Expensive winter for insurers

By Phil Boeyen, ShareChat Business News Editor

Thursday 16th August 2001

The Insurance Council says total claims for this year are likely to top $1 billion as the current winter shapes up to be one of the most costly on record.

The council says New Zealand insurers estimate they will pay out nearly $90 million as a result of damage directly caused by storms and frosts.

"Insurers have already made multi-million dollar payments as a result of the severe frosts that hit New Zealand last month," says council boss, Chris Ryan.

The council says companies are receiving claims from right across the South Island and the central part of the North Island where there has been a dramatic increase in the number of motor vehicle accidents.

It says fallen power lines have interrupted power supplies and are currently being repaired and as a result companies who rely on refrigeration to keep food fresh are also claiming losses.

"The farming community has also been particularly hard hit and there is continued extensive damage being caused as a result of water freezing in pipes both in private homes and commercial properties," says Mr Ryan.

Mr Ryan says there are also fears of spring flooding, which will be exacerbated when snow on the mountains starts flowing into the rivers and water systems.

"Traditionally late winter or spring is when the most significant floods occur in New Zealand. Last spring Insurance companies paid out over $50 million alone for one Queenstown flood."

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