The business has lowered its reported insurance margin guidance range from 12.5%-14.0% to 10.5%-12.5%, due to a $170 million increase in net natural peril claim cost assumption for the financial year.
The major insurer has received approximately 4,300 claims as of April 04, mainly for property damage in relation to the cyclone which hit Queensland last week.
As of yesterday at 9am AEST, members of the Insurance Council of Australia had received 30,370 claims from Tropical Cyclone Debbie and flooding in northern New South Wales. The value of these claims was estimated to be $386 million.
As the trail of destruction from Cyclone Debbie has now moved south to hit New Zealand, Peter Harmer, IAG managing director and CEO, said that the effects of the storm are still being felt.
“We have mobilised local builders to perform critical repairs where we have access, and we have our people at the recovery centres in the affected areas,” Harmer said.
“We are well-advanced in assessing damaged properties and this is a priority so our customers can get back on their feet as soon as possible.”
Following Cyclone Debbie, IAG has increased its expectation for FY17 net natural peril claim costs to $850 million, compared to $680 million previously. This is made up of around $650 million for the eight months ended February 28, approximately $50 million from events in March excluding the cyclone, and $140 million for Cyclone Debbie.
The insurer has estimated a $100 million figure for further peril events that could impact the business before the end of the financial year based on maximum exposure to a subsequent event.
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IAG has said that it estimates it will incur a net natural peril claims cost of approximately $140 million from claims related to Tropical Cyclone Debbie.