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Suncorp share price: important market update in focus

The insurance giant Suncorp (ASX: SUN) has today provided the market with an update focused on the impact of Australia's unfolding bushfire crisis.

Suncorp (ASX: SUN) Source: Bloomberg

The Suncorp (ASX: SUN) share price rose a little over 1% today after providing the market with an update primarily concerning Australia’s current bushfire situation.

Speaking to the severity of the unfolding bushfire crisis, the insurance giant’s CEO – Steve Johnston – commented that:

'Having visited some of the communities affected by these fires, it is difficult to describe the extent and indiscriminate nature of the damage that has been caused and how deeply traumatic and dangerous they have been for families, communities and emergency services personnel.’

All up, Suncorp has received more than 2,600 insurance claims related to the devastating bushfire crisis.

'We fully recognise that these bushfires are particularly significant in terms of their duration; the geographic breadth of the fire zones; the sheer destruction of property; and the associated impacts on people's lives, as well as local communities and economies,’ Mr Johnston further said.

Building on an outpouring of support from citizens and corporate Australia, Suncorp reported that it has increased its donations to bushfire relief efforts to $500,000.

Not only that, but 'Suncorp also continues to double match employee donations with over $90,000 contributed to bushfire relief agencies to date.’

Speaking to the scope of the current bushfire situation, the insurer noted that not only have natural hazard costs increased significantly in the last month alone; but the insurer was also increasing its FY20 reinsurance protection to combat potentially worsening conditions.

Specifically, it was pointed out that SUN’s total natural hazard costs for the previous six-month period were $519 million – some $109 million above the Group's 1H20 natural hazard allowance.

Looking over a shorter time-frame, the insurance giant reported that 'claims incurred in the 1-5 January period are estimated to be $75—$105 million.’

As a consequence of all this, Suncorp today noted that it has increased its reinsurance protection for FY20 – commenting that the bushfire threat remains 'ongoing'.

Suncorp (ASX: SUN) is expected to report its FY20 first-half results on February 11.

Australian Prime Minster Scott Morrison has been heavily criticised by a number of media outlets, commentators and Australian citizens for his handling of the bushfire crisis thus far.

Ultimately, the current bushfire situation has drawn global media attention and caused many to worry that without satisfactory action against climate change – extreme natural events, like Australia's still-unfolding bushfire catastrophe, will only intensify in severity over the coming years.

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