Source: Radio New Zealand
Tower Insurance says the high sea surge risk rating reflected the likelihood of flooding through nearby water systems. File photo. RNZ / Nate McKinnon
A Christchurch man has ditched his home insurance after his premiums went up by more than 30 percent a year – or by $1000 – based on new risk pricing.
Tower Insurance has taken into account the risk of sea surge and landslips for the Burwood home, as well as earthquakes and flooding.
But Trevor Taylor says his home is several kilometres from the sea, and he can not understand Tower’s sea surge assessment.
He has challenged that assessment, but said the insurer will not budge.
Taylor has asked to the see the evidence used to assesses his property, but Tower has refused to release specific information.
Taylor told Checkpoint he thought the odds of him being caught up in a sea surge were close to zero.
“They are doubling down and saying ‘no, I am at risk here’ and I just think it’s a load of rubbish.
“If you actually look at the journey where the water would have to go, it’s actually quite ridiculous.”
Taylor said he had done his own research into the journey the sea surge may take to get to his property.
He said it involved the water travelling up an estuary and a river, bursting through stop banks, and travelling uphill past houses before it reached his home.
While Tower had told him that its risk assessment was based off close to 200 million data points, Taylor was sure his own research negated some of the company’s findings.
“I’ve done a bit of my own research and according to the Ministry of Environment, storm surges rarely exceed 0.6 metres on open coasts around New Zealand.”
The Ministry of Environment noted that surges can be higher in some estuaries and harbours, with the largest recorded a 0.9 metre storm surge in Kawhia Harbour in May 2013.
Taylor said he thought Tower was overestimating the risks.
He said he had filed a Privacy Act request, asking for all the information Tower had on his property, but was refused based on the grounds it was commercially sensitive.
“I’d actually like someone from Tower to get out of their ivory tower in Auckland and come down and we’ll drive around and have a look and I can just show them how ridiculous it is.”
Taylor said he felt there was a disconnect between Environment Canterbury, the council and government agencies, as he struggled to find a uniform set of data to base the risks upon.
“I think risk pricing is fair, the thing is, I think they’re actually making up the risk.”
He said a government body should have a responsibility of investigating risk assessments by insurance companies if people felt they were wrong.
“The government or local councils can work together and then they could figure out ways to mitigate these hazards.”
Tower said in a statement that the high sea surge risk rating given to Taylor’s property reflected the likelihood of flooding through nearby water systems, including the Avon River, Travis Wetland Nature Heritage Park and Horseshoe Lake.
“If a storm coincides with high tides, water levels can rise, and waterways can carry water many kilometres inland, causing flooding during a sea surge event. Our assessment is consistent with the Christchurch City Council’s flood map which notes the property as being in the council’s flood hazard management area, with a one in 200-year flood risk.”
Tower said fewer than 10 percent of properties with higher sea surge or landslide risks would see an increase in the natural hazards portion of their premiums. A third of those would see a premium increase of less than $100 a year, and the majority would be less than $300 a year.
“For some customers with significantly higher risks, the natural hazards portion of the premium will increase by more.”
Tower would not release detailed data because “it would not help customers understand the risks”.
“For example our sea surge model considers a range of different historical and possible tidal heights within storm scenarios – sharing this detailed data would not help customers understand their risks. It is also commercially sensitive. Instead, we simplify this information into a risk rating, which represents our evaluation of the insurance risk for a property based on this data.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
