Natural catastrophe insurance data provider PERILS has disclosed its initial estimate for the industry’s losses in the North Island floods. From the period of Jan. 27 to Feb. 2, PERILS estimated that the market lost NZ$1.65 billion, with the supporting data collected from most of the sector including the property insurance market.
PERILS Asia-Pacific head Darryl Pidcock said that the floods are unprecedented, as they marked the largest weather-related insurance industry loss for Aotearoa. It is also the third-largest catastrophe event for the insurance sector, behind the Canterbury earthquakes of 2010/11 and the Kaikoura earthquake of 2016.
“In addition, Cyclone Gabrielle passed through the North Island region only 10 days after the North Island Floods, causing considerable damage and leaving many people homeless,” Pidcock said in a press release. “For two such extreme weather events to occur within such a short period is unprecedented in New Zealand’s recent history and will test the industry’s existing understanding of these perils.”
The North Island flood event was so devastating that a separate GlobalData study found that it caused enough damage to cut into the profits of property insurers across New Zealand.
Extreme rainfall overwhelmed the greater Auckland Region and surrounding areas on the North Island from Jan. 27 to Feb. 2. Further fuelling the event was the very warm and humid weather throughout the summer, which culminated in record-breaking rainstorms during the same period.
As a result, the affected regions were flooded by a combination of heavy rains and overflowing rivers and sewage, which then damaged a large number of insured properties. The North Island flooding left four people dead in its wake, and several thousand others needed to be evacuated following a rare red-alert state of emergency declaration.
On May 2, PERILS will release an updated estimate of the market loss from the North Island floods to better reflect the damages caused by the extreme weather event.
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