Tower Insurance expects annual net profit tax after tax of between $100 million and $110 million, but only if there are no major events this month.
The general insurer made the announcement on Friday, sharing it had updated its guidance for the year ending September 30.
Previous guidance for Tower’s underlying net profit after tax (NPAT) was between $70 million and $80 million, including the full use of its $50 million large insurance events allowance.
Tower has so far recorded just $7 million in large insurance event costs in its 2025 financial year, “and assuming this remains the same, some $31 million ($43 million before tax) will be returned to underlying NPAT at year end”, the insurer’s statement said.
In its 2024 financial year, Tower recorded NPAT of $83.5 million.
Tower said its customer base has increased by 5% in the year to date to 318,000, and policy numbers have increased by 4% - mostly for house insurance.
Its New Zealand house insurance portfolio saw 10% policy growth “reflecting Tower’s strategic focus on the house insurance market”, the insurer said.
“As signalled at the half year, policy and customer volumes have continued to grow, while average premiums have reduced.
“This is due to a higher proportion of lower-risk new policies consistent with Tower’s risk-based pricing approach, and more competitive pricing in the New Zealand market.”
Because of this, the general insurer said guidance for gross written premium (GWP) growth has been revised to 2% to 3%.
GWP is the total amount customers pay for insurance coverage on policies issued by the insurer. Their previous guidance for GWP was "mid-single digit".
Tower’s management expense ratio (MER) - the insurer’s operating expenses in relation to its assets - has been revised to around 31%, reflecting the “lower GWP flowing through to the ratio, alongside Tower’s continued investment in technology and growth initiatives, including for customer acquisition”, the statement said.
The general insurer's previous guidance for MER was less than 31%.
Tower will announce its full-year results in November.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.