New Zealand insurer Tower expects to increase claim provisions for the Canterbury earthquakes by $NZ53.2 million ($48.48 million) for the six months to September 30, resulting in a $NZ13.6 million ($12.39 million) impact on net profit.

The company expects to post a $NZ7 million ($6.38 million) loss for the full year to September 30 when it reports to the market tomorrow.

Its underlying result, which excludes Canterbury, will show a net profit of $NZ28 million ($25.51 million).

“Along with other general insurers, Tower continues to work through the tail end of Canterbury claims, which are challenging and complex,” the insurer says.

“The higher claims provision is driven by increased repair and rebuild costs for the remaining claims, and an increased risk margin.”

At September 30 Tower had settled 95.6% of Canterbury claims by number and 88% by value.