April 29, 2015 / 12:15 AM / in 4 years

IAG lowers insurance margin guidance after storm lashes Australia

SYDNEY, April 29 (Reuters) - Insurance Australia Group said on Tuesday it has lowered its full-year insurance margin guidance to 10.5-12.5 percent following claims from a cyclone-strength storm that battered Australia’s east coast last week, a hailstorm in Sydney and Tropical Cyclone Marcia earlier this year.

It earlier expected its insurance margin for the year-ending June 2015 at 13.5-15.5 percent. Its guidance for gross written premium growth for the year was unchanged at the lower end of the 17-20 percent range, it said in a statement.

It expects net costs of A$250 million from the NSW storm damage, about $50 million from Sydney hailstorm and $140 million from Cyclone Marcia.

IAG, which specialises in motor and property insurance, has raised its net natural peril claim cost assumption for the current financial year to A$1 billion ($800 million), after reinsurance recoveries, from A$700 million earlier.

Net profit for the year-ended June 2014 rose 59 percent to A$1.23 billion. ($1 = 1.2489 Australian dollars) (Reporting by Swati Pandey; Editing by Richard Pullin)

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