The sector posted $7.8b in total premiums in 2024 after steep repricing.
New Zealand’s insurance sector has seen a recovery in profitability after a period of heavy losses, according to Gallagher Re’s latest Asia-Pacific Market Watch.
Premiums continued to grow in 2024, with total insurance premiums reaching $7.8b and non-life premiums at $6.0b.
This represents growth of 8.6% for 2024, although this was slower than the previous year’s 17.6% increase.
The improvement in insurer performance follows a sharp rise in premiums over the past 12 to 18 months.
Insurers increased prices after large weather-related losses in 2023, including the Auckland floods and Cyclone Gabrielle, which caused about $2.3b in insured damage.
Those price increases have led to a clear turnaround in underwriting results. The industry’s combined ratio improved to 78.6% in 2024 from 97.9% a year earlier, indicating a return to stronger profitability.
Loss ratios also fell across key segments, including property and motor insurance.
Major insurers operating in New Zealand reported stronger earnings as a result. IAG and Suncorp both recorded significant increases in net profit, reflecting better underwriting conditions across Australia and New Zealand.
The market remains supported by a strong level of insurance coverage. Public schemes such as NHC Toka Tū Ake play a significant role, helping make full-value home insurance widely available and accounting for a large share of the market.
At the same time, the wider economic backdrop remains weak. New Zealand’s GDP contracted slightly by 0.1% in 2024, which may weigh on future insurance demand.