Suncorp says its general insurance net profit has grown following premium increases across all portfolios and despite higher-than-expected natural disaster costs.

Net profit is expected to be between $870 million and $890 million for the year to June 30, up from $493 million last year.

Gross written premium (GWP) is up about 8%. The expected underlying insurance trading ratio of 13% exceeds the 12% target, and natural hazard costs of about $600 million are higher than the $520 million allowance.

Suncorp says the upper limit on the current financial year’s reinsurance program has increased to $5.8 billion from $5.3 billion, and the company has multi-year arrangements to provide protection for natural hazards in Queensland and New Zealand.

In Queensland 30% of home GWP is paid to reinsurers; in return the company is covered for 30% of all gross paid claims and handling expenses.

In New Zealand Suncorp has bought reinsurance “dropdowns” to reduce a first-event retention to $NZ50 million ($44 million) and second and third-event retentions to $NZ25 million ($22 million).

The cost of catastrophe reinsurance will rise marginally this financial year because of the extra cover, exposure growth and an increase in sums insured, it says.

Suncorp Life’s net profit for the financial year just ended is expected to drop to about $60 million from $251 million, reflecting accounting adjustments and lapse and claims experience.

The group’s total net profit is expected to fall to $480 million to $500 million from $724 million, following a loss of about $630 million on the sale of the non-core banking portfolio.