More Information
11.7 Insurance
Authors: B MabeyPublication: NZIF Forestry Handbook, Volume Section 11 – Forestry business and investment, pp 7, Dec 2023
Publisher: New Zealand Institute of Forestry
Abstract: Plantation forests in New Zealand have an excellent record with regard to fire losses when compared with countries such as Australia, North America and South America, where devastating losses from fire have occurred regularly in recent years. Unfortunately for New Zealand plantation forest owners, the collective premium pool generated by insured forests within New Zealand is too small to be recognised by insurance markets as a "stand alone" portfolio that generates sufficient premiums to maintain independent profitability. Instead, what tends to occur, is that New Zealand forestry insurance business is very much subject to regional influences and consequently, while New Zealand forests may continue to enjoy much lower premiums than those in Australia for example, there is a definite flow-on effect from overseas losses. As for all insurance policies where substantial amounts of cover are required, insurers are reliant on the re-insurance market to provide terms that tend to reflect the global experience of the re-insurers.