By Caroline Henshaw
SYDNEY--Suncorp Group Ltd. (SUN.AU) said Monday it has secured its property catastrophe reinsurance cover for fiscal 2013 with a "moderate increase" compared to the year before after a series of catastrophes pushed up premiums.
The Australian insurance and banking group said it has cut the upper limit on its catastrophe program, which covers motor vehicles and commercial property in the event of events such as earthquakes, storms and floods, to 5.3 billion Australian dollars (US$5.18 billion) from A$5.8 billion dollars.
As part of the deal, Suncorp has signed a 30% proportional quota share agreement for its "significant" exposure to Queensland state's property market, which was devastated by flooding during the 2012 financial year, the group said in a statement.
Suncorp declined to provide further details as they are subject to confidentiality agreements.
Trade publication Insurance Insider has previously reported that Berkshire Hathaway Inc. had agreed to write a 30% share of Suncorp's loss-hit Queensland homeowners' book ahead of the negotiations for its catastrophe cover.
"Suncorp has strengthened its balance sheet and capital position due, in part, to the reinsurance programs it had in place," said Group Chief Executive Patrick Snowball. "This year's program provides similar protection while also supporting the Group's strategic growth objectives," he added.
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