Youi Australia saw its operating profit decline 10.9% to $98 million in the past financial year because of increased natural perils claims.

A number of large weather-linked catastrophes such as hailstorms in Sydney and Gympie in Queensland have affected its results.

“In the prior year, the natural perils claims experienced by Youi Australia was unusually low,” parent group Outsurance Holdings says in its annual report.

“This compares to 2019 where various large natural catastrophes impacted the claims ratio.”

The claims ratio worsened to 54% from 53.2% and the combined ratio deteriorated 2.4 percentage points to 85.8%.

Gross written premium (GWP) improved 5.3% to $695 million but headline earnings decreased 2.9% to $68 million.

The New Zealand arm of the South African-owned company achieved a 78% rise in operating profit to 12 million rand ($1.2 million).

Looking ahead, Outsurance warns that climate change and global warming may over time affect its business in the form of transition and physical risks.