NZ insurance industry's $2b deficit
New Zealand's insurance industry slumped into a deficit of $2.17 billion in the 2011 financial year after the Christchurch earthquakes saw expenses rocket by 83 per cent to $2.57b.
Statistics New Zealand figures show the insurance and financial services industry was the hardest-hit category in the year - down 2.2 per cent, or $1.4b.
Total income for all industries rose 4.7 per cent on the 2010 year to $575.39b.
The insurance industry had a surplus of $429m in the 2010 financial year, Statistics said, but was dragged well into deficit in 2011 after it booked a large net claims expense bill in 2011 as Cantabrians claimed for quake damage to property.
The quakes also pushed up the industry's current assets and liabilities. Current assets jumped 231 per cent, or $10.9b, because of increased reinsurance and other recoveries, while current liabilities shot up 278 per cent, or $10.7b, after claims increases.
Statistics said the insurance and central government administration (which includes the Earthquake Commission) industries both showed changes in performance and position because of the quakes.
''We expect other industries to show financial movements related to these earthquakes in future,'' it said.
The increase in total income followed a 4.2 per cent dip in 2010 and was largely because of a recovery in income from sales of goods and services, which rose 5.5 per cent, or $23.2b.
Labour and industry statistics manager Neil Kelly said increases in most industries showed the New Zealand economy was recovering from its 2010 decline.
''In particular, manufacturing and agriculture recorded strong growth in 2011 due to increase in both domestic and external demand,'' he said.
Total income for the manufacturing industry jumped by 8.6 per cent, or $7.6b, while agriculture industry income lifted 14 per cent, or $4.1b.
Total expenditure for all business rose 7 per cent to $533.3b. Surplus before income tax dropped 12 per cent to $44.4b.
Salaries and wages paid to all employees across all industries rose 3.9 per cent, or $3.46b, topping a 0.4 per cent lift in 2010.
The total value of fixed assets rose 2.6 per cent to $521.4b.