Suncorp Group, the Australian primary insurance giant, has provided an update on its catastrophe and severe weather losses from the first-half of its financial year, having now gone well-over budget, but seemingly with only occurrence reinsurance to benefit the company, only one loss event is set to drive a recovery at this time.As we reported back in November, Suncorp had said that .This morning Suncorp has confirmed that, by pegging the net cost of the Queensland hail storm outbreak at its retention of $350 million..

It also features drop-downs, to reduce the retention for the insurer for any subsequent large catastrophe loss events.Suncorp said before that its drop-down coverage would reduce the second or subsequent event retention to between $240 million and $280 million for the next large Australian catastrophe or weather loss.Today, the insurer has confirmed it now estimates this will be $260 million.

Which is particularly relevant given ongoing loss development from other events that have occurred during the first-half of Suncorp’s financial year, as well as the fact there is now a bushfire outbreak that is on the radar of insurers.For the first-half, Suncorp said its large natural catastrophe event costs reached $917 million with 9 separate loss events over $10 million, while its other natural hazard costs, attritional and claims handling expenses, reached $402 million, giving total first-half natural hazard costs of $1.319 billion.That is well-above the budget given for H1, which was $866 million and running well into the full-year natural hazard budget of $1.77 billion.

Suncorp CEO Steve Johnston said that while the weather loss events will impact profits and shareholder returns they “reinforced the value of insurance and the role Suncorp plays in supporting customers and rebuilding communities.” “The hailstorms that hit parts of the east coast of Australia, particularly south-east Queensland in October and November, were particularly destructive, with more than 37,000 home, motor and commercial insurance claims being received,” Johnston explained.With no aggregate reinsurance in-force for the current financial year, recall that , the reduced attachment for the main catastrophe cover could come into focus.Which brings the developing bushfire outbreak in Victoria into focus, as an ongoing event with currently uncertain loss potential.

As of today, Suncorp said that the bushfires have driven around 60 home and motor policy claims for the insurer.Johnston commented, “Bushfire risk remains high across southern Australia, particularly Victoria, and we are closely monitoring from our Disaster Management Centre in Brisbane.We are utilising satellite imagery to evaluate the damage ahead of our teams being able to be safely on the ground.” The Insurance Council of Australia has now declared a Significant Event for the severe bushfires that have been impacting Victoria since 7 January 2026.

ICA Director of Mitigation and Extreme Weather Response, Liam Walter said, “Insurers’ first priority is community safety and we strongly encourage all Victorians to follow the advice of emergency services.This Significant Event declaration extends to all of Victoria, allowing the ICA to monitor claims across the entire state.While it’s too early to estimate the total damage bill of these fires, insurers stand ready to assist impacted policyholders in their recovery.” Reports in the media suggest hundreds of homes now burned by the bushfires, with figures as high as 400 structures burned being cited in recent reporting.

There are also fires in New South Wales and the hot, dry weather conditions are expected to continue, while authorities say fires could burn for several weeks.As a result this developing wildfire event in Australia has the potential to erode more of the natural hazard budgets of the large Australia insurers and the reduced retention Suncorp now has may prove relevant should the costs rise meaningfully.With the global reinsurance market now softened and aggregate reinsurance becoming more readily accessible again, it will be interesting to see if Australian insurer’s like Suncorp elevate the priority of securing new frequency protection at their next renewals given the severe weather experience..

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