Insurance Australia Group (IAG) has revised its FY11 insurance margin guidance, in the wake of recent 6.3 magnitude earthquake that struck Christchurch region, Newzeland.
As per the revised guidelines AIG’s New Zealand businesses, which include State and NZI, has down to 8%-10% (from 9%-11%) to reflect an increased natural peril cost assumption of $540m (from $500m) and the estimated cost of reinstatements in respect of its catastrophe reinsurance cover.
IAG managing director and CEO Mike Wilkins said that the primary concern is for the people affected by this catastrophe and AIG is focused on providing assistance to the customers and staff as quickly as possible.
"This event is particularly devastating, given the region is still rebuilding following the previous major earthquake, in September 2010."
"While still far too early to determine the extent of damage from this latest event, our reinsurance covers mean that the maximum financial impact on the group would be $40m," Wilkins said.