1. The New Zealand Insurance Market – Where Are We?

2. The Global Position – The Large Claims (est - NZD) AMERICAS $50b (27%) ASIA $53b (28%) EUROPE $2.5b (1%) AFRICA $46.2b (25%) AUSTRALASIA $36.5b (19%) Total Reinsurance claims (est.): NZD$188b

3. Asia Pacific Events 2011: Tokyo, Earthquake, $16.8 - 40 Billion 2010: Maule, Earthquake, $9.6 Billion 2009: Victoria, Bushfires, $1.25 Billion 2010: Perth, Hail, $1.32 Billion 2010: Christchurch, Earthquake, $6+ Billion 2011: Brisbane, Flood, $2.7 Billion 2010: Melbourne, Hail, $1.2 Billion 2011: Christchurch, Earthquake, $22+ Billion 2011: Queensland, Cyclone Yasi, $2.1 Billion Cumulative Cost (NZD): $ Billion 1.25 2.45 3.77 13.37 19.37+ 22.07+ 44.07+ 46+ 62 - 102 Cumulative Cost (NZD):$ 75 - $115 Billion 2011: Thailand, Flooding, $13 + Billion

4. 2010: Gisborne, Flooding, $0.25 million 2010: Northland/Coromandel/Eastern BOP, Flooding $12.5 million 2010: Southland, Storms, $49.3 million 2010: North & South Islands, Flooding, $5.5 million 2010: Wellington, Thunderstorms, $1.2 million 2011:Mid – Upper North Island, BOP – Northland Flooding & storms, $26.7 million New Zealand Events (Excl Christchurch Earthquakes) Cumulative Cost (NZD):$ 1.2 Million Cumulative Cost (NZD):$ 19.2 Million Cumulative Cost (NZD):$ 6.7 Million Cumulative Cost (NZD):$ 19.45 Million Cumulative Cost (NZD):$ 68.75 Million Cumulative Cost (NZD):$ 95.45 Million Data Source: Insurance Council of New Zealand 2011: Taranaki Tornados, $1.6 million 2011: Hawkes Bay, Flooding, $6.4 million 2011: Auckland Tornado, $6 million Cumulative Cost (NZD):$ 101.85 Million Cumulative Cost (NZD):$ 107.85 Million Cumulative Cost (NZD):$ 109.45 Million 2011: Nelson Floods, $13.5 million (estimated) Cumulative Cost (NZD):$ 123 Million

5. The Global Premiums (est – NZD) NORTH AMERICA $70b 39% ASIA PACIFIC $26b 15% EUROPE $20b 11% EUROPE, MIDDLE EAST & AFRICA $46b 25% OTHERS $18b 10% Total Reinsurance premium (est.): NZD$181b NZ EQ Premium $220m

6. New Zealand’s Overall Contribution Premiums Losses 2% 15% Premiums Contribution to Global Reinsurance Pool Claims Contribution to Global Reinsurance Pool Approximately 2% of $181millionApproximately 15% of $28billion Needs Rebalancing – How?

7. Key Definitions Earthquake Prone0-33% of 2004 NBS Earthquake Risk34% - 66% of 2004 NBS Normal67% + of 2004 NBS Note: This assessment against 2004 code likely to be upgraded to 2012 code. NBSNew Building Standard IEPInitial Evaluation Process ReinsuranceInsurers Insurance

8. How will Rebalancing be Achieved Premiums Losses The New Zealand Insurance Market  Premium Levels increase  Excess Levels / Retention / Self Insurance increase  Insurers have to be aware of affordability of insurance

9. Excess Levels / Retentions / Self Insurance  Natural Damage excesses – 2.5%, 5%, 10% minimum by region  Fire and other perils  Co-insurance v full insurance  Managing affordability

10. Available capacity Who’s gone  Ansvar, Western Pacific, China, AMI, Civic  Zurich and Allianz now only writing natural disaster cover in certain areas of NZ New Insurers – Yes but!!  They are opportunistic  Short term  Very expensive

11. Social Impact  Compliance to new seismic requirements v affordability  Safety and ongoing use of Parish properties – sustainability  Economic stress – something must give  Flight to quality insurers for more certainty  Church is struggling to cope with the increased premiums

12. Mitigation Opportunities Valuations  Accuracy  Understanding  Control IEP - Careful  Engineers Reports  Geotech Reports  Structural Reports Planning  Contingency based  Understand need  Decide  Act The outcome will be hugely influenced by the Information you are able to supply

13. Conclusion  Costs still increasing although rate of increase has slowed  Capacity still tight for at risk territories / properties  Coverage restrictions Where will you be insurance wise if there is another Christchurch?