Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Vero CEO calls for significant changes to EQC Act

Vero CEO calls for significant changes to EQC Act

Vero Chief Executive Gary Dransfield says the EQC Act Review is a “once in a generation” opportunity to significantly improve the way natural disaster insurance is funded and managed in New Zealand.

Addressing the Trans-Tasman Business Circle at a lunch in Wellington today, Mr Dransfield said: “I believe it would be a lost opportunity if Government, insurers and others simply used the review to finesse existing legislation.

“For insurers, it should be the start of an ongoing reform process designed to deliver a resilient general insurance sector that underpins New Zealand’s economic competitiveness.

“For Government, it should be an opportunity to consider the best way to reduce the fiscal risk to the Crown for natural disasters, while providing an acceptable level of protection for public and private property.”

The latest Reserve Bank of New Zealand Financial Stability Report says expected total claims costs related to the Canterbury earthquakes may exceed $30 billion.

That would be more than 15% of the GDP of New Zealand. Fortunately, 80% of those costs are expected to be met by insurers and reinsurers.

“If the New Zealand Government had to borrow what reinsurers and insurers are paying out for the Canterbury recovery, the Government would have to find an additional $800 million a year in debt interest payments.”

Mr Dransfield said insurance had protected New Zealand from the full fiscal impact of the Canterbury earthquakes.

“The Canterbury earthquakes exposed weaknesses in the current EQC and private insurer hybrid insurance approach,” he said.

“The model is systemically flawed when placed under the stress of a massive volume of claims and no consistency in the terms and conditions of policies being managed by both the EQC and private insurers.

“Having a government insurer and private insurers responsible for claims from the same customer has made the Canterbury recovery extraordinarily complex and has reduced claims management speed and efficiency.

“Another major deficiency of the current approach is that it increases costs and wastes capital for both the Government and private insurers. Those additional costs are ultimately met by taxpayers and customers.”

Given the Government’s commitment to a balanced budget and debt reduction, Vero questioned whether it was sensible to operate a fully resourced and funded public insurance agency with the sole mandate of managing claims after a major natural hazard disaster.

Mr Dransfield concluded by saying that solid progress was being made and that prospects were bright for investment in Canterbury.

“That progress would have been faster and more substantial if not for the inefficiencies of the current earthquake insurance model. Pleasingly, we now have an opportunity to rectify those.”

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Wage Hike For MPs (and Paul Robeson)

Hard to tell what is more infuriating. Is it the 5.3% increase on the already bloated salaries of MPs, or their pantomime of outrage at being gifted with such a wonderful back-dated bonanza?

As usual, Prime Minister John Key has busily tried to distance himself from the political fallout, even though he happens to be the main beneficiary of the Remuneration Authority’s generosity. Finance Minister Bill English says with a straight face that it would actually be very hard to give the money back...

Even if it were true, it would actually be very easy for English and any other guilty colleagues, to give the extra money away. There are any number of food banks or homeless shelters who would be able to put the money to good use. More>>

 

PARLIAMENT TODAY:

No Designers Or Visual Artists: Flag Panel Members Announced

The Government has appointed 12 New Zealanders as members of the Flag Consideration Panel which will engage with the public about a possible new New Zealand flag, Deputy Prime Minister Bill English says. More>>

ALSO:

Labour MP Stands Down From Portfolio: Comment From Carmel Sepuloni

The first I knew of my mother’s charges was when I was called by a reporter yesterday. I spoke to Andrew and we agreed there is a conflict of interest at the present time which means I will temporarily stand aside from the Social Development portfolio. It’s the right thing to do… . More>>

ALSO:

Gordon Campbell: On Whether NZ Troops Are The Least Of Islamic State’s Problems

Given that it has been politically packaged and sold as a training mission, the Iraq deployment announced yesterday by Prime Minister John Key seemed to be mysteriously short of actual trainers... The other wing of the argument is whether a troop deployment is (a) the only effective way and (b) the appropriate time to combat Islamic State. More>>

ALSO:

143 Troops, Possible SAS Deployment, Legalities Unsorted: PM’s Statement On ISIL

Mr Speaker, today I am announcing to the House the Government’s decisions about our contribution to the fight against the Islamic State of Iraq and the Levant, or ISIL... More>>

ALSO:

Liu Saga: PM's Dinner With Controversial Donor

John Key must front up to New Zealand and say what he discussed with Donghua Liu when the disgraced businessman paid $25,000 for the Prime Minister to come to dinner at his Remuera home, the Green Party said today. More>>

ALSO:

Roads: National MP 'Concerned' At Overseas Driver Crashes

Waitaki MP and Parliamentary Private Secretary for Tourism Jacqui Dean said she was concerned at the number of fatal crashes involving overseas licence holders and she really felt that the time had come for more to be done. More>>

ALSO:

Parliament Today: Parole Bill Passes

A bill reducing parole hearings deemed to be unnecessary has passed. The third reading of the Parole Amendment Bill was completed by 104 to 16 with the Greens and Maori Party opposed. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news