Tower has increased its catastrophe reinsurance cover for the next financial year to support growth and provide protection from large events volatility.

“We’ve further strengthened relationships with global reinsurers, with several agreeing to new multi-year arrangements, which provides greater long-term certainty of reinsurance costs and catastrophe excesses,” CFO Paul Johnston said today.

“We’re pleased to have secured a comprehensive reinsurance program with stable excesses and pricing.”

The catastrophe upper limit has been increased to $NZ800 million ($733 million) from $NZ750 million ($687 million) and Tower has expanded cover for a third event to $NZ85 million ($78 million) from $NZ75 million ($69 million).

The excess for the first two events increases to $NZ18.75 million ($17.2 million) from $NZ16.9 million ($15.5 million), and is unchanged at $NZ20 million ($18 million) for a third event.

Tower estimates it will pay 11.7% of total income for reinsurance cover, down from 13.9%.

The company, which last month upgraded its earnings guidance for the financial year ending September, is due to report its results in November.