Tower secures NZ$970M reinsurance cover
- Tower renews its FY27 reinsurance programme with a catastrophe upper limit of $970 million.
- Reinsurance premium expenses are projected to fall to 9.5% of Gross Written Premium.
- The structural update aims to support operating efficiency while expanding catastrophe coverage.
Tower (ASX:TWR) completed the renewal of its reinsurance programme for the financial year ending Sept. 30, 2027, raising its catastrophe limit to NZ$970 million.
The expanded limit increases catastrophe coverage from $915 million in FY26 while keeping catastrophe event excesses unchanged at NZ$20 million.
"Our disciplined approach to risk selection, pricing and portfolio management has helped us secure a strong outcome for our FY27 reinsurance arrangements, supporting Tower's ongoing resilience and ability to offer competitive pricing for customers," said Tower CEO Paul Johnston.
Tower estimates its reinsurance premium expense will decline to 9.5% of Gross Written Premium in FY27, down from 10.6% in FY26.
The company structured its third catastrophe limit of $100 million on pre-agreed terms payable if two catastrophe events occur, replacing its previous annual prepaid arrangement.
Following the announcement, the Tower share price was unchanged at $1.57.
Tower provides home, motor, boat, and commercial insurance coverage across New Zealand and Pacific markets.
The business continues to expand its risk-based pricing capability across perils while securing multi-year agreements with global reinsurers to manage future costs.
