Back-to-back weather events across the East Coast earlier this year caused up to $11 million worth of property damage to farmland but just $1.3m of this is likely to be covered by insurance, a new report has found.
Two hundred and fifty-one flood-affected property owners across Wairoa and Gisborne-Tairāwhiti were interviewed for the report, conducted by Federated Farmers with support from Hawke’s Bay Regional Council and Ministry for Primary Industries.
Almost half felt they would have no insurance cover and it was estimated that of the damage only 11.9% would be met by insurance proceeds
“With the need to fund uninsured losses on the back of reduced income, there will be challenging times ahead for the local community,” the report stated.
READ MORE:
* Residents in Tairāwhiti and Wairoa urged to prepare for more bad weather
* Extra funding to help clean up flood-hit east coast, with farms prioritised
* State of emergency to be lifted in Tairāwhiti; two years of recovery ahead
* East Coast floods close to ‘nail in the coffin’ for hurting horticulture sector
* Insurers pay record $305 million for extreme weather claims in 2021
The report focussed on two back-to-back events: the first in late-March, when a state of emergency was declared in Tairāwhiti and some residents evacuated following a week of “constant rain”, and another less than two weeks later when ex-tropical cyclone Fili reached New Zealand.
“We are pretty fed up,” one respondent said. “This is the second significant flood in nine months and we are finding it hard to take.”
Rural areas saw additional significant damage to pasture and fences with slips, blocked and damage culverts, washouts and rockfalls being some of the more common issues. Most sustained damage to fencing, with up to 268.6km needing to be replaced across the two regions.
The events also created access and connectivity issues – about half the properties lost power or internet during the event, and 35% of the properties lost access which left some feeling “vulnerable”.
“The road was closed for 10 long days. We couldn’t get stock out for over a month and had to fly in an electrician, groceries etc. We spent $4k [sic] on chopper just getting supplies in to survive,” one landowner said.
Another family described having to leave the car more than 5km from their house and take the quad, while parts of many other farms were only accessible by horse.
Gisborne-Wairoa Federated Farmers president Toby Williams was perhaps most struck by the amount of monetary damage and lack of insurance, though he understood the reasons behind it.
Williams felt it likely the damage had been underreported. “Farmers are just left to pick up the pieces.”
One of his neighbours had experienced equipment and infrastructure being washed away three times in three years. It was especially demoralising to lose riparian plantings and sections of fencing, separating waterways, he said.
Williams wanted to see generators available and more funding for solar options to make communities more resilient to these types of events which would only increase.
Tim Grafton, chief executive of the Insurance Council of New Zealand, said the insurance industry did not provide cover for land itself and land damage coverage was limited to very specific instances under the EQC regime.
That explained the low level of insurance payments compared to total damage done, as much of it was uninsurable, for example slips further than 8 metres from a dwelling.
There was also “low uptake” of business interruption insurance in the farming sector generally, which might have been able to provide more support and relief for the community, he said.
Grafton encouraged farmers to work with their insurer to understand what parts of the business could be protected and to consider what mitigating actions they could take.
© 2022 Stuff Limited