Global reinsurers back New Zealand with record $12.3 billion programme
The Natural Hazards Commission Toka Tū Ake (NHC) has secured a record $12.3 billion reinsurance protection for the year ahead, providing substantial financial protection for New Zealand homeowners in the event of a major natural hazard disaster.
The total reinsurance programme has grown by $2.1 billion from last year – a 20 percent increase. The record level of cover reflects the strong confidence international reinsurers have in New Zealand's natural hazards insurance scheme. NHC Toka Tū Ake was also able to secure the overall programme on a more cost-effective basis than last year.
"NHC Chief Executive Tina Mitchell says the result is good news for New Zealand homeowners.
Securing increased reinsurance cover means New Zealand is better placed to respond financially when a major natural hazard event occurs," says Tina."It provides confidence that funding will be available to help pay claims and support recovery, while helping protect the Crown's balance sheet."
Reinsurance is effectively insurance for insurers. NHC Toka Tū Ake purchases cover from international reinsurers using a portion of the levies paid by insured homeowners into the Natural Hazard Fund. Following a major natural hazard event, reinsurance provides funding to help settle claims.
“International reinsurers have choices about where they put their capital at risk. Their willingness to increase their support for NHC reflects the strength of our scheme, the quality of our natural hazard science and modelling, our ongoing investment in resilience and the transparency of our long-standing engagement with reinsurers,” explains Tina.
“This continued support from global reinsurers is an important part of the financial protection available for New Zealanders.”
“This programme provides peace of mind that New Zealand will have access to the funding needed to recover from major natural hazard events and support affected communities when they need it most,” she says.