New Zealand's costliest natural disasters in the past decade

New Zealand's costliest natural disasters in the past decade | Insurance Business New Zealand

New Zealand's costliest natural disasters in the past decade

New Zealand’s location in the Pacific Ring of Fire makes it vulnerable to natural disasters. And with climate change in full swing, the risk of extreme weather events in the country, including storms, flooding, and drought, is magnified.

These are the main reasons why the Insurance Council of New Zealand | Te Kāhui Inihua o Aotearoa (ICNZ) and the country’s insurance providers have been collaborating with the central and local governments and various stakeholders to help raise public awareness of these natural hazards and build up the nation’s resilience in the face of calamities.

How does New Zealand’s insurance industry work?

On its website, the ICNZ emphasises the importance of reinsurance for the country’s insurance industry. The council explained that most of New Zealand’s insurers purchase their own insurance from large overseas (re)insurers, which helps them pay for large-scale disasters.

“Local insurers are working hard for New Zealanders to maintain the supply of affordable reinsurance from global providers, at a time when there has been a rise in dramatic and costly natural disasters around the world,” according to the council. “[After the 2010 and 2011 earthquakes,] Canterbury benefited from more than $22 billion in reinsurance money through private insurers alone – more than 15% of New Zealand’s GDP. Without strong investment in insurance, bearing this cost through other means would have been a massive burden on our small nation.”

The ICNZ added that all its members have emergency response procedures in place, allowing insurers to handle the large volume of claims that are expected after emergency events such as natural calamities.

New Zealand’s costliest natural disasters

Since 2010, natural calamities have cost New Zealand about $27 billion in insured losses, according to ICNZ’s data. These events include storms, flooding, earthquakes, tornadoes, fires, cyclones, and hailstorms. The following are the costliest disasters in terms of insured losses that New Zealand has experienced in the past decade.

1. Canterbury earthquakes
Date: 2010 to 2011
Insurance cost: $22.88 billion*
– accumulated (insurers only)

The 2010 Canterbury earthquake struck the South Island in the early morning hours of September 04, with a magnitude of 7.1. It caused widespread damage and several power outages, particularly in the city of Christchurch. Some damaging aftershocks followed, the strongest of which was a 6.3-magnitude earthquake that happened in Christchurch in February 2011, almost six months after the first.

According to the ICNZ, the Canterbury earthquakes were by far the most damaging and costliest natural disaster in the country.

Read more: Canterbury claims: what are the issues, and how are they being resolved?

2. Kaikōura earthquake
Date: 14 November 2016
Insurance cost: $2.27 billion

A magnitude 7.8 earthquake hit the South Island, 95 kilometres from Christchurch, shortly after midnight on November 14, 2016. It lasted about two minutes and was considered notable because of the complexity of the ruptures involved. The earthquake was followed by a tsunami, with a maximum run-up height of 6.9 metres above tide level, according to data from the Australian Institute for Disaster Resilience (AIDR). The height was approximately 5.3 metres at Oaro. A survey team from the AIDR located various marine flora and fauna as far as 250 metres inland of the high tide mark.

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

39,835

$732,063,462

Commercial

4,311

$1,519,021,898

Marine

134

$9,051,746

Motor

655

$1,861,110

Other

80

$7,764,113

Source: ICNZ

Read more: How the Kaikoura earthquake helped shape future insurance response

3. Timaru hailstorm
Date: November 20, 2019
Insurance cost: $170.98 million

On noon on November 20, 2019, golf-ball sized hail stones began hammering Timaru causing severe damage to buildings and vehicles. The hailstorm is considered New Zealand’s costliest weather-related event since 2000.

Cost breakdown

Claims type

Number of claims

Insured losses

House & contents

5,791

$59,630,067

Commercial

1,047

$23,183,874

Marine

15

$73,759

Motor

12,078

$86,196,105

Crops

10

$171,701

Other

99

$1,726,346

Total

19,040

$170,981,852

Source: ICNZ

Read more: Timaru hailstorm now NZ’s costliest weather event since 2000

4. Cyclone Debbie remnants
Date: April 03-07, 2017
Insurance cost: $91.46 million

After wreaking havoc in Australia, the tail-end of ex-Cyclone Debbie brought heavy rainfall in New Zealand’s North Island causing widespread flooding and forcing massive evacuations in the Bay of Plenty region. A state of emergency was declared in the township of Edgecumbe as river levels rose amid record rainfall. About 10,000 homes in Auckland were also left without power.

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

4,303

$69,877,114

Commercial

637

$15,933,501

Marine

22

$270,469

Motor

449

$4,287,813

Other

59

$1,098,565

TOTAL

5,470

$91,467,462

Source: ICNZ

Read more: Cyclones Debbie and Cook insured costs rise to $109 million

5. Napier flooding
Date: November 09-10, 2020
Insurance cost: $87.72 million

The North Island city of Napier was plunged into a state of emergency after record-breaking rain and massive flooding struck. Between the morning of November 09 and November 10, 2020, the city experienced 242.2 millimetres of rain – the highest since 1963 and second highest since records began in 1870. The downpour caused landslips and power outages and trapped many people in their vehicles.

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

2,994

$42,014,755

Commercial

745

$33,371,855

Motor

1,447

$12,214,302

Other

16

$123,493

Total

5,202

$87,724,405

Source: ICNZ

Read more: Napier floods – some families still homeless six months on

6. West Coast flooding
Date: 16-19 July 2021
Insurance cost: $85.41 million*

Severe flooding prompted authorities in the Marlborough region to declare a state of emergency on July 16. According to data gathered by Floodlist.com, some areas in the region recorded more than 300 millimetres of rain in 48 hours to July 18, including 212 millimetres in 24 hours on July 17 in Onamalutu and 103.5 millimetres on the previous day in Tunakino Valley. Local officials said this was the largest ever recorded flood in the region. Data also showed that as many as 900 people were evacuated from more than 500 properties across Marlborough, including in the areas of Renwick, Spring Creek, and Tuamarina.

Read more: ICNZ reveals insurance impact of July West Coast storm

7. Severe weather, including tornado
Date: April 10-11, 2018
Insurance cost: $74.4 million

On April 10, 2018, a low-pressure system crossed New Zealand, bringing severe gales to the North Island and upper South Island. The storm caused severe flooding and brought hurricane-forced winds of up to 140 kilometres per hour, knocking out power in several areas in Auckland. Two tornadoes – one at Rahotu in Taranaki and another at National Park – were also reported, according to data of the National Institute of Water and Atmospheric Research | Taihoro Nukurangi (NIWA).

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

12,503

$46,203,001

Commercial

2,263

$24,305,831

Marine

52

$512,819

Motor

755

$2,533,651

Other

151

$810,040

Total

15,724

$74,365,342

Source: ICNZ

Read more: Early-April storm costs insurers more than $72 million

8. Upper North Island flooding
Date: March 07-12, 2017
Insurance cost: $61.7 million

A storm system colloquially called the Tasman Tempest brought a wave of torrential rain that drenched areas around Auckland, Northland, and Waikato. NIWA’s data revealed that some areas recorded a month’s worth of rainfall in a 24-hour period from March 10-11, including Coromandel, which recorded 130 millimetres, Rotorua at 97 millimetres, and Auckland at 91 millimetres. From March 07-12, Whangamata also recorded 475 millimetres of rain, which was about the same amount it typically saw for the whole autumn.

Read more: Tasman Tempest tops $62 million

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

2,500

$27,207,665

Commercial

568

$13,227,671

Marine

44

$262,185

Motor

361

$3,169,164

Crops

6

$21,478

Other

11

$311,199

Total

3,490

$44,199,362

Source: ICNZ

9. Southland Storm
Date: September 17-23, 2010
Insurance cost: $49.3 million
Inflation adjusted cost: $54.5 million

From September 17-23, 2010, seven days of storms lashed New Zealand. According to NIWA, the storm was so massive that it covered an area roughly the size of Australia. Flooding and high winds caused damage to roads and power lines across the country while heavy snow in the South Island resulted in heavy losses of stock to farmers.

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

5,111

$8,456,571

Commercial

883

$39,724,911

Marine

29

$183,934

Motor

284

$814,010

Other

35

$138,682

Total

6,342

$49,318,108

Source: ICNZ

10. Marlborough-Nelson hailstorm
Date: December 26, 2020
Insurance cost: $50.18 million

Summer thunderstorms dumped heavy hail and torrential rain caused flash flooding in the upper South Island on the afternoon of December 26, 2020. According to a report by Stuff, emergency services responded to call outs for damaged buildings, while businesses reported flooding on social media after severe thunderstorms hit Abel Tasman National Park, Motueka, Tasman Bay, Riwaka and Kaiteriteri on Boxing Day.

Cost breakdown

Claim type

Number of claims

Insured losses

House & contents

472

$1,991,306

Commercial

162

$19,859,406

Marine

3

$1,650

Motor

82

$171,996

Crops

467

$27,837,962

Other

7

$322,656

Total

1,193

$50,184,976

Source: ICNZ

*Numbers marked with an asterisk are provisional, according to the ICNZ