Tower solvency margin reduced
Tower Insurance has completed 82 per cent of its more than 10,000 Canterbury earthquake residential claims and is now allowed to hold $30 million less because its risks have reduced.
Tower's completion rate is well ahead of New Zealand's biggest general insurer IAG's 58 per cent announced this week.
Tower told the NZX yesterday the amount it was required to hold by the Reserve Bank had dropped from $80 million to $50m because of its progress in settling its earthquake claims.
Tower said that the central bank had completed its annual solvency review and confirmed a $30m reduction in funds Tower was required to hold as part of its minimum solvency margin (MSM) requirement.
Tower chief executive David Hancock said Tower would provide a capital update to the market when it released its full-year results in November.
Tower also wanted to grow its general insurance business, he said. It was on track to achieve about $4m of annual cost savings and improved customer service through an upgrade to its systems and processes.
Tower's website show it has claims for 10,756 properties.
About 6787 or 63 per cent are minor repairs to pathways, drives, pools and fencing, of which more than 90 per cent have been settled.
Tower has 1111 rebuilds and 1188 major repairs over the $100,000 cap.
Of the 1111 rebuilds, 610 or 55 per cent have been cash settled, and 110 rebuilds have been completed. So in total 65 per cent of the rebuild claims are now completed.
Of the 1188 major repairs, 391 or 33 per cent have been cash settled and 185 completed. So in total 48 per cent of the major repair claims have been completed.