Tower has reported a $NZ13.2 million ($10.3 million) after-tax profit for its general insurance business in the year to September 30 – up from $NZ2.5 million ($1.97 million) the previous year.

Net premiums were $NZ197.8 million ($155.8 million), up from $NZ167.3 million ($131.8 million), and gross earned premiums reached $NZ238.9 million ($188.2 million), rising from $NZ208.3 million ($164.1 million).

Claims also rose, to $NZ91.3 million ($72 million) from $NZ86.4 million ($68 million).

The year’s result includes further claim costs from last year’s earthquakes, totalling $NZ13.6 million ($10.6 million) after taxation.

General reinsurance costs were $NZ41.1 million ($32.3 million), compared with $NZ23.4 million ($18.4 million) in the previous year.

Tower Group MD Rob Flannagan says general insurance price increases have helped cover rising reinsurance costs.

“The business continues to grow while maintaining a low claims ratio,” he said in an investor briefing. “Significant catastrophe costs were absorbed during the financial year.”

Mr Flannagan says Tower has achieved revenue growth and lower costs.

“The group is recovering well from the Canterbury earthquakes and the strong financial performance highlighted the benefits of its streamlined and cohesive operating structure,” he said. “This included business-to-business alliances and partnerships with distributors.”

Tower reported a 67% rise in group after-tax profit, up to $NZ55.8 million ($44 million) in the year to September.

Group revenue from insurance – including general, life and health premiums – was $NZ333 million ($262 million), up from $NZ297.1 million ($234 million) the previous year.

Net claims for the three insurance divisions were $NZ194 million ($153 million), up from $NZ181.7 million ($143 million).

Group reinsurance fell dramatically to $NZ59.8 million ($47.1 million) from $NZ417.4 million ($328.9 million).