Insurance Australia Group's first-half earnings in New Zealand has more than tripled as an absence of earthquakes and natural disasters kept a lid on claims for the country's biggest general insurer.
Insurance profit rose to A$119 million ($129m) in the six months ended December 31 from A$36m a year earlier, the Sydney-based company said.
While gains in premiums helped, the insurer earnings were largely bolstered by a 15 per cent drop in claims expense to A$507m with just A$17m claimed from natural peril events against an allowance of A$43m.
The year-earlier period, which included the Kaikoura quake, reported natural peril claim costs of A$123m, exceeding the allowance of A$32m.
"Reported margin of 14.2 percent benefited from the absence of earthquake events, with some offset from prior period reserve strengthening," the insurer said.
IAG's New Zealand division increased gross written premiums 9.5 per cent to $1.3 billion as motor policies drove gains in its consumer division while commercial lines improved, continuing a trend since the 2016 Kaikoura quake.
The insurer's New Zealand business includes the AMI, State, NZI and Lumley Insurance brands, and contributed 21 per cent to group GWP of A$5.83b.
The group posted a 24 per cent gain in net profit to A$551m and the board declared an interim dividend of 14 Australian cents per share.
IAG said it had settled more than $6.5b of claims from the 2011 Canterbury earthquakes, accounting for 98 per cent of commercial claims and 97 per cent of residential claims with the balance either in construction or negotiation for cash settlement.
The insurer increased its gross reserved position on the three major Canterbury quakes, which is covered by reinsurance using about 10 per cent of $600m of adverse development cover in excess of $4.4b on the February 2011 event.
It still has more than $1b for the September 2010 quake, $540n for the February event, and just under $4b for the June 2011 quake.
The insurer expects it will take several years to finalise the outstanding claims which are subject to dispute and litigation.
The company's ASX-listed shares last traded at A$7.27 and have increased 0.4 per cent so far this year.