News: Floods to cost insurers $2.5 billion

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Suncorp Group (ASX:SUN) chief executive Patrick Snowball says the recent floods and cyclone will cost the insurance sector $2.5 billion in claims.

More than half of small businesses do not have business interruption insurance, according to the insurer.

Mr Snowball warned the government not to rush into industry reform.

Insurance companies have been widely criticised for their strict definition of “flooding”.

Assistant Treasurer Bill Shorten will meet insurance companies today to devise a common definition of what flooding entails.

Mr Snowball said he believes the priority should be assessing and paying claims instead of discussing definitions.

For the year ended 30 June 2010, Suncorp reported a net profit of $789 million.