Hurunui Remains Comprehensively Insured
The Hurunui District Council has successfully renewed its insurance, ensuring comprehensive coverage for the 2012/2013 year.
Manager of Financial Services, Jason Beck, says that the ongoing provision of earthquake cover for assets has continued to put pressure on the Council.
Although the Council had budgeted for an increase in the cost of the premiums from last year (which was approximately 260% higher than the premiums paid for the 2010/11 year), the earthquake premiums charged this year on any buildings built prior to 1980 have increased and for any buildings built prior to 1935, the increase has been five time the premium changed in the previous year. This had meant that material damage insurance cover for $52 million of assets has cost $330,000, of which $230,000 in earthquake cover.
The result is that the Council has been able to secure 100% cover for its above ground assets, inclusive of cover for earthquake damage, however; it has again come at a cost. Overall, the total cost of insurance is likely to be just short of $500,000, which is approximately $75,000 over what was budgeted for in the Long Term Plan.
To ensure that the Council is able to secure the most appropriate cover for the range of assets that it owns, it uses the services of Jardine Lloyd Thompson as its insurance brokers. The lowest cost option for insurance for the Council has been to use a panel of insurers made up of Vero, QBE and Chartis Insurance, to achieve the full 100% capacity.
The Council had determined, as it did with the insurance renewals last year, that not having comprehensive insurance cover was a risk the Council was not prepared to take at this stage, however; as the increased costs relate to a range of community buildings, the Council will work with its individual communities to determine the level of risk they are prepared to take in order to achieve some savings in the premiums into the future.
For further information:
Manager Financial Services
Hurunui District Council
P: 03 314 0029