Suncorp expects streamlining to improve margin

SYDNEY: Suncorp-Metway says its general insurance business will see an underlying margin improvement of at least 3 per cent in the next two years.

Chief executive Patrick Snowball said five key projects aimed at streamlining Suncorp's insurance pricing and claims would drive the improvement.

"Our move to a functional model and a single view of pricing and claims will ensure the general insurance business leverages scale advantages across all of its brands and unlocks the potential in functional capability that has not been realised to date," he said yesterday.

Suncorp expects the project, which it calls the Building Blocks Programme, to deliver A$235 million ($289 million) in annual benefits from 2013.

It said the project's A$120 million cost would be absorbed by cuts to discretionary spending and redirection of capital expenditure.

The plans will see the personal insurance business of Suncorp, Australia's biggest general insurer, merge its portfolio of separate businesses into a single model.

"One pricing system and one pricing team gives us a consistent view across the portfolio and minimises conflicts between brands, which will help lift yield on new and renewal policies," personal insurance chief executive Mark Milliner said.

The company said the Vero New Zealand business was expecting to double its sustainable net profit by June 2013.

- AAP