Download - Insurance Council of New Zealand

President’s Report
New Zealand Treasury
estimates the total cost
of the earthquakes at
around $30 billion
The past 18 months have been the most challenging
period in the history of the NZ insurance industry. We
have faced incredible operational challenges in the
most stressful of conditions and we have had to deal
with unprecedented financial losses, all the while in
an environment full of volatility and rapid change.
Meanwhile, we have been subject to intense media
scrutiny and have had to manage a raft of new and
existing stakeholders.
But the challenges have highlighted, like never
before, the essential value which insurance brings to
individuals, businesses, communities and the nation.
1
The year began with the continued response to the
September 4th earthquake, and just as we thought
we were getting on top of the recovery, we had the
devastating earthquake on February 22nd.
The February earthquake was the most destructive,
fatal and extensive insured event in the history of New
Zealand. The event ranks seventh in Aon Benfield’s list
of Top 10 insured loss events between 1980 and 2011.
Even more dramatically, the Christchurch earthquakes
of February and June rank in the top ten insured loss
events in the world for 2011. For a country as small as
New Zealand to suffer three earthquakes on this sort of
scale is unprecedented and has tested everyone within
the industry to the utmost.
As a result of the February 22nd earthquake, 185 people
lost their lives and many more were injured. Extensive
damage to land and buildings means thousands of
people have to replace their homes. New Zealand
Treasury estimates the total cost of the earthquakes at
around $30 billion, which is about 15% of GDP. To put
this estimate in context, the March 2011 earthquake
off the north-east coast of Japan, although larger in
physical terms, is estimated to have caused damage
equivalent to around 3 – 5% of Japan’s GDP.