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Dean Lester: Insurance consultant reveals impact of government changes on homeowners · Early Edition with Ryan Bridge

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  Speaker 1: Right now, homeowners are in for another punch to their wallet.
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  Speaker 1: David Seymour says insurance levies will have to increase to
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  Speaker 1: help fund the Natural Hazard's Commission. This used to be
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  Speaker 1: the EQC Cabinet will soon begin consultation on the changes.
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  Speaker 1: Could increase levies by two hundred to three hundred bucks
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  Speaker 1: a year. Dean Leicster is an insurance consultant with me
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  Speaker 1: this morning.
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  Speaker 2: Dean, good morning, Lareena, good morning, Ryan.
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  Speaker 1: Good morning, good morning. So two to three hundred bucks
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  Speaker 1: a year? You reckon why? And this is all because
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  Speaker 1: what's there are more natural disasters and we don't have
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  Speaker 1: enough money in the kitty.
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  Speaker 2: The second part, so there's not enough money in the kitty.
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  Speaker 2: So the Natural Hazard Commission and the insurance cover that
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  Speaker 2: the government provides for earthquakes, land damage, for flood's, volcanic eruption, tsunami,
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  Speaker 2: that the government decides that they want to pay the
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  Speaker 2: first two billion dollars worth of claims. At the moment,
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  Speaker 2: they've got about five hundred billion in the kitty and
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  Speaker 2: they need to increase that amount of funds. It doesn't
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  Speaker 2: relate to the larger proportion of the program, which is
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  Speaker 2: the world reinsurance market where they obtain about nine billion
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  Speaker 2: on the world insurance World reinsurance market. World re insurance
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  Speaker 2: market's pretty positive. Those rates seems to be really confusing
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  Speaker 2: reporting in these other times, but world reinsurance rates are
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  Speaker 2: generally consistent. They had a good program last year of
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  Speaker 2: getting good cover for nine million dollars at good premiums.
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  Speaker 2: This relates to the first amount where the government says
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  Speaker 2: that they'll carry two billion dollars with a risk, and
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  Speaker 2: currently there is five hundred million in their.
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  Speaker 1: Kiddy So how will does this just mean basically we
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  Speaker 1: have to swallow it. We will all have to pay
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  Speaker 1: more for our levies, and that's just the way it.
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  Speaker 2: Is in essence s The surprise that has existed since
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  Speaker 2: the recent changes to the natural hazard cover where it's
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  Speaker 2: increased cover to three hundred thousand, is that there has
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  Speaker 2: been no positive reaction from private insurance to reduce their
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  Speaker 2: premiums because they now don't have as much risk. So
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  Speaker 2: at the time of the christ Church earthquake, for example,
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  Speaker 2: eqc AS it was paid the first one hundred and
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  Speaker 2: fifteen thousand that under the current legislation they now play
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  Speaker 2: the first three hundred thousand and It's always been a
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  Speaker 2: surprise that private insurers are not recognizing that their exposure
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  Speaker 2: and far less and that their premiums are reducing.
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  Speaker 1: Right, I've got you, Dean. Thank you very much for
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  Speaker 1: that update. Really interesting stuff. Dean Leicster, insurance consultant with us,
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  Speaker 1: talking about the fact that the NHC, which is the
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  Speaker 1: Natural Hazards Commission, used to be EQC. The levy's probably
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  Speaker 1: going to go up, David Simols, the minister in charge,
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  Speaker 1: he said so. For more from Early Edition with Ryan Bridge,
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  Speaker 1: listen live to News Talks at be from five am weekdays,
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  Speaker 1: or follow the podcast on iHeartRadio.