Message from the CEO and Managing Director FY25

Dear Shareholders,

One of the great privileges I am afforded in my role is getting out of the office and meeting our customers as we go about managing their insurance claims. In these visits I am continually reminded of the important role we play at a traumatic time in their lives and how our actions have such a big impact on their futures. When we get it right - as we do in the vast majority of cases - we go a long way to putting lives back together. If we get it wrong, we can compound the problems. One of the key benefits of our simpler, more focussed business is that every dollar can be spent on improving the quality of the insurance products and services we provide to our customers in Australia and New Zealand.

While the absolute cost of natural hazard events in FY25 was below our allowance, the number of weather-related claims remained high at more than 120,000. This is consistent with recent years and underscores the importance of having accessible and affordable insurance. These topics remain core pillars of our advocacy agenda and feature regularly in our discussions with all levels of government. Unfortunately, across Australia and New Zealand too many people have built homes where they should never have been allowed to build. At the same time, as a society we haven't invested enough in resilience and mitigation projects that reduce risk. It is pleasing to see our advocacy on these topics gaining traction with increased investment and greater awareness of the impact of our built environment on the cost of insurance. 

Suncorp is also working to expand our advocacy to build awareness about issues inside the home which, if left unaddressed, have the potential to impact home insurance premiums in future years, not to mention the risk to human life. These include the use of sub-standard building materials such as flexible piping and heightened levels of fire risk that come with the growing use of lithium-ion batteries, both of which have contributed to our claims costs this year.

Our prevention and protection initiatives, investment in leading disaster management capability, and efforts to create more efficient processes and improved customer experiences are important ways Suncorp continues to address the affordability challenges. We recognise the cost pressures businesses and households across Australia and New Zealand have continued to experience, including the impact of higher insurance premiums. Encouragingly, the increases in customer premiums continue to moderate as supply chain inflation eases and reinsurance markets stabilise.

Suncorp’s net profit after tax of $1,823 million result benefited from the one-off profits on the sale of Suncorp Bank and New Zealand Life, while cash earnings of $1,486 million benefited from higher net investment income of $766 million, and natural hazard claims costs of $1,355 million, which were $205 million below our $1,560 million allowance for FY25.

Our Australian and New Zealand businesses performed strongly with top line growth experienced across all portfolios. Gross written premium increased by 6.3% over the year, reflecting both the strength of our suite of brands and the quality of our products. Our underlying insurance trading ratio of 11.9% was at the top end of our target range.

Suncorp Group’s Net Promoter Score (NPS) across our Australian consumer business increased to +9.1, up from +7.4 in FY24, reflecting the targeted programs of work underway to uplift every part of the customer experience. Suncorp paid $9.8 billion in claims during FY25, up from $9.7 billion in FY24, and over this time our claims NPS increased by 8.7 points to +57.1.

I'm pleased to report that at 30 June, Suncorp successfully placed its FY26 reinsurance program, with improved reinsurance outcomes and reduced costs as reinsurance markets continue to stabilise. 

Our disciplined approach to capital management and robust capital position has enabled us to announce an on-market share buy-back of up to $400 million, commencing in September 2025, and continuing through to the end of FY26.

Suncorp continued to focus our efforts on supporting our customers and communities in their time of need, as well as improving the way we deliver our products and services and uplifting the experiences our customers have with Suncorp through our suite of valued brands and broker networks across Australia and New Zealand.

While we have finalised more than 70% of the claims received following 17 declared natural hazard events across Australia and New Zealand this year, our full attention remains on getting every customer back into their home as soon as possible. We continue working hand in glove with our repair network and focused on providing customers dealing with more complex circumstances the highest levels of support and care as we work through their claims.

Our leadership and investment in disaster management, as outlined throughout this report, is more critical than ever as our communities across Australia and New Zealand continue to face into the impacts of climate change. You can read more about our prevention and protection programs, including initiatives funded through our more than $11 million investment in the community this year on pages 19 to 23 of the Annual Report.

Our ongoing work to update our core data, pricing and claims systems and improve our digital offering through automation and Artificial Intelligence (AI) deployment has continued to make it easier for our customers to access our products and services in the way that they want. This year saw the proportion of our customers who purchase our home, motor and CTP products digitally grow to 78% (up from 54% in FY21), with 59% now accessing our services digitally, up from 38% five years ago. 70% of our customers impacted by ex-Tropical Cyclone Alfred lodged their claim digitally.

Suncorp’s people continued to live our purpose, rallying behind our customers impacted by severe weather. More than 400 of our people upskilled and volunteered to assist our Customer Support Teams in answering customer calls as ex-Tropical Cyclone Alfred unfolded.

This year, our teams delivered an important milestone in our platform modernisation agenda, with the first release of our new policy administration system, commencing in our AAI New Zealand business. This more digitised and streamlined system has reduced complexity for our people, enabling them to assist our customers with greater speed and efficiency. We look forward to deploying the upgraded system across our AAMI teams in the coming year as we continue the rollout.

To support the ongoing digitisation and scaled adoption of AI at Suncorp, we continued to invest in growing the AI fluency of our teams through dedicated training programs, as well as our bespoke Reskill program that helps our people develop meaningful skills that will prepare them for the changing world of work. Providing our people access to wellbeing support through partnerships and training also remained a priority and our health and wellbeing measure continues to sit above the financial services benchmark. 

We take pride at Suncorp in providing our employees with a workplace that fosters growth, encourages the opportunity to make a difference, and cultivates a high-performance culture. This is reflected in our strong employee engagement scores, with a score of 8.5 out of 10 in FY25, which remains in the top quartile of our peer group. This year Suncorp modernised its Enterprise Agreement (EA), with 93% of employees voting for the new EA, which included the introduction of improved leave and remuneration entitlements.

Suncorp’s strategic focus as a pure-play general insurer is centred on accelerating the pace at which we modernise, innovate and create greater value for our customers through seamless digital experiences and more personalised products. 

This will be underpinned by investments in our business and our respected brands, as well as the capability of our people, to continue to grow our consumer, commercial, personal injury and New Zealand portfolios. Investment will focus on modernising our platforms, and the deployment of AI to support the transformation of our operations.

Importantly, we are able to make these investments without compromising margins or sustainable shareholder returns, reflecting the strong platform we have created over the past five years as we have simplified and become a resilient, more focused business with significantly improved data and digital capabilities.

Building greater efficiency and effectiveness in the way we do things will at the same time help us address the complex challenge of insurance affordability and accessibility and support a fit-for purpose, sustainable insurance industry for the generations ahead.

I thank all of our team members for their dedication and support of our customers, communities and business not only this year but for their tireless efforts over the past five years to help us deliver on our commitments and build the strong foundations we have today.

I also take this opportunity to thank our Chairman, Christine McLoughlin AM, for her leadership and significant contribution to Suncorp over the past decade. I wish Christine well as she retires from Suncorp’s Board next month, and congratulate Duncan West on his appointment as Chair-Elect of the Board. 

Finally, I extend my appreciation to all of our shareholders for your ongoing confidence in Suncorp and our strategic direction as we pave a new path as a pure-play general insurer.

Suncorp CEO and Managing Director, Steve Johnston