Insurance sector hit with storm of damage claims: ASX tracking 0.2% higher

Market Reports

by Michael Luu

The ASX has made a quick u-turn from a weak start this morning to bounce back up. As at Midday, the ASX200 is tracking 0.2 per cent higher or 15 points up at 6723. The SPI is suggesting a rise of 28 points

The insurance sector is challenged to weather the storm, as more than 5000 claims have been lodged in the midst of heavy rain and flooding across NSW alone. This has prompted the Insurance Council of Australia (ICA) to declare an insurance catastrophe, as shares in QBE Insurance (ASX:QBE), Suncorp (ASX:SUN) and IAG (ASX:IAG) are drenched in red. Shares in ANZ (ASX:ANZ) are up after the company settled a rate-rigging dispute without admission of liability. Meanwhile, Crown Resorts’ (ASX:CWN) shares have skyrocketed following their announcement of a takeover bid from American investment manager Blackstone.

Company news

Multinational insurance provider IAG (ASX:IAG) had received over 2100 claims as at 8pm last night regarding property damage since the series of torrential rains across NSW and Queensland started this year.

Over 18,000 people have been evacuated from affected areas in NSW, while authorities received 8,000 calls for help in Sydney during this year’s rainy season. IAG has mustered up extra manpower to monitor the situation and accelerate processing for these claims to ensure quick customer support.

Shares in Insurance Australia Group (ASX:IAG) are trading 2.5 per cent lower at $4.74

Best and worst performers

The best-performing sector is Healthcare, adding 1.6 per cent, while the worst performing sector is Materials, shedding 1.1 per cent.

The best performing stock in the S&P/ASX 200 is Crown Resorts (ASX:CWN), rising 17.8 per cent to $11.62, followed by shares in Graincorp (ASX:GNC) and IDP Education (ASX:IEL).

The worst performing stock in the S&P/ASX 200 is Champion Iron (ASX:CIA), dropping 8.5 per cent to $5.16, followed by shares in Nickel Mines (ASX:NIC) and Fortescue Metals Group (ASX:FMG).

Commodities and the dollar

Gold is trading at US$1,735 an ounce.
Iron ore price dipped 3.1 per cent to US$161.39.
Iron ore futures are pointing to a fall of 4.2 per cent.
One Australian dollar is buying 77.11 US cents.

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