New Zealand general insurer Tower Limited has returned to profit with full year earnings of $NZ16.8 million ($15.83 million), helped by benign weather and improved underwriting.

The ASX-listed company improved its combined ratio by 6.6 points to 88.8% in the year to September 30. It forecast net profit would climb to between $NZ27 million ($25.45 million) and $NZ30 million ($28.28 million) in the current financial year.

“While fiscal year 2020 is a year of transition, we expect solid growth and profitability to continue,” Tower CEO Richard Harding said. “You can be confident that our strategic plan is solidifying our position as a digital challenger and will deliver significant long-term value.”

The core New Zealand portfolio increased by 9.1%, and total gross written premium (GWP) rose 21% to $NZ356.8 million ($336.3 million) across New Zealand and the Pacific.

In September, Tower agreed to buy Youi’s New Zealand home, contents and motor portfolio for $NZ13 million ($12.25 million).