Whirinaki flood protection delays raise insurance worries for homeowners

Initiative was designed to reduce risks for residents impacted by Cyclone Gabrielle

Whirinaki flood protection delays raise insurance worries for homeowners

Catastrophe & Flood

By Roxanne Libatique

A flood protection project in Whirinaki, Hawke’s Bay, designed to reduce risks for residents impacted by Cyclone Gabrielle, is facing setbacks due to funding constraints.

The initiative, which includes stopbank improvements and upgrades to State Highway 2, was initially expected to be covered by Transport Rebuild East Coast (TREC). However, the estimated cost has now increased to $26.94 million, leading the Hawke’s Bay Regional Council (HBRC) to seek additional government funding.

According to Local Democracy Reporting (LDR), the delays have left homeowners in limbo, particularly those whose properties remain classified as Category 2C, a provisional risk category preventing them from returning to Category 1, which indicates low flood risk.

Hawke’s Bay homeowners in limbo

Whirinaki resident Lyn Noanoa voiced concerns about the prolonged wait, saying residents cannot move forward with their lives.

“We just want the Regional Council to forge ahead and get their work done,” she told LDR. “We can’t move into Category 1 until they have completed the work.”

When the project was announced in late 2023, the council estimated homes could be reclassified within a year. However, an April 2024 report from the National Institute of Water and Atmospheric Research (NIWA) found that extreme weather events in the region are becoming more frequent and severe, requiring adjustments to the original flood mitigation plans.

The updated scope includes raising the Pohutukawa Drive stopbank to a 1-in-500-year flood protection level and reinforcing the Pan Pac stopbank, which protects one of the area’s largest employers. The council considered alternative measures, such as floodgates or lower stopbank protection, but determined they either carried higher risk or provided little cost savings.

Insurance concerns due to delays

For homeowners, the uncertainty extends beyond flood protection. Noanoa noted that being in a provisional flood risk category affects insurance coverage, mortgages, and property values.

“Being in Category 2a affects everything for the community: mortgages, insurance, [and] house prices. My insurance company has rang me asking if the stop bank is in,” she said. “But no, it’s not. We have watched the silt being moved from one pile to another. Why can’t they just use it and put whatever they need in it and build the stopbank?”

HBRC has stated that if additional funding is not secured, the project’s scope and affordability will need to be reassessed, potentially causing further delays.

Cyclone Gabrielle’s insurance losses 

According to PERILS, the total industry loss from Cyclone Gabrielle has been confirmed at $2.174 billion, up from the previous estimate of $2.018 billion published in August 2023. The final figure reflects claims across both residential and commercial properties, with home insurance claims making up 51% of the total and business-related losses accounting for 49%.

The report drew on data from insurers across New Zealand, detailing the geographical distribution of claims and categorizing losses into structural damage, contents damage, and business interruption. The assessment also considered peak wind speeds and rainfall accumulation during the cyclone.

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