Suncorp Group will benefit from rising investment yields, lower reinsurance prices and market disruption this year, according to CEO Patrick Snowball.

And Commercial Insurance CEO Anthony Day says his division is set for further growth, “particularly in the intermediary market, where they are seeing change”.

He says the division will prioritise margin over growth and maintain underwriting standards.

Mr Snowball told insuranceNEWS.com.au market disruption, such as IAG’s proposed takeover of Wesfarmers’ underwriting operations, means brokers will rebalance their business with insurers.

He says Suncorp Group is “firing on all cylinders” and set for growth in commercial and personal lines as the benefits of de-risking gain traction and its simplification program ramps up.

The group reported a 5% fall in profit to $548 million for the six months to December 31, with general insurance (GI) profit down 17% to $470 million on higher disaster losses.

Net claims grew 13% to $2.61 billion. The Central Coast hailstorm in October cost $63 million, while the NSW and Queensland storms in November were the largest single event at $66 million.

The combined operating ratio was 90.8%, compared with 88.5% the previous year.

GI gross written premium (GWP) increased 4% to $4.38 billion, or 7% to $4.3 billion excluding the Victorian fire services levy (FSL). Mr Snowball says all product lines recorded growth.

Suncorp Commercial Insurance GWP grew 6% to $1 billion. Compulsory third party increased 8% to $505 million on growth in the Queensland and NSW markets and Suncorp’s entry into the ACT market.

Mr Day says margins are improving across the commercial portfolio. “We have really focused on delivery, on making it simple to access our products and services, and that does pay off.”

Direct channels will continue to grow for customers with less-complex needs, while intermediated channels, particularly broker business, will remain the choice of customers with complex requirements, he says.

The GWP for Australian personal lines, excluding FSL, grew 4% to $2.38 billion, mostly driven by higher premiums.

Suncorp Personal Insurance CEO Mark Milliner says competition and the external market continue to challenge his growth targets, but the group’s simplification program gives it more capability.

All personal insurance is on one platform after AAMI went live on the new policy system two weeks ago.

Mr Snowball says Suncorp has renewed its Queensland home insurance quota share arrangement.

New Zealand operations recorded a 22% increase in GWP to $568 million, with commercial business up 16% to $275 million, mostly due to rate increases.

Higher prices have attracted offshore capital to commercial property, and Vero New Zealand CEO Gary Dransfield told an analysts’ briefing the growth rate of commercial pricing is slowing.