Suncorp Group Limited is an Australian financial services company whose principal activities are general insurance, banking and wealth management. UBS analyst Kieren Chidgey anticipates a substantial blow to Suncorp’s earnings due to a sharp increase in natural hazard claims throughout Australia and New Zealand. Year-to-date catastrophe costs, spanning July to November, have reached approximately $1.15–$1.28 billion, exceeding the 10-year inflation-adjusted average for large and mid-sized events by over threefold.
UBS now projects that Suncorp will exceed its fiscal year 2026 catastrophe budget by $580 million. This expected overrun has led to a 31 per cent reduction in the FY26 earnings per share (EPS) forecast, now estimated at 88¢. The forecast for FY27 EPS has also been revised downward by 1 per cent to $1.27.
The insurer’s most expensive event to date, a recent hailstorm in South East Queensland, has already resulted in 10,000 claims. Suncorp anticipates that payouts from this event will reach its maximum event retention level. Additionally, smaller, attritional weather claims are tracking 1.5 times higher than historical averages.
UBS highlighted potential mitigating factors. The surge in claims could lead to extended increases in home and motor premium rates during the second half of this financial year and into FY27. The broker has reduced its target price for Suncorp shares to $22 from $23.15. This new target price implies a total shareholder return of approximately 24 per cent from the current levels.
