new zealand

The New Zealand government statistical department has increased its estimate of the reinsurance recovery due to insurance companies in the country, raising it from NZ$694 million at the end of 2016 to NZ$814 million at the end of March 2017.

The insurance and reinsurance market loss from the 2010/11 Canterbury, New Zealand earthquakes continues to increase, with insurer Tower Group again reporting further loss creep yesterday and the industry total now estimated at $21 billion by the Insurance Council.

Insurance companies in New Zealand are set to reclaim NZ$694 million from the global reinsurance market for claims made in the wake of the 14th November magnitude 7.8 earthquake in Kaikoura, a total that is expected to rise further.

We’ve written before about the lengthening tail on the Canterbury New Zealand earthquake loss from 2010/11, as the event demonstrates that quakes are not always a short-tail catastrophe loss. Latest commentary from local insurers suggests this tail continues to lengthen.

Insurance industry losses from the 14th November magnitude 7.8 earthquake in Kaikoura, new Zealand are starting to be counted, with the Insurance Council of New Zealand revealing that over NZ$900 million of commercial claims have already been filed.

Australian insurer Suncorp Group has revealed a further deterioration in its 2010 and 2011 Canterbury, New Zealand earthquake losses, increasing provisions by NZ$112 million (just over US$80m) with the majority to be passed on to its reinsurance providers.

The recent magnitude 7.8 earthquake that struck the Kaikoura area of New Zealand could result in a cost to the economy of up to NZ$8 billion, with insurance and reinsurance potentially paying as much as NZ$5 billion (almost US$3.6 billion) of the loss, according to the country’s Reserve Bank.

New Zealand based primary insurance firm Vero, a subsidiary of the Suncorp Group, expects its “strong reinsurance arrangements” will cover “all expected claims” from the recent earthquake that struck the Kaikoura area.

The recent magnitude 7.8 New Zealand South Island earthquake could end up costing the insurance and reinsurance industry as much as US$3.5 billion, according to risk modelling firm AIR Worldwide.

Reinsurance capital looks set to pay for some of the damage caused by this weeks earthquakes in New Zealand, with local insurers having low deductibles and the EQC likely to call on its program as well, but questions of how many events have occurred could complicate matters, as could supply chain interruption.