DHB insurance premiums skyrocket
Physical threats to the Waikato's hospitals have caused their insurance to climb three-fold to more than a million dollars.
Waikato District Health Board director of board governance Neville Hablous said the "material damage/business interruption insurance" which related to insurance for threats such as earthquake, fire and flooding had jumped from $556,000 last year to almost three times that this year.
Mr Hablous said the board had planned for an increase but the jump was more than expected and would cost around $800,000 more than was budgeted for.
He said the increase would be absorbed into the budget without reducing expenditure in specifically related areas, and that the reason for the increase was three-fold.
Firstly, the value of the building stock had increased as a result of the building programme, secondly, the impact of the Christchurch earthquake on the insurance market for New Zealand generally, and thirdly, the lead insurer had taken a rigorous approach to risk to each district health board rather than looking at the sector generally.
Mr Hablous said while the region was at relatively low risk of earthquake activity, Thames Hospital was deemed a flood risk, and this had had a significant impact on the board's costs as well as the premium.
He said the cover was decided on behalf of all DHBs by Health Benefits: "It is theoretically possible for us to object to this process and attempt to go our own way but we see absolutely no merit in doing so."