N.Z. insurance loss at Darwin heavy

Press, Volume CXIV, Issue 33730, 31 December 1974, Page 2

N.Z. insurance loss at Darwin heavy

(Aeiu Zealand Press Association) AUCKLAND, December 30. lhe New Zealand insurance industry has suffered substantial losses in the Darwin cyclone, but it will be several weeks before a reliable estimate can be made.

Part of the loss is covered by “catastrophy reinsurance” on the international market.

Of the three major New Zealand-owned companies, South British does more than one-half of its business in Australia, and the New Zealand Company 42 per cent. The National Insurance Company also does substantial business in Australia.

The general manager of N.Z.I. (Mr D. G. Hare) said today that the position was still obscure. Assessors had not yet been allowed to enter Darwin.

The Darwin damage, which would be covered in normal policies, could well exceed that caused by Cyclone Wanda in Brisbane and other parts of Queensland in January, he said. Estimates of the cost of Cyclone Wanda to the international insurance industry vary between sBom and sloom. Mr Hare said that until fairly recently, Darwin had been primarily a Government town, and buildings and houses owned by the Government would not be covered by insurance.

In the last few years there had been strong commercial < development, and several i parge buildings had been ’ jerected. People living in Gov- 1 ernment houses would still 1 have their belongings insured. I j Both South British and i [N.Z.I. have offices in Darwin, 1 and both are still standing, i that of South British is damaged, but not badly. The South British staff '■ ■dwelling was destroyed, and ' the staff are now sleeping in 7 the office. i’

International reinsurance of “catastrophy damage” is normal in the insurance world, and becomes effective once a certain loss level has been reached. The January floods in Queensland and other parts of Australia caused a loss of sl.sm to N.Z.1., but reinsurance reduced this to $520,000. South British in the last year lost $786,000 in New Zealand and Australia, ■ largely as a result of Cyclone i Wanda.