While Australian and New Zealand perils have traditionally been eagerly sought by global re/insurers seeking diversification, a series of costly natural catastrophes in the region has forced the industry to re-evaluate these risks and seek better data.
The scale of the human tragedy and economic loss facing New Zealand is immense. Devastating earthquakes struck the city of Christchurch on three separate occasions over a nine-month period; in September 2010, February 2011 and June 2011. While the total cost of these events—in economic and human terms—is, of course, immeasurable, the insured losses for each event range from NZ$3 billion to in excess of NZ$10 billion.
Across the Tasman, although not of the magnitude of the New Zealand earthquakes, Australia has also seen a recent spate of large catastrophe losses. These have not gone unnoticed; witness the 24/7 media coverage of Brisbane as it succumbed to the waters of the Brisbane River.
Over the past four years, there have been no fewer than six loss occurrences, each with insured loss estimates in excess of AU$1 billion ($1.07 billion). The suffering and loss to Australians in Queensland, New South Wales, Victoria and Western Australia have also been significant.
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Guy Carpenter, Diversification, Peak perils, Australia , New Zealand