NZ second riskiest for insurance

New Zealand has been named the second riskiest country in a major global insurance report by reinsurer Lloyds.

The report, A World at risk: Closing the insurance gap, ranks 43 countries on their expected loss from disaster by looking at the probability of a natural disaster happening and multiplying that by the cost.

New Zealand has an annual expected loss of 0.66 per cent of its gross domestic product, ranking it second behind Bangladesh on 0.83 per cent.

It is the second time the report has been carried out and New Zealand has jumped from third to second since the 2012 report, overtaking Chile.

Tim Grafton, chief executive of the Insurance Council of New Zealand, the industry body for home, contents and vehicle insurers, said the report showed how risky New Zealand really is.

“Since the last report in 2012, we’ve seen the cost of the Canterbury earthquakes continue to rise, a second major earthquake striking Kaiko¯ura and Wellington and a major flood in Edgecumbe.”

The report also ranks countries on how well insured they are by looking at insurance penetration by comparing premiums as a percentage of GDP. New Zealand ranks fourth out of 43 countries for insurance penetration, down from second place in the 2012 report.

Grafton said as a risky country it was important New Zealand remained wellinsured. “That means not only ensuring we insure our assets but making sure coverage of those assets is sufficient to replace them.”