New Zealand Financial Markets Authority report calls for six improvements to insurers' extreme weather claims processes

The New Zealand Financial Markets Authority (FMA) released a report reviewing how insurers handled claims arising from the Auckland Anniversary Weekend Floods and Cyclone Gabrielle, finding that while claims processes have improved since the Canterbury earthquakes, further improvements are needed to support consumer outcomes in major events. The review sets out six priority areas for insurers to strengthen claims handling. Based on feedback from insurers, brokers and dispute resolution schemes, the report notes consumer concerns about delays, complaints and the overall claims experience after the events, which generated 118,000 claims and close to NZD 4 billion in damage to insured property. Recommendations cover clearer communications on the claim lifecycle and third-party roles, stronger project management and oversight of outsourced providers and delegated claims authorities, better identification and support of customers in vulnerable circumstances, improved resourcing and use of technology to redeploy trained staff, more effective complaints pathways, and business continuity planning tailored to major events with annual scenario testing. The FMA also links the findings to insurers’ work under the Conduct of Financial Institutions (CoFI) regime and signalled that initial CoFI supervision will focus on product and service reviews in firms’ Fair Conduct Programmes, alongside the use of interventions ranging from feedback and public warnings to enforceable undertakings and litigation where warranted.