Insurers pay $226m to support recovery from extreme weather

Insurers pay $226m to support recovery from extreme weather

Source: Insurance Council of NZ

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Insurers have spent more than $226 million this year helping customers recover from extreme weather, according to data from the Insurance Council of NZ (ICNZ).

The severe weather stats place 2018 as the second most expensive year for severe weather events since 1969, with 33,064 claims costing $226.4 million. 2018 fell just short of 2017’s record, a year in which severe weather events cost insurers $243 million.

The increasing frequency of severe weather events is an issue for everyone.

"To have two years in a row in the 3 most expensive years on record is an indicator of the increasing frequency and intensity of storms in New Zealand," said ICNZ Chief Executive, Tim Grafton. "This is in large part to the impacts of climate change."

"It’s critical New Zealand adapts to the changing climate," said Grafton. "It’s impacting on our communities and it’s impacting on our economy. A report from the Treasury says that climate change-induced droughts alone have cost New Zealand $720 million in economic losses in the 10 years to 2017. It states that the total economic impact of climate change, including flooding and severe weather, will be much greater."

"These impacts can only increase the longer we fail to adapt."

"According to preliminary research from NIWA, there are 125,600 buildings and $38 billion of replacement costs within 0-1m of sea level rise and there is near certainty that the sea will rise a further 0.2m to 0.3m in the next 20 years. With these sea level rises come increasing risks from storms and coastal inundation, as well as the increased risks of ever higher water tables and sunny day flooding."

Figures presented by UMR at the ICNZ conference showed 53% of people thought climate change was concerning or very concerning.

"It’s important that we take that concern and turn it into action," said Grafton. "The sooner we adapt to our changing climate, the less adaptation will cost us and the less we will be impacted by the increasing frequency and severity of storms."

Adaptation actions can include improving infrastructure such as stormwater systems, moving properties away from coastal areas and floodplains and not consenting new properties in these areas, and building new residential and commercial buildings to be more resilient to a changing climate. People looking to buy property should do their research and find out how likely the property is to suffer from flooding, high winds and other natural disasters.

ICNZ regularly works with both central and local government and other stakeholders on resilience and risk reduction issues.

Notes for editors:

- Attached are tables showing weather events this year and their total costs plus a breakdown by claim type.

- ICNZ captures claim numbers and costs for events classified by their members as severe weather events each year. All severe weather events for this year, as at the date of publication, have been included in the data for this media release.

ENDS

The figure listed with an asterisk (*) is provisional. Final data for this event is due in late December.

2018 WEATHER EVENTS

BREAKDOWN BY TYPE OF CLAIM, TOTAL FOR SEVERE WEATHER IN 2018

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