Tower NZ is now expecting the Christchurch earthquake to cost it between $NZ15-$20 million ($11.5-$15.4 million) by the end of its September 30 financial year.

According to Tower’s half-year report, the various Christchurch events have cost the company $NZ7.544 million ($5.822) for the six months ending March 31.

The September 4 earthquake costs were $NZ4.47 million ($3.44 million), but these had been included in the 2010 financial year.

Tower has been forced to take out more reinsurance to cover the numerous subsequent Christchurch claims.

The report says Tower has paid $NZ26.7 million ($20.6 million) for reinsurance in the six months ending March 31 this year, compared to $28.1 million ($21.6 million) in the corresponding period last year.

The insurer has been paid $NZ11.6 million ($8.9 million) from the reinsurers in the six months ending March this year compared to $NZ14.9 million ($11.4 million) in the six months to March 2010.

Tower NZ Group MD Rob Flannagan says the Christchurch earthquakes have been “tough” for the insurance industry and the company has dealt with more than $NZ350 million ($270 million) of claims in the past six months.

“The country’s economic situation has remained difficult, but despite this I am pleased that Tower has come through these challenges very well,” he said.

The insurer’s life and health business faced $NZ2.1 million ($1.6 million) of claims from Christchurch, but excluding this event the division made a $NZ16.6. million ($12.8 million) profit for the 2011 six-month period.

General insurance profit was down from $NZ11.9 million ($9.1 million) in the six months ending March 2010 to $NZ10 million ($7.7 million) in the corresponding period this year.

Mr Flannagan says this was due to falling investment income and the costs of restructuring the division.