ICNZ urges swift climate action as risks and costs increase

ICNZ urges swift climate action as risks and costs increase | Insurance Business New Zealand

Environmental

ICNZ urges swift climate action as risks and costs increase

Industry welcomes report’s recommendations

Environmental

By
Roxanne Libatique

The Insurance Council of New Zealand Te Kāhui Inihua o Aotearoa (ICNZ) is urging faster action to address climate change adaptation following the release of a new report from the Climate Change Commission.

The commission’s first assessment of New Zealand’s progress in adapting to climate risks has found that the current efforts are inadequate and falling behind the escalating threats posed by climate change.

“We support the commission’s findings that urgent action is needed to address the impacts of climate change,” he said.

He said that New Zealand’s susceptibility to natural disasters makes it vital to adapt now to help protect communities, businesses, and the economy from future impacts.

The report emphasised the need for a shift toward more proactive management of climate risks, including more robust planning for extreme weather events, which have increased in frequency.

For example, the Auckland Anniversary floods and Cyclone Gabrielle have led to insurance claims nearing$4 billion, with total infrastructure damage potentially reaching$14.5 billion, according to government estimates.

How to improve New Zealand’s climate adaptation measures

To address these challenges, the report highlighted several key recommendations, including:

the need for a clear framework to guide local governments on climate adaptation
more effective community planning
a clearer understanding of how adaptation costs will be shared

Faafoi expressed support for these recommendations, emphasising that collaboration between government, councils, iwi, businesses, and communities will be crucial to managing climate risks and keeping insurance affordable for New Zealanders.

“We back the commission’s call that there are things we can do together as a country to provide long-term clarity and certainty around our response to climate change,” he said.

He also stressed the importance of clarity on how the financial burden of climate adaptation will be distributed across sectors.

“Further clarity about how the costs of local adaptation will be shared and the involvement of new targeted funding and financing instruments will be crucial,” Faafoi said.

The Climate Change Commission report also suggested that taking action to mitigate climate risks now will help reduce the long-term economic costs of future disasters.

Research has shown that every dollar invested in climate adaptation can significantly reduce future costs, providing economic benefits by protecting infrastructure and livelihoods.

New Zealand government called to lead climate adaptation measures

ICNZ said it supports the commission’s call for the government to take the lead in facilitating access to information and resources for local adaptation planning.

“We support the government taking the lead on exploring ways to facilitate access, availability, and sharing of expertise and information to support local adaptation planning and action,” Faafoi said.

The progress report is part of a series of biennial assessments required by the Climate Change Response Act.