1 00:00:05,400 --> 00:00:05,840 Speaker 1: Gielda. 2 00:00:05,880 --> 00:00:09,040 Speaker 2: I'm Chelsea Daniels and this is the Front Page, a 3 00:00:09,160 --> 00:00:10,920 Speaker 2: daily podcast. 4 00:00:10,400 --> 00:00:12,520 Speaker 1: Presented by The New Zealand Herald. 5 00:00:16,000 --> 00:00:19,800 Speaker 2: Could the government be taking a step back from helping 6 00:00:19,920 --> 00:00:25,680 Speaker 2: homeowners after the elements make their homes unlivable? Recent extreme 7 00:00:25,800 --> 00:00:30,440 Speaker 2: weather events have prompted a rethink of government housing protections. 8 00:00:31,040 --> 00:00:34,400 Speaker 2: Billions of dollars have been spent over the years on 9 00:00:34,560 --> 00:00:39,479 Speaker 2: buying out homes after natural disasters. But in a changing 10 00:00:39,600 --> 00:00:44,040 Speaker 2: world and climate where these events are happening harder and faster, 11 00:00:44,640 --> 00:00:48,240 Speaker 2: is the idea of the crown stepping in with unlimited 12 00:00:48,360 --> 00:00:53,360 Speaker 2: cash sustainable? Today on the Front Page, Insurance Council Chief 13 00:00:53,400 --> 00:00:57,639 Speaker 2: Executive Chris Farfoy joins us to explain what the future 14 00:00:57,760 --> 00:01:01,280 Speaker 2: looks like for homeowners. 15 00:01:04,440 --> 00:01:06,080 Speaker 1: Chris, the government's. 16 00:01:05,720 --> 00:01:11,160 Speaker 2: Historically stepped in after natural disasters to buy properties. This week, 17 00:01:11,240 --> 00:01:14,440 Speaker 2: Christopher Luxon has said that the government won't be able 18 00:01:14,520 --> 00:01:17,480 Speaker 2: to keep bailing out people in this way. 19 00:01:17,959 --> 00:01:20,959 Speaker 1: Does this come as a surprise to you, that's. 20 00:01:20,840 --> 00:01:23,600 Speaker 3: On the first time we've heard that from the government. 21 00:01:23,640 --> 00:01:28,520 Speaker 3: I think, regardless of which stripe, you are the appetite 22 00:01:29,000 --> 00:01:31,240 Speaker 3: for continuing the kind of buyouts and that we're seen 23 00:01:31,319 --> 00:01:34,720 Speaker 3: over the last decade and a half are starting to wane. 24 00:01:35,120 --> 00:01:38,039 Speaker 3: From our perspective, that's a government decision to make. But 25 00:01:38,080 --> 00:01:40,560 Speaker 3: also from the insurance perspective, if they're going to invest, 26 00:01:40,600 --> 00:01:43,480 Speaker 3: if they're going to spend tax payer money, then instead 27 00:01:43,520 --> 00:01:45,640 Speaker 3: of paying out after an event has happened, we'd prefer 28 00:01:45,760 --> 00:01:48,920 Speaker 3: that you spend that money to protect the communities and 29 00:01:48,920 --> 00:01:52,080 Speaker 3: that we're seeing being devastated by these kinds of events 30 00:01:52,080 --> 00:01:55,880 Speaker 3: on a relatively regular basis. Obviously, that can keep those 31 00:01:55,920 --> 00:01:59,120 Speaker 3: communities safer. But from an insurance perspective as well, it 32 00:01:59,320 --> 00:02:03,520 Speaker 3: just uses the risk and that's what our members used 33 00:02:03,520 --> 00:02:05,600 Speaker 3: the price, and if we can reduce that risk, we 34 00:02:05,640 --> 00:02:08,440 Speaker 3: can keep the insurance more accessible for keys. 35 00:02:08,600 --> 00:02:11,360 Speaker 2: Yeah, if we're in a situation where the government does 36 00:02:11,520 --> 00:02:14,560 Speaker 2: pull the pen entirely on buyouts, where does that put 37 00:02:14,680 --> 00:02:15,799 Speaker 2: private insurers? 38 00:02:17,440 --> 00:02:21,880 Speaker 3: And essentially in the same situation we continue to pay 39 00:02:21,880 --> 00:02:24,639 Speaker 3: out of people have got insurance policies. We did that 40 00:02:24,680 --> 00:02:29,799 Speaker 3: after Walking Anniversary and cyclone. Gabrielle that the difference here 41 00:02:29,880 --> 00:02:33,320 Speaker 3: is buyouts usually we have done the land or the 42 00:02:33,360 --> 00:02:37,040 Speaker 3: location of the incident is so bad, the risk is 43 00:02:37,080 --> 00:02:40,079 Speaker 3: so high, usually to the life that the local council 44 00:02:40,120 --> 00:02:42,680 Speaker 3: and the government agree that people shouldn't really live there anymore, 45 00:02:43,040 --> 00:02:45,000 Speaker 3: so people will still get an insurance pay out, but 46 00:02:45,040 --> 00:02:47,239 Speaker 3: the councilors and the central government also put their hands 47 00:02:47,240 --> 00:02:49,160 Speaker 3: in their pocket and say it's not possible for you 48 00:02:49,200 --> 00:02:52,400 Speaker 3: to live here anymore, and they get compensated through the buyout. 49 00:02:52,520 --> 00:02:55,799 Speaker 3: It almost makes insurance more important for people to make 50 00:02:55,800 --> 00:02:57,519 Speaker 3: sure that they've got it. Otherwise, if they're dying and 51 00:02:57,600 --> 00:03:02,400 Speaker 3: they're in this situation, I've got fewer options. But again, 52 00:03:02,840 --> 00:03:04,680 Speaker 3: if the government does go down this path and they 53 00:03:04,680 --> 00:03:08,320 Speaker 3: haven't made a decision, I've given some indications this week 54 00:03:08,400 --> 00:03:12,519 Speaker 3: around that, then the investment and making sure that communities 55 00:03:12,520 --> 00:03:14,200 Speaker 3: are safer because we know these kinds of things are 56 00:03:14,200 --> 00:03:17,240 Speaker 3: going to happen more often and have the ferocity of 57 00:03:17,240 --> 00:03:19,640 Speaker 3: what we've seen in the last couple of years and 58 00:03:19,680 --> 00:03:21,280 Speaker 3: in the last couple of months, then we really need 59 00:03:21,280 --> 00:03:22,880 Speaker 3: to make sure we're protecting those communities. 60 00:03:23,120 --> 00:03:25,480 Speaker 2: Do you think we've actually learned any lessons from the 61 00:03:25,600 --> 00:03:27,920 Speaker 2: likes of Auckland and what's happened in Gisbon as well? 62 00:03:28,240 --> 00:03:28,680 Speaker 4: Slightly? 63 00:03:28,760 --> 00:03:32,359 Speaker 3: I think you've probably seen the issue around the Taka Bunagov. 64 00:03:32,400 --> 00:03:36,600 Speaker 3: Of course, in the last month where the open Councils says, well, 65 00:03:36,680 --> 00:03:40,240 Speaker 3: there is flooding risk in that community, to the families, 66 00:03:40,320 --> 00:03:44,960 Speaker 3: to the businesses, there's schools, there's rest homes there. So 67 00:03:45,160 --> 00:03:48,200 Speaker 3: actually something needs to be done to reduce the impacting 68 00:03:48,480 --> 00:03:51,800 Speaker 3: the impact of those kinds of events. So there's some 69 00:03:51,840 --> 00:03:55,800 Speaker 3: difficult decisions to be made. We'd agreed with the group 70 00:03:55,840 --> 00:03:58,480 Speaker 3: that put out the report last week, that independent reference 71 00:03:58,520 --> 00:04:01,800 Speaker 3: group that's given some advice the government that we needs emergency. 72 00:04:02,720 --> 00:04:06,240 Speaker 3: We're seeing these kinds of events happening more and more often. 73 00:04:06,480 --> 00:04:10,800 Speaker 3: You've seen this appetite four buyots start to wane from 74 00:04:10,840 --> 00:04:13,400 Speaker 3: the government. So something needs to happen in the middle 75 00:04:13,440 --> 00:04:15,440 Speaker 3: to make sure the communities are safe, that we can 76 00:04:15,480 --> 00:04:18,640 Speaker 3: protect from the impacts of the likes of flooding and landslips. 77 00:04:19,640 --> 00:04:21,280 Speaker 4: And also again insurance. 78 00:04:21,000 --> 00:04:24,360 Speaker 3: Is obviously quite important those situations for keepleus to fall 79 00:04:24,400 --> 00:04:26,440 Speaker 3: back on. You would have seen in the last twelve 80 00:04:26,480 --> 00:04:29,360 Speaker 3: to twenty four months after Gabrielle that people have had 81 00:04:29,680 --> 00:04:32,760 Speaker 3: along with everything else, that paying those insurance premiums can 82 00:04:32,800 --> 00:04:35,760 Speaker 3: be a challenge and in order to keep it manageable 83 00:04:35,800 --> 00:04:39,480 Speaker 3: in the long term, that kind of risk reduction, the 84 00:04:39,600 --> 00:04:42,800 Speaker 3: infrastructure getting put in place some difficult conversations, so we 85 00:04:42,800 --> 00:04:45,080 Speaker 3: can make sure that if things do happen, we're kind 86 00:04:45,120 --> 00:04:47,880 Speaker 3: of lowering the impact of whether those kinds of weather 87 00:04:47,920 --> 00:04:51,080 Speaker 3: events is really important to keep insurance accessible for the future. 88 00:04:53,480 --> 00:04:53,720 Speaker 4: Yeah. 89 00:04:53,720 --> 00:04:56,200 Speaker 5: Look, I know the report came out last week. It'll 90 00:04:56,240 --> 00:04:58,240 Speaker 5: take time for the government to digest. And you're right, 91 00:04:58,279 --> 00:05:01,839 Speaker 5: a lot of the proposals are around climate adaptation and 92 00:05:01,880 --> 00:05:03,520 Speaker 5: it's often for twenty years from now and I think 93 00:05:03,560 --> 00:05:05,719 Speaker 5: in principle, yes, you can't. The government won't be able 94 00:05:05,720 --> 00:05:07,200 Speaker 5: to keep bailing people out in this way. 95 00:05:07,600 --> 00:05:07,720 Speaker 4: You know. 96 00:05:07,839 --> 00:05:10,040 Speaker 5: That's why Simon Watts has worked quite hard to get 97 00:05:10,040 --> 00:05:12,000 Speaker 5: a bipartner as an approach with all the parties in 98 00:05:12,000 --> 00:05:14,200 Speaker 5: Parliament to say, look, there's going to be governments of 99 00:05:14,240 --> 00:05:16,640 Speaker 5: different colors and shoes going forward over the next couple 100 00:05:16,680 --> 00:05:19,280 Speaker 5: of generations. This is a long term issue. We need 101 00:05:19,320 --> 00:05:22,000 Speaker 5: a proper framework in place to work out whether it's landowners, 102 00:05:22,000 --> 00:05:25,400 Speaker 5: whether it's councils, whether it's central government, banks, insurers that 103 00:05:25,480 --> 00:05:27,520 Speaker 5: actually have to create a framework for dealing with these 104 00:05:27,520 --> 00:05:29,640 Speaker 5: sort of weather events and how we'll handle them going forward. 105 00:05:31,920 --> 00:05:36,160 Speaker 2: When we think about and talk about shared responsibility, and 106 00:05:36,200 --> 00:05:40,480 Speaker 2: that's between central government local councils, banks, insurers and homeowners alike. 107 00:05:40,680 --> 00:05:42,719 Speaker 2: What could that mean in practice? 108 00:05:42,920 --> 00:05:45,200 Speaker 3: I think you've got a lot of those parts of 109 00:05:45,640 --> 00:05:47,400 Speaker 3: the system keen to get ahead of this. I think 110 00:05:47,440 --> 00:05:49,680 Speaker 3: if you ask, most of these Islanders don't prefer that 111 00:05:49,760 --> 00:05:52,720 Speaker 3: we ate before these events a certainly from my perspective, 112 00:05:52,839 --> 00:05:54,880 Speaker 3: the insurance sector is keen to make sure that we 113 00:05:54,920 --> 00:05:55,840 Speaker 3: are reducing risk. 114 00:05:56,160 --> 00:05:58,640 Speaker 4: That makes business sense for them, but also. 115 00:05:58,720 --> 00:06:01,040 Speaker 3: For the communities that they cover, keeps some protective I think, 116 00:06:01,080 --> 00:06:05,000 Speaker 3: and there's a willingness for banks that we've been talking 117 00:06:05,040 --> 00:06:07,880 Speaker 3: to as a sector to get involved in their Certainly 118 00:06:07,960 --> 00:06:11,680 Speaker 3: councils I've been indeed earlier this week South of Leedin 119 00:06:11,839 --> 00:06:13,760 Speaker 3: is a long term issue and the councils want to 120 00:06:13,760 --> 00:06:15,880 Speaker 3: get their heads around this. What can we do, What 121 00:06:15,920 --> 00:06:18,480 Speaker 3: are the rules and the tools that central government might 122 00:06:18,520 --> 00:06:20,479 Speaker 3: give them. Where's the funding going to come from? None 123 00:06:20,480 --> 00:06:23,960 Speaker 3: of this is cheap and it's also very emotional. So 124 00:06:24,360 --> 00:06:26,320 Speaker 3: I think what we're looking for is some strong central 125 00:06:26,360 --> 00:06:29,000 Speaker 3: government leadership and I think we've seen some good signals 126 00:06:29,040 --> 00:06:32,400 Speaker 3: from the Prime Minister this week about what their thoughts 127 00:06:32,440 --> 00:06:35,039 Speaker 3: are around buyouts, what their thoughts are around building and 128 00:06:35,080 --> 00:06:39,919 Speaker 3: done places, and actually having to tackle this issue to 129 00:06:40,000 --> 00:06:41,640 Speaker 3: keep communities safe. 130 00:06:41,440 --> 00:06:42,120 Speaker 4: In the future. 131 00:06:42,600 --> 00:06:46,440 Speaker 3: So we're expecting some policy from the government by the 132 00:06:46,520 --> 00:06:48,680 Speaker 3: end of the year and some legislation in the House 133 00:06:48,720 --> 00:06:51,640 Speaker 3: to give us an idea of what those early rules 134 00:06:51,640 --> 00:06:55,200 Speaker 3: and tools for governments and the sectors that are part 135 00:06:55,240 --> 00:06:57,480 Speaker 3: of this, and we're really looking for some strong leadership 136 00:06:57,520 --> 00:06:59,040 Speaker 3: so we can kind of start tackling this. I mean, 137 00:06:59,240 --> 00:07:01,560 Speaker 3: from an insurance perspective, we want to make sure that 138 00:07:01,600 --> 00:07:04,280 Speaker 3: we are affordable to kiwis for the future. But if 139 00:07:04,320 --> 00:07:06,600 Speaker 3: nothing is done, if these things keep happening and we're 140 00:07:06,640 --> 00:07:09,920 Speaker 3: just status quo, then there's going to be some long 141 00:07:10,000 --> 00:07:13,239 Speaker 3: term challenges, not just for insurance, but for communities as well. 142 00:07:13,320 --> 00:07:15,520 Speaker 2: I was thinking about because these climate events are going 143 00:07:15,560 --> 00:07:18,800 Speaker 2: to happen harder and faster, and we're going to see 144 00:07:18,840 --> 00:07:22,200 Speaker 2: more and more of them, and if the government or 145 00:07:22,240 --> 00:07:26,040 Speaker 2: if we don't start making those solutions before things actually happen, 146 00:07:26,720 --> 00:07:29,560 Speaker 2: then we then see a world where insurance is just 147 00:07:29,680 --> 00:07:33,040 Speaker 2: unaffordable for most kiwis and. 148 00:07:33,240 --> 00:07:36,080 Speaker 3: The extremely with that's the challenge, and that's why we're 149 00:07:36,080 --> 00:07:39,640 Speaker 3: pushing so hard that we can do things beforehand to 150 00:07:39,680 --> 00:07:42,240 Speaker 3: try and reduce the risk as you say we're expecting 151 00:07:42,360 --> 00:07:45,360 Speaker 3: to be more often, we're expecting them to be more 152 00:07:45,440 --> 00:07:47,840 Speaker 3: ferocious than if you ask the people of now Stasman 153 00:07:48,040 --> 00:07:50,520 Speaker 3: experience of the last month in last that we're seeing 154 00:07:50,520 --> 00:07:51,120 Speaker 3: that we. 155 00:07:51,080 --> 00:07:52,440 Speaker 4: Don't want to get into that situation. 156 00:07:52,840 --> 00:07:57,520 Speaker 3: We prefer we've given the opportunity that banks, insurers, councils, 157 00:07:57,520 --> 00:07:59,960 Speaker 3: central government and communities can actually work together to get 158 00:08:00,360 --> 00:08:02,320 Speaker 3: some of these protections in place, because I think the 159 00:08:02,360 --> 00:08:05,640 Speaker 3: worst case scenario is that we don't do anything. These 160 00:08:05,680 --> 00:08:09,160 Speaker 3: things happen and you know, you've got asset values of 161 00:08:09,240 --> 00:08:12,400 Speaker 3: homes starting to diminish, you've got insurance being a challenge. 162 00:08:13,120 --> 00:08:15,920 Speaker 3: That's the fear. But we actually in about ten or 163 00:08:15,920 --> 00:08:18,760 Speaker 3: fifteen years time, I think if we can say that 164 00:08:18,880 --> 00:08:22,080 Speaker 3: some good decisions were made ten or fifteen years ago 165 00:08:22,200 --> 00:08:23,960 Speaker 3: to make sure you can get ahead of this, some 166 00:08:24,000 --> 00:08:27,000 Speaker 3: of the communities that are really at risk can continue 167 00:08:27,240 --> 00:08:29,680 Speaker 3: to survive and be strong. But I also want to 168 00:08:29,720 --> 00:08:33,599 Speaker 3: be really honest, there's some difficult conversations about some communities 169 00:08:33,640 --> 00:08:35,680 Speaker 3: have to have as well, and that's where that central 170 00:08:35,679 --> 00:08:37,200 Speaker 3: government leadership is really important. 171 00:08:37,760 --> 00:08:41,840 Speaker 6: Because there we're built so many of towns and communities 172 00:08:42,040 --> 00:08:46,760 Speaker 6: in flood plains for historical reasons, but yeah, we will 173 00:08:47,040 --> 00:08:49,480 Speaker 6: likely have to move some of them. Figuring out how 174 00:08:49,480 --> 00:08:52,240 Speaker 6: to do that in a way that's as best for 175 00:08:52,400 --> 00:08:55,600 Speaker 6: the residents and for a sense of community and all 176 00:08:55,640 --> 00:08:58,240 Speaker 6: of those aspects. There's going to be as a massive 177 00:08:58,320 --> 00:09:02,920 Speaker 6: challenge for for local government central government and is a 178 00:09:02,960 --> 00:09:05,680 Speaker 6: big focus of a lot of social science research as well. 179 00:09:07,440 --> 00:09:10,400 Speaker 2: Yeah, and are those difficult situations anything to do with 180 00:09:11,200 --> 00:09:12,959 Speaker 2: in moving entire towns. 181 00:09:13,640 --> 00:09:17,200 Speaker 3: It could be, you know, in some councilors around the 182 00:09:17,200 --> 00:09:20,040 Speaker 3: country have been brave and started to ins towards those 183 00:09:20,080 --> 00:09:23,760 Speaker 3: conversations and have some of those conversations with the communities, 184 00:09:23,800 --> 00:09:26,040 Speaker 3: and as an insurance sector, we want to support them 185 00:09:26,080 --> 00:09:28,760 Speaker 3: because whether they are conversations that need to be had, 186 00:09:28,800 --> 00:09:31,920 Speaker 3: insurance might be an aspect of some of those decisions. 187 00:09:32,360 --> 00:09:35,200 Speaker 3: But that's where when I say rules and tools for 188 00:09:35,360 --> 00:09:38,080 Speaker 3: local government, I think there is a fear from local 189 00:09:38,120 --> 00:09:40,600 Speaker 3: government that if they start to make decisions which are 190 00:09:40,600 --> 00:09:43,120 Speaker 3: heading in a direction for some of those communities, if 191 00:09:43,160 --> 00:09:46,400 Speaker 3: it gets challenged or they kind of find themselves stuck 192 00:09:46,559 --> 00:09:50,559 Speaker 3: in long engagements where the communities then nothing will get done. 193 00:09:51,400 --> 00:09:54,359 Speaker 4: And in some places, as it's been evidenced by the buyouts. 194 00:09:54,559 --> 00:09:55,120 Speaker 4: Some of these. 195 00:09:55,000 --> 00:10:00,360 Speaker 3: Areas are you risk to life scenarios and keeping in 196 00:10:00,400 --> 00:10:02,680 Speaker 3: some of those places is not the wisest thing to 197 00:10:02,720 --> 00:10:06,480 Speaker 3: do long term. So instead of having an event to 198 00:10:06,520 --> 00:10:08,920 Speaker 3: get to that situation, there is an opportunity for us 199 00:10:08,960 --> 00:10:10,959 Speaker 3: to say, hey, look, let's have a good, mature look 200 00:10:10,960 --> 00:10:11,280 Speaker 3: at this. 201 00:10:11,280 --> 00:10:13,360 Speaker 4: This is high risk. What do we do here? 202 00:10:13,880 --> 00:10:16,280 Speaker 3: And certainly if counsels think that they're doing that on 203 00:10:16,280 --> 00:10:18,760 Speaker 3: the run, they're going to be They're going to find 204 00:10:18,760 --> 00:10:21,280 Speaker 3: out a challenge. So getting thanks, as you say, getting insurer, 205 00:10:21,360 --> 00:10:24,280 Speaker 3: is having rules and tools for counselors to be able 206 00:10:24,280 --> 00:10:28,480 Speaker 3: to have those conversations and being led by central government 207 00:10:28,559 --> 00:10:30,840 Speaker 3: giving them the tools to do that. And at some 208 00:10:30,920 --> 00:10:34,280 Speaker 3: stage who pays conversation has to come into this as well, 209 00:10:34,440 --> 00:10:35,400 Speaker 3: and we think is really. 210 00:10:35,280 --> 00:10:37,520 Speaker 1: Important who does pay well? 211 00:10:37,559 --> 00:10:41,240 Speaker 3: That's where that's the billion dollar question. And at the 212 00:10:41,320 --> 00:10:43,080 Speaker 3: end of the day, I think the government will end 213 00:10:43,160 --> 00:10:48,120 Speaker 3: up deciding that. The report that came out earlier this 214 00:10:48,200 --> 00:10:51,320 Speaker 3: month from the Independent Reference Group, which was advising the 215 00:10:51,360 --> 00:10:53,960 Speaker 3: government around well it should do in the adaptation and space, 216 00:10:54,320 --> 00:10:58,720 Speaker 3: basically said the beneficiari should pay now in some instances 217 00:10:58,760 --> 00:11:02,560 Speaker 3: that might be a community or an individual family or 218 00:11:02,800 --> 00:11:05,000 Speaker 3: a business and someone might be able to do that. 219 00:11:05,280 --> 00:11:07,760 Speaker 3: I think one of the promising science from that independent 220 00:11:07,760 --> 00:11:10,640 Speaker 3: reference group was in some instances, some communities won't be 221 00:11:10,679 --> 00:11:13,160 Speaker 3: able to pay, and they send a pretty clear indication 222 00:11:13,320 --> 00:11:17,640 Speaker 3: that in some instances central government might have to kind 223 00:11:17,640 --> 00:11:20,840 Speaker 3: of chip in and make sure they can protect communities. 224 00:11:20,880 --> 00:11:24,400 Speaker 3: So it's extremely complex. I think from an insurance perspective, 225 00:11:24,559 --> 00:11:26,719 Speaker 3: we want to see some urgency. We want to see 226 00:11:26,760 --> 00:11:30,319 Speaker 3: some clear leadership from central government. We've seen some good 227 00:11:30,320 --> 00:11:33,160 Speaker 3: indications of that week from the Prime Minister, and really 228 00:11:33,160 --> 00:11:34,600 Speaker 3: we just need to get on with it. There's been 229 00:11:34,640 --> 00:11:36,760 Speaker 3: a diagnosis of this issue. We know what's coming down. 230 00:11:36,840 --> 00:11:40,360 Speaker 3: The forecasters, the scientists are telling us that the weather 231 00:11:40,440 --> 00:11:41,439 Speaker 3: is going to get more extreme. 232 00:11:42,160 --> 00:11:43,760 Speaker 4: People are starting to experience that. 233 00:11:44,400 --> 00:11:47,000 Speaker 3: I'm the scientist, but I think people are kind of 234 00:11:47,080 --> 00:11:50,400 Speaker 3: understanding that things in terms of whether are getting much 235 00:11:50,400 --> 00:11:53,079 Speaker 3: more challenging. So getting together this is really important. 236 00:12:02,440 --> 00:12:05,400 Speaker 2: When thinking about when the game really changed. 237 00:12:05,559 --> 00:12:07,680 Speaker 1: I always think about the Canterbury earthquakes. 238 00:12:07,760 --> 00:12:11,400 Speaker 2: Right at the time it was the fourth most expensive 239 00:12:11,679 --> 00:12:18,080 Speaker 2: ensured global natural disaster ever to happen. That's internationally, and 240 00:12:18,120 --> 00:12:21,520 Speaker 2: today it's cost private insurer is twenty one billion dollars. 241 00:12:21,559 --> 00:12:24,360 Speaker 1: EQC paid a further ten billion. 242 00:12:24,800 --> 00:12:28,960 Speaker 2: I mean, if that were to happen tomorrow, how would 243 00:12:29,000 --> 00:12:32,920 Speaker 2: we fare because private insurers especially, isn't that still being 244 00:12:33,000 --> 00:12:33,800 Speaker 2: kind of paid for? 245 00:12:34,320 --> 00:12:34,480 Speaker 4: Oh? 246 00:12:34,600 --> 00:12:39,280 Speaker 3: Un Thankfully we do have capital requirements, we do have 247 00:12:39,760 --> 00:12:44,000 Speaker 3: reinsurance arrangements. So in plain English, reinsurance is insurance that 248 00:12:44,080 --> 00:12:46,120 Speaker 3: insurers have. So if a big one line crist you 249 00:12:46,320 --> 00:12:48,280 Speaker 3: just to happen, as well as the money that they 250 00:12:48,400 --> 00:12:50,160 Speaker 3: have in their capital. 251 00:12:49,760 --> 00:12:52,080 Speaker 4: Requirements, how they call on reinsurance. 252 00:12:52,679 --> 00:12:55,760 Speaker 3: And again I think this is another if we're seen 253 00:12:55,800 --> 00:12:59,600 Speaker 3: by those international reinsurers to be taking action to reduce 254 00:12:59,640 --> 00:13:01,960 Speaker 3: the risk here in New Zealand for some of these 255 00:13:02,080 --> 00:13:04,680 Speaker 3: kind of weather related events stacy, that is a positive. 256 00:13:04,960 --> 00:13:08,120 Speaker 3: And we went to visit those re insurers with Climate 257 00:13:08,200 --> 00:13:11,600 Speaker 3: Change Minister Simon Watts last year. I mean they liked 258 00:13:11,640 --> 00:13:15,400 Speaker 3: the conversations that are happening and happening both our big 259 00:13:15,440 --> 00:13:16,640 Speaker 3: parties are talking about it. 260 00:13:16,920 --> 00:13:18,160 Speaker 4: We're expecting some policy. 261 00:13:18,200 --> 00:13:21,600 Speaker 3: We're actually in terms of the international situation, quite advanced 262 00:13:21,640 --> 00:13:24,400 Speaker 3: and looking at what we do to reduce risk. Now 263 00:13:24,440 --> 00:13:25,959 Speaker 3: as the time as I stay for the urgency, to 264 00:13:26,000 --> 00:13:27,720 Speaker 3: make sure we're getting on it so we can keep 265 00:13:28,000 --> 00:13:29,280 Speaker 3: those reinsurers happy. 266 00:13:29,360 --> 00:13:30,600 Speaker 4: So if we keep those. 267 00:13:30,480 --> 00:13:33,760 Speaker 3: Reinsurers happy, then their ability to pay out when the 268 00:13:33,760 --> 00:13:36,640 Speaker 3: big ones happened is maintained. And that did happen not 269 00:13:36,679 --> 00:13:39,400 Speaker 3: only in christ huge as you say, but that also 270 00:13:39,559 --> 00:13:43,280 Speaker 3: happened in twenty twenty three when Auckland Anniversary weekend and 271 00:13:43,360 --> 00:13:46,200 Speaker 3: cyclone Gabrielle happened. That was a three point eight billion 272 00:13:46,240 --> 00:13:50,640 Speaker 3: dollar event for private insurers alone, and the reinsurance got 273 00:13:50,679 --> 00:13:53,640 Speaker 3: caught on. But that was also a game changer. When 274 00:13:54,000 --> 00:13:56,920 Speaker 3: re insurers looked at New Zealand, traditionally they saw earthquakes, 275 00:13:56,920 --> 00:13:59,959 Speaker 3: and then twenty twenty three happened, and then climate related 276 00:14:00,080 --> 00:14:03,000 Speaker 3: events also became an issue. So we need to we 277 00:14:03,040 --> 00:14:05,160 Speaker 3: need to make sure that we're on top of those 278 00:14:05,320 --> 00:14:07,720 Speaker 3: kinds of events that of reinsurance will continue to have 279 00:14:07,760 --> 00:14:10,160 Speaker 3: confidence in us and be quite happy to re ensure 280 00:14:10,240 --> 00:14:11,920 Speaker 3: the resk that we've got here in New Zealand so 281 00:14:12,040 --> 00:14:15,280 Speaker 3: that our members our insurance can pay out when those 282 00:14:15,320 --> 00:14:16,079 Speaker 3: big things happen. 283 00:14:16,280 --> 00:14:18,120 Speaker 1: Have you any idea where to start? 284 00:14:18,320 --> 00:14:20,280 Speaker 2: I mean, I know these conversations are going to be 285 00:14:20,320 --> 00:14:23,560 Speaker 2: long and hard, but if you looked at, say someone 286 00:14:24,240 --> 00:14:27,240 Speaker 2: who lives on a house on a hill and you're 287 00:14:27,240 --> 00:14:30,600 Speaker 2: thinking coastal erosion, or is it a town on an 288 00:14:30,640 --> 00:14:34,120 Speaker 2: alpine fault, or is it a town in a valley, 289 00:14:34,200 --> 00:14:37,240 Speaker 2: Like where do you even begin to have these conversations 290 00:14:38,160 --> 00:14:40,920 Speaker 2: with these local communities and as a whole as well. 291 00:14:41,360 --> 00:14:43,920 Speaker 3: That's a really good question because depending on where you are, 292 00:14:44,480 --> 00:14:47,360 Speaker 3: the risks are very different. According to Lloyd's where the 293 00:14:47,360 --> 00:14:49,640 Speaker 3: second risk is country in the world in terms of 294 00:14:50,040 --> 00:14:54,200 Speaker 3: natural hazard risk. So what I think everyone agrees on, 295 00:14:54,240 --> 00:14:55,800 Speaker 3: and I hope it's done out of some of the 296 00:14:55,840 --> 00:14:58,160 Speaker 3: work that the government's doing now, is we have a 297 00:14:58,200 --> 00:15:01,120 Speaker 3: really good national picture of war the risks are, and 298 00:15:01,440 --> 00:15:05,240 Speaker 3: the data is uniform across the board. A lot of 299 00:15:05,240 --> 00:15:07,680 Speaker 3: councils do have a good idea of what the risks 300 00:15:07,680 --> 00:15:09,480 Speaker 3: are in the area and they'll try and tackle that. 301 00:15:09,840 --> 00:15:12,440 Speaker 3: Some councils don't. Are smaller, they can't afford that kind 302 00:15:12,480 --> 00:15:15,000 Speaker 3: of thing. So what we're asking, and I think we're 303 00:15:15,040 --> 00:15:17,520 Speaker 3: getting some good indications for the government, is that we 304 00:15:17,640 --> 00:15:20,400 Speaker 3: have a platform that says here's New Zealand, here are 305 00:15:20,400 --> 00:15:22,520 Speaker 3: the biggest risks. So then we can all say, from 306 00:15:22,560 --> 00:15:25,680 Speaker 3: a central government perspective, how do we prioritize some investment 307 00:15:25,760 --> 00:15:28,680 Speaker 3: and risk reduction that the central government can get stuck into. 308 00:15:29,000 --> 00:15:31,480 Speaker 3: And also local councilors can say, like, here it is, 309 00:15:31,720 --> 00:15:34,760 Speaker 3: here's how much money we've got, and we can start prioritizing. 310 00:15:34,880 --> 00:15:38,160 Speaker 3: So I think you ask a good question. If we 311 00:15:38,240 --> 00:15:40,600 Speaker 3: try and board the ocean from the outset, we're going 312 00:15:40,600 --> 00:15:41,600 Speaker 3: to find out a real challenge. 313 00:15:41,600 --> 00:15:42,640 Speaker 4: It's going to be really costly. 314 00:15:42,960 --> 00:15:44,840 Speaker 3: But I think if we've got a really good understanding 315 00:15:44,880 --> 00:15:47,800 Speaker 3: across the board or the data around where those risks are, 316 00:15:48,320 --> 00:15:50,200 Speaker 3: if we start with that, then we've got a picture 317 00:15:50,200 --> 00:15:53,840 Speaker 3: that everyone can work off. And I think if councils 318 00:15:53,880 --> 00:15:56,640 Speaker 3: are given again the rules and how they can engage 319 00:15:56,640 --> 00:15:59,560 Speaker 3: and the tools to engage, I think you'll start seeing 320 00:15:59,600 --> 00:16:01,040 Speaker 3: local was getting really stuck in. 321 00:16:03,320 --> 00:16:06,200 Speaker 7: My husband had to break down these palings off the 322 00:16:06,240 --> 00:16:08,160 Speaker 7: fence so that we could climb out through the back 323 00:16:08,200 --> 00:16:09,680 Speaker 7: fence and through the neighbor's property. 324 00:16:09,920 --> 00:16:12,720 Speaker 1: All of her neighbors are in the same situation. The 325 00:16:12,760 --> 00:16:14,800 Speaker 1: house at the end of the streets bore the baruns 326 00:16:14,800 --> 00:16:15,160 Speaker 1: of us. 327 00:16:15,440 --> 00:16:17,200 Speaker 4: I don't want this for anybody else. 328 00:16:22,240 --> 00:16:22,840 Speaker 1: God it's way. 329 00:16:23,040 --> 00:16:26,120 Speaker 7: It's quite upsetting because you feel like you're kind of 330 00:16:26,200 --> 00:16:29,680 Speaker 7: tricked into it because you think if the council gives 331 00:16:29,720 --> 00:16:32,720 Speaker 7: consent to build on a piece of land that that 332 00:16:32,760 --> 00:16:34,080 Speaker 7: piece of land would be safe. 333 00:16:36,720 --> 00:16:41,080 Speaker 2: Chris, what would you like the government to do tomorrow? 334 00:16:41,320 --> 00:16:43,880 Speaker 2: Would it be something like bringing in a law saying 335 00:16:43,960 --> 00:16:48,680 Speaker 2: you can't build on flood prone areas or something as simple. 336 00:16:48,400 --> 00:16:52,200 Speaker 1: As that, or I mean, what would you tackle first? 337 00:16:53,680 --> 00:16:56,040 Speaker 3: I might take two or three of it's okay, still 338 00:16:56,720 --> 00:16:59,320 Speaker 3: certainly rooms for not building and dumb places. And I'm 339 00:16:59,320 --> 00:17:01,880 Speaker 3: heartened by the message that the Prime Minister gave on that. 340 00:17:02,320 --> 00:17:05,719 Speaker 3: I think the data issue, having a really good picture 341 00:17:05,720 --> 00:17:08,439 Speaker 3: of what the weare the risk is and then you 342 00:17:08,480 --> 00:17:11,199 Speaker 3: can empower counsels to say, okay, we're all working off 343 00:17:11,240 --> 00:17:14,560 Speaker 3: the same data here, I can get the councilors can 344 00:17:15,119 --> 00:17:17,760 Speaker 3: get stuck into that, and then answering some of the 345 00:17:17,840 --> 00:17:20,840 Speaker 3: questions about who pays would be really useful too, because 346 00:17:20,880 --> 00:17:23,240 Speaker 3: I think you know, it's good, there's there's pleady of 347 00:17:23,280 --> 00:17:25,040 Speaker 3: good intentions out there, but stuff is going to have 348 00:17:25,080 --> 00:17:27,880 Speaker 3: to get built to make sure that we're reducing some 349 00:17:27,920 --> 00:17:31,280 Speaker 3: of the risk of primarily flooding and landslip on other 350 00:17:31,320 --> 00:17:31,800 Speaker 3: things as well. 351 00:17:31,840 --> 00:17:34,840 Speaker 4: When when when it's weather hat so if we're giving. 352 00:17:34,640 --> 00:17:36,320 Speaker 3: Clear leadership on that by the end of the year 353 00:17:36,320 --> 00:17:38,640 Speaker 3: by the government, then I think there would be good 354 00:17:39,480 --> 00:17:41,800 Speaker 3: a lot of momentum to start. There's plenty more to do, 355 00:17:41,920 --> 00:17:44,240 Speaker 3: but I think if we start biting this, taking this 356 00:17:44,359 --> 00:17:46,239 Speaker 3: as a chunk by chunk, then that's much better than 357 00:17:46,280 --> 00:17:47,840 Speaker 3: China ball all of the ocean. 358 00:17:48,000 --> 00:17:49,879 Speaker 2: And just lastly, I've just thought of this, Chris, because 359 00:17:49,960 --> 00:17:51,960 Speaker 2: it's something that I'm sure that comes up with you 360 00:17:52,000 --> 00:17:55,440 Speaker 2: gout you all the time, our insurance. 361 00:17:55,000 --> 00:17:57,320 Speaker 1: Evil and not want to ever pay out. 362 00:17:57,400 --> 00:18:01,840 Speaker 3: Ever, Look, that's a public perception, and I think it's 363 00:18:01,880 --> 00:18:04,399 Speaker 3: around fair. I think if you look at what happened 364 00:18:04,800 --> 00:18:08,600 Speaker 3: certainly around Cyclo and Gabrielle and Augland anniversary weekend, we 365 00:18:08,640 --> 00:18:12,200 Speaker 3: had about ninety six percent of settlements done within eighteen months. 366 00:18:12,560 --> 00:18:15,359 Speaker 3: It's a vast improvement on some of the experiences that 367 00:18:16,280 --> 00:18:19,080 Speaker 3: understandably people might have been might have may been frustrated 368 00:18:19,320 --> 00:18:20,640 Speaker 3: with Kai. 369 00:18:20,480 --> 00:18:23,240 Speaker 4: Kora and the Christ Shoots earthquake. 370 00:18:23,720 --> 00:18:25,760 Speaker 3: I mean, we're there to make sure that people have 371 00:18:25,840 --> 00:18:29,000 Speaker 3: the peace of mind went when these things happen, that 372 00:18:29,040 --> 00:18:31,880 Speaker 3: we're there to support them. And I think overwhelmingly in 373 00:18:31,920 --> 00:18:34,920 Speaker 3: the last couple of years, three point eight billion dollars 374 00:18:35,000 --> 00:18:37,880 Speaker 3: gone into settlements to actual people and businesses can get 375 00:18:37,920 --> 00:18:41,080 Speaker 3: back up on their feet. I know that's a public perception, 376 00:18:41,320 --> 00:18:43,320 Speaker 3: but the numbers that I've just read it off, I 377 00:18:43,359 --> 00:18:46,120 Speaker 3: think are quite an impressive response to one of the biggest, 378 00:18:46,320 --> 00:18:49,320 Speaker 3: if not their biggest, climate related events that the country 379 00:18:49,359 --> 00:18:51,440 Speaker 3: has had. And the fact that we I to get 380 00:18:51,520 --> 00:18:53,720 Speaker 3: people back up on their feet so quickly. I think 381 00:18:54,240 --> 00:18:55,720 Speaker 3: it's test them to do a lot of hard work. 382 00:18:56,240 --> 00:18:58,560 Speaker 3: But as we were told at our conferences, yet it 383 00:18:58,600 --> 00:19:01,000 Speaker 3: was good. Could you do any better? Looking to improve? 384 00:19:01,240 --> 00:19:02,560 Speaker 1: Thanks for joining us, Chris. 385 00:19:03,359 --> 00:19:03,760 Speaker 4: Thank ee. 386 00:19:07,240 --> 00:19:10,320 Speaker 2: That's it for this episode of The Front Page. You 387 00:19:10,359 --> 00:19:14,359 Speaker 2: can read more about today's stories and extensive news coverage 388 00:19:14,359 --> 00:19:17,960 Speaker 2: at enzedherld dot co dot nz. The Front Page is 389 00:19:18,000 --> 00:19:21,520 Speaker 2: produced by Ethan Sills and Richard Martin, who is also 390 00:19:21,800 --> 00:19:22,439 Speaker 2: our editor. 391 00:19:22,920 --> 00:19:24,320 Speaker 1: I am Chelsea Daniels. 392 00:19:24,680 --> 00:19:28,159 Speaker 2: Subscribe to The Front Page on iHeartRadio or wherever you 393 00:19:28,160 --> 00:19:31,800 Speaker 2: get your podcasts, and tune in on Monday for another 394 00:19:31,840 --> 00:19:33,600 Speaker 2: look behind the headlines.