Means reinsurance will only cover up to $7.5m - after that, Tower will take the hit?
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Not a very helpful announcement
Do they expect claims to exceed 7.5m or not
Does this mean no more reinsurance available for rest of year
On the face if it seems a strange and inadequate reinsurance arrangement 14m excess and 7.5 m cover
Needs urgent clarification by company
Specifically says "this event" for $7.5m in the announcement. Too early to forecast claims total costs.
142 claims so far with more expected over the coming days - however the bulk will be there.
If they reach 200 claims say, at $7.5m there is an average of $37,500 per claim coverage which is fine for contents claims, depends if there are house claims (though usually not total loss in these weather events) in the mix.
Means tower can pay a ton of money to customers and recover from reinsurance, building some good will without affecting the bottom line.
Really ? Slow process on the West Coast as to who is red stickered (complete rebuild) and who is not. How do you make a claim if you're not sure what you're claiming for ?
Plenty more total house rebuild claims will come flooding in over the coming weeks.
How many more so called 1 in 100 year weather events this year ?
Industry in bad light again
Pack of rogues
https://www.newsroom.co.nz/insurance...9f0dc-97970805
When TWR updated the Canterbury flooding event in June they had 164 claims and expected a cost of $3m before tax. The recent widespread July event, with emphasis on the West Coast, is 142 claims presently so even if more to come should stay under $7m. In the first Half year the major events were the Ohau Fire and the Napier flood, leading to $9.3m large event costs being booked. The presentation given with the Half Year results said long term average for large events is $8m pa, so while the 20/21 year is shaping to come in at over $14m which is the sum before the reinsurance of $7.5m kicks in it doesn't seem to me likely that $21.5m will be exceeded given TWR has less than 10% of the General Insurance market in NZ unless risk has been significantly concentrated in the localities most seriously affected.