Majority of people say insurers need to be clearer about where they will and won't provide insurance, and about the costs that make up premiums, IAG NZ survey shows

A majority of people want insurers to be clearer about the costs that make up their premiums and to also be clearer about where they will and won't provide cover, a poll from the country's largest general insurer has found.

IAG NZ - which trades under the AMI, State, NZI, Lumley and Lantern brands - has released its climate change poll from AMI, State and NZI for 2026. The survey was conducted by Ipsos in May with a sample size of 1000 people.

Of the people surveyed, 90% say insurers need to clearer about where they will and won't provide insurance, while 89% thought insurers needed to be clear about the costs that make up their premiums.

The poll also showed that a majority of New Zealanders know the impacts of a warming climate and expect the frequency and severity of climate hazards to grow, having effects on homes, businesses and communities.

"They see these growing impacts being the major influence on their insurance premiums, which makes them concerned about what might happen and whether they will be able to afford or even obtain insurance in the future," IAG NZ says.

Since 2000, the price of house insurance has increased 916% - which consumer advocacy organisation Consumer NZ says is the biggest price rise for goods monitored by the Consumers Price Index (CPI) over the past 25 years. Alongside this, premiums have increased three times more than CPI inflation since 2011.

IAG NZ’s poll shows 69% of those surveyed say the growing number and cost of natural disasters is causing premiums to increase. Alongside this, 35% say it's the primary cause of increasing premiums.

Of the people surveyed, 74% were willing to accept that they will have to pay more for their insurance if they live in a high-risk location, and 55% say they are willing to accept they may not be able to get insurance if they live in a high-risk location.

When it comes to the long-term impacts on insurance, the poll found 80% thought home and contents insurance was becoming less affordable and 50% were worried about no longer being able to afford house and contents and insurance.

Risk-based approach to pricing

Of those surveyed, 45% say that people only paying for the risk they face is the fairest way to set premiums and a further 41% say that paying for some of the risk they face is the fairest.

Just over half (56%) those polled, say they are not willing to pay more to subsidise the insurance of people who live in high-risk locations while 20% would be willing to do this.

In a recent panel discussion, Victoria University of Wellington emeritus professor Jonathan Boston spoke about two possible approaches that could be taken: a market model that focuses on individual responsibility, actuarial fairness and risk-related premiums, or a social model that prioritises mutual responsibility, solidarity and fairness with flat rate or community-based premiums.

While both had their positives and negatives, Boston was in favour of a social approach.

While some people might advocate to leave others to cope on their own and some may be able to manage in a market model, he says; "the likely outcomes of relying on a market model going forward in the context of climate change will be increasing underinsurance and uninsurance, less economic and societal resilience ... more hardship, less social cohesion, higher fiscal costs, and so on."

A social model, he says, would; "minimise long-term societal costs from increasing natural hazard risk, minimise hardship and inequality, while at the same time retaining a viable private insurance market because that market helps protect properties and spreads the risk of different types of perils.”

But there was no silver bullet, Boston says.

‘The challenge we face is not insurmountable’

The poll found 61% say the Government should reduce the risk of climate hazards to help bring insurance premiums down, and 84% say insurers should work with central and local government to keep insurance affordable and available.

Just over half of those surveyed (58%) think central government is most responsible for action on climate change.

Just a few weeks ago, IAG NZ chief executive Phil Gibson called on the Government to put forward a long-term road map on how to strengthen the country's ability to reduce natural hazard risk, and proposed a possible 15-year roadmap option.

He renewed this call on Tuesday, saying the country needed to take stronger action to reduce the impacts of climate change.

"It is clear we cannot continue as we are," Gibson says.

“The challenge we face is not insurmountable and requires a clear strategy and senior political leadership to drive the change needed so that councils, businesses and households can get on and reduce the climate risks they face."