“Insurance is at the forefront of so much”

“Insurance is at the forefront of so much” | Insurance Business New Zealand

Insurance News

Outgoing chief excited about what’s ahead for general insurance sector

Insurance News

By
Terry Gangcuangco

Insurance Council of New Zealand Te Kāhui Inihua o Aotearoa (ICNZ) chief executive Tim Grafton (pictured) may have less than three months left at the helm, but his appreciation for insurance has never been greater.

Speaking with Insurance Business, Grafton said: “How can you not be excited about insurance once you understand how it plays a fundamental role in protecting people, business, and their property? How can you not be excited by the uniqueness of a product that constantly deals with the risk of what might happen in the future on the basis that the many look after the few?

“No sector is more focussed on what the future and its emerging risks may hold, nor more focussed on how to manage those risks. Insurance is at the forefront of so much, and in New Zealand we are fortunate that we have a sector that is committed to doing better for New Zealand.”

Set up in 1895, ICNZ represents fire & general insurance companies in New Zealand who, together, accept the risks of more than $1 trillion of the country’s assets and liabilities. The representative body has been led by the current CEO since 2012.

Industry challenges in 2024

In Grafton’s view, the key considerations for this year will essentially be the same.

“The biggest challenge will remain ensuring there is cross-sectoral support and action to build resilience to natural hazards, particularly the risks that climate change presents,” he declared. “This will also help address the ongoing challenge of insurance affordability as many New Zealanders face cost-of-living pressures across the board.”

Opportunities for insurance sector

In terms of opportunities, Grafton believes that some of them relate to challenges.

He told Insurance Business: “The 2023 Auckland Anniversary Weekend floods and Cyclone Gabrielle should create the opportunity for action on behalf of central and local government, the finance sector, the science and built environment sector, as well as communities and individuals, to develop a comprehensive and coordinated plan to make New Zealand more resilient and adaptable to extreme weather events.”

Additionally, for Grafton, there is an opportunity to be clear about what insurance can and cannot deliver following a disaster. More specifically, the opportunity for consistent messaging in regards to what assistance people can expect.

“Where there are affordability challenges, there is an opportunity to provide more options for people in terms of innovative products and services or advice,” the chief executive went on to say. “The sector has also shown how sharing aggregated data can help with decisions that support resilience.

“There is also an opportunity for regulators to reflect on the requirements they are placing on the sector with a view to what is essential and cost-effective as opposed to nice-to-have. On the technology front, the potential of generative AI (artificial intelligence) to transform aspects of the insurance value chain in ways that benefit the customer experience and guard against its risks is a huge opportunity.”