New Zealand businesses face a sharply worsening climate risk environment, with storm-related insurance claims rising 256% year-on-year, according to a recent analysis by Gallagher Insurance NZ.
The analysis draws on IAG’s Wild Weather Tracker (April 2026), covering the 12 months to the end of February 2026. It recorded 46 storms during that period, up from 29 the previous year, generating 33,174 storm-related claims across IAG brands compared with 9,324 the year before. One in every eight days recorded a damaging storm event, up from one in 19 days over the previous 15 years.
Three events drove much of the increase locally: the October 2025 South Island windstorm, the February 2026 lower North Island storm, and ex-Tropical Cyclone Tam in April 2026. Each affected thousands of businesses simultaneously, overwhelming suppliers, tradespeople, and loss adjusters.
The pattern extends beyond New Zealand. In Australia, extreme weather generated AU$4.8 billion in insured losses during 2025, a 727% increase on the previous year. Munich Re attributed 92% of global natural catastrophe losses in 2025 to weather-related events, with insured losses exceeding US$100 billion for the seventh consecutive year.
The claims surge has had a measurable effect on insurer finances. Auckland-based Tower Limited reported its profit fell to $22.9 million in the first half of the 2026 financial year, down from $49.7 million a year earlier, as weather-related event costs reached $18.5 million. Tower’s gross written premiums grew only 1% to $301 million.
Gallagher cautioned that even businesses with no recent claims history remain exposed.
“Insurance markets are responding to a global weather signal, not just individual loss performance,” according to the report.
A key finding was that insurers have shifted from sector-wide risk assessments to individual site-level evaluations. Two otherwise similar businesses, the report noted, can face significantly different premium terms based solely on location-specific flood, coastal, and weather data. The true cost of risk now extends beyond premiums alone to include higher deductibles, tighter sub-limits, and longer recovery periods.
The analysis argued that early action on climate risk carries benefits beyond insurance. Lenders increasingly factor physical climate risk into financing decisions, while government and corporate clients expect suppliers to demonstrate resilience as part of procurement processes. Investors also assess climate-related disclosures when evaluating long-term resilience.
Gallagher recommended that businesses begin with a clear assessment of exposure across physical locations, supply chains, long lead-time equipment, and single-source dependencies.
“Much of this exposure is not new,” the report highlighted. “Flood plains were flood plains decades ago. Coastal sites have always faced storm surge. Single-supplier dependencies have long been fragile. What has changed is frequency, severity, and visibility.”
