with the sale of Suncorp Bank and New Zealand Life, Suncorp’s full focus as a pure-play general insurer is on improving the insurance products and services we offer our customers across Australia and New Zealand.
“Our strong set of results delivered this year included the one-off profits on the sale of Suncorp Bank and New Zealand Life, significantly higher investment returns and weather costs across Australia and New Zealand that were favourable to allowance by more than $200 million. Suncorp, however, dealt with 17 declared weather events and more than 120,000 natural hazard claims this year.”
Johnston also addressed the ongoing challenge of affordability, noting that while the company has had to increase premiums, these increases are now moderating as supply chain inflation eases.
He called for increased investment in mitigation projects and incentives for customers who invest in their own resilience as well as lower taxes on insurance products to help alleviate cost-of-living pressures.
The CEO added: “Suncorp’s advocacy agenda is also expanding to include issues inside the home such as sub-standard flexi piping and lithium-ion batteries which have the potential to impact home insurance premiums in future years. Suncorp’s strategic focus as a pure-play general insurer is centred on tackling the challenges of insurance affordability and accessibility and growing our business by advancing our work to modernise, innovate and improve customer outcomes with seamless digital experiences and more personalised product offerings.
“Importantly, we are able to make these investments without compromising margins or shareholder returns. Our disciplined approach to capital management and robust capital position has enabled us to announce an on-market buy-back of up to $400 million, commencing in September 2025 and continuing through to the end of FY26.”
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