What is happening in the New Zealand insurance market?
What is happening in the New Zealand insurance market? | Insurance Business New Zealand
Insurance News
What is happening in the New Zealand insurance market?
Report analyses repercussions of market challenges
Insurance News
By
Roxanne Libatique
Marsh has unveiled its “New Zealand insurance market update 2023: Year in review,” providing an analysis aimed at those engaged with New Zealand’s insurance industry.
The report delves into the intricate dynamics of the market, examining the effects of economic and environmental factors on insurance coverage, insurer preferences, and the fluctuation of rates across 12 distinct classes of insurance.
A significant portion of the analysis focuses on the repercussions of natural disasters, the pressure from rising inflation, the state of reinsurance capacity, and the critical importance of robust risk management strategies for policyholders.
New Zealand property insurance market update
The assessment indicated that while the property insurance market in New Zealand continues to navigate through turbulent waters as of 2024, there are emerging indicators of potential market stabilisation and recovery as the year unfolds, assuming no major disruptions occur.
Notably, the financial impact of two severe weather incidents in the early part of 2023, with a combined insured loss of around $3.5 billion, underscored the vulnerability of the local insurance landscape to climatic events.
Despite these challenges, there is a silver lining as the broader insurance industry showed signs of resurgence, with improved profitability, an influx of new capital investments, and a broadening of underwriting capacity.
New Zealand liability insurance market update
The liability insurance segment, which includes coverage for directors and officers (D&O) and cyber risks, presented a somewhat brighter outlook.
The year 2023 saw a steadying of the market and a reduction in rates for entities that demonstrate effective risk management. Conversely, buyers of professional indemnity (PI) insurance encountered ongoing obstacles, particularly within specific sectors.
New Zealand construction insurance market update
The construction insurance market is bracing for continued upward pressure on rates through 2024, fuelled by persistent claims activity. Locations prone to natural disasters, notably Wellington, face heightened insurance challenges.
New Zealand group life and health insurance market update
In the realm of group life insurance, concerns over the sustainability of pricing models for long-term disability benefits are mounting, propelled by an increase in claims related to stress and mental health issues.
Furthermore, the sector of health insurance is wrestling with the implications of medical cost inflation on pricing strategies.
Related Stories
Keep up with the latest news and events
Join our mailing list, it’s free!
