As New Zealanders are expecting more extreme weather events as a result of climate change, they want more to be done to reduce the risks and costs of these events to help keep insurance affordable and available.
According to the latest climate change poll, 90% of New Zealanders anticipate more extreme storms, 89% foresee more frequent and intense flooding and 88% expect coastal flooding due to rising sea levels.
“Recent and regular weather events are still fresh in people’s minds and continue to have a profound effect on the country, highlighting for many the very real impact that our changing climate is having on our communities,” said CEO of AMI, State and NZI Amanda Whiting.
As New Zealanders brace for a future shaped by more frequent and severe climate events, many expect the cost of these events to be reflected in insurance premiums. It was found that they only want to pay for the risks they themselves face:
- 60% agreed that insurers should raise premiums for those that face more risk
- 45% said that people only paying for the risk they face was the fairest way to set premiums, with 10% saying that everyone paying the same regardless of the risk they face is fairest
- 71% said they accepted that they will have to pay more for insurance if they live in a high-risk location, but only 17% said they were willing to subsidise the insurance of people who lived in high-risk locations
- 60% of people agreed that insurers should focus on incentivising risk reduction by making it more difficult or more costly to insure in high-risk areas
It was also found that:
- 74% of people agreed that insurers should focus on keeping as many homes insured as possible amidst growing climate hazards
- 87% of people agreed that house and contents insurance is important
“Continuing to meet people’s expectations of fair pricing while keeping our most exposed communities insured will become ever more difficult to achieve without urgent and significant risk reduction,” said Ms Whiting.
“We are fast approaching a crossroads and need to make an important decision about which path we take.”
She also said, “We can commit to reducing risk and investing in resilience and adaptation to help keep insurance available and affordable for as many people as possible. Or we can keep doing what we are doing and risk rising costs, reduced coverage and the possibility that some homes may become too risky or expensive to insure.”
New Zealanders want to see more action to reduce the risk of climate change hazards, as well:
- 80% said more should be done to modify the environment to fit in with the impacts of climate hazards
- 77% said more should be done to avoid or reduce development in high-risk locations
- 77% said more should be done to make buildings and infrastructure more resilient to the impacts of climate hazards
“The need for action is clear. New Zealanders want to see smarter decisions about where and how we build and more investment in infrastructure and natural solutions to protect our homes, businesses and communities,” said Ms Whiting.
“Ultimately, if we want to keep people protected, we need to address the underlying risks. That means acting decisively, together, and with urgency. Reducing risk is the fairest and most durable way to ensure we can continue to insure as many New Zealanders as possible.”