Update from Crombie Lockwood – MHP’s national portfolio insurerJuly 9, 2018
The MHP/Mitchell Mackersy portfolio insurance programme renewed 31st March 2018 and we are delighted to announce that our goal for the programme – to insulate the portfolio against market forces – was achieved. By way of context, the New Zealand insurance market was hardening quickly, with rate increases of 10-20% occurring across the board in the third and fourth quarter of 2017. Rates have continued to increase this year. Notwithstanding this, the portfolio renewed on unchanged premium rates with the exception of Wellington-based properties, where the applicable natural disaster premium rates were increased. However, the rates for Wellington remain approximately 15-20% below the technical requirement of insurers.
Following major global events in 2017, the first half of 2018 was affected by severe weather in early January followed by ex-tropical cyclones Fehi, Gita and Hola. Expected claims from these events amount to around $80 million. In addition, a large EPS (expanded polystyrene) fire at an Australian abbatoir is expected to result in around $200 million in claims.
How this will affect New Zealand in the second half of 2018 remains to be seen, but it is expected that premiums will continue to increase for natural disaster cover and for buildings with EPS insulation.
Crombie Lockwood provides insurance across the entire nationwide portfolio of properties owned by Mitchell Mackersy investors groups and managed by MHP, as well as a number of MHP’s private managements.