Tower has purchased a year of reinsurance cover which includes two catastrophe losses up to $NZ750 million ($697.84 million), and cover for a third catastrophe event up to $NZ75 million ($69.78 million). 

New reinsurance was secured at competitive rates for home, motor, boat and commercial portfolio cover, across New Zealand and the Pacific, Tower CFO Paul Johnston says, and the insurer received "backing from reinsurers looking to start new relationships with us”. 

Moderate increases in both pricing and excesses were agreed. Tower’s excess is $NZ16.9 million ($15.72 million) for the first two catastrophe events, up from $NZ11.9 million ($11.07 million) in its previous arrangements. An excess of $NZ20 million ($18.61 million) applies for a third event. 

“The market has experienced significant increases in reinsurance prices and excesses, so we are pleased to have achieved a comprehensive reinsurance program with moderate increases in pricing and excesses,” Mr Johnston said. 

"Reinsurers are impressed by our ability to proactively manage risks throughout our portfolio via risk-based pricing, our dynamic rating capability, and digital direct customer relationships.”  

Tower estimates it will pay 14% of income for reinsurance cover in the year to June 30 2024. 

The Auckland-based insurer has forecast a range of an underlying loss of $NZ2 million ($1.85 million) to profit of $NZ3 million ($2.77 million) in the year to September. The final result is expected in November.