Suncorp will stop insuring oil and gas projects and called for more government action on climate change as it reported a 32 per cent fall in full-year cash earnings.
Suncorp on Friday said its $749 million earnings were mostly affected by reduced profits in its insurance division from higher reinsurance costs and a low yield environment, and COVID-19 impacts on its banking and wealth division.
Insurers endured a torrid 2020 financial year of claims from drought, the summer bushfires, flood and heavy downpours along the nation’s east coast.
Its prompted Suncorp to toughen its approach to fossil fuels.
In documents published with its report, the company said it will stop underwriting, financing or directly investing in new and oil gas projects by 2025.
Fossil fuel extraction activities accounted for less than 0.1 per cent of the company’s general insurance gross written premium on June 30.
Many believe fossil fuel extraction activities have contributed to an increase in severe weather, such as drought and bushfires.
Natural hazards cost Suncorp $820 million in the 2020 financial year.
Chief executive Steve Johnston said he hoped the nation did not lose sight of the changing climate’s significant risks amid the coronavirus pandemic.
“This can no longer remain in the too-hard basket,” he said.
Governments needed to invest in infrastructure, improved building standards and remove inefficient taxes and charges, he said.
“This will not only reduce the impact of natural disasters on our communities; it will provide much-needed economic stimulus at a time when it is desperately needed, particularly in regional communities.”
Suncorp will pay a final dividened of 10 cents per share, fully franked. This is lower from the 2019 final dividend of 44 cents, fully franked.