Suncorp-Metway Ltd (ASX:SUN) has responded to the Christchurch earthquake over the weekend, and predicts its financial exposure is likely to be limited, due to New Zealand's statutory framework and the company's reinsurance arrangements.
Suncorp advises that the New Zealand Earthquake Commission provides the first layer of household cover in the event of an earthquake, which generally caps at NZ$100,000 plus GST per dwelling and NZ$20,000 plus GST for contents.
Any household exposure over this amount and Suncorp's commercial property risks are being supported by the company's reinsurance arrangements, which include a cap of NZ$60 million on the domestic earthquake exposures of its New Zealand businesses, Vero NZ and AAI.
Suncorp also advises that the weather conditions that impacted New South Wales and Victoria over the weekend have not resulted in a significant number of claims at this stage.
Suncorp reported a net profit of $780 million for the 2010 financial year, up from $348 million the year before.
SUN Price at posting:
$8.61 Sentiment: None Disclosure: Held
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