New Zealand's EQC secures high reinsurance cover for homeowners

The 12.5% jump in cover shows good value amidst a challenging market, it said.

New Zealand’s Earthquake Commission (EQC) has secured a record-high reinsurance cover of nearly $5b (NZ$7b) on the international reinsurance market for FY2021/2022, an announcement read.

The 12.5% increase in cover for an 11% jump in total premiums represents good value for the country amidst the current reinsurance market and supports ongoing access to affordable home insurance, said EQC chief executive Sid Miller.

“It is also pleasing to see that around two-thirds of this cover is provided by the same reinsurers who covered the damage from the Canterbury earthquakes, so again, it shows the reinsurers continue to trust our ability to manage the impact of natural hazards in New Zealand,” Miller added.

EQC invests over $12.2m (NZ$17m) each year into natural hazard research and modelling, as well as mitigation strategies such as engineering solutions, he noted.

The research will help loss modelling that ECQ shares with reinsurers to provide a New Zealand-specific view of the hazard risks that the scheme covers.