New Zealand’s largest insurer, IAG, has stated that 20,000 homes across the country are at risk of severe flooding, with the company also now in talks with the government about where flood-damaged houses should be written off for good.
As part of an advisory panel, IAG is helping the government with legislation for managed retreat. Cyclone Gabrielle, thought to be New Zealand’s worst weather event so far, and its severe economic effects have continued to elicit response from insurers and the government alike, with many asking how to best weather another monumental catastrophe in the future.
Three different councils in the East Coast were approached, but none could say which areas should be vacated due to risks of flooding, a report found. Grant Robertson, minister of finance, said that decisions need to be made quickly on whether places should be rebuilt just the way they were or if they should be abandoned altogether before money and resources are ultimately wasted.
Amanda Whiting, IAG chief executive, said that the insurer had maps of areas at high risk of flooding, and that it was sharing this information with government officials in order to speed up the process.
"They vary and we've got to do a bit more mapping yet because we'll have to agree on the parameters that deem those high flood risk zones. But we do have a lot of that mapping available and we'll share that with government and other stakeholders,” Whiting said.
The IAG model showed that 1% of homes across the country, equivalent to around 20,000, are at risk of severe flooding, necessitating managed retreat for areas with certainty. Whiting said that homeowners who currently have no idea if their homes can withstand extreme weather events in the future should let their insurer know if they want to relocate.
"Talk to us. As we start to get a bit of a sense of those people who are wanting to retreat, that will help us with the government on a plan,” Whiting said.
Among those calling for a stoppage of the construction of homes in flood-prone areas is Tower Insurance CEO Blair Turnbull, with the executive citing the effects of Gabrielle and the Auckland floods as having caused a downturn for the company.
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