New Zealand general insurer Tower says it is on track to top $NZ22 million ($21.1 million) in underlying net profit this financial year, thanks to positive business trends and progress with its digital transformation.

Gross written premium in its core New Zealand book grew 7.9% in the four months to January.

“Business performance… is in line with expectations and, while only four months into the financial year, pleasingly, momentum is continuing,” Tower says in an investor update.

“In the Pacific, growth in core markets and a benign weather environment has resulted in the contribution of this part of the business returning to historic levels.

“Despite accelerating activity in the business, management expenses remain steady.”

The number of open claims from the Canterbury earthquakes has reduced to 138 from 163.

In May Tower, which is New Zealand’s third-largest general insurer. will release its financial results for the half-year to March 31.

Meanwhile, the insurer says about 70% of its digital revamp is complete.

“Testing is under way and indicating positive outcomes, with new business and other phase-one components to be live from the first half of the calendar year.”

Phase two will follow in the second half of this year.