Sharechat Logo

Canterbury reinsurance claims a third of the way through, RBNZ says

Wednesday 7th November 2012

Text too small?

Insurance claims for the spate of Canterbury earthquakes are about a third of the way through with $10.8 billion paid out, according to the Reserve Bank.

The Earthquake Commission has paid $3.8 billion in claims and other insurers have met $7 billion of claims, in what's estimated to be a bill in excess of $30 billion, the central bank said in its twice-yearly financial stability report.

"Many significant issues affecting insurance claims are yet to be resolved and uncertainty about the total insurance claim cost estimate remains high with an approximate $10 billion difference between the upper and lower bound estimates used by the Reserve Bank," the report said.

The swarm of quakes devastated New Zealand's second-biggest city and have led to increased premiums for customers around the country as insurers faced bigger reinsurance bills, and caused greater demands for building standards across the nation.

The Reserve Bank said new property insurance is becoming more available in Christchurch, with some insurers relaxing their underwriting constraints.

"Further improvements are anticipated in the absence of any major aftershocks," the bank said.

Berkshire Hathaway International Insurance has recently obtained an insurance licence and intends to provide earthquake cover for construction in Canterbury.

The bank is considering a policy position on reinsurance agreements that may have a financing element and whether that could breach solvency capital requirements for insurers. It expects to undertake public consultation soon, it said.

BusinessDesk.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: Blue-chip stocks Meridian, A2 lead market lower
NZ dollar rises on Brexit hopes, rate cut reassessment
Three not failing, just needs a new owner - MediaWorks CEO
Major investors back new CBL class action targeting directors
Rip Curl purchase a done deal on Kathmandu proxies alone
Comvita chair Neil Craig eyes the exit once he finds a new CEO
Mercury raises guidance on increased storage, high spot prices
Eroad reports strong 3Q sales growth, eyes ASX listing
MediaWorks puts TV business on the block
NZ dollar benefits as preliminary Brexit deal improves risk appetite

IRG See IRG research reports