Suncorp has joined the growing list of insurers confronted by adverse life/risk experience, with a 76.1 per cent decline in net profit after tax by Suncorp Life dragging on the company’s overall full-year result.
However, the company is looking to the sale of life via its direct and general insurance channels as a strategy to address some of its problems.
The company announced a 32.2 per cent decline in group net profit after tax to $491 million, which its chairman Ziggy Switkowski described as “solid”.
However in dealing with the performance of Suncorp Life over the 12-month period, the company’s release to the Australian Securities Exchange (ASX) referenced a result which had been “significantly impacted by increased discount rates”.
“The underlying profit after tax was $120 million down on the prior year due to negative experience against lapse and claims assumptions,” it said.
In other results, the company said disability claims experience had been negative $20 million and lapse experience was negative $26 million.
However, the announcement said that reported life individual risk new business sales were up 14.2 per cent to $121 million and sales of life through general insurance were up 16 per cent, reinforcing the strategy to concentrate on growing that channel.
