Premiums Under Pressure: How climate change is reshaping residential property insurance and what to do about it
- Author
- Mercier K
- Year
- 2024
- Journal / Source
- Helen Clark Foundation and WSP report
- Publisher / Organisation
- Helen Clark Foundation
- Pages
- 164 pp
- Keywords
- Enter details to download.
- Summary
- Without intervention the country can expect steep rises in premiums and insurance retreat from some properties, leaving homes unprotected. Residential insurance premiums in Aotearoa New Zealand have faced steep increases over the past few years. Premiums are expected to rise further in the coming years as more insurers move to adopt ‘risk-based pricing’ for flood hazards and as the impacts of climate change increase, pushing up costs for insurance companies and their international underwriters. Without effective policy measures, these pressures are expected to result in unaffordable premiums for some properties, leading households to reduce, or cancel, their insurance cover. Recent estimates suggest that on current trajectories some 10,000 coastal properties in Auckland, Wellington, Christchurch, and Dunedin could become uninsurable by 2050 as a result of coastal flooding (Storey et al., 2024).