Insurers look likely to foot 80 percent
of the $20 billion price tag put on the Christchurch
earthquakes, according to industry research.
Global reinsurer Swiss Re says the New Zealand
insurance industry will cover about 80 percent of the overall cost of the
February 22 quake and 81 percent of the earlier September quake, according to
its internal database.
That's significantly higher than similar
coverage for seismic events, and shows New Zealand has one of the highest
rates of earthquake insurance penetration.
"The insurance industry is playing a
key role in post-disaster financing of the countries affected," said Lucia
Bevere, Swiss Re senior catastrophe data analyst.
"The low frequency of major
earthquakes tends to create the perception that earthquake risk is low, even in
places where there have been very deadly and damaging occurrence."
Government officials have forecast the
quakes caused more than $20 billion of damage to property in the region, though
that predates the recent swarm of temblors since Christmas.
The Swiss Re research shows the insurance
sector will only cover up to 17 percent of Japan's March earthquake last year,
and just 1 per cent to Haiti's magnitude seven quake in 2010, which killed as
estimated 316,000 people.
Worldwide seismic events between 2010 and
2011 caused economic losses of about US$276 billion and highly earthquake-prone
countries remain underinsured, Swiss Re said.
NZN