Stratford Mayor Neil Volzke: Costs won’t reduce if we don’t mitigate weather issues

People of Piha were cut off by the effects of Cyclone Gabrielle with many houses wiped out due to landslides. Photo / George Heard

OPINION

Recently I paid my annual home insurance bill and like everyone else who has paid theirs of late, you will have noticed a major increase in the premium.

The increases are not the normal inflationary adjustments, but much larger percentages that are justified by the increasingly absurd costs of claims insurers are being subjected to. Typically, these are the claims arising from natural disasters worldwide and right here in New Zealand.

In principle we shouldn’t complain, because the whole purpose of insurance is to spread each individual’s risk profile across a whole lot of people, in effect meaning, that when one person’s individual claim occurs, we all collectively pay for it.

The trouble is these natural disaster claims are becoming more and more frequent and of much larger scale. Each event has a horrendous cost attached to it both in financial terms and in human grief. So, what does the future hold? A recent report makes for some grim reading.

The report by Niwa and the University of Auckland found that 441,384 residential buildings were at risk of flooding, with an estimated replacement value of $218 billion. Alarmingly, 12 per cent of New Zealand’s housing value is in a flood hazard area. The figures comprise 282,395 houses valued at $213b and 158,989 appurtenant buildings (like shed and sleep-outs) valued at $5b.

Most were in urban areas, with Auckland and Canterbury accounting for around half of the buildings. The Wellington, Waikato and Bay of Plenty regions also had many buildings affected.

Niwa hazard analyst Ryan Paulik said while New Zealand had a lot of residential buildings that could be exposed to fluvial flood hazards, a large number of those flood hazards were protected to some degree by stopbanks and other flood mitigation structures. He went on to say that it’s important to understand what the frequency of potential flood exposure could be, because a number of buildings that are identified as exposed to flooding might only be exposed to flooding under rare circumstances. This meant rare flood events with high intensity and magnitude such as Cyclone Gabrielle may not be sufficiently factored into planning and as a nation, we are continuing to build in flood risk areas.

Essentially, we have a two-pronged problem. One is dealing with buildings that are already in existence and the other is managing where buildings are constructed in the future.

For me, what is really alarming and just plain stupid is that plenty of houses are still being built in flood-risk areas. Previously, Radio New Zealand reported that council consent staff were being pressured to give the go-ahead to developments in flood-risk areas in the greater Wellington region. It also reported that more than 15 per cent of the state housing portfolio was on flood-prone land, and Kāinga Ora planned to continue putting new builds on land it knows will flood in the future. Go figure?

One tiny beacon of light that has surfaced during the election campaign and as a result of Cyclone Gabrielle is that the major political parties seem to have, at last, recognised the problem and are making the first noises on what can/should be done to prevent future events. Some have even committed funding packages to start addressing the issues and while one or two billion dollars here and there may seem a lot of money, it is a drop in the ocean in comparison to the remedial costs that can be imposed by catastrophic weather events.

Unless we get seriously serious about mitigating these uncontrollable weather events soon, we are going to be paying like never before. Furthermore, the issue needs to be de-politicised, and a cross-party strategy developed that is based on scientific and geographical factors, not vote-catching headlines.

Going back to my opening sentence; will I ever see my insurance premium going down? Not likely.