Toka Tū Ake EQC Annual Report 2022-2023
The past year has been one of significant progress and achievement for Toka Tū Ake EQC, but a challenging time for our wider community and country. Many thousands of homeowners have had to deal with the significant and life-changing impacts of Cyclone Gabrielle and other severe weather events in Nelson/Marlborough in August 2022 and the Upper North Island in January and February 2023.
The Toka Tū Ake EQC scheme exists to help homeowners recover from devastating natural hazard events by providing the first layer of residential land and building insurance cover for certain hazards. At Toka Tū Ake EQC we also want to help prevent or minimise the impacts of natural hazard events, rather than purely react, respond and support the recovery from them.
Since 30 June 2021, the vast majority of new claims have been managed by private insurers on our behalf to make the overall insurance process as simple as possible for impacted homeowners. We have stood shoulder to shoulder with insurers as we have road-tested the model through a range of natural hazard events since it went live. Our model is designed to always keep the focus on the homeowner’s experience.
We have seen a significant change in our claims profile as a result of these recent weather events, from a majority of building claims previously to mostly residential land claims.. While the land cover provided under the scheme is unique in the world it can be technical and difficult to assess in the aftermath of a natural hazard event, especially as land often takes some time to stabilise or settle following an event. We are incorporating what we have learned in our work to continuously improve the efficiency and effectiveness of our claims model across a range of event response types, including extreme weather events.
A core design principle for our scheme is that it remains sustainable and that the cost of adequate first-layer residential insurance remains accessible and affordable. This year Toka Tū Ake EQC secured a record level of reinsurance of just under $8.2 billion for 2023-2024, including $225 million through a catastrophe bond.