Suncorp says first-half earnings will be affected after natural hazard costs exceeded expectations.

The insurer has an allowance of $1.77 billion for natural hazard events this financial year – $866 million for the first half and $904 million for the second.

It says the cost for the first half is expected to be $1.319 billion.

Nine events in the period cost more than $10 million each, with the southeast Queensland hailstorm in November topping the list at $350 million.

Hailstorms in east Australia were “particularly destructive, with more than 37,000 home, motor and commercial insurance claims being received”, CEO Steve Johnston says.

Suncorp says its main catastrophe cover remains in place for this financial year and the retention for a next large Australian event is reduced to $260 million, based on current estimates.

Investment bank Jefferies’ equities team says a “full-year overrun should still be considered likely”, despite Suncorp reiterating its hazard budget after the Victorian bushfires and ex-Cyclone Koji.

Jefferies forecasts $815 million of hazard claims in the second half – higher than the period average between 2023 and 2025. 

“With storm activity ongoing in early January, the adequacy of [Suncorp’s] natural hazard allowance is likely to be tested,” it said.

Suncorp will release its first-half results on February 18.