Insurance firm Tower has posted an annual loss as it prepares for more expensive claims from the Canterbury spate of earthquakes, but raised its dividend payout.

The Auckland-based company reported an annual loss of $NZ7 million ($A6.34 million) in the 12 months ended September 30, compared to a profit of $NZ23.6 million a year earlier, it said, confirming guidance it gave last week.

It was largely due to a $NZ36.2m charge from increased provisioning on its remaining Canterbury earthquake claims, which exhausted the reinsurance cover the company took out in April.

Tower estimates the Canterbury quakes attracted gross claims totalling $NZ792m, of which $NZ206.8m was still outstanding at September 30. After reinsurance recoveries and other receivables, the insurer estimates net outstanding claims from the quakes to be $NZ46.2m.

Stripping out the impact of the quakes, underlying earnings climbed 30 per cent to $NZ28.2m, on a 6.4 per cent increase in revenue to $NZ322.4m.

The board declared a final dividend of 7.5 cents per share taking the annual payout to 16 cents, a 10 per cent increase from a year earlier.

"Despite the increased provisions for Canterbury claims cost, our underlying results were very good and reflect the potential of the general insurance business," chairman Michael Stiassny said.

"We hold considerable capital and will be continuing with our on-market buyback and current dividend policy."

The company will continue its $NZ34m share buyback, of which it's bought $NZ12m of stock.

Tower didn't provide guidance for the 2016 financial year.

The shares last traded at $NZ1.97 and have dropped 8.4 per cent this year.