Insurance claims continue to roll in as torrential rains wreak havoc in Auckland

Heavy rains cause flooding in Auckland
An area flooded during heavy rainfall is seen in Auckland, New Zealand January 27, 2023, in this screen grab obtained from a social media video. @MonteChristoNZ/via REUTERS

Feb 3 (Reuters) - Insurance firms continued to receive thousands of claims following severe storms and flooding in and around New Zealand's biggest city, Auckland, with Insurance Australia Group (IAG) (IAG.AX) registering a bulk of the claims so far.

Auckland and much of New Zealand's upper North Island have been hit by record rainfall in the last week. Four people died in flooding and landslides that left roads closed, cut off communities, and caused millions of dollars in damage.

More than 15,000 claims have been lodged across AMI, State, NZI and partner brands as of Friday, IAG said, adding that natural peril costs for the first half of fiscal 2023 are likely to be A$70 million more than the allowance that was set aside, and will come in at A$524 million ($370.89 million).

IAG shares tumbled 7.7% in early trading on Friday, marking its biggest single-day drop since March 2021.

The insurance industry expects the costs associated with the flood to top the NZ$97 million ($62.5 million) spent following 2021's floods on New Zealand's West Coast in what is likely to be the country's most expensive weather event ever.

Australia's Suncorp (SUN.AX) on Monday noted its Vero and AA Insurance brands had received about 3,000 claims. The insurer will further update on claims received on Feb. 8. Local player Tower (TWR.NZ) had received 1,900 claims as of Monday.

IAG, meanwhile, said that based on a preliminary assessment, the cost impact from the flooding in Auckland will be A$236 million as indicated previously.

It also raised the natural peril costs forecast for fiscal 2023 by A$236 million to A$1.15 billion.

Still, it expects profit for the half to nearly triple to A$468 million from A$173 million a year earlier.

Shares of Suncorp and QBE Insurance (QBE.AX) fell between 2.4% and 3.4%

($1 = 1.5526 New Zealand dollars)

($1 = 1.4128 Australian dollars)

Reporting by Harish Sridharan in Bengaluru, Additional reporting by Himanshi Akhand; Editing by Devika Syamnath and Uttaresh.V

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