Insurance claims from Cyclone Gabrielle and Auckland flooding hit $890 million

Thursday, 23 March 2023

Cyclone Recovery Minister Grant Robertson speaks to media in Hawke's Bay about the latest developments in the cyclone recovery plan.

The insurance bill for Cyclone Gabrielle and Auckland flooding has hit $890 million, the Insurance Council of New Zealand Te Kāhui Inihua o Aotearoa says.

More than half of the bill is for damage to homes and property in Hawke’s Bay.

Over 40,000 claims have been recorded to date, according to ICNZ, which is the industry association for insurers including Tower, IAG (State, NZI and AMI) and Suncorp (Vero and AA Insurance).

“Aotearoa New Zealand’s insurers have so far paid out over $180m in claims across the Auckland Anniversary Weekend and Cyclone Gabrielle climate events,” said ICNZ chief executive Tim Grafton.

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Riley, John and Katrina Harris and Maureen Dorr run a dog kennel and day care in Eskdale which was devastated in the cyclone. Business claims to insurers have passed $350 million.

The majority of claims were for damage to homes, and their contents.

There had been 27,800 claims on house and contents insurance policies with an initial estimated claims value of $453m, ICNZ said.

Businesses were also hit hard by the two extreme weather events in late January and mid-February.

“The impact of this event on business is also clear with an initial claims value of over $350m being recorded for related insurance,” Grafton said.

So far more than 5000 vehicle insurance claims had been logged by insurers. The combined insurance value of those vehicles was more than $73m.

Cyclone recovery minister Grant Robertson says that the Government is working with insurance companies to determine high-risk areas and what that means for rebuilding.

Over 13,000 of the claims following Cyclone Gabrielle were in Hawke’s Bay.

“While this is around a third of all claims, such is the extent of the damage there, the region accounts for more than half of the total value of claims to date for the cyclone at over $481m,” Grafton said.

“Insurers are doing all that they can to get assessments completed and to agree next steps with customers. In the meantime, insurers have been working hard to activate temporary accommodation benefits for homeowners and renters alike,” Grafton said.

Not all homes and lost commercial buildings are likely to be rebuilt.

The Government will in the coming month decide which areas devastated by Cyclone Gabrielle will be deemed “high-risk” and possibly not rebuilt on, Grant Robertson says.

The cyclone recovery minister visited Omahu Marae in Hawke’s Bay on Wednesday, more than a month after Cyclone Gabrielle swept across the region, causing extensive flooding damage.

In a statement, Robertson said the Government’s cyclone recovery taskforce was working with insurance companies to determine the “high-risk areas” and “what this means for re-building” in the coming week.

“We are making good progress, with the insurance sector agreeing to provide the taskforce with a consolidated view of the areas they have identified as high-risk within the next week. This will then be overlaid with the risk assessments that local councils are carrying out,” Robertson said.

With insurance payouts having started, and some repair work commencing, the Bank of New Zealand (BNZ) is warning flood and cyclone victims to be on the watch for crooks trying to scam them.

Ashley Kai Fong, BNZ’s head of financial crime, said: “Scammers often prey on people in vulnerable situations, and we want to ensure that New Zealanders are prepared and protected.

“Invoice scams are a good example. This is where scammers compromise email accounts of legitimate businesses and modify customer bills, replacing the actual bank account number with their own.

”Always thoroughly check the authenticity of any invoice or bill you receive and contact the sender directly if you have any doubts. Additionally, confirm with a supplier that the bank account number on an invoice is correct before making a payment.”

Kai Fong said bogus trade services were another scamming method.

“Scammers pose as tradies offering to repair homes, properties, or utility services at cheap rates or promise to do the repairs immediately. They’ll often ask for an upfront payment, and will then either do a poor job, damage your property, or take-off before completing the work,” Kai Fong said.

“Always request written quotes and references from tradespeople you hire, and avoid paying cash or disclosing personal information.”