Insurance loss from Cyclone Gabrielle & North Island Floods estimated at $2.4 bn

PERILS, a provider industry-wide catastrophe insurance data, has released the third insurance loss estimate for Cyclone Gabrielle which impacted the North Island of New Zealand during the period of 11 to 17 February 2023.

The updated industry loss figure is NZD 2,018m ($1.2 bn) and is based on detailed loss data by postcode and property line of business collected from the majority of the New Zealand insurance market.

The figure compares to the previous PERILS estimates of NZD 1,925m issued three months after the event, and NZD 1,543m issued six weeks after the event.

The figure is composed of personal lines property losses which represent 54% and commercial lines property losses representing 46% of the total industry loss.

Insurance data provider PERILS estimated the 3rd loss for Cyclone Gabrielle

With a very low central pressure and an extensive width, Cyclone Gabrielle affected almost all of New Zealand’s North Island. Its impact was heightened by torrential rains falling on the ground still saturated from the North Island Flood event which occurred between 27 January and 2 February.

Strong winds, storm surge and high tides further amplified the catastrophe, which in addition to wind damage saw severe flooding, coastal inundation and many landslides damaging property and critical infrastructure

Cyclone Gabrielle occurred less than two weeks after the North Island Floods which PERILS estimated in its third loss report to have caused an industry loss of NZD 1,995 million. The event caused 11 fatalities.

Together with Cyclone Gabrielle this brings the total insured loss amount from the two events to NZD 4,013 million.

According to the Insurance Council of New Zealand, the largest industry loss on record from a weather event in New Zealand prior to 2023 was NZD 171 million.

The total insurance loss from Cyclone Gabrielle and the North Island Floods, currently estimated at NZD 4 bn ($2.4 bn), therefore highlights the extraordinary scale of the two events occurring so close to each other.

Darryl Pidcock, Head of PERILS Asia-Pacific

The last six months have been very challenging for policyholders and insurers given two such large events impacting the North Island.

“We hope the availability of our detailed loss and exposure data can support the industry’s efforts to better understand atmospherical risks as it works closely with policyholders, communities, and government in the recovery of the affected areas”.

Severe Tropical Cyclone Gabrielle

Severe Tropical Cyclone Gabrielle was a severe tropical cyclone that devastated parts of the North Island of New Zealand and affected parts of Vanuatu and Australia in February 2023.

It is the costliest tropical cyclone on record in the Southern Hemisphere, with total damages estimated to be at least NZ$13.5 billion ($8.4 bn), of which the provisional cost of insured damage is at least NZ$1.5 billion ($920 mn).

The total cost in the Hastings District alone is estimated to surpass NZ$2 billion (US$1.25 bn). It was also the deadliest cyclone and weather event overall to hit New Zealand since Cyclone Giselle in 1968, surpassing Cyclone Bola in 1988.

Nataly Kramer   by Nataly Kramer