The number of New Zealanders with insurance has increased due to changing attitudes to risk, according to early data from the Financial Services Council (FSC). The uptick is said to be brought about by the instability of the past few years, including the global economic downturn and COVID-19.
Income protection insurance ranks first in the list of increased insurance levels since 2022, up 9% from the previous year with 20% of respondents reporting that they have this product. This is followed by:
In a news release, FSC chief executive officer Richard Klipin said that the rise in Kiwis protecting themselves reflects the world experiencing several “black swan” events, from the pandemic and to the recession that followed it.
“If there’s a silver lining to the past few years, it’s that these events are starting more conversations in households and encouraging New Zealanders to take steps to manage their financial wellbeing,” Klipin said.
Klipin also stressed the importance of this rising insurance trend, as the life and health insurance sector of New Zealand retained high payouts across 2022. He said that $1.06 billion was paid out in claims for the life sector, while the health sector doled out $1.41 billion in claims to New Zealanders in need.
Klipin also called the pandemic, cost-of-living crisis, and cyclones the “rainy days that prompts us to think about how we protect ourselves when things go wrong.”
“The upside is that now more of us are thinking and having conversations about how we manage risk, which is vital in this time of economic uncertainty,” he said.
Early data from the 2023 Financial Resilience Index from the FSC also show that over three-quarters of Kiwis have started to reconsider how they protect themselves and their families in the wake of the Auckland floods and Gabrielle. Although these results can be good news for New Zealanders and the financial sector as a whole, Klipin said that there’s still work left to be done.
“While the Financial Resilience Index’s early finds are encouraging, we still have a long way to go. Our work as an industry doesn’t stop until we’ve significantly lifted the financial confidence and wellbeing of all New Zealanders,” he said.
The FSC is also bringing back its flagship conference for 2023, with the event including members from the financial sector as various panels, keynotes, and exhibition spaces delve into key issues facing New Zealand ahead of the 2023 election.
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