CoverNote September 2026 issue

September 2026

Leading through advocacy IBANZ releases its Advocacy Briefing Paper

ALSO IN THIS ISSUE AI Liability - the next silent risk for New Zealand businesses Proposed changes to the Building Act New research provides insights into future flood risks to infrastructure Climate resilience plans still have barriers to overcome Why meaningful choice matters

New Zealand's professional association representing the interests of insurance brokers, risk managers and consumers.

IBANZ gives strength and support to members, enabling them to better meet their challenges and opportunities.

We achieve this through staying involved with government activity and legislative reform impacting the insurance industry, and more specifically, fire and general brokers and their clients.

We focus on providing high-quality presenters who speak on a variety of fire, general and business topics under our Continuing Professional Development (CPD) offering to support members deepen their knowledge and broaden their skills.

The IBANZ Code of Professional Conduct provides the public with assurance that members act in a professional and ethical manner. It includes a disciplinary and complaints committee to review concerns that may arise.

Ph: 09 306 1732 www.ibanz.co.nz

Welcome to the September 2026 CoverNote

T

he insurance and risk landscape is evolving rapidly, shaped by climate change, regulatory reform, and growing expectations around consumer protection and resilience. In this edition, we explore several of the critical issues influencing the future of our industry and the communities we serve.

Across the country, the cost of climate risk is rising. We examine Te Waihanga, the New Zealand Infrastructure Commission’s findings on the scale of the Katherine Wilson resilience challenge facing local authorities, insurers, businesses and communities. The Commission’s research reveals annual average losses from inland and coastal flooding are projected to increase markedly by 2075 and examines the challenge that lies ahead for the long-term sustainability of critical infrastructure networks.

Complementing this, we examine proposed changes to New Zealand’s building liability and consumer protection framework through the Building Amendment Bill. The proposed Bill would see a major shift introducing proportionate liability for defective building work, mandatory home warranties, and compulsory professional indemnity insurance for design professionals. These reforms have the potential to reshape risk allocation across the industry.

Advocacy remains a central part of ensuring the industry's voice is heard as these changes unfold. In this issue, we highlight how IBANZ is advancing key priorities through its recently released Advocacy Briefing Paper, focusing on natural hazard preparedness, insurance accessibility and affordability, and the quality of insurance advice.

Through engagement with government leaders and increased media visibility, IBANZ continues to champion practical solutions that support members and strengthen confidence in the insurance sector.

Together, these stories highlight a common theme: managing risk in an era of change. Whether driven by climate pressures, regulatory reform, or evolving market expectations, the decisions being made today will play a critical role in determining the resilience, affordability, and performance of New Zealand's infrastructure and construction sectors for decades to come.

Enjoy the third issue of 2026.

Katherine Wilson.

Cover story

Regulars 1 Welcome to CoverNote

Pages 6 - 7

Leading through advocacy IBANZ releases its Advocacy Briefing Paper

18

Humans of NZI

42-43

FSCL Case Studies

40

44-45 48

ISFO Case Study IBANZ Forum

IBANZ Contacts

Features 4

Marine insurance in transition: an evolving risk landscape

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AI Liability The next silent risk for New Zealand businesses

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The insurance conversation brokers avoid - and clients keep starting anyway

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The advice gap is reshaping how New Zealand brokers deploy senior talent

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NZI strengthens leadership capability with two senior appointments

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Rothbury Insurance Brokers has appointed Charlene Kitching as Head of Broking Services

22

Lockton strengthens New Zealand offering with new Queenstown office

24

Proposed changes to the Building Act would impact construction and PI sectors

28

Lessons from the FIFA World Cup

40

Why meaningful choice matters

21 RedBook launches ‘RegCheck’ the vehicle verification tool for brokers and insurers

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Cyber insurance delivers meaningful financial protection, with a majority of data breach and first-party losses covered

Climate Change 30

The climate risks you can't insure away

32

New research provides insights into future flood risks to infrastructure

34

Kaikōura river's repair bill exposes New Zealand's funding fight

36

Climate resilience plans still have barriers to overcome

38

Climate Change Response Amendment Bill welcomed

39

New Zealanders call for stronger Government leadership on climate hazards

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HOT OFF THE PRESS! 31.Editorial/Content

September 2026

Leading through advocacy IBANZ releases their Advocacy Briefing Paper

ALSO IN THIS ISSUE AI Liability - the next silent risk for New Zealand businesses Proposed changes to the Building Act would impact construction and PI sectors New research provides insights into future flood risks to infrastructure Climate resilience plans still have barriers to overcome Why meaningful choice matters

Aidan Bennett, Benefitz Mob 021 500 997 Email aidan@benefitz.co.nz

2

CoverNote is the official publication of IBANZ and is distributed FREE on a quarterly basis (March, June, September, December) to members throughout New Zealand and associated companies. Additional copies are available at a cost of $7.50 per copy, or 12 month (4 issues) subscriptions at $30.00, inclusive of postage and packaging. The articles or opinions featured within this magazine are not necessarily the opinions of the publishers or IBANZ, and they do not accept responsibility for the content of articles featured within the publication. No part of this publication may be reproduced without the written permission of the publisher. The publishers do not accept responsibility for loss or damage to unsolicited photographs or manuscripts.

IBANZ enquiries should be made to: Katherine Wilson, Chief Executive, IBANZ. Email: katherine@ibanz.co.nz IBANZ National Office located at: The Crate, 28 Constellation Drive, Rosedale, Auckland 0632 PO Box 302196, North Harbour, Auckland 0751 Telephone 09-306-1734 | Website: www.ibanz.co.nz

Advertising/Content Liz Cannon, Benefitz Mob 021 204 3395 Email liz@benefitz.co.nz

September 2026

Produced for IBANZ by Benefitz 5-11 Parkway Drive, Mairangi Bay, Auckland 0632.

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Telephone 09 477 4700

Calendar of events September to November 2026 Pages 46 - 47

Design/Production Craig Burkett, Benefitz, Imaging: CTP by Benefitz Advertising Deadlines Bookings 10th of the month prior to publication, material 15th of the month prior to publication.

ISSN 2815-9268

Risk Impact launch event

Risk Impact:

A landmark report on the value of New Zealand's insurance brokers R

isk is becoming more complex. From natural hazards and economic uncertainty to cyber threats and changing regulation, New Zealanders are experiencing an increasingly challenging landscape. As these risks evolve, so too does the role of the insurance broker.

Next month, IBANZ will launch Risk Impact - The Value of New Zealand's Broking Profession, the first report of its kind to examine the contribution insurance brokers make to New Zealand's economy, businesses and communities.

Developed to provide an evidence-based view of the profession, the report looks at the growing value brokers create through trusted advice, risk management expertise and advocacy for clients. It highlights the important role brokers play in helping individuals and organisations understand risk, make informed decisions and recover more effectively when unexpected events occur. The report also considers how the profession is adapting to changing customer expectations, technological innovation and a plethora of evolving risks.

PLACES ARE LIMITED

Register now to be among the first to access the findings of this landmark report.

CHRISTCHURCH EVENT 7am - 9am Wednesday, 14 October 2026 Rydges Latimer Hotel

Scan below to register

Key findings set to be unveiled include: •

A snapshot of New Zealand’s broking industry: workforce size, diversity, regional distribution, and education levels.

•

The broking industry’s total Gross Written Premiums and contribution to New Zealand’s insurance market.

•

New insights into claims volumes, including the average number of claims handled and the time taken to deliver payouts.

To mark the release, IBANZ will host exclusive breakfast events in Christchurch (14 October) and Auckland (15 October), where attendees will receive a first look at the report's findings. The events will bring together brokers, insurers, business leaders and industry stakeholders to explore the future of risk advice in New Zealand and discuss the profession's growing contribution to resilience and economic wellbeing.

AUCKLAND EVENT 7am - 9am Thursday, 15 October 2026 Pullman Hotel

Scan below to register

The Auckland event will be joined by Hon. Cameron Brewer, Minister of Commerce and Consumer Affairs.

Whether you are an insurance broker, insurer, business leader or policymaker, these events provide an opportunity to hear directly from IBANZ Chief Executive Katherine Wilson and gain insights into one of the most comprehensive studies ever undertaken on New Zealand's insurance broking profession.

www.covernote.co.nz

3

Marine Insurance

Marine insurance in transition: an evolving risk landscape

war and strike risks. John McKelvie of Vero Marine outlined changes to policy exclusions and examined how international events are influencing New Zealand trade and marine insurance cover.

Legislative change was another major focus. Matthew Flynn and Zane Fookes of McElroys discussed the transition from the Marine Insurance Act 1908 to the new Insurance Contracts Act, considering how disclosure obligations will change and what brokers need to understand as the new framework is implemented.

The workshop also highlighted the increasing importance of risk management as vessel technology and client operations evolve. Glen Hunter of Hunter Marine talked about the condition of older vessels alongside the growing risks associated with lithium-ion batteries on marine craft - an emerging exposure receiving increasing attention across the market.

Katherine Wilson (IBANZ) and John Lucas (ICNZ)

M

arine insurance operates in a dynamic environment, and the pace of change is accelerating. Geopolitical instability, legislative reform, and emerging technologies are reshaping the sector, creating challenges for insurers, brokers and their clients.

Against this backdrop, IBANZ and the Insurance Council of New Zealand (ICNZ) recently brought the industry together for a dedicated Marine Workshop in Auckland to cover the latest developments.

IBANZ Chief Executive Katherine Wilson said the workshop demonstrated the importance of staying informed in an environment where change is becoming the norm.

"From global conflict through to domestic legislative reform and evolving operational risks, brokers are navigating an increasingly complex landscape. Bringing the industry together to share knowledge and perspectives helps ensure brokers remain well equipped to support their clients."

One of the key topics explored was the impact of geopolitical tensions, including conflict in the Middle East, on

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September 2026

Infrastructure and marina resilience standards were demonstrated by Rob Brown of Shorewise Engineering, who shared practical insights via a series of examples which explained the importance of proactive asset maintenance and planning.

The final presentation was from John Lucas of ICNZ, who gave an update on the Fire and Emergency New Zealand (FENZ) levy changes taking effect from July 2026 and what the reforms mean for marine hull and marine transit insurance.

The event reinforced that the marine insurance environment now extends beyond traditional risks. Brokers are increasingly expected to understand legislative reform, geopolitical developments, and emerging technologies while continuing to provide practical advice and tailored insurance solutions.

IBANZ extends its thanks to the Insurance Council of New Zealand (ICNZ) for partnering to deliver the workshop, and to presenters John McKelvie, Matthew Flynn, Zane Fookes, Glen Hunter, Rob Brown and John Lucas for sharing their expertise.

As the marine sector continues to evolve, industry events have an important role in ensuring New Zealand insurance brokers remain informed, connected and ready to respond to the challenges.

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IBANZ Advocacy

Katherine Wilson and Hon. Simon Watts

Katherine Wilson and MP Arena Williams

Key highlights FYE2026

External

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September 2026

Leading through advocacy T

he release of the IBANZ Advocacy Briefing Paper marked an important step in strengthening the voice of insurance brokers across New Zealand.

Developed to highlight the issues that matter most to our members, the paper sets out our top three priorities: 1.

Improve readiness for natural hazards

3.

Quality of insurance advice

2.

Accessibility and affordability of insurance

Bringing these priorities to life has meant taking advocacy beyond the page and into meaningful conversations with decision-makers.

In recent months, IBANZ Chief Executive Katherine Wilson and members of the board met with Hon. Simon Watts (Minister of Climate Change and Minister of Local Government) and MP Arena Williams (Labour Party Spokesperson for Commerce and Consumer Affairs). These two meetings provided an opportunity to share insights from across the industry and demonstrate the vital role brokers play in helping New Zealanders manage risk and recover from unexpected events.

The discussions reinforced the importance of collaboration between government and industry. By presenting practical solutions and highlighting the experiences of our members, IBANZ advocates for policies that support our members and strengthen confidence in the insurance sector.

Another positive outcome of our Advocacy Briefing Paper was increased media interest in IBANZ's position on FENZ levies and Section 72 notices. This led to several media opportunities, including a prominent feature in the New Zealand Herald and a Radio New Zealand interview.

From the publication of the Advocacy Briefing Paper to engagement with key political leaders and increased media coverage of our advocacy positions, IBANZ is turning advocacy into action and ensuring the industry's voice is heard where it matters most.

www.covernote.co.nz

7

Gallagher’s global insights

AI Liability

The next silent risk for New Zealand businesses

G

allagher’s global insights identify AI liability as the next ‘silent risk’ for businesses, mirroring the early stages of cyber risk, where exposures existed long before they were fully understood or explicitly covered.

What makes AI different is the speed at which that pattern is unfolding.

In New Zealand, adoption is already well advanced. Datacom research shows that around 87% of organisations are already using AI in some capacity, with many reporting improvements in productivity, efficiency and decision-making. However, while the benefits are immediate, the supporting frameworks around governance, regulation and insurance are still catching up.

A familiar pattern, evolving faster The insurance market has seen this before. In the early stages of cyber risk, many exposures

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September 2026

sat ‘silently’ within traditional policies. Coverage was not absent, but it was often unclear. When losses occurred, that lack of clarity became highly visible.

AI is now tracking along a similar path.

The risks are already present within business operations, whether through automated decisionmaking, customer-facing tools or internally generated insights. However, the way those risks translate into liability, and how they are treated within insurance programmes, is not always well defined.

The key learning from global markets is that risk tends to emerge first, with clarity on the true impact following later. For New Zealand businesses, this means the question is no longer whether AI introduces liability exposure, but whether that exposure is understood.

New Zealand’s regulatory context Globally, regulation is still evolving. In New Zealand, the approach has been intentionally light-touch, with a focus on principles rather than AI-specific laws.

Existing frameworks, most notably the Privacy Act, continue to apply and regulators are increasingly enforcing this. The Office of the Privacy Commissioner has also made it clear that privacy obligations extend across the entire AI lifecycle, from data inputs through to outputs and decisions. At the same time, the Reserve Bank of New Zealand has signalled concerns around how AI may amplify financial, operational and cyber risks, particularly where third-party providers are involved.

This approach supports innovation, but it also changes the risk dynamic. In the absence of detailed regulation, accountability sits more firmly with the business itself.

They are required to make judgement calls about how AI is used, governed and controlled, often without definitive external benchmarks.

Where liability is most likely to emerge One of the defining characteristics of AI risk is that it does not sit neatly in one place.

Unlike traditional risks that align to clear categories, AI creates exposure across multiple parts of the business.

A single issue, such as an incorrect output or flawed recommendation, can have implications for professional advice, customer outcomes, operational performance, and governance simultaneously.

From an insurance perspective, this means potential triggers span multiple policies, from professional indemnity through to cyber and directors’ and officers’ liability. The complexity is not just in the risk itself, but in how different policies may respond.

Adding to this complexity is the way AI is typically deployed. Most businesses are not building systems in isolation. They’re relying on a network of external providers, platforms and data sources. This creates an ecosystem where accountability is shared and, at times, unclear.

When something goes wrong, responsibility may not sit with a single party. Instead, it can be distributed across developers, vendors and users, often across jurisdictions.

Global experience shows that this is where disputes are most likely to arise, particularly when contractual protections and insurance responses have not been clearly aligned in advance.

The gap between use and control For many businesses, the most immediate risk does not stem from the technology itself, but from the pace at which it is being adopted.

AI is increasingly being used to support decisionmaking, streamline processes and enhance customer interactions. However, governance frameworks, internal controls and oversight mechanisms are still developing.

This creates a gap between how AI is used and how well it is understood or managed.

It is within this gap that liability is most likely to emerge.

Early indicators from global markets suggest that issues often arise not from system failure, but from over-reliance on AI outputs without sufficient challenge, validation or accountability. Inaccurate insights, biased outcomes or unintended consequences can quickly translate into financial loss, reputational damage or regulatory scrutiny.

Insurance in a period of transition As with cyber risks, the insurance market is evolving in response to AI. Insurers are beginning to refine policy wordings and clarify their positions on AI-related exposures. However, this is still a developing area. In many cases, businesses are operating in a period where risk is advancing faster than certainty around coverage.

This creates an environment where exposures may exist, but how they are treated under insurance programmes is not always clear until tested.

The lesson from cyber is that this period does not last indefinitely. As claims emerge and understanding improves, policies tend to become more explicit, often with more defined terms, conditions and exclusions.

Businesses that engage early are typically better positioned to navigate that transition.

Moving forward with clarity AI presents a significant opportunity for New Zealand businesses, but it also introduces a new and evolving layer of liability.

The most effective response is not to slow adoption, but to ensure that risk, governance and insurance strategies evolve alongside it. This means understanding where AI is being used, how decisions are being made, and how potential exposures flow through the organisation and into your insurance programme.

In a landscape changing this quickly, early insight is a critical advantage.

www.covernote.co.nz

9

Broker Insights

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September 2026

The insurance conversation brokers avoid - and clients keep starting anyway B

rokers assume asking wealthy clients about their belongings sounds like a sales pitch, but underwriters say it's usually the client who raises it first.

For a broker already handling a Felicity Sheppard, client's construction Underwriter & Head of or commercial Specie at Keystone insurance, asking about the paintings on their wall or the watch in their safe can feel like an awkward pivot - as though it risks sounding like a broker fishing for extra business. Felicity Sheppard (pictured), underwriter and head of specie for Melbourne-headquartered Keystone Underwriting in Australia, says that's rarely how it actually plays out.

"That's right," she said. "That's certainly how I often hear of it - it's the client that mentions something." In Sheppard's experience, the trigger is usually mundane and client-led: a business owner she's covering for a construction risk mentions, almost in passing, that they'd like their Rolex insured too. It's a stray comment attached to an existing relationship, not a cold pitch from the broker.

Why the client gets there first The reason is less about salesmanship and more about proximity. Brokers handling a wealthy client's core insurance - home, business, professional indemnity - are already in the room when personal wealth comes up naturally. Clients tend to default to the adviser they already trust rather than shop around for a specialist they've never met, particularly for something as personal as a watch or an heirloom.

That dynamic suits brokers who want to be, in Sheppard's words, "a one-stop shop for their

clients, so all things to their client from that [insurance] aspect." Sheppard said Keystone deliberately supports that instinct in the Australian market, offering a broad enough product range that a broker whose core business is construction risk can still bring back a workable answer when a client asks about a piece of jewellery or a small art collection - without needing to hand the client off elsewhere.

The same dynamic is visible in New Zealand's private client market, even without an identical underwriting structure. Chubb's Masterpiece policy in New Zealand is built around exactly this bundling logic - home, contents, jewellery, fine art and personal liability sitting under one high-net-worth policy rather than being split across separate specialists. NZ private client brokers such as Rothbury and Howden similarly package valuables cover - art, wine, bullion, sports memorabilia - alongside a client's broader personal asset insurance, reflecting the same expectation Sheppard describes: clients want one adviser across all of it, not a referral chain.

Low-key doesn't mean low-value The size of these placements is often modest - "one or two pieces," as Sheppard describes it, rather than a sprawling collection. But the conversation matters disproportionately for client retention: a broker who can say yes to a stray, personal request reinforces exactly the kind of relationship wealthy clients want from their adviser - someone who handles everything, not just the core commercial risk.

For brokers hesitant to raise the subject unprompted, the more useful posture may be one of simple availability rather than active pitching: making it clear, in the normal course of an annual review, that personal valuables cover sits within scope. Whether the client is in Melbourne or Auckland, Sheppard's experience suggests the client will often do the rest - brokers just need to be ready with an answer when they do.

www.covernote.co.nz

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Broker News

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September 2026

The advice gap is reshaping how New Zealand brokers deploy senior talent Abbott’s Christchurch appointment reflects a market-wide rethink of where experience creates value.

T

hree of New Zealand’s largest broking operations are publicly making the same argument to commercial clients in 2026: insurance placement alone is no longer sufficient. A Christchurch appointment crystallises a structural question the whole industry is navigating.

The appointment

Michael Carswell

Broker and Business Development Executive Abbott's Christchurch commercial team

Abbott Insurance Brokers announced on July 29 the appointment of Michael Carswell (pictured) as broker and business development executive in its Christchurch commercial team. Carswell brings more than two decades of experience across underwriting, executive leadership, and commercial broking, with senior roles at NZI, QBE, and Aon on both the insurer and intermediary sides of the market. The structural logic behind the appointment is as significant as the hire itself. Abbott is placing one of its

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Broker News

One thing has become increasingly clear to me - the conversations that create the greatest value for clients rarely start with insurance.

They start with understanding the business – where it’s heading, the opportunities it’s pursuing, and the risks that could stand in its way.

Michael Carswell Broker and Business Development Executive Abbott's Christchurch commercial team

(FMA) Access to Financial Advice Review, completed in March 2026 following consumer research and sector engagement conducted from July to December 2025, found that only 28% of New Zealanders had accessed financial advice in the past 12 months. FMA chief executive Samantha Barrass said that improving access to quality financial advice is critical to New Zealanders’ long-term financial wellbeing, and that there is “significant opportunity to expand access to advice so more New Zealanders can benefit from it.”

That finding sits alongside structural regulatory change.

Since 31 March 2025, insurers have been required to hold a financial institution licence and establish a fair conduct programme under the Conduct of Financial Institutions (CoFI) regime. Alongside existing obligations on licensed financial advice providers under the Financial Markets Conduct Act 2013 and the Code of Professional Conduct for Financial Advice Services, the changes have strengthened expectations around the quality of insurance advice and customer outcomes.

Meanwhile, Vero New Zealand’s 2026 SME research described Kiwi SMEs as increasingly valuing practical risk advice in addition to their cover.

Competitors are arriving at the same conclusion

most experienced practitioners directly into a client-facing advisory role - an explicit reversal of the industry convention in which seniority typically moves people away from daily client contact and into management, national practice, or business development functions.

Abbott chief executive Mark Reid said the firm is deliberate about that choice. “Many organisations see experience as something that naturally moves further away from clients as careers progress. We’ve taken the opposite view. We believe our most experienced advisers create the greatest value when they’re sitting alongside business owners – understanding their ambitions, navigating complexity, and mitigating risk,” Reid said.

Carswell said the rationale reflects where he believes senior practitioners can make the most difference. “One thing has become increasingly clear to me - the conversations that create the greatest value for clients rarely start with insurance. They start with understanding the business – where it’s heading, the opportunities it’s pursuing, and the risks that could stand in its way. Insurance then becomes one part of a much wider conversation about protecting value, supporting growth, and building resilience,” he said.

Why the client base makes this matter The commercial stakes of getting advisory engagement right for small and medium-sized businesses are significant.

Small businesses make up around 97% of all enterprises in New Zealand and contribute about 42% of total economic value, according to the Ministry of Business, Innovation and Employment (MBIE) – making the SME segment the primary commercial broking client base across the market. That segment is navigating a period of sustained pressure. SME confidence entered positive territory for the first time in five years in MYOB’s 2025 Business Monitor, with 46% of SMEs expecting the economy to improve over the next 12 months.

While economic sentiment has improved, SMEs continue to contend with cost pressures and regulatory obligations that influence business resilience and risk management decisions, including inflation, consumer demand, utility costs, interest rates, fuel and transport costs, and compliance requirements.

The advice gap and what the regulator says Research and regulatory findings point consistently to a gap between the advisory depth New Zealand businesses require and what they are receiving. The Financial Markets Authority’s 14

September 2026

Abbott is not making this argument in isolation. Two of New Zealand’s other leading broking firms have published closely aligned positions in 2026, drawn from their own clientfacing research and market analysis. Gallagher Insurance New Zealand published guidance in March 2026 arguing that commercial clients treating insurance as a transactional purchase are most exposed when disruption hits. Chief broking officer Mark Jones stated that underinsurance “isn’t just a claims problem anymore – it’s a financing and governance problem,” with banks and investors “asking sharper questions about insurance to value, business interruption modelling, and location exposures.” Jones framed insurance adequacy as directly relevant to loan covenants, mergers and acquisitions transactions, and growth plans.

Marsh New Zealand's February 2026 market update made a parallel case. The firm advised that “strong risk management continues to deliver the best insurance outcomes” and that, even in a competitive market, insurers favour businesses that demonstrate “sound governance and planning.” Marsh positioned its brokers explicitly as risk management experts rather than placement intermediaries. The convergence of this messaging across competing firms is the most significant signal in the current market. When Abbott, Gallagher and Marsh are all publicly framing commercial insurance advice as a risk management and governance conversation rather than a product transaction, this represents a directional shift in how the industry is positioning itself – not a point of differentiation for any single firm.

What market conditions are reinforcing Prevailing conditions are sharpening that pressure. The Insurance Council of New Zealand (ICNZ) reports the industry’s average combined ratio improved significantly, from 97.9% in December 2023 to 78.6% in December 2024, and many businesses achieved premium savings on property insurance in 2025, with that trend expected to continue into 2026. In a soft market where premium outcomes are increasingly available across the board, competing on price alone becomes a weaker value proposition. The broking firms that can substantiate a broader advisory role are responding to a commercial reality as much as to client demand. The question Abbott’s appointment poses for the broader market is not whether senior experience should be closer to clients – the evidence on that is converging. It is whether firms will restructure to make it so.

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15

People News

NZI strengthens leadership capability with two senior appointments

Garry Taylor

Executive General Manager, NZI

N

ZI has announced two senior appointments that further strengthen its Property and Liability team’s capability and reinforce its commitment to supporting brokers and customers in an increasingly complex insurance market.

Troy Sexton has been appointed Executive Manager, Portfolio Performance and Strategy and will join NZI on 20 July, while Kent Chaplin will join the business in September as Head of Liability.

Kent Chaplin

Head of Liability, NZI

Garry Taylor, Executive General Manager, NZI says, "These are two significant appointments for NZI and are a strong signal of our commitment to investing in the people and the expertise needed to support brokers and customers for the long term.

"Troy and Kent are highly respected insurance leaders with proven leadership and extensive industry experience and bring deep technical expertise. Together, they further strengthen our Property and Liability portfolio capability and reinforce our commitment to quality decision-making and sustainable growth."

About the appointments In a newly created role, Troy Sexton will lead NZI's Property portfolio strategy, performance and underwriting governance, working across underwriting, pricing, product and finance to optimise portfolio outcomes and balance risk and growth. He will join NZI’s leadership team.

Troy joins NZI from Everest Insurance, where he established and led the company's Property – Asia Pacific business. Prior to this appointment, he spent 18 years with ACE and Chubb, including as Chubb’s Chief Underwriting Officer for Property Asia Pacific, where he helped lead the property portfolio across 12 countries.

As Head of Liability, Kent Chaplin will lead NZI's end-toend Liability proposition, bringing together portfolio strategy, underwriting, claims, distribution and market engagement under a single leadership role.

Kent brings more than 30 years' experience spanning insurance, reinsurance, law and speciality markets. Most recently Group CEO of Delta Insurance Group, he has also held significant international leadership positions, including CEO of Lloyd's Asia Pacific.

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September 2026

Troy Sexton

Executive Manager Performance and Strategy Portfolio, NZI

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Meet Kim Wight

NZI’s Principal, Renewables

NZI is helping brokers and customers navigate New Zealand's energy transition.

W

hen Kim Wight talks about renewable energy, she’s not just talking about wind farms and solar panels. She’s talking about business resilience, evolving risk profiles, and the opportunities created when companies begin to see energy as a strategic asset rather than simply a cost of doing business.

Kim Wight

As NZI's newly appointed Principal, Renewables, Kim is helping shape how NZI approaches one of the most significant shifts facing businesses in Aotearoa New Zealand today: the transition to cleaner and more resilient energy sources.

NZI's Principal, Renewables

"My job is to make sure NZI is ready for what's next," she explains. "The energy transition is creating new opportunities for businesses, but it's also changing their risk profiles."

No two days look the same for Kim. One day she's talking with specialist renewable energy underwriters overseas; the next she's meeting New Zealand businesses exploring their energy transition plans. In between, she works with NZI teams to better understand emerging technologies and the risks that come with them.

Why the conversation is changing One of the biggest shifts Kim has observed is the way renewable energy has moved from a niche topic to a mainstream business discussion.

“I think renewables used to be seen as a fringe conversation,” she reflects. “What I really love is seeing energy use becoming a part of everyday business discussions and decision-making.”

She believes businesses are increasingly viewing energy through a strategic lens, seeking greater resilience, cost certainty and long-term competitiveness.

“Energy is becoming a strategic business asset,” she says.

“We're seeing a real shift where businesses are moving away from simply being energy consumers to energy generators.”

Kim says New Zealand is reaching a point where businesses no longer need to choose between sustainability and economics.

“Businesses are investing in renewable energy solutions that are helping reduce emissions while also lowering operating costs and improving energy resilience.

"Businesses are not only talking about it through a sustainability lens,” she observes. “They're talking about it through a commercial lens and how they can actually reduce costs and maintain a competitive edge."

A career built through curiosity

For many businesses, energy decisions are becoming business decisions, influencing everything from operating costs and resilience through to future growth and investment planning.

Like many people in insurance, Kim didn't set out to join the industry. Originally trained as a lawyer, she began her career in litigation before an opportunity to join Lumley, which later became part of NZI, set her on a different path.

What brokers should be watching

“I kind of fell into insurance, but then I made a deliberate decision to stay,” she laughs.

For brokers, Kim believes the opportunity lies in recognising how energy transition decisions can reshape a customer's risk profile.

While an organisation’s core operations may remain unchanged, the addition of technologies such as rooftop solar and battery storage can introduce new considerations from an insurance perspective.

What followed was what Kim jokingly describes as a "career by secondment" as she moved between claims, relationship management and major customer roles, building a broad understanding of the commercial insurance industry along the way.

Those experiences ultimately positioned her for the renewables role when NZI's growing sustainability focus and responsibility for underwriting the energy transition began to take shape.

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September 2026

"The energy transition isn't just about new technology; it's about understanding how those investments can change a customer's risk profile and making sure they're set up for success from the start," says Kim. Kim encourages brokers to look beyond individual technologies and instead focus on the broader trend of electrification and how clients are approaching it.

Kim and her son enjoying the outdoors Engaging risk engineers and insurers early allows customers to make better-informed decisions before construction or installation begins.

Businesses are investing in renewable energy solutions that are helping reduce emissions while also lowering operating costs and improving energy resilience.

She also advocates bringing an insurance lens into projects as early as possible.

“Design decisions, product decisions, contractor reputation, risk mitigation measures, all those things can make a real difference,” she says.

“If NZI is engaged early on, we've got our risk engineering team to apply that risk lens,” Kim explains. “It's a fully informed decision.”

Food, family and finding balance Away from work, Kim's favourite way to recharge is simple: spending time with the people closest to her.

Having grown up in a family where food and music were a central part of life, she still gravitates towards gathering friends and family around a table.

“If there's an opportunity to get together with friends or family over delicious food and try and solve the world's problems or just have a laugh, I'm there. That's my idea of a good time.”

Alongside good company, Kim is an enthusiastic podcast listener whose interests range widely.

“I often oscillate between pop culture podcasts, and then I go really deep. Right now, that’s listening to one about AI.” When life gets busy, Kim’s preferred reset is a walk outdoors with her dog and family.

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19

Broker News

Rothbury Insurance Brokers has appointed Charlene Kitching as Head of Broking Services

T

he role was created following a review of Business Operations to ensure the support provided to broking branches continues to evolve with the needs of the business.

As Head of Broking Services, Charlene is focused on improving how broking services operate across the business, bringing greater consistency and efficiency to how services are delivered - helping ensure clients receive more consistent, dependable support.

This includes simplifying processes and improving how teams work together across the business, creating a more joined-up and consistent approach to supporting brokers nationwide.

Charlene brings 34 years of experience with Aon, spanning broking, branch management and her most recent role as National CPF Manager. Her expertise in insurer policy wordings, underwriter relationships and system change is invaluable as Rothbury continues to evolve its broking services.

“I joined Rothbury at a time when strengthening broking services and consistency across the business is a real focus. It’s been great working with teams nationally to simplify how we do things and support brokers in delivering reliable service to clients,” says Kitching.

Based in Papamoa, Charlene works from Rothbury’s Tauranga office, collaborating with teams across the country. Outside of work, she enjoys family life with her husband and two children — supporting her daughter’s passion for musical theatre and cheering on her son as he completes his final years of school.

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September 2026

RedBook launches ‘RegCheck’

- the vehicle verification tool for brokers and insurers.

A

s policy volumes increase and regulatory expectations continue to evolve, insurers and brokers are always looking for ways to streamline these workflows without compromising accuracy.

That challenge is what sits behind the launch of RegCheck.co.nz, a new verification platform developed

by RedBook and designed specifically for high-volume insurance and broker operations.

Rather than simply producing vehicle history reports, RegCheck has been built as a practical risk management tool, bringing together multiple layers of information that underwriting, broking and claims teams can access quickly and consistently.

At the core of the platform are vehicle history and verification reports that provide all the key information required, including ownership and registration history, WOF, COF and registration status, odometer readings, PPSR finance checks, and a range of alerts that may indicate elevated risk.

Reports are presented in a clear, colour-coded format that allows users to identify important information quickly and make decisions with confidence.

One of the platform's most significant developments for insurers and brokers is its ability to handle vehicle checks and valuations in bulk. Through batch reporting, users can process vehicle histories, registrations and valuations across multiple vehicles simultaneously. For teams dealing with policy renewals, portfolio reviews, commercial fleets or claims assessment, this removes a significant administrative burden and can dramatically reduce processing time.

RegCheck incorporates trusted RedBook valuation data as an optional reporting feature. This provides insurers with independent market valuation information that can assist with sum-insured accuracy, total loss assessments, salvage calculations and premium setting.

Having reliable valuation data available alongside verification reporting helps create a more complete

For Insurers and Brokers.

picture of the vehicle and its associated risk profile.

The platform also includes enhanced RedBook specification data covering vehicle configuration, factory features, engine and transmission details, trim levels and model-specific specifications. This information allows insurers and brokers to verify that a vehicle matches the details declared by a policyholder, helping reduce errors, identify discrepancies and minimise the risk of misrepresentation.

Driver verification is another area attracting interest.

The RegCheck licence checking functionality enables users to confirm licence validity, endorsements, restrictions and suspensions. For commercial motor and fleet business in particular, access to this information can support stronger underwriting decisions and more efficient claims validation processes.

Recognising that insurance decisions are rarely made by a single person, the platform has also been designed around team-based workflows. Organisations can establish multiple users under a central dashboard, allowing administrators to manage permissions, monitor usage, centralise billing and maintain clear audit trails.

This enterprise approach makes the platform suitable for brokerages, underwriting agencies, insurer claims departments and compliance teams alike.

Beyond operational efficiency, RegCheck has introduced a community-focused element to its public reporting service. A portion of every public vehicle history report purchased is donated to New Zealand charities, with customers able to support organisations including KidsCan, I AM HOPE, Forest & Bird, SPCA and road safety charity Brake.

RegCheck is strongly positioned as a practical solution for an industry that continues to demand both efficiency and accuracy. For many insurance professionals, that combination may prove particularly valuable.

Learn more about a Business User account at RegCheck.co.nz

RedBook values and history checks by plate. For underwriting, claims and broker teams.

Set up a business account. regcheck.co.nz

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21

Broker News

Lockton strengthens New Zealand offering with new Queenstown office

Mark Hyland General Manager, Lockton New Zealand

L

ockton has announced the opening of its new office in Queenstown, led by General Manager Mark Hyland.

The new office opening further demonstrates Lockton’s strong commitment to the New Zealand market, adding to existing locations in Auckland, Hamilton and Christchurch.

Craig Buckle, Chief Executive Officer, Lockton New Zealand said: “I’m delighted to announce this expansion of our South Island presence, which supports our strategic growth ambitions. Since establishing our New Zealand operations in 2021, we have made a meaningful impact delivering tailored insurance and risk advisory services to clients.

“This new office positions us to build further momentum while providing the exceptional client service levels that Lockton is known for. I’m excited to see the positive impact the Queenstown team will make to the local community and beyond.”

The new office will be led by Mark Hyland, an insurance industry leader and Queenstown local. Mark brings decades of client management experience, specialising in commercial insurance and aviation risk.

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September 2026

Craig Buckle Chief Executive Officer, Lockton New Zealand

Commenting on his appointment as Queenstown General Manager, Mark said: “I’m excited to be leading Lockton’s newest branch and bringing the world’s largest privately owned insurance broker to the Southern Lakes region.

Queenstown is an incredibly dynamic market, and we’re building a strong local team with the expertise to meet the needs of businesses here.

“Opening our office at 36 Shotover Street is an important milestone for us. It allows us to build stronger relationships locally while connecting clients to Lockton’s global expertise and resources.”

About Lockton: Lockton's private ownership empowers its 13,100+ Associates doing business in over 140 countries to focus solely on clients' risk, insurance and people needs. With expertise that reaches around the globe, Lockton delivers deep industry knowledge and product specialisation with a passion for serving clients.

Visit: https://global.lockton.com/nz

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For advice on product suitability, please contact your financial adviser.

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23

Building Act changes

Proposed changes to the Building Act would impact construction and PI sectors

T

he Building Amendment Bill, which passed its first reading in Parliament in June, is proposing significant reforms to New Zealand’s building liability and consumer protection framework that will be of particular interest to insurers, brokers and underwriting agencies operating in the construction and professional indemnity (PI) sectors.

The Bill amends the Building Act 2004 and would see a shift from joint and several liability for defective building work to proportionate liability, the introduction of mandatory home warranties and compulsory professional indemnity (PI) insurance for design professionals.

Move to proportionate liability A significant legal reform proposed by the Bill is the replacement of the current joint and several liability framework with proportionate liability for defective building project work. This change is expected to have material implications for risk allocation across the construction sector and may influence future underwriting and claims outcomes.

Under a proportionate liability regime, each party involved in a building project is responsible only for the proportion of loss that reflects their contribution to the defect or failure.

The new liability framework will apply where multiple parties contributed to defective building project work, and a claim is pursued through litigation, adjudication or arbitration.

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September 2026

Mandatory home warranties The Bill proposes a warranty framework intended to strengthen consumer protection and provide homeowners with greater certainty in the event of defective building work.

Mandatory residential home warranties would be required for: •

New homes;

• Multi-unit residential buildings up to 10 metres in height; and •

Residential renovations valued at $100,000 or more where the work involves restricted building work and requires a building consent.

Warranty products will be required to provide minimum cover of: •

At least one year for defective building work; and

•

At least 10 years for structural defects.

The Bill also establishes a registration regime. Warranty providers would be registered with the Ministry of Business, Innovation and Employment (MBIE), the register would be publicly available and include the details of those whose registration has been suspended.

Mandatory Professional Indemnity (PI) insurance Design professionals such as architects, designers,

engineers and surveyors who contribute to the design or compliance of building work through advice or other services will need to have PI insurance.

Further detail on minimum insurance requirements is expected to be developed through regulations.

This represents a significant change for the professional services market and is likely to increase demand for PI insurance products across the building and construction sector.

Power to temporarily suspend warranty and insurance requirements Recognising the potential for market disruption, the Bill provides a mechanism for the Governor-General, on the recommendation of the Minister for Building and Construction, to temporarily disapply some or all home warranty and professional indemnity insurance requirements.

This power may be exercised where there is, or is likely to be, a material impact on the availability or affordability of these products. Examples could include insurer withdrawal, severe market disruption, or circumstances that may adversely affect housing delivery or continuity within the building sector.

Building sector funding changes The Bill also proposes changes to building research funding arrangements by combining the Building Levy and Building

Research Levy and introducing contestable funding.

Implementation timeframes The mandatory home warranty, professional indemnity insurance and proportionate liability provisions will come into force one year after the Bill gets Royal Assent. This is intended to provide time for insurers, warranty providers, brokers, construction professionals and regulators to prepare for the new regime.

What this means for brokers The proposed reforms can be expected to increase demand for both home warranty and professional indemnity insurance products. Brokers will have an important role in helping builders, developers, architects, engineers and other design professionals understand and meet the new requirements.

The shift to proportionate liability may also influence insurer pricing, coverage terms and underwriting appetite, making it important for brokers to stay informed as the reforms progress and the insurance market responds.

The Bill has been referred to the Infrastructure and Transport Select Committee for consideration. A due date is yet to be set for submissions and is likely to close in November 2026. IBANZ will participate in the select committee submission process.

www.covernote.co.nz

25

Willis Report

Cyber insurance delivers meaningful financial protection, with a majority of data breach and first-party losses covered

Michael Parrant, Director Cyber and Technology Practice, FINEX Pacific, Willis

Peter Foster, Chairman Global FINEX Cyber and Cyber Risk Solutions at Willis

M

ore than 95% of average data breach losses and 90% of average first-party losses are adequately covered by insurance, according to the latest report published in Australia by Willis, a WTW business (NASDAQ:WTW). The report, Cyber claims in Focus - Getting value from cyber insurance, analyses 5,500 cyber claims occurring from January 2013 to January 2026 across 95 countries, and around US$1 billion in insurer payments.

Data breaches are the most frequently reported cyber insurance loss, with malicious data breaches accounting for the majority of incidents. Ransomware losses register the highest financial severity, predominantly driven by the disrupted productivity and prolonged downtime that follows incidents. Third-party vendors are responsible for an increasing proportion of losses, and systemic risk from single vendor incidents impacting multiple organisations remains a critical concern.

Other key findings include:

•

The average ransomware event lasts 25 days, and the average loss is US$5.3 million, with the largest single loss now exceeding US$500 million.

•

Events where attackers target organisations’ systems directly account for 58% of ransomware notifications and 95% of total costs, while vendor-led incidents account for 42% of notifications but only 5% of costs.

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September 2026

•

Business interruption losses and ransom payments represent the two largest cost elements for ransomware events. Average ransom demands are now US$3.8 million versus an actual payment of US$1.5 million.

• Third parties are responsible for nearly 50% of data breach losses and 29% of first-party losses. Among the third parties responsible for breach events, 50% fall into the IT, tech or telecom categories, 17% involve financial institutions and 11% come from administrative services.

•

Pixel-tracking litigation is the hidden cyber insurance risk, with some cases leading to substantial losses across the wider cyber insurance market.

“Our analysis highlights a consistent pattern: while the average claim value is approximately $3.3 million, a relatively small number of large-scale events drive the majority of total losses. Incidents exceeding $10 million represent only around 5% of claims by volume, yet account for close to 90% of total cost, underscoring the materiality of tail risk in cyber portfolios.

While certain industries are targeted more frequently, no organisation or industry is immune to cyber incidents,” said Michael Parrant, Director, Cyber & Technology Practice, FINEX Pacific, Willis.

“In Australia, large-scale incidents have reinforced the

reality of escalating regulatory scrutiny, increasing class action exposure, and the significant downstream costs associated with remediation, customer notification and business disruption.

“As the threat landscape continues to intensify, the impact is being felt not only in the frequency, severity and velocity of cyber events, but also in the expanding blast radius and persistence of attacks. In response, organisations are increasingly adopting cyber risk quantification to support both control investment and insurance purchasing decisions, ensuring that programs are calibrated not only to expected losses, but to increasingly volatile and interconnected tail-risk scenarios.

“To get the strongest value from cyber insurance, consideration must reflect the claims patterns seen across the market.”

Peter Foster, chairman, global FINEX cyber and cyber risk solutions at Willis, added, "Cyber insurance cover varies widely, which is why organisations must understand what they have in place and ensure it aligns with their risk exposures. When cover doesn’t reflect reality, organisations risk critical gaps where protection is needed most, while paying for cover that offers little real value. To get the strongest value from cyber insurance, consideration must reflect the claims patterns seen across the market. Our analysis of claims and loss data

To get the strongest value from cyber insurance, consideration must reflect the claims patterns seen across the market.

Michael Parrant Director, Cyber and Technology Practice, FINEX Pacific, Willis

provides hints to understand how cyber losses occur and what that means for organisations, helping them to prioritise the most material scenarios and design coverage around these realities.”

Visit www.wtwco.com/en-nz to read the entire report.

www.covernote.co.nz

27

Football World Cup 2026

Lessons from the FIFA World Cup A

s North America hosted the largest FIFA World Cup in history, risk managers looked beyond the matches themselves.

Jeff Lang, Senior Vice President at Trucordia

With 48 teams, 104 matches and millions of fans expected across the US, Canada and Mexico, the tournament’s unprecedented scale is providing a blueprint for how organisations should approach risk planning for any large public event.

For Jeff Lang (pictured), senior vice president at Trucordia, the insurance challenge isn't simply protecting stadiums.

It's also safeguarding an interconnected ecosystem where transportation networks, hotels, sponsors, broadcasters, technology providers and government agencies all depend on one another.

"This is much more than a sporting event," Lang said.

"These are essentially temporary global cities. For 30 to 60 days, you've got millions of people, billions of dollars, dozens of venues, transportation networks, hotels, sponsors, broadcasters, and even government agencies all converging.

The insurance challenge is protecting this interconnected ecosystem where one disruption can cascade through multiple stakeholders."

Think beyond the venue That cascade is what makes a single incident so 28

September 2026

dangerous. Crowd safety and general liability top the list of common exposures: crushes, slips and falls, structural failures and transportation incidents moving fans between venues.

"When you have 70,000 or 80,000 people together in one stadium, the probability of small incidents becomes a certainty," he said. "Risk management is about preventing those incidents from becoming catastrophic events."

Security and terrorism exposures compound the problem.

A single attack, he noted, can simultaneously trigger general liability claims, business interruption, reputational damage and event cancellation.

Plan years ahead, not months Insurance is just one piece of the puzzle when it comes to protecting mega-events.

Sophisticated organisers begin with risk identification years in advance, said Lang, asking what could stop the event, reduce attendance or disrupt broadcasts and sponsor commitments. “These discussions happen in the boardroom, not just at the risk management desk,” he said.

The second piece is contractual risk transfer, including vendor agreements, security contracts, venue contracts, transportation providers, and hospitality partners.

"Some of the most effective risk management happens long before game day, and it's written into contracts rather than insurance policies," Lang noted.

Expect weather disruption Extreme heat, wildfires, flooding, severe storms and air quality are no longer just operational concerns.

Image credit: maxdigi - stock.adobe.com

coverage and a traditional property policy," he said. "The two need to work together."

It's no longer a question of choosing between parametric coverage and a traditional property policy.

The two need to work together.

Jeff Lang Senior Vice President at Trucordia

A standalone structure is often the better solution, he added, because the product is flexible enough to respond to location-specific uncertainties, whether a venue is enclosed or open-air.

Treat cyber as an operational risk Modern events run on technology, and Lang ranks technology failure at the top of the cyber threat list, which also includes ticketing outages, credential failures, payment disruptions, broadcast interruptions and ransomware. AI has sharpened the danger, enabling phishing attacks, deepfake announcements, fake emergency notices, impersonation of officials and vendor fraud.

And the exposure bleeds into reputation, with a single viral video able to cause millions in damage that insurance can only partly absorb.

Plan for resilience, not perfection

The industry's response has evolved alongside it – most visibly through parametric insurance, which pays out against defined triggers such as temperature thresholds, wind speeds or rainfall amounts.

Once a niche product, parametric coverage now features in roughly three-quarters of his event conversations, Lang said, either as an endorsement to a property policy or as a standalone policy.

"It's no longer a question of choosing between parametric

The final lesson is that disruption should be assumed, not feared. "It's not a question of whether disruption will happen," Lang said. "The question is how quickly you can recover." That means backup communications, alternate transportation routes and power sources, redundant technology systems and rehearsed crisis management plans.

The mindset, he argued, applies far beyond sport.

"Most businesses don't need to prepare for a World Cup, but every business should think like World Cup organisers,” Lang concluded.

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29

CL I M AT E CH A N G E Climate Risks Planning

The climate risks you can’t insure away

By Rachael Pettigrew, Head of Risk Advisory, Willis NZ

O

rganisations can spend more time preparing for the last crisis than they do for the next one.

Insurance remains one of the most effective tools for managing known risks. However, some of the biggest threats facing businesses today are emerging in ways that are difficult to quantify. Few emerging risks are more relevant to New Zealand businesses than climate change. While extreme weather events often dominate headlines, the broader impacts are creating new risks that can reshape business operations, supply chains and access to insurance long before a claim occurs.

Emerging risks are often characterised by uncertainty and don’t have a clearly defined ‘event’. They develop gradually, lack historical data and can be difficult to assess using traditional risk management techniques. Despite this, they

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September 2026

have the potential to fundamentally alter an organisation's operating environment, creating both threats and opportunities.

When climate risk is discussed, attention naturally turns to extreme weather events and the resulting insurance claims.

These tend to dominate headlines, which can create a strong bias in decisions made at renewal time. However, the broader implications extend far beyond physical loss. Climate change is increasingly influencing the way smart organisations operate, invest, plan and make strategic decisions.

An emerging risk insurance brokers should watch closely is the growing challenge of affordability and access. As natural hazard losses continue to increase, some locations and industries may face rising premiums, higher retentions or reduced insurer appetite. For many organisations, this

becomes a business resilience issue rather than simply an insurance purchasing challenge. The ability to access affordable risk transfer via strong market participation may become an important competitive advantage.

can be easy to overlook. Over time, however, these signals can combine to materially change an organisation's risk profile. Many major disruptions seem predictable in hindsight.

A second emerging risk is supply chain disruption. Severe weather events do not need to occur at a client's premises to create significant impacts. Flooding, wildfire, drought or storm events elsewhere can interrupt the availability of critical materials, equipment and services. Businesses may experience operational disruption, increased costs and delayed projects despite suffering no direct physical damage themselves.

For brokers, the challenge is to broaden conversations beyond policy coverage and renewal terms. By helping clients understand how emerging climate-related risks may affect their business over the coming years, brokers can support more informed decision-making and stronger organisational resilience.

Emerging risks don’t arrive with complete information or a clear event date; they emerge through a series of weak signals and wider economic or political indicators that

Insurance will always remain an important component of risk management. However, the organisations best positioned for a sustainable future will be those that look beyond what can be insured and prepare for the broader impacts of a changing climate.

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31

CL I M AT E CH A N G E Future Flood Risks

New research provides insights into future flood risks to infrastructure

By Graham Campbell, Director - Economics and Research, New Zealand Infrastructure Commission, Te Waihanga

F

looding - both inland and coastal - is already one of New Zealand's most costly natural hazards, and the costs are rising. New research by Earth Sciences New Zealand, commissioned by the New Zealand Infrastructure Commission, Te Waihanga, examines how climate change could affect future flood damage to infrastructure and private buildings, helping inform long-term investment decisions.

How scenario modelling can help us prepare for an uncertain future

This research builds on the Commission’s earlier Invest or Insure? report, which explored when infrastructure owners should reduce, transfer or accept natural hazard risk.

Understanding the likely size of future losses is an essential first step in deciding which response is appropriate. The research uses average annual loss (AAL) to estimate the expected annual cost of flooding, providing a consistent basis for comparing risk across hazards, sectors and regions.

2.

How are flooding losses expected to change over time in response to climate change?

3.

How large are flooding losses to private buildings, which gives a sense of the need for flood protection?

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September 2026

Building on a previous phase, this research aims to explore three questions: 1.

How do flooding losses vary between regions?

Regional variation: As seen in the figure below, some regions are expected to face significantly more infrastructure losses than others, relative to the size of their networks. That means a localised approach to adaptation may be required.

Source: New Zealand Infrastructure Commission analysis of Earth Sciences New Zealand modelling.

Note: Regional losses are estimated by aggregating Territorial Authorities within each region. Where a Territorial Authority crosses regional boundaries, it is allocated to the region containing the largest share of its land area.

Change over time: Infrastructure losses for coastal flooding are expected to nearly double over the next 50 years. Inland flooding losses are expected to increase by 50%, with much of those increases felt in the next 20 years. Total flood losses to private buildings are lower than total flood losses to infrastructure but are similarly expected to climb 50% over the next 50 years.

Resilience investment benchmark: The loss estimates provide a useful benchmark against which to compare the cost of risk reduction options, including new infrastructure, greater insurance, or strategies to avoid the risk, such as managed retreat. Where the cost of an option is lower than AAL, it likely represents value for money.

Building resilience into managing assets

should not be treated as a separate planning exercise.

Infrastructure owners will invest significantly in renewals as ageing assets reach the end of their lives. In many cases, natural hazard risk can be addressed alongside this routine asset management investment.

Better information to make better decisions Better information about future flood risk helps infrastructure owners, council planners and local communities make more informed decisions today, strengthening resilience while making the best use of limited funding.

Learn more: https://tewaihanga.govt.nz/our-work/researchinsights/when-waters-rise-research

Perhaps the report's most important insight is that resilience

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33

CL I M AT E CH A N G E Adapting to Climate Change

Kaikōura river's repair bill exposes New Zealand's funding fight A $15 million scheme elsewhere avoided 10 times its cost

P

rivate insurers have absorbed $31 billion of the more than $64 billion in total natural hazard costs New Zealand has incurred since 2010, while government spending on reducing that risk before disasters strike has remained at just 3%, according to a Sapere Research report commissioned by IAG. That imbalance sits behind the repair bill now facing Environment Canterbury (ECan) in Kaikōura, where an estimated 450mm of rain over 7 and 8 July caused flooding, stopbank breaches, erosion and heavy movement of gravel and sediment.

ECan chairperson Dr Deon Swiggs said the event points to a wider case for investment in climate change adaptation.

"Every dollar we spend now has a saving of $7-$9 in recovery costs, and this is where insurance is going, because if you don't do this work, you may not get insurance," he said.

That framing lines up with where policy currently stands.

As reported in coverage of the government's new climate adaptation bill, climate change minister Simon Watts introduced legislation on July 15, 2026, that would, for the first time, place a legal obligation on councils to plan how high-risk communities will adapt to climate change over a minimum 30-year horizon.

Watts confirmed the funding split remains unresolved, telling media that cost-sharing decisions would be left to the next term of government, while finance minister Nicola Willis has rejected calls for a dedicated resilience levy, arguing it is unnecessary "if you have prudent government investing in infrastructure."

What the pricing already shows The gap between resilience spend and disaster response is visible in how insurers price flood exposure today. The Reserve Bank's May 2024 Financial Stability Report found that around 6% of properties, roughly 120,000 nationwide, are assessed at high flood risk, with an average of 20% of insurers' quotes on

34

September 2026

Dr Deon Swiggs ECan Chairperson

Hon. Simon Watts Climate Change Minister

those properties carrying an additional flood premium of $250 or more a year.

In Treasury data reported separately, that additional premium reached as high as $4,500 on some properties, with some Christchurch suburbs unable to secure more than one online quote at all. Kaikōura, where flood protection along the Kowhai River held but the riverbed has risen five to seven metres in places, is a candidate for the same kind of repricing once insurers assess the aftermath.

Council flood protection recovery manager Shaun McCracken said repairing ECan's infrastructure, including flood protection assets, would run to tens of millions of dollars based on current estimates.

Swiggs said public safety is the immediate focus while staff work through the damage.

"Our first priority is to make it safe, plugging in holes and critical weaknesses, repairing the breaches and working where there is erosion," he said.

The case for paying upfront ICNZ has pointed to specific examples of what earlier resilience spending has returned. As set out in its proposal for a Community Protection Levy, the $15 million Awanui Flood Protection Scheme in Kaitaia is estimated by the council to have already avoided around $50 million in damage, and a $4 million stopbank upgrade in Taradale helped protect around 10,000 properties during Cyclone Gabrielle.

Those figures sit behind ICNZ's push to replace the Fire and Emergency New Zealand levy with the new levy, which would redirect an estimated $600 million to $700 million a year into resilience projects rather than post-event recovery.

ECan's own resilience work in Kaikōura is funded through the Regional Infrastructure Fund, under an arrangement in which government contributes 60% of costs.

That programme, including river protection, vegetation

clearance, berm work and measures on the Kowhai River to lower future flood risk, had only just started when the flood struck.

"The funding has been really helpful as we were already bringing in large rocks into the area to prepare for a rainy day," McCracken said, adding that a dozen work sites are now under way to deliver immediate resilience measures, though the Kowhai River flood defences remain vulnerable.

A small ratepayer base, a national question Kaikōura has around 3,000 ratepayers, but Swiggs said the district's exposure carries implications for the national economy given its position on the South Island transport network.

"Kaikōura is an example of where it could go terribly wrong if you don't think about how you fund resilience," he said. "It is a small community which is vulnerable to climatic events and they can't fund it by themselves."

Insured losses from the Kaikōura event itself are not yet available, though the damage profile, spanning road closures, flooded buildings, inundated vehicles and commercial disruption, is consistent with the multi-line exposure seen across a costly run of South Island weather events over the past year.

According to the ICNZ Cost of Natural Disasters database, that run includes $158.9 million from the October 2025 event, $37.4 million from a June 2025 storm, and $75.9 million and $83.9 million from January and February 2026 events respectively.

Te Uru Kahika, the body representing regional and unitary councils that Swiggs chairs, has lobbied government for several years for co-funding toward flood resilience, and Swiggs said a larger region provides the capacity and staffing needed to respond to events of this kind.

Article courtesy of Insurance News

www.covernote.co.nz

35

CL I M AT E CH A N G E Understanding Climate Risk

Climate resilience plans still have barriers to overcome

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September 2026

Y Yvonne Moore, Head of Zurich Resilience Solutions (UK)

vonne Moore, head of Zurich Resilience Solutions (UK), explains why resilience programmes stall inside organisations.

She also sets out what a proactive climate strategy does to an underwriting conversation, and why that exchange should not wait for renewal.

Most businesses can now map their physical climate exposures. Far fewer, however, have a plan they can present to their insurer. That gap is increasingly what separates the companies that hold on to affordable cover from those that do not.

Why resilience programmes stall For many organisations, climate risk is now better understood than it is managed. The more pressing challenge is turning that understanding into a funded programme, and the obstacle is rarely awareness. Moore argues it is structural.

Resilience pays off over a timeframe that most corporate decision-making is not built to accommodate.

"The biggest challenge is that resilience creates value over long time horizons, while many commercial decisions are still made around annual budgeting and insurance cycles," Moore said.

The result is a mismatch that leaves adaptation competing for budget against projects with more immediate returns.

"A key barrier to overcome is that the business case can be difficult to prove," Moore said. "Return on investment can be realised over several years and be hard to quantify. Delaying action can increase future costs and heighten the risk of stranded assets, so it is sometimes the potential cost of inaction which becomes the biggest selling point."

The scale of that downside is not abstract. Global economic losses from natural disasters reached US$318 billion in 2024, of which 57% were uninsured, according to Swiss Re's sigma 1/2025 report. For a business weighing a resilience investment against a renewal cycle, that uninsured portion represents the exposure sitting on its own balance sheet.

"Even when a risk has been identified, translating that into the correct adaptation programme can be tricky," she said.

Part of the difficulty is that resilience does not belong to any single function. It cuts across risk, operations, sustainability, property, procurement and finance, and getting those teams to agree on priorities rarely sits within one person's remit.

Turning awareness into underwriting advantage The starting point, Moore said, is recognising how much has already shifted.

"A decade ago, you might have found that most businesses with strong climate change awareness had

already suffered an incident, but in my experience that's no longer the case," she said.

Awareness is now widespread. The question is what a company does with it, and Moore's answer is to stop treating adaptation as a separate initiative.

"Climate adaptation needs to be reframed as part of everyday risk management rather than existing as a separate initiative, and then connected to ongoing business decisions," she said.

"Those could be capital upgrades, maintenance programmes, refurbishment cycles, supply chain reviews, and business continuity planning. This should prevent adaptation being viewed as something new, costly or disconnected from business priorities."

That shift in framing also changes the nature of the insurance conversation. An insurer reviewing a proactive client is assessing a different risk from one confronted with a history of losses and no forward plan.

"From an insurance perspective, a proactive strategy means being able to show insurers that future risks are understood, prioritised, and actively managed," Moore said. "Shifting the conversation from past losses to demonstrating how the business is reducing future risk can strengthen underwriting confidence and support long-term insurability."

For Moore, that is the direction the whole sector is moving: away from indemnifying losses after the fact and towards preventing them.

"By helping customers avoid, reduce, and manage losses before they occur, we are shifting the focus beyond building back better to building better before," she said.

What risk managers should do differently now None of this closes the protection gap in isolation, and Moore is clear that no single party can. Businesses, insurers, and governments each hold part of the solution, but the influence is not equally distributed.

According to Moore, businesses control the underlying risk, which gives them the most immediate ability to act.

Insurers can price it and advise on it, while governments can set the policy and investment conditions around it.

Neither, she notes, can strengthen a building or redesign a supply chain on a company's behalf.

For a risk manager, the practical takeaway concerns timing and scope. The relationship with an insurer works best as a continuous one, Moore argues, not an annual transaction, and it should extend beyond placement.

"Please don't wait until renewal to speak to your insurer,” Moore said. "The sector can do its best for you as part of an ongoing conversation, not a once-ayear interaction. Ask whether broader services such as risk advisory services are available, not just insurance placement.

"The organisations that will be most successful over the next decade are not those that perfectly predict climate risks. They are the ones that build a repeatable process for identifying vulnerabilities, prioritising adaptation and demonstrating progress."

Article courtesy of Insurance News

www.covernote.co.nz

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CL I M AT E CH A N G E Insurance Council of New Zealand

Climate Change Response Amendment Bill welcomed T

Kris Faafoi, ICNZ Chief Executive

he Climate Change Response Amendment Bill has been welcomed by insurers for setting out a long-awaited framework for climate adaptation, but they warn that funding, implementation and durable political support will be critical to turning plans into meaningful risk reduction.

The Insurance Council of New Zealand | Te Kāhui Inihua o Aotearoa (ICNZ) Chief Executive Kris Faafoi said reducing risk in vulnerable communities was critical to protecting people and supporting continued access to insurance.

“The introduction of this Bill is good to see, but the proof will be in the doing.

“Planning is important, but what insurers, councils and communities need to see now is action that reduces risk and helps protect people, property and infrastructure,” Kris Faafoi said.

The Bill will require adaptation planning in the highest risk areas, with councils required to plan how high-risk communities prepare for the impacts of climate change.

Plans are expected to cover at least 30 years and set out the sequence of actions and investment needed to manage climate-driven natural hazard risks over time.

Kris Faafoi said long-term planning must be backed by long-term certainty.

“Keeping communities safe from natural hazards will require sustained action and investment over many years.

“Councils need confidence that the policy framework and 38

September 2026

funding will endure beyond electoral cycles so they can make long-term decisions about reducing risk.

“That’s why government leadership and durable crossparty support is essential. Long-term adaptation planning requires confidence that policy settings and funding arrangements will endure,” Kris Faafoi said.

“The biggest challenge now is moving from planning to funded delivery. Councils will need support to identify highrisk areas, work with communities and deliver the mitigation needed to reduce risk.

“Some councils are already meeting this challenge, but others will need help. Councils should not be expected to face this alone.”

ICNZ has previously called for greater certainty around funding for local risk reduction and resilience projects. Earlier this year it proposed replacing the Fire and Emergency New Zealand levy with a Community Protection Levy to help fund projects that reduce risk and strengthen community resilience.

Kris Faafoi said the key issue for insurers is whether New Zealand takes action to reduce risk, because that is what will help protect communities and support ongoing access to insurance.

“We need investment in risk reduction so communities are safer and insurance is accessible in the future.

“This legislation can help provide the framework, but what matters now is urgency, practical delivery and a credible funding pathway.

“If we get that right, we can better protect communities from natural hazards and help keep insurance accessible for New Zealanders,” Kris Faafoi said.

AMI, State and NZI 2026 climate poll

New Zealanders call for stronger Government leadership on climate hazards

N

ew Zealanders do not have confidence in the country’s ability to manage climate risks, according to the latest climate change poll from AMI, State and NZI.

Just 27% of New Zealanders say they are confident the country can reduce climate impacts, Phil Gibson, Chief Executive, compared with 42% who are not, AMI, State and NZI making this the fifth year in a row that more people are pessimistic than optimistic about how the country is tracking on this issue.

Phil Gibson, Chief Executive AMI, State, and NZI warns: “It is clear we cannot continue as we are. New Zealand must take stronger action to reduce the impacts of climate hazards.”

Rising climate risks driving insurance pressures Now in its ninth year, the 2026 AMI, State, and NZI climate poll shows most New Zealanders expect that climate hazards will worsen. Reflecting the growth in weather events reported in the most recent Wild Weather Tracker (one storm every eight days), New Zealanders expect more frequent and extreme floods (92%), storms (90%) and coastal inundation from sea-level rise (91%).

Awareness of growing risk is also shaping perceptions of insurance 69% of survey respondents say the growing number and rising cost of natural disasters is driving premium increases.

And they are feeling the impact, with 80% saying home and contents insurance is becoming less affordable and 50% worrying they may no longer be able to afford their home insurance.

Phil Gibson says: “New Zealanders see the link between the growing risk and their insurance. Without meaningful action to reduce that risk, their ability to afford or even obtain insurance

will reduce. As a country, from government to individuals, we know we can’t allow that to happen.

“Fewer people with insurance simply means greater economic and social harm, and a greater call on the Government and taxpayers when the next disaster strikes.”

The survey also reveals the tension at the heart of how insurers respond to a growing risk 61% of New Zealanders agree that insurers should raise premiums for homes and businesses that face more risk, while only 20% are prepared to pay more to subsidise the cost of insurance for people who live in high-risk locations.

At the same time, 74% want insurers to focus on keeping people insured and for New Zealanders to have the right amount of insurance (67%). A third (36%) want insurers to stop supporting customers in locations where the risk is too great.

Time for a coordinated national approach Phil Gibson says: “The findings of this year’s poll reinforce the messages in our recent report, A long-term approach to natural hazard risk reduction, which called for a more intentional, coherent and coordinated approach to risk reduction.”

“The challenge we face is not insurmountable and requires a clear strategy and senior political leadership to drive the change needed so that councils, businesses and households can get on and reduce the climate risks they face.”

The poll also highlights that responsibility for reducing climate impacts is broadly shared and that unfortunately no one is doing a good job at it. New Zealanders see the Government as needing to take a leading role, with 58% saying it is most responsible for taking action.

“IAG remains committed to working alongside the Government to reset New Zealand’s focus on risk and help create greater economic and social resilience.”

www.covernote.co.nz

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Broker Choices

Why meaningful choice matters

By Paul Uprichard, Executive Director, New Zealand Underwriting Agencies Council (NZUAC)

C

hoice is one of the most valuable things a broker can offer a client. But choice, in itself, is not the objective.

A healthy insurance market isn't defined solely by the number of products or participants it has; rather, the real measure is whether brokers have access to meaningful choice - genuinely different products, underwriting expertise, insurance capacity and approaches that help them achieve better outcomes for their clients.

Meaningful choice is created by a competitive market that welcomes different business models, encourages innovation and continually evolves to meet changing customer needs.

The continued growth of underwriting agencies both globally and here in New Zealand is one reflection of that evolution.

There remains a perception in some quarters that underwriting agencies simply distribute products already available through traditional insurers, but the reality is much broader. Today, underwriting agencies operate across both personal and commercial insurance, offering everything from mainstream products through to highly specialised solutions.

They provide brokers with access to different underwriting expertise, products, policy wordings and both high-quality local and international insurance capacity, allowing for the expansion in the range of solutions available to clients.

Innovation is also a key tenet of underwriting agencies globally. Whilst we tend to associate innovation primarily with technology, it starts with product design. One of the strengths of the underwriting agency model is the ability to develop purpose-built insurance solutions for defined customer segments, rather than necessarily adapting broader products through multiple endorsements and amendments. The result is cover that is often more closely aligned to the needs of clients and can evolve more quickly as those needs change.

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Innovation naturally also extends beyond product design, to new approaches to underwriting, data analytics, artificial intelligence, connected technology, parametric insurance and access to alternative sources of insurance capital, which are all helping expand the range of solutions available to brokers.

Not every innovation will be relevant to every client, but together they contribute to a market that is more responsive, more adaptable and better equipped to meet increasingly complex risks.

This is not about suggesting one business model is better than another. Insurers and underwriting agencies play different but complementary roles within a healthy insurance market, a model that has become well established across many mature insurance markets around the world. Their business models may differ, but together they broaden the quality of choice available to brokers and, most importantly, help deliver better outcomes for clients.

In my view, that is the hallmark of a healthy insurance market. Not simply more products or more participants, but meaningful choice - where brokers have access to genuinely different solutions that enable them to meet the diverse needs of their clients with confidence.

At NZUAC, we are committed to supporting a professional, innovative and well-governed underwriting agency sector that works collaboratively with brokers, insurers and the wider industry.

To learn more about NZUAC members and the breadth of underwriting expertise, products and insurance capacity they bring to the New Zealand market, visit www.nzuac.org.nz or follow us on LinkedIn.

ISFO Case Study

Claim declined after scooter accident overseas A

couple took out travel insurance for an overseas holiday. While travelling, they were both injured in an accident involving a rented motorised scooter and needed medical treatment. The scooter was also damaged.

They made a travel insurance claim for their medical expenses and for the damage to the scooter.

The insurer declined the claim. It said the policy excluded cover for injuries and losses arising from riding motorised scooters unless an optional add-on benefit had been purchased. The couple had not selected this additional cover when they bought the policy.

The couple complained to the IFSO Scheme. They said riding a scooter was a common and ordinary way for tourists to get around in the country they were visiting, and that they were not clearly warned this activity was excluded. They also believed the policy wording was unclear or misleading.

Our decision We assess complaints by looking at the facts, the law, and the contract.

We looked carefully at the policy wording,

the insurer’s online purchase process, and the information shown to customers when choosing optional benefits.

The policy clearly excluded cover for claims arising from riding motorised scooters unless an optional add-on benefit was purchased. Similar exclusions, with the option to buy additional cover, are standard in travel insurance policies across the industry.

We also considered whether the exclusion was unusual or onerous, and whether the insurer was required to bring it more clearly to the couple’s attention. The exclusion was not unusual. The insurer’s website also visually highlighted that scooter use required additional cover and provided further information through pop-up explanations during the online purchase process.

While we understood the couple’s concerns, our role is not to override clear policy exclusions or require an insurer to make payments outside the policy terms.

We found the insurer had correctly applied the policy and was entitled to rely on the exclusion.

The complaint was not upheld.

www.covernote.co.nz

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FSCL Case Study

Unauthorised disclosure an expensive mistake for broker ark* operated a motel business. His insurance broker assisted with the placement and renewal of the motel’s business insurance policies. As part of an insurance renewal process, the broker asked Mark whether the motel had any contracts with the Ministry of Social Development (MSD) for MSD tenants to be at the property. Mark (correctly) said they did not. The broker recorded that information on their file.

Around the same time, the broker was also advising a different client – Mark’s landlord – about building insurance for the same motel premises. During a discussion with the landlord, the broker disclosed that Mark had advised there were no MSD contracts or MSD tenants at the motel. The broker did so without first obtaining Mark’s consent.

The landlord then issued Mark with notices to cancel the motel lease. One of the grounds the landlord relied on was that he thought there were MSD contracts for the motel, and that Mark had lied to his broker. If Mark had lied, then the landlord’s insurance would be prejudiced too.

Mark subsequently incurred significant legal costs in taking steps to successfully prevent his landlord from cancelling the motel’s lease. Mark sought to recover those costs from the broker.

What were the parties’ views?

Mark complained that the broker had unlawfully shared information with his landlord, contrary to Code Standard 5 (Protect Client Information) of the Code of Professional Conduct for Financial Advice Services.

The broker argued they had not breached Code Standard 5 because the information about MSD contracts and

MSD tenants was relevant to Mark, his landlord, and their respective insurers. The information should have been within the reasonable knowledge of both Mark and his landlord as part of the landlord-tenant relationship. The information was information about the premises rather than “client information”.

What was FSCL’s view?

Our initial view was that the broker had breached Code Standard 5.

•

The information was “client information” under the Code because that includes all information about the client collected by the person who gives financial advice.

•

While we agreed that the information was relevant to the landlord and their insurer, that did not create a reasonable excuse for the broker to disclose the information without first speaking with Mark to obtain his permission.

•

Finally, the information relayed by the broker was inaccurate. Mark’s response to the broker’s question differed from the information the broker gave to Mark’s landlord.

What was the outcome?

FSCL facilitated settlement discussions. The broker offered an ex-gratia payment of $20,000 towards Mark’s legal costs.

We thought this was a fair outcome in the circumstances because the broker’s actions accounted for some but not all the reasons that Mark’s landlord had issued notice to cancel the motel lease. Mark accepted the offer, and the complaint settled.

* name changed

INSIGHTS FOR PARTICIPANTS Insurance brokers have legal obligations to protect their client’s information by not disclosing the information to third parties without the client’s permission. Brokers may be liable to compensate their clients if unauthorised disclosure of information causes the client financial loss.

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* name changed

M

FSCL Case Study

You can’t unknow what your broker knows R

oss* bought a commercial property insurance policy through his broker. Ross owned a business that manufactured and leased small buildings to third parties.

One of the buildings was stolen while located at a customer’s property. Ross made a claim under his policy for about $75,000.

to describe the insured’s business to the insurer was a commercial property code. There was no other indication that the risk was a residential property risk, either by way of specific questions asked by the insurer, or specific information proactively provided to the insurer by the broker.

Ross’s insurer investigated the claim. They discovered the buildings were being used for residential purposes. But the insurer did not insure residential property. The insurer argued that if Ross or his broker had told them that the building was residential, they would never have agreed to insure Ross in the first place. The insurer treated the policy as if it never existed, meaning they declined to pay the claim for the loss of the building.

As part of our investigation, we reviewed the circumstances surrounding placement of the policy, including the application via the trading platform, the insurer’s underwriting rules and training on the platform to the broker market, and all communications between the insurer and the broker.

Ross complained about the insurer’s decision. He said that the insurer had agreed to the policy and had the opportunity to ask for more detail about the use of the buildings earlier.

Importantly, the broker arranged the policy through an online platform. When information about a customer’s business was entered into the platform, the system automatically placed the insurance with a particular insurer if the information matched certain rules.

Unfortunately, in this case, the standard code used

What was FSCL’s view?

We asked the insurer to consider whether section 10 of the Insurance Law Reform Act 1977 applied. That section deems knowledge of the broker to be knowledge of the insurer where the insurer pays the broker commission.

What was the outcome of the case?

The insurer confirmed that they had paid the broker commission, and there was evidence that the broker knew, before the policy began, that the buildings were being leased for residential use, although they had not passed that information on to the insurer.

The insurer offered to settle the complaint by paying Ross the full amount of the claim. Ross accepted that outcome.

INSIGHTS FOR CONSUMERS AND PARTICIPANTS * name changed

This complaint highlights that disputes about non-disclosure are not always resolved by looking only at what was recorded on an application form. Where a broker knows material information about a risk, insurers and brokers should consider whether that knowledge may be attributed to the insurer under section 10 of the Insurance Law Reform Act 1977.

It may affect the insurer’s ability to later rely on non-disclosure or misrepresentation arguments.

www.covernote.co.nz

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FORUM Application of 'Turnover elsewhere after damage' Business Interruption clause Material Damage/BI/Contract Works

QUESTION I have a client who owns a restaurant which suffered damage and was unable to trade for three weeks, resulting in a Gross Profit loss.

Their insurer has accepted the Business Interruption claim, however has noted that the client has another restaurant close by and wishes to apply the 'Turnover Elsewhere after Damage' clause to adjust the claim.

Essentially wanting to take into account whether the other restaurant has seen an uptick in business as a result of the closure of the insured business.

The complication here is that: 1) Each restaurant is owned by separate legal entities (albeit with a similar shareholding).

2) Each restaurant caters for different clientele, the damaged restaurant is a breakfast and lunch restaurant, and the other restaurant is fine dining lunch and dinner. Four days a week there is a small cross over in trading hours over lunch.

3) Each restaurant is run at arm's length. There is no sharing of resources between restaurants.

4) Each insurer is separately insured with different renewal dates.

Taking the above into account, we believe the insurer is adjusting the claim unfairly. However, we wish to know whether there are any precedents, legal or otherwise, for insurers taking this approach?

EXPERT ANSWER: Mark Anderson - Commercial Loss Management A typical 'Turnover Elsewhere' wording is as follows: If during the Indemnity Period, any goods are sold or services are rendered elsewhere than at the Premises for the benefit of the Business, either by the Insured or by others on behalf of the Insured, the money paid or payable in respect of those sales or services shall be brought into account in arriving at the Turnover during the Indemnity Period.

The principle and the intention of the 'Turnover Elsewhere' clause is easily understood. It is to ensure an insured does not re-direct turnover away from its business, to the detriment of the claim. For example, setting up temporary premises 44

September 2026

in another entity and failing to include the turnover (and additional expenses) in its business interruption claim.

may be confusing the insured entity with the person who owns the two restaurant entities to come to its conclusion.

In addition to the 'Turnover Elsewhere' clause, business interruption policies typically include in their 'Claims' Condition the requirement of the Insured to take “prompt steps to minimise any interruption of or interference with the business and avoid or diminish the loss”.

From the information provided, it would be helpful to clarify with the insurer what its reasoning is to offset any uplift at the nearby restaurant, in case this has not been conveyed to the insured? This is aside from how it would be proposed to measure the increase, given the comments indicate that there is minimal crossover in opening hours, pricing and food offered?

Even if the insured placed signage in its windows, or on social media, to dine at the nearby alternative restaurant, unless the insured was failing to mitigate losses by some other means, it is difficult to see how the insurer is entitled to offset any uplift given the separate entities. The insurer

It would be worth reverting to the insurer or getting assistance to review the claim, as it is not obvious from the information provided that insurers are taking the correct approach.

Your questions answered FENZ charged on Rural Sundry vehicle limits Rural

QUESTION If you have sundry vehicle cover under a rural policy, what is the applicable FENZ levy payable, as we do not always know all the vehicles that are covered by this, which is why the sundry limit is in place?

For example, say $15,000 sundry vehicle limit, anyone vehicle $5,000.

Is the FENZ $25 for the limit, or $75 (being 3 vehicles into limit) or something else?

EXPERT ANSWER: Stephanie Beswick - FENZ If a fire policy has an automatic extension for Unspecified Rural Vehicles and the schedule does not specify them, then no levy is charged for this automatic extension, as they cannot be accurately identified as part of a total loss until the event has occurred (refer to definition of sum insured).

If they are insured items rather than an extension, or if they are specified in the schedule, then levy should be calculated on the number of vehicles at $25 per vehicle.

Levy can be based on the number of vehicles known and/or estimated to the best of the knowledge of the levy payer. Sum insured cannot be used to calculate levy if the insured items meet the definition.

FENZ levy is not usually revaluated at claim time unless the policy is being reassessed/changed.

FENZ on a stop bank Contract Works NHI/FENZ

QUESTION The words stop bank don't appear in the Exemptions list, but they also don't appear to have been in the previous Exemptions list ,but no FENZ were charged on stop banks under a Contract Works policy. It is dirt. Is this still exempt?

EXPERT ANSWER: Stephanie Beswick - FENZ As no exemption applies, then if the contract covers the risk of fire, levy is payable.

www.covernote.co.nz

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Calendar of events October 14th

October 15th

LIVE BREAKFAST

LIVE BREAKFAST

7:00am - 9:00am

7:00am - 9:00am

IBANZ launch Risk Advice: The Value of NZ’s Broking Profession Report

IBANZ launch Risk Advice: The Value of NZ’s Broking Profession Report

Join industry leaders and professionals for the launch of Risk Advice - The Value of New Zealand’s Broking Profession.

This IBANZ exclusive report examines the contribution New Zealand’s broking profession makes to businesses, households, communities and the wider economy.

Join industry leaders and professionals for the launch of Risk Advice - The Value of New Zealand’s Broking Profession.

This IBANZ exclusive report examines the contribution New Zealand’s broking profession makes to businesses, households, communities and the wider economy.

September 3rd

September 16th

Presenter: Steve Mayo-Smith Just how secure are you and ready to defend yourself and the business you work for against the increasing rate and sophistication of cyber-attacks? Understanding what to look for and what not to click on or trust is vital. This session will provide you with an understanding of the types of threats and intrusion techniques and the do’s and dont's of protection.

Presenter: Jessica Coope | FSCL Jessica will give you some information about recent complaint numbers to FSCL and will talk about some recent complaints FSCL has investigated about insurance brokers and insurers, including the lessons learned from those complaints.

September 8th

Topic: Demystifying general liability and professional indemnity policies

Christchurch Event

Topic: Don't get hacked

Topic: Breach and learn - war stories from the cyber front Presenters: Anthony Cooke and Cilla Chu | Atmos In this webinar Atmos will discuss, NZ cyber incidents trends, lessons learned from the frontline and what brokers need to know.

September 9th

Topic: Policy Items/Memoranda not often considered - Part 2 Presenter: Mark Anderson | Commercial Loss Management Part 2 is a continuation of the 19 August 2026 Part 1 as we delve into areas of the business interruption policy that are often overlooked.

September 10th

Topic: Amendments to the Commerce Act and competition law obligations Presenter: Alicia Murray | Lowndes Jordan This session will provide an overview of the obligations under the Commerce Act, and what red flags to look out for that may give rise to potential concerns. This is particularly timely in light of the Commerce Commission limited market study and greater focus by the Commerce Commission on the insurance industry.

September 15th

Topic: Section 72 Notices Presenters: Emma Gabor | Gabor Law Dr Gabor will unpack section 72 notices, what they are and what brokers need to be aware of, and talk about other situations which may result in natural disaster claims being declined.

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September 2026

Auckland Event

Topic: A round up of recent complaints

September 17th Presenters:

Matthew Atkinson and Morgan Fee

Fee Langstone This practical seminar examines the increasingly blurred boundary between General Liability and Professional Indemnity insurance.

Using real claim examples, we will explore defective workmanship, defective design, professional services provided by nontraditional professionals, and the difficult question of where insurable risk ends and uninsured business risk begins.

September 22nd Topic: D & O

Presenters: Veiko Termonen | Chubb More details to come*

September 24th

Topic: Homebuyers and natural hazards - due diligence Presenter: Hamish Armstrong | Natural Hazards Commission Our second webinar from Natural Hazards Commission Toka Tū Ake (NHC) webinar will focus on helping you support client due diligence around natural hazards when they’re purchasing a home. Natural hazard risk is a reality of living in New Zealand, but the risks aren’t the same everywhere, so it’s important to make educated choices when deciding where to buy. We’ll discuss how you can help clients research natural hazard risks in an area, check a property’s features, and what to consider before making an offer. We’ll also share a range of resources you can use to provide trusted due diligence advice to your clients, to help inform insurance decisions.

IBANZ offers a range of CPD from quality presenters who specialise in providing a variety of fire and general presentations, as well as a selection on soft skills, ranging from time management to client care.

All webinars: 10.30 - 11.30am unless otherwise stated.

September 30th

October 28th

Presenter: Trevor Slater In this session an easy-to-understand business risk model and process will be explained which can be applied to any business or personal goals. It will show you how to help your client identify risks, assess their impact and likelihood and how to respond to those risks.

Presenter: Emma Gabor | Gabor Law Dr Emma Gabor will discuss what to watch for when the insurer repeatedly requests additional information during a claim investigation – often a critical stage in the assessment process.

Topic: Using risk analysis when providing advice

October 6th

Topic: Navigating an insurer’s investigation into a claim: when the insurer keeps asking for more info

November 11th

Topic: Medical malpractice and commercial legal expenses

Topic: War, disruptions, delays and more in travel insurance Presenter: Eve Battersby and Sharee Lowe | IFSO (Time: 10.30am-11am)

The war in the middle east this year have been a nightmare for the aviation and tourism sectors, with many New Zealanders overseas travel plans cancelled and severely disrupted. The ISFO discuss recent travel insurance cases and the type of disputes IFSO is investigating in these eventful times.

Presenter: John Moore and Sharna Garbett | Delta In this session we will look at the current landscape related to medical businesses in New Zealand, including what does Medical Malpractice actually insure, the role official regulatory bodies play, the business risks medical businesses face on a day to day basis, as well as claims developments and trends.

November 12th

Topic: Presenting to Groups - you only get one shot

October 8th

Presenter: Martin Stroud and Lisa Christensen | NZI Join Martin Stroud from NZI for a clear, practical introduction to reinsurance This session will explain how reinsurance works, why it matters, and how it directly influences insurance premiums in New Zealand.

Presenter: Trevor Slater It is fair to say that most advisers are excellent talkers. But what if you need to present to a group of people, such as a Board or management team?The session will include: what preparation do you need to do; tools to make it professional; talking to groups; overcoming nerves; answering difficult questions; and closing to obtain a successful outcome.

October 13th

November 17th

Presenter: Chris Hammond and Ed Birrell | Dual Title Insurance protects buyers of commercial real estate against financial loss arising from legal issues that affect either the ownership or use of a property. It is an important but often overlooked layer of protection in commercial property transactions. There are two main policy options 'Unknown Risks Cover' and 'Known Risks Cover' which will be discussed.

Presenter: Gemma Hicks | CFC Looking to build confidence in cyber insurance and start meaningful conversations with your clients? Whether you're new to cyber insurance or looking to grow your cyber book, this webinar will provide practical knowledge and actionable takeaways you can start using immediately.

Topic: Introduction to the 'Dark Arts' AKA - Reinsurance

Topic: Broker essentials: Introduction to cyber insurance

November 18th

October 20th

Topic: Contracts of Insurance Act

Topic: Navigating commercial hull insurance: key coverage and claims insights Presenters: Mark Roelink | NZI Marine This session provides an overview of commercial hull insurance, focusing on the key elements that shape underwriting decisions.

October 27th

Topic: Construction insurance trends – PI, Stat and GL claims issues Presenter: Misha Henaghan and Sam Hider | Wotton Kearney With significant law changes on the horizon and tough economic conditions, the construction sector is undergoing a period of rapid change. Misha Henaghan and Sam Hider from Wotton Kearney will talk through the legislative amendments (particularly in relation to PI, Stat and GL claims) and trends they are seeing on claims.

www.covernote.co.nz

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Presenter: Fee Langstone This presentation will provide a practical overview of the Contracts of Insurance Act 2024, focusing on the changes it introduces to the relationship between insurers and policyholders. It will examine the key obligations imposed on both parties, including the insured’s duty of disclosure and the consequences of misrepresentation, and non-disclosure.

*No details available at the time of print.

Topic: Title Insurance, why it matters for buyers of commercial real estate

IBANZ Board Roger Abel

John Chandler

Neil Cousins (President)

Jill Comley-Forbes

Duane Duggan

Head of Insurance Legal Arthur J. Gallagher and Co (NZ) Limited PO Box 68910 Wellesley Street, Auckland 1141 Tel: 09 357 4805 Mob: 021 833 286 duane.duggan@ajg.co.nz

Samuel Kerr (Vice President) Insurance Broker SHARE PO Box 305415 Triton Plaza Auckland 0757 Tel: 09 476 1670 Mob: 021 980 435 sam.kerr@sharenz.com

Angus McCullough (Vice President) General Manager Marketing and Chief Officer Aon New Zealand PO Box 1184 Shortland Street, Auckland 1140 Tel: 09 362 9059 angus.mccullough@aon.com

Dave Penfold

Maureen Pua

Rothbury Group Limited PO Box 1596 Shortland Street Auckland 1140 Mob: 021 952 230 roger.abel@rothbury.co.nz

Chief Executive Officer Willis New Zealand Ltd PO Box 2220 Christchurch 8140 Tel: 03 366 5715 Mob: 027 451 8098 jill.comley-forbes@wtwco.com

Chief Commercial and Client Officer PIC Insurance Brokers Ltd PO Box 58842 Botany Auckland 2163 Tel: 09 281 6870 Mob: 029 969 3878 john.chandler@pic.co.nz

Director – New Zealand Penfold Insurance Partners Ltd 34 Natzka Road Waiheke Island Mob: 021 409 400 dave@penfoldip.co.nz

Broker Services Manager Steadfast NZ Ltd PO Box 180 Shortland Street Auckland 1140 Tel: 09 309 7942 Mob: 021 377 942 neilc@steadfastnz.nz

Client Director – Pacific Territories Lockton Companies NZ Ltd Partnerships Level 8, 1 Albert Street Auckland 1010 Tel: 09 300 2135 Mob: 027 289 5157 maureen.pua@lockton.com

IBANZ Katherine Wilson

Nick Raven

Physical address

Mailing address

Chief Executive DDI: 09 306 1734 Mob: 027 8708 150 katherine@ibanz.co.nz

The Crate, 28 Constellation Drive, Rosedale, Auckland 0632

Communications and Content Manager DDI: 09 306 1733 Mob: 021 159 9462 nick@ibanz.co.nz

PO Box 302196, North Harbour, Auckland 0751

Karen Scard

Emma Porritt

Administration and Accounts Manager DDI: 09 306 1738 karen@ibanz.co.nz

Membership and Events Manager DDI: 09 243 1275 Mob: 027 503 3190 emma@ibanz.co.nz

WANT YOUR VERY OWN COPY OF COVERNOTE?

September 202 6

Leading thro u advocacy gh

Each issue of CoverNote is packed with vital information, news, commentary and advice for the insurance industry from experts within the industry. To keep abreast of all the issues affecting New Zealand’s insurance broking industry just email info@ibanz.co.nz TO ADVERTISE: Contact Liz Cannon on: Email: liz@benefitz.co.nz Phone: 09 477 4702 Mobile: 021 204 3395 CoverNote is published quarterly by IBANZ, the Insurance Brokers Association of New Zealand.

All correspondence should be addressed to: CoverNote PO Box 33-1630, Takapuna, Auckland.

48

September 2026

www.ibanz.co.nz

Toll free: 0800 306 173

IBANZ release s their Advoca

ALSO IN THIS

cy Briefing Pap

ISSUE

AI Liability - the next silent risk for New Zealand businesses Proposed chan ges to the Build ing Act would and PI sectors impact construc tion New research provides insig hts into future flood risks to Climate resilience infrastructure plans still have barriers to over come Why meaning ful choice mat ters

er

IBANZ CORPORATE COMPANY LIST Abbott Group

Christchurch

Insurance Advisernet NZ Ltd

Auckland

Abraham & Associates Ltd

Christchurch

Insurance Brokers Alliance Ltd

Invercargill

Adams Trimmer Insurance 1992 Ltd

Whangarei

Insurance Design Limited

Warkworth

Advance Insurance Services Ltd

Paeroa

Insurance Partners Group

Tauranga

Affiliated Insurance Brokers Ltd

Wellington

Insurance People (Fire & General) Limited

Auckland

AIB Group Insurance Ltd

Lower Hutt

Insurance Resources Limited

Auckland

Albany Insurance Canterbury Ltd

Christchurch

Jason Bayly Insurance Brokers Ltd

Orewa

Albany Insurance Services Ltd

Auckland

JenBro Insurance

Taupo

Allied Financial Advisors Limited

Christchurch

JRI Limited

New Plymouth

Amicus Brokers Ltd

Christchurch

Kumeu Insurance Services (1990) Ltd

Auckland

Aon New Zealand

Auckland

Lockton Companies NZ Limited Partnership

Auckland

Arthur J. Gallagher & Co (NZ) Limited

Auckland

Malcolm Flowers Insurances Ltd

Taupo

Baileys Insurance Limited

Auckland

Marsh Ltd

Auckland

Bay Insurance Brokers Ltd

Tauranga

McDonald Everest Insurance Brokers Ltd

New Plymouth

Better Insurance

Auckland

BMS Risk Solutions Limited

Christchurch

Medical Assurance Society New Zealand Limited

Wellington

Builtin Insurance Brokers Limited

Tauranga

MW Insurance

Auckland

Cambridge Insurance Brokers Ltd

Cambridge

Capital Risk Solutions Limited

Wellington

Capricorn Risk Services Pty Ltd

Christchurch

Cartwrights Ltd

Ashburton

Community Broker Network NZ Limited

Auckland

Coast Insurance

Whangaparaoa

Commercial & Rural Insurance Brokers Ltd

Alexandra

Creme Northcrest Insurance Ltd

Auckland

Dawson Insurance Brokers (Rotorua) Ltd

Rotorua

Eclipse Insurance Brokers Limited

Auckland

Emerre & Hathaway Insurances Limited

Gisborne

FG Insurance Services

Gisborne

First Lane Insurance Ltd

Blenheim

Frank Risk Management

Hamilton

FundAGroup Insurance Brokers Limited

Auckland

Futurisk General Insurance Ltd

Palmerston North

Grayson & Associates Ltd Greenlight Insurance Brokers Ltd

Nelson Marlborough Insurance Brokers Ltd (NIB) Nelson Neville Newcomb Insurance Brokers Ltd

Auckland

Northco Insurance Brokers Ltd

Masterton

O'Connor Warren Insurance Brokers

Tauranga

OFS Insurance Brokers Ltd

Dunedin

Omni Fire & General Ltd

Auckland

Partridge Advisory Limited

Auckland

Penberthy Insurance Ltd

Auckland

Penfold Insurance Partners Ltd

Auckland

PIC Insurance Brokers Ltd

Manukau

Prestige Insurance Broker Services Ltd

Auckland

Primesure Brokers Ltd

Auckland

Property and Commercial Insurance Brokers

Feilding

Provincial Insurance Brokers Limited

Masterton

PSC Insurance Brokers NZ Limited

Auckland

Rothbury Group Ltd

Auckland

Runacres Insurance Ltd

Christchurch

Auckland

SHARE

Auckland

Rotorua

Sherpa Limited

Christchurch

Gregan & Company Ltd

Papakura

Sit & Blake Limited

Auckland

GSI Insurance Brokers

Auckland

South Pacific Insurance Brokers Ltd

Auckland

GSI South

Christchurch

Straightline Advisory Limited

Auckland

GYB Insurance Brokers Ltd

Lower Hutt

Thames Valley Insurance Ltd

Thames

Hazlett Insurance Brokers Ltd

Christchurch

The Advisers for insurance

New Plymouth

Hood Insurance Brokers NZ Ltd

Auckland

Thorner General Insurances Ltd

Upper Hutt

Howden Commercial & Affinity Ltd

Auckland

Towes Insurance Brokers Ltd

Te Aroha

Howden Corporate Limited

Auckland

Vercoe Insurance Brokers Ltd

Morrinsville

Howden Waikato Limited

Hamilton

Vision Insurance (S.I.) Ltd

Ashburton

Hurford Parker Insurance Brokers Ltd

Hastings

Wanganui Insurance Brokers Ltd

Wanganui

Hutchison Rodway Ltd

Auckland

Wealthpoint General Limited

Auckland

ICIB BrokerWeb

Auckland

Willis Towers Watson

Auckland

Ingerson Insurances Ltd

Wellington

www.covernote.co.nz

49

New Zealand's professional association representing the interests of insurance brokers, risk managers and consumers.

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